By: Shapiro, et al. S.B. No. 12 (In the Senate - Filed April 13, 2011; April 13, 2011, read first time and referred to Committee on Education; April 18, 2011, reported adversely, with favorable Committee Substitute by the following vote: Yeas 5, Nays 2; April 18, 2011, sent to printer.) COMMITTEE SUBSTITUTE FOR S.B. No. 12 By: Davis A BILL TO BE ENTITLED AN ACT relating to the flexibility of the board of trustees of a school district in the management and operation of public schools in the district. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: SECTION 1. Section 21.0031, Education Code, is amended by amending Subsections (a) and (b) and adding Subsection (b-1) to read as follows: (a) An employee's probationary, continuing, or term contract under this chapter is void if the employee: (1) does not hold a valid certificate or permit issued by the State Board for Educator Certification; [or] (2) fails to fulfill the requirements necessary to renew or extend the employee's temporary, probationary, or emergency certificate or any other certificate or permit issued under Subchapter B; or (3) fails to comply with any requirement under Subchapter C, Chapter 22, if the failure results in suspension or revocation of the employee's certificate under Section 22.0831(f)(2). (b) If a school district has knowledge that an [After an employee receives notice that the] employee's contract is void under Subsection (a): (1) the [a school] district may, except as provided by Subsection (b-1): (A) terminate the employee; (B) suspend the employee with or without pay; or (C) retain the employee for the remainder of the school year on an at-will employment basis in a position other than a position required to be held by an employee under a contract under Section 21.002 [classroom teacher] at the employee's existing rate of pay or at a reduced rate; and (2) the employee is not entitled to the minimum salary prescribed by Section 21.402. (b-1) A school district may not terminate or suspend under Subsection (b) an employee whose contract is void under Subsection (a)(1) or (2) because the employee failed to renew or extend the employee's certificate or permit if the employee: (1) requests an extension from the State Board for Educator Certification to renew, extend, or otherwise validate the employee's certificate or permit; and (2) not later than the 10th day after the date the contract is void, takes necessary measures to renew, extend, or otherwise validate the employee's certificate or permit, as determined by the State Board for Educator Certification. SECTION 2. Subsection (a), Section 21.103, Education Code, is amended to read as follows: (a) The board of trustees of a school district may terminate the employment of a teacher employed under a probationary contract at the end of the contract period if in the board's judgment the best interests of the district will be served by terminating the employment. The board of trustees must give notice of its decision to terminate the employment to the teacher not later than the 10th [45th] day before the last day of instruction required under the contract. The board's decision is final and may not be appealed. SECTION 3. Subsection (a), Section 21.105, Education Code, is amended to read as follows: (a) A teacher employed under a probationary contract for the following school year may relinquish the position and leave the employment of the district at the end of a school year without penalty by filing with the board of trustees or its designee a written resignation not later than the 30th [45th] day before the first day of instruction of the following school year. A written resignation mailed by prepaid certified or registered mail to the president of the board of trustees or the board's designee at the post office address of the district is considered filed at the time of mailing. SECTION 4. Section 21.157, Education Code, is amended to read as follows: Sec. 21.157. NECESSARY REDUCTION OF PERSONNEL. (a) A teacher employed under a continuing contract may be released at the end of a school year and the teacher's employment with the school district terminated at that time because of: (1) a necessary reduction of personnel by the school district; or (2) a program change that requires a reduction in personnel[, with those reductions made in the reverse order of seniority in the specific teaching fields]. (b) Notwithstanding Subsection (a)(1), a teacher employed under a continuing contract may not be released as described by that subdivision for a school year in which the district is authorized to implement a furlough program under Section 21.4021 or reduce salaries under Section 21.4022 unless the district has taken action under either or both of those sections to achieve the greatest savings in salary costs permitted by Section 21.4022. SECTION 5. Subsection (a), Section 21.160, Education Code, is amended to read as follows: (a) A teacher employed under a continuing contract may relinquish the position and leave the employment of the district at the end of a school year without penalty by filing with the board of trustees or its designee a written resignation not later than the 30th [45th] day before the first day of instruction of the following school year. A written resignation mailed by prepaid certified or registered mail to the president of the board of trustees or the board's designee at the post office address of the district is considered filed at time of mailing. SECTION 6. Subsection (a), Section 21.206, Education Code, is amended to read as follows: (a) Not later than the 10th [45th] day before the last day of instruction in a school year, the board of trustees shall notify in writing each teacher whose contract is about to expire whether the board proposes to renew or not renew the contract. SECTION 7. Subsection (a), Section 21.210, Education Code, is amended to read as follows: (a) A teacher employed under a term contract with a school district may relinquish the teaching position and leave the employment of the district at the end of a school year without penalty by filing a written resignation with the board of trustees or the board's designee not later than the 30th [45th] day before the first day of instruction of the following school year. A written resignation mailed by prepaid certified or registered mail to the president of the board of trustees or the board's designee at the post office address of the district is considered filed at the time of mailing. SECTION 8. Section 21.211, Education Code, is amended by amending Subsection (a) and adding Subsection (a-1) to read as follows: (a) The board of trustees may terminate a term contract and discharge a teacher at any time for: (1) good cause as determined by the board; [or] (2) a financial exigency that requires a reduction in personnel; or (3) a program change that requires a reduction in personnel. (a-1) Notwithstanding Subsection (a)(2), the board of trustees may not terminate a term contract as described by that subdivision for a school year in which the district is authorized to implement a furlough program under Section 21.4021 or reduce salaries under Section 21.4022 unless the district has taken action under either or both of those sections to achieve the greatest savings in salary costs permitted by Section 21.4022. SECTION 9. Subchapter I, Chapter 21, Education Code, is amended by adding Sections 21.4021, 21.4022, and 21.4023 to read as follows: Sec. 21.4021. FURLOUGHS. (a) Notwithstanding Section 21.401 and subject to Sections 21.4022 and 21.4023, the board of trustees of a school district may, in accordance with district policy, implement a furlough program and reduce the number of days of service otherwise required under Section 21.401 by not more than six days of service during a school year if the commissioner certifies in accordance with Section 42.009 that the district will be provided with less state and local funding for that year than was provided to the district for the 2010-2011 school year. (b) Notwithstanding Section 21.402 but subject to Section 21.4022, the board of trustees may reduce the salary of an employee who is furloughed in proportion to the number of days by which service is reduced, provided that the furlough program is implemented in compliance with this section. (c) A furlough program must subject all contract personnel to the same number of furlough days, except that, for purposes of providing professional development, the board of trustees may exempt from furloughs or subject to a lesser number of required furlough days contract personnel assigned to a campus that: (1) does not satisfy performance standards under Section 39.054(e); or (2) satisfies performance standards under Section 39.054(e) for the current school year but would not satisfy performance standards under Section 39.054(e) if the standards to be used for the following year were applied to the current year. (d) An educator may not be furloughed on a day that is included in the number of days of instruction required under Section 25.081. (e) An educator may not use personal, sick, or any other paid leave while the educator is on a furlough. (f) A furlough imposed under this section does not constitute a break in service for purposes of the Teacher Retirement System of Texas. (g) Implementation of a furlough program may not result in an increase in the number of required teacher workdays. (h) If a board of trustees adopts a furlough program after the date by which a teacher must give notice of resignation under Section 21.105, 21.160, or 21.210, as applicable, a teacher who subsequently resigns is not subject to sanctions imposed by the State Board for Educator Certification as otherwise authorized by those sections. (i) A decision by the board of trustees to implement a furlough program: (1) is final and may not be appealed; and (2) does not create a cause of action or require collective bargaining. Sec. 21.4022. SALARY REDUCTION. (a) Notwithstanding Section 21.402 or any other law, but subject to Section 21.4023, a school district may, if authorized by the board of trustees, reduce for a school year the monthly salary of contract personnel employed by the district during the 2010-2011 school year if the commissioner certifies in accordance with Section 42.009 that the district will be provided with less state and local funding for that year than was provided to the district for the 2010-2011 school year. (b) A salary reduction may be achieved through a reduction associated with a furlough as provided by Section 21.4021, through a reduction not associated with a furlough, or through a combination of those reductions. (c) A school district may not, through the cumulative effect of actions described by Subsection (b), reduce an employee's salary received for the 2010-2011 school year by more than the percentage by which the district's state and local funding is reduced for the applicable school year, as certified by the commissioner under Section 42.009. (d) For purposes of this section, an employee's salary does not include any stipends provided by the district to the employee. (e) A decision by the board of trustees to authorize a salary reduction: (1) is final and may not be appealed; and (2) does not create a cause of action or require collective bargaining. Sec. 21.4023. REQUIRED PROCESS FOR DEVELOPMENT OF FURLOUGH PROGRAM OR OTHER SALARY REDUCTION PROPOSAL. (a) The board of trustees of a school district may not implement a furlough program under Section 21.4021 or reduce salaries in accordance with Section 21.4022 until the district has complied with this section. (b) A school district must use a process to develop a furlough program or other salary reduction proposal, as applicable, that: (1) includes the involvement of the district's professional staff; and (2) provides district employees with the opportunity to express opinions regarding the furlough program or salary reduction proposal, as applicable, at the public meeting required by Subsection (c). (c) The board of trustees must hold a public meeting at which the board and school district administration present: (1) information regarding the options considered for managing the district's available resources, including consideration of a tax rate increase and use of the district's available fund balance; and (2) an explanation of how the district intends, through implementation of a furlough program under Section 21.4021 or through other salary reductions authorized under Section 21.4022, as applicable, to limit the number of district employees who will be discharged or whose contracts will not be renewed. (d) Any explanation of a furlough program under Subsection (c)(2) must state the specific number of furlough days proposed to be required. (e) The public and school district employees must be provided with an opportunity to comment at the public meeting required under Subsection (c). SECTION 10. Subsection (c), Section 28.021, Education Code, is amended to read as follows: (c) In determining promotion under Subsection (a), a school district shall consider: (1) the recommendation of the student's teacher; (2) the student's grade in each subject or course; (3) the student's score on an assessment instrument administered under Section 39.023(a), (b), or (l), to the extent applicable; and (4) any other necessary academic information, as determined by the district. SECTION 11. Section 28.0211, Education Code, is amended by adding Subsections (c-1), (o), and (p) and amending Subsection (f) to read as follows: (c-1) Accelerated instruction required under Subsection (c) after a student fails to perform satisfactorily on an assessment instrument a third time is not required to commence until the beginning of the next school year. (f) A school district shall provide to a student who, after three attempts, has failed to perform satisfactorily on an assessment instrument specified under Subsection (a) accelerated instruction commencing at the beginning of [during] the next school year as prescribed by an educational plan developed for the student by the student's grade placement committee established under Subsection (c). The district shall provide that accelerated instruction regardless of whether the student has been promoted or retained. The educational plan must be designed to enable the student to perform at the appropriate grade level by the conclusion of the school year. During the school year, the student shall be monitored to ensure that the student is progressing in accordance with the plan. The district shall administer to the student the assessment instrument for the grade level in which the student is placed at the time the district regularly administers the assessment instruments for that school year. (o) This section does not require the administration of a fifth or eighth grade assessment instrument in a subject under Section 39.023(a) to a student enrolled in the fifth or eighth grade, as applicable, if the student: (1) is enrolled in a course in the subject for which the student will receive high school academic credit; and (2) will be administered an end-of-course assessment instrument adopted under Section 39.023(c) for the course. (p) Notwithstanding any other provision of this section, a student described by Subsection (o) may not be denied promotion on the basis of failure to perform satisfactorily on an assessment instrument not required to be administered to the student in accordance with that subsection. SECTION 12. Subsection (a), Section 38.101, Education Code, is amended to read as follows: (a) Except as provided by Subsection (b), a school district annually shall assess the physical fitness of students enrolled in grade three or higher in a course that satisfies the curriculum requirements for physical education under Section 28.002(a)(2)(C) [grades 3 through 12]. SECTION 13. Section 39.023, Education Code, is amended by amending Subsection (a) and adding Subsection (a-2) to read as follows: (a) The agency shall adopt or develop appropriate criterion-referenced assessment instruments designed to assess essential knowledge and skills in reading, writing, mathematics, social studies, and science. Except as provided by Subsection (a-2), all [All] students, other than [except] students assessed under Subsection (b) or (l) or exempted under Section 39.027, shall be assessed in: (1) mathematics, annually in grades three through seven without the aid of technology and in grade eight with the aid of technology on any assessment instrument that includes algebra; (2) reading, annually in grades three through eight; (3) writing, including spelling and grammar, in grades four and seven; (4) social studies, in grade eight; (5) science, in grades five and eight; and (6) any other subject and grade required by federal law. (a-2) A student is not required to be assessed in a subject otherwise assessed at the student's grade level under Subsection (a) if the student: (1) is enrolled in a course in the subject for which the student will receive high school academic credit; and (2) will be administered an end-of-course assessment instrument adopted under Subsection (c) for the course. SECTION 14. Section 39.025, Education Code, is amended by adding Subsection (e-1) to read as follows: (e-1) Nothing in this section has the effect of prohibiting the administration of an end-of-course assessment instrument listed in Section 39.023(c) to a student enrolled below the high school level who is enrolled in the course for which the assessment instrument is adopted. The commissioner shall adopt rules necessary to ensure that the student's performance on the assessment instrument is considered in the same manner for purposes of this section as the performance of a student enrolled at the high school level. SECTION 15. Section 39.053, Education Code, is amended by adding Subsection (d-1) to read as follows: (d-1) In aggregating results of assessment instruments across grade levels by subject in accordance with Subsection (c)(1), the performance of a student enrolled below the high school level on an assessment instrument required under Section 39.023(c) is included with results relating to other students enrolled at the same grade level. SECTION 16. Section 39.082, Education Code, is amended by adding Subsection (d) to read as follows: (d) The commissioner may not use the system developed under this section to evaluate: (1) a district during a school year for which the commissioner certifies in accordance with Section 42.009 that the district will be provided with less state and local funding than was provided to the district for the 2010-2011 school year; or (2) an open-enrollment charter school during a school year for which the commissioner determines in a manner comparable to the process described in Section 42.009 that the school will be provided with less state and local funding than was provided to the school for the 2010-2011 school year. SECTION 17. Section 39.0822, Education Code, is amended by adding Subsection (f) to read as follows: (f) The agency may not review a district using the process developed under this section during a school year for which the commissioner certifies in accordance with Section 42.009 that the district will be provided with less state and local funding than was provided to the district for the 2010-2011 school year. SECTION 18. Subchapter A, Chapter 42, Education Code, is amended by adding Section 42.009 to read as follows: Sec. 42.009. DETERMINATION OF FUNDING LEVELS. (a) Not later than July 1 of each year, the commissioner shall determine for each school district whether the estimated amount of state and local funding per student in weighted average daily attendance to be provided to the district under the Foundation School Program for maintenance and operations for the following school year is less than the amount provided to the district for the 2010-2011 school year. If the amount estimated to be provided is less, the commissioner shall certify the percentage decrease in funding to be provided to the district. (b) In making the determinations regarding funding levels required by Subsection (a), the commissioner shall: (1) make adjustments as necessary to reflect changes in a school district's maintenance and operations tax rate; (2) for a district required to take action under Chapter 41 to reduce its wealth per student to the equalized wealth level, base the determinations on the district's net funding levels after deducting any amounts required to be expended by the district to comply with Chapter 41; and (3) determine a district's weighted average daily attendance in accordance with this chapter as it existed on January 1, 2011. SECTION 19. Section 44.004, Education Code, is amended by adding Subsection (g-1) to read as follows: (g-1) If the rate calculated under Subsection (c)(5)(A)(ii)(b) decreases after the publication of the notice required by this section, the president is not required to publish another notice or call another meeting to discuss and adopt the budget and the proposed lower tax rate. SECTION 20. Subsection (a), Section 26.05, Tax Code, is amended to read as follows: (a) The governing body of each taxing unit, before the later of September 30 or the 60th day after the date the certified appraisal roll is received by the taxing unit, shall adopt a tax rate for the current tax year and shall notify the assessor for the unit of the rate adopted. The tax rate consists of two components, each of which must be approved separately. The components are: (1) for a taxing unit other than a school district, the rate that, if applied to the total taxable value, will impose the total amount published under Section 26.04(e)(3)(C), less any amount of additional sales and use tax revenue that will be used to pay debt service, or, for a school district, the rate calculated [published] under Section 44.004(c)(5)(A)(ii)(b), Education Code; and (2) the rate that, if applied to the total taxable value, will impose the amount of taxes needed to fund maintenance and operation expenditures of the unit for the next year. SECTION 21. Subsection (a), Section 58.258, Utilities Code, is amended to read as follows: (a) Notwithstanding the pricing flexibility authorized by this subtitle, an electing company's rates for private network services may not be increased before January 1, 2014 [2012]. However, an electing company may increase a rate in accordance with the provisions of a customer specific contract. SECTION 22. Section 58.268, Utilities Code, is amended to read as follows: Sec. 58.268. CONTINUATION OF OBLIGATION. Notwithstanding any other provision of this title, an electing company shall continue to comply with this subchapter until January 1, 2014 [2012], regardless of: (1) the date the company elected under this chapter; or (2) any action taken in relation to that company under Chapter 65. SECTION 23. Subsection (a), Section 59.077, Utilities Code, is amended to read as follows: (a) Notwithstanding the pricing flexibility authorized by this subtitle, an electing company's rates for private network services may not be increased before January 1, 2014 [2012]. SECTION 24. Section 59.083, Utilities Code, is amended to read as follows: Sec. 59.083. CONTINUATION OF OBLIGATION. Notwithstanding any other provision of this title, an electing company shall continue to comply with this subchapter until January 1, 2014 [2012], regardless of: (1) the date the company elected under this chapter; or (2) any action taken in relation to that company under Chapter 65. SECTION 25. The change in law made by Subsection (g-1), Section 44.004, Education Code, as added by this Act, applies beginning with adoption of a tax rate for the 2011 tax year. SECTION 26. This Act takes effect immediately if it receives a vote of two-thirds of all the members elected to each house, as provided by Section 39, Article III, Texas Constitution. If this Act does not receive the vote necessary for immediate effect, this Act takes effect September 1, 2011. * * * * *