87R7654 CAE-D By: Dutton H.B. No. 3731 A BILL TO BE ENTITLED AN ACT relating to public school accountability ratings, including interventions and sanctions administered to a school district or campus assigned a needs improvement rating. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: SECTION 1. Sections 8.051(b) and (d), Education Code, are amended to read as follows: (b) Each regional education service center shall annually develop and submit to the commissioner for approval a plan for improvement. Each plan must include the purposes and description of the services the center will provide to: (1) campuses assigned an overall performance rating of D or F [an unacceptable performance rating] under Section 39.054; (2) the lowest-performing campuses in the region; and (3) other campuses. (d) Each regional education service center shall maintain core services for purchase by school districts and campuses. The core services are: (1) training and assistance in: (A) teaching each subject area assessed under Section 39.023; and (B) providing instruction in personal financial literacy as required under Section 28.0021; (2) training and assistance in providing a gifted and talented program and each program that qualifies for a funding allotment under Section 48.102, 48.104, or 48.105; (3) assistance specifically designed for a school district or campus assigned an overall performance rating of D or F [an unacceptable performance rating] under Section 39.054; (4) training and assistance to teachers, administrators, members of district boards of trustees, and members of site-based decision-making committees; (5) assistance specifically designed for a school district that is considered out of compliance with state or federal special education requirements, based on the agency's most recent compliance review of the district's special education programs; and (6) assistance in complying with state laws and rules. SECTION 2. Sections 11.174(b) and (f), Education Code, are amended to read as follows: (b) The board of trustees of a school district may enter into a contract as provided by Subsection (a) only if: (1) the charter of the open-enrollment charter school has not been previously revoked; (2) for the three school years preceding the school year of the proposed operation of the district campus as described by Subsection (a), the open-enrollment charter school has received: (A) an overall performance rating of C or higher [acceptable or higher] under Section 39.054 [Subchapter C, Chapter 39]; and (B) a financial accountability rating under Subchapter D, Chapter 39, indicating financial performance of satisfactory or higher; or (3) the entity considered for a district-authorized charter has not previously operated an open-enrollment charter school in which the charter expired or was revoked or surrendered. (f) This subsection applies only to a district campus subject to a contract described by Subsection (a) that received an overall performance rating of D under Section 39.054 and is subject to commissioner action under Section 39A.117(b) or is otherwise assigned an overall performance rating of unacceptable under Subchapter C, Chapter 39, for the school year before operation of the district campus under the contract began. The commissioner may not impose a sanction or take action against the campus under Section 39A.101 [39.107(a)] or 39A.111 [(e)] for failure to satisfy academic performance standards during the first two school years of operation of a district campus under Subsection (a). The overall performance rating received by the campus during those first two school years is not included in calculating consecutive school years and is not considered a break in consecutive school years under Section 39A.101 [39.107(a)] or 39A.111 [(e)]. SECTION 3. Section 12.1054(a), Education Code, is amended to read as follows: (a) A member of the governing body of a charter holder, a member of the governing body of an open-enrollment charter school, or an officer of an open-enrollment charter school is considered to be a local public official for purposes of Chapter 171, Local Government Code. For purposes of that chapter: (1) a member of the governing body of a charter holder or a member of the governing body or officer of an open-enrollment charter school is considered to have a substantial interest in a business entity if a person related to the member or officer in the third degree by consanguinity or affinity, as determined under Chapter 573, Government Code, has a substantial interest in the business entity under Section 171.002, Local Government Code; (2) notwithstanding any provision of Section 12.1054(a)(1) [12.1054(1)], an employee of an open-enrollment charter school that received an overall performance rating of C [rated acceptable] or higher under Section 39.054 for at least two of the preceding three school years may serve as a member of the governing body of the charter holder of the governing body of the school if the employees do not constitute a quorum of the governing body or any committee of the governing body; however, all members shall comply with the requirements of Sections 171.003-171.007, Local Government Code. SECTION 4. Section 12.110(e), Education Code, is amended to read as follows: (e) The commissioner shall give priority to applications that propose an open-enrollment charter school campus to be located in the attendance zone of a school district campus assigned an overall performance rating of D and that is subject to commissioner action under Section 39A.117(b) or an unacceptable performance rating under Section 39.054 for the two preceding school years. SECTION 5. Sections 12.1141(b) and (d), Education Code, are amended to read as follows: (b) At the end of the term of a charter for an open-enrollment charter school, if a charter holder submits to the commissioner a petition for expedited renewal of the charter, the charter automatically renews unless, not later than the 30th day after the date the charter holder submits the petition, the commissioner provides written notice to the charter holder that expedited renewal of the charter is denied. The commissioner may not deny expedited renewal of a charter if: (1) the charter holder has been assigned the highest or second highest performance rating under Subchapter C, Chapter 39, for the three preceding school years; (2) the charter holder has been assigned a financial performance accountability rating under Subchapter D, Chapter 39, indicating financial performance that is satisfactory or better for the three preceding school years; and (3) no campus operating under the charter has been assigned an overall performance rating of D and is subject to commissioner action under Section 39A.117(b) or is otherwise assigned an unacceptable performance rating [the lowest performance rating] under Section 39.054 [Subchapter C, Chapter 39], for the three preceding school years or such a campus has been closed. (d) At the end of the term of a charter for an open-enrollment charter school, if a charter holder submits to the commissioner a petition for renewal of the charter, the commissioner may not renew the charter and shall allow the charter to expire if: (1) the charter holder has been assigned an overall performance rating of D and is subject to commissioner action under Section 39A.117(b) or has been otherwise assigned an unacceptable [the lowest] performance rating under Subchapter C, Chapter 39, for any three of the five preceding school years; (2) the charter holder has been assigned a financial accountability performance rating under Subchapter D, Chapter 39, indicating financial performance that is lower than satisfactory for any three of the five preceding school years; (3) the charter holder has been assigned any combination of the ratings described by Subdivision (1) or (2) for any three of the five preceding school years; or (4) any campus operating under the charter has been assigned the lowest performance rating under Subchapter C, Chapter 39, for the three preceding school years and such a campus has not been closed. SECTION 6. Section 12.115, Education Code, is amended by amending Subsection (c) and adding Subsection (c-1) to read as follows: (c) The commissioner shall revoke the charter of an open-enrollment charter school if: (1) the charter holder has been assigned an overall performance rating of D and is subject to commissioner action under Section 39A.117(b), or is otherwise assigned an unacceptable performance rating under Subchapter C, Chapter 39, for the three preceding school years; (2) the charter holder has been assigned a financial accountability performance rating under Subchapter D, Chapter 39, indicating financial performance lower than satisfactory for the three preceding school years; or (3) the charter holder has been assigned any combination of the ratings described by Subdivision (1) or (2) for the three preceding school years. (c-1) The commissioner shall include an overall needs improvement performance rating designated as a D rating as an unacceptable performance rating under Subsection (c)(1) and as provided by Section 39A.117(a). Section 39A.117(c) does not apply to a determination under this section and an overall D rating that does not satisfy Section 39A.117(a) constitutes an unacceptable performance. SECTION 7. Section 12A.001(b), Education Code, is amended to read as follows: (b) A school district is eligible for designation as a district of innovation only if the district's most recent performance rating under Section 39.054 reflects a [at least acceptable] performance rating of C or higher. SECTION 8. Sections 12A.008(a) and (c), Education Code, are amended to read as follows: (a) The commissioner may terminate a district's designation as a district of innovation if the district receives for two consecutive school years: (1) an overall performance rating of D and is subject to action under Section 39A.117(b) or is otherwise assigned an unacceptable academic performance rating under Section 39.054; (2) an unacceptable financial accountability rating under Section 39.082; or (3) any combination of one or more D ratings or [an] unacceptable ratings under Subdivision (1) and one or more unacceptable ratings under Subdivision (2) [academic performance rating under Section 39.054 for one of the school years and an unacceptable financial accountability rating under Section 39.082 for the other school year]. (c) The commissioner shall terminate a district's designation as a district of innovation if the district receives for three consecutive school years: (1) an overall performance rating of D and is subject to action under Section 39A.117(b) or is otherwise assigned an unacceptable [academic] performance rating under Section 39.054; (2) an unacceptable financial accountability rating under Section 39.082; or (3) any combination of one or more D ratings or unacceptable ratings under Subdivision (1) and one or more unacceptable ratings under Subdivision (2). SECTION 9. Section 13.054, Education Code, is amended by adding Subsection (a-1) to read as follows: (a-1) The commissioner shall incorporate an overall D rating as an unacceptable performance rating for purposes of Subsection (a), in accordance with Section 39A.117(a), except that the commissioner may apply Section 39A.117(c) if the overall D rating meets the requirements of Section 39A.117(a). An overall D rating that does not satisfy Section 39A.117(a) shall constitute unacceptable performance for purposes of Subsection (a). SECTION 10. Section 21.453(b), Education Code, is amended to read as follows: (b) The commissioner may allocate funds from the account to regional education service centers to provide staff development resources to school districts that: (1) are rated academically unacceptable or are assigned an overall needs improvement rating and are subject to commissioner action under Section 39A.117(b); (2) have one or more campuses rated as academically unacceptable or are assigned an overall needs improvement rating and are subject to commissioner action under Section 39A.117(b); or (3) are otherwise in need of assistance as indicated by the academic performance of students, as determined by the commissioner. SECTION 11. Section 29.202(a), Education Code, is amended to read as follows: (a) A student is eligible to receive a public education grant or to attend another public school in the district in which the student resides under this subchapter if the student is assigned to attend a public school campus assigned an overall performance rating of D and is subject to commissioner action under Section 39A.117(b) or is otherwise assigned an unacceptable performance rating that is made publicly available under Section 39.054 for: (1) the student achievement domain under Section 39.053(c)(1); and (2) the school progress domain under Section 39.053(c)(2). SECTION 12. Section 30A.101(a), Education Code, is amended to read as follows: (a) A school district or open-enrollment charter school is eligible to act as a course provider under this chapter only if the district or school has received an overall performance rating of C or higher [is rated acceptable] under Section 39.054. An open-enrollment charter school may serve as a course provider only: (1) to a student within its service area; or (2) to another student in the state: (A) through an agreement with the school district in which the student resides; or (B) if the student receives educational services under the supervision of a juvenile probation department, the Texas Juvenile Justice Department, or the Texas Department of Criminal Justice, through an agreement with the applicable agency. SECTION 13. Section 39.052, Education Code, is amended by adding Subsection (b-1) to read as follows: (b-1) The commissioner shall incorporate an overall performance rating of D as an unacceptable performance rating under Subsection (b)(1)(A) in accordance with Section 39A.117(b). SECTION 14. Section 39.201(b), Education Code, is amended to read as follows: (b) A district or campus may not be awarded a distinction designation under this subchapter unless the district or campus is assigned an overall performance rating of C or higher [has acceptable performance] under Section 39.054. SECTION 15. Section 39.306(a), Education Code, is amended to read as follows: (a) Each board of trustees shall publish an annual report describing the educational performance of the district and of each campus in the district that includes uniform student performance and descriptive information as determined under rules adopted by the commissioner. The annual report must also include: (1) campus performance objectives established under Section 11.253 and the progress of each campus toward those objectives, which shall be available to the public; (2) information indicating the district's accreditation status and identifying each district campus awarded a distinction designation under Subchapter G or each district campus that has received an overall performance rating of D or is otherwise considered an unacceptable campus under Chapter 39A; (3) the district's current special education compliance status with the agency; (4) a statement of the number, rate, and type of violent or criminal incidents that occurred on each district campus, to the extent permitted under the Family Educational Rights and Privacy Act of 1974 (20 U.S.C. Section 1232g); (5) information concerning school violence prevention and violence intervention policies and procedures that the district is using to protect students; (6) the findings that result from evaluations conducted under the Safe and Drug-Free Schools and Communities Act of 1994 (20 U.S.C. Section 7101 et seq.); (7) information received under Section 51.403(e) for each high school campus in the district, presented in a form determined by the commissioner; and (8) the progress of the district and each campus in the district toward meeting the goals set in the district's: (A) early childhood literacy and mathematics proficiency plans adopted under Section 11.185; and (B) college, career, and military readiness plans adopted under Section 11.186. SECTION 16. Section 39.333, Education Code, is amended to read as follows: Sec. 39.333. REGIONAL AND DISTRICT LEVEL REPORT. As part of the comprehensive biennial report under Section 39.332, the agency shall submit a regional and district level report covering the preceding two school years and containing: (1) a summary of school district compliance with the student/teacher ratios and class-size limitations prescribed by Sections 25.111 and 25.112, including: (A) the number of campuses and classes at each campus granted an exception from Section 25.112; and (B) for each campus granted an exception from Section 25.112, a statement of whether the campus has been awarded a distinction designation under Subchapter G or has been assigned an overall campus performance rating of D or has otherwise been identified as an unacceptable campus under Chapter 39A; (2) a summary of the exemptions and waivers granted to campuses and school districts under Section 7.056 or 39.232 and a review of the effectiveness of each campus or district following deregulation; (3) an evaluation of the performance of the system of regional education service centers based on the indicators adopted under Section 8.101 and client satisfaction with services provided under Subchapter B, Chapter 8; (4) an evaluation of accelerated instruction programs offered under Section 28.006, including an assessment of the quality of such programs and the performance of students enrolled in such programs; and (5) the number of classes at each campus that are currently being taught by individuals who are not certified in the content areas of their respective classes. SECTION 17. Section 39.361, Education Code, is amended to read as follows: Sec. 39.361. NOTICE IN STUDENT GRADE REPORT. The first written notice of a student's performance that a school district gives during a school year as required by Section 28.022(a)(2) must include: (1) a statement of whether the campus at which the student is enrolled has been awarded a distinction designation under Subchapter G or has been assigned an overall performance rating of D or has otherwise been identified as an unacceptable campus under Chapter 39A; and (2) an explanation of the significance of the information provided under Subdivision (1). SECTION 18. Section 39A.001, Education Code, is amended to read as follows: Sec. 39A.001. GROUNDS FOR COMMISSIONER ACTION. (a) The commissioner shall take any of the actions authorized by this subchapter to the extent the commissioner determines necessary if: (1) a school district does not satisfy: (A) the accreditation criteria under Section 39.052; (B) the academic performance standards under Section 39.053 or 39.054; or (C) any financial accountability standard as determined by commissioner rule; or (2) the commissioner considers the action to be appropriate on the basis of a special accreditation investigation under Section 39.057. (b) The commissioner shall consider an overall performance rating of D as an unacceptable performance rating for purposes of Subsection (a)(2), in accordance with Section 39A.117. SECTION 19. Section 39A.004, Education Code, is amended to read as follows: Sec. 39A.004. APPOINTMENT OF BOARD OF MANAGERS. (a) The commissioner may appoint a board of managers to exercise the powers and duties of a school district's board of trustees if the district is subject to commissioner action under Section 39A.001 and: (1) has a current accreditation status of accredited-warned or accredited-probation; (2) fails to satisfy any standard under Section 39.054(e); or (3) fails to satisfy financial accountability standards as determined by commissioner rule. (b) The commissioner shall consider an overall performance rating of D as an unacceptable performance rating for purposes of Subsection (a)(2), in accordance with Section 39A.117. SECTION 20. Section 39A.005, Education Code, is amended by adding Subsection (a-1) to read as follows: (a-1) The commissioner shall consider an overall performance rating of D as an unacceptable performance rating for purposes of Subsection (a)(2), in accordance with Section 39A.117. SECTION 21. Section 39A.051, Education Code, is amended by adding Subsection (a-1) to read as follows: (a-1) The commissioner shall consider an overall performance rating of D as an unacceptable performance rating for purposes of Subsection (a), in accordance with Section 39A.117. SECTION 22. Section 39A.0545, Education Code, is transferred to Subchapter C, Chapter 39A, Education Code, redesignated as Section 39A.117, Education Code, and amended to read as follows: Sec. 39A.117 [39A.0545]. NEEDS IMPROVEMENT RATING. (a) Notwithstanding any other law, if a school district or campus is assigned an overall [or domain] performance rating of D and in the previous school year the district or campus received an overall rating of C or higher: (1) the commissioner shall order the district or campus to develop and implement a targeted improvement plan approved by the board of trustees of the district; and (2) the rating may not be included in calculating consecutive school years of unacceptable performance and is not considered a break in consecutive school years of unacceptable performance [interventions and sanctions provided by this chapter based on failure to satisfy performance standards under Section 39.054(e) apply to the district or campus only as provided by this section]. (b) The interventions and sanctions provided by this title [chapter] based on failure to satisfy performance standards under Section 39.054(e) apply to a district or campus assigned an overall performance rating of D, except as otherwise provided by Subsections (a) and (c) [ordered to develop and implement a targeted improvement plan under Subsection (a) only if the district or campus is assigned: [(1) an overall or domain performance rating of F; or [(2) an overall performance rating of D as provided by Subsection (c)]. (c) The commissioner is not required to take action under Section 39.052(c)(2) or 39A.111, if [If] a school district or campus is assigned an overall performance rating of D for a school year after the district or campus is ordered to develop and implement a targeted improvement plan under Subsection (a). (c-1) For a district or campus described by Subsection (c), the commissioner may [shall] implement any other interventions and sanctions under this title, including closure and the appointment of a board of managers, and [that apply to an unacceptable campus and those] interventions and sanctions previously implemented by the commissioner shall continue. An action taken by the commissioner under this subsection does not affect the determination of a district's or campus's consecutive school years of unacceptable performance [for each consecutive school year thereafter in which the campus is assigned an overall performance rating of D]. [(d) The commissioner shall adopt rules as necessary to implement this section.] SECTION 23. This Act applies beginning with the 2021-2022 school year. SECTION 24. In determining consecutive years of the overall performance rating of a school district or campus, a performance rating of a D or F issued before this Act takes effect applies to the determination of consecutive years of overall performance rating. SECTION 25. This Act takes effect September 1, 2021.