SRC-JEC, MSY S.B. 894 78(R)BILL ANALYSIS


Senate Research CenterS.B. 894
By: Bivins
Education
6/26/2003
Enrolled


DIGEST AND PURPOSE 

Under current law, school districts are required to hire a public
accountant to independently verify dropout rates and the expenditure of
compensatory education funds when submitting such information to the Texas
Education Agency (TEA).  S.B. 894 requires instead that school districts
supply the information directly to TEA on an annual basis in an electronic
format, and requires TEA to create a ranking system to review the
information provided on a district-by-district basis.  The bill requires
TEA to review the information of districts ranked as being at risk of
providing inaccurate figures as regards dropout rates and compensatory
education fund expenditures, and to conduct on-site investigations at the
district, if the district does not respond to the high-risk ranking in a
timely or satisfactory manner. 

RULEMAKING AUTHORITY

This bill does not expressly grant any additional rulemaking authority to
a state officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Sections 39.055(a) and (e), Education Code, as follows:

(a)  Deletes language requiring the board of trustees of each school
district to have the district's dropout records audited annually by a
public accountant.  Instead, requires the commissioner of education
(commissioner) to develop a process for auditing school district dropout
records electronically.  Requires the commissioner to develop a system and
standards for review of the audit or to use systems already available at
the Texas Education Agency (TEA).  Requires the system to be designed to
identify districts that are at high risk of having inaccurate dropout
records and, as a result, require on-site monitoring of dropout records.
Prohibits a district from being subject to on-site monitoring under this
subsection if the electronic audit of the district's dropout records
indicate a district is not at high risk of having inaccurate dropout
records. Entitles a district to an opportunity to respond to the
commissioner's determination before onsite monitoring may be conducted, if
the risk-based system indicates that the district is at high risk of
having inaccurate dropout records.  Requires the district to respond
within 30 days after the date the commissioner notifies the district of
the commissioner's determination.  Requires the commissioner to order TEA
staff to conduct on-site monitoring of the district's dropout records, if
the district's response does not change the commissioner's determination
that the district is at high risk of having inaccurate dropout records or
if the district does not respond in a timely manner.  

(e)  Deletes language requiring TEA to review each report of an audit of
district dropout records, and replaces references to such reports with
references to a district's dropout data. Makes conforming changes. 

SECTION 2.  Amends Section 42.006, Education Code, by adding Subsection
(d), to require the commissioner's rules to ensure that the Public
Education Information Management System links student performance data to
other related information for purposes of efficient and effective
allocation of scarce  school resources, to the extent practicable using
existing agency resources and appropriations. 

SECTION 3.  Amends Section 42.152, Education Code, by amending Subsections
(c), (q), and (r), and adding Subsections (q-1) through (q-4), as follows: 

(c)  Deletes the word "only" to remove a restriction on the use of funds
allocated under this section.  Deletes the word "only" to remove a
restriction on the use of a district's compensatory education allotment.
Authorizes the funds to be used at a campus which at least 40, rather than
50, percent of the students are educationally disadvantaged.  Requires,
rather than authorizes, a district's compensatory education allotment to
be used for costs supplementary to the regular education program.  Creates
Subdivisions (2)(A) and (2)(B) from existing text.  Creates Subdivision
(3), as follows: 

(3)  Provides that, for the purposes of this section, an alternative
education program specifically designed to serve students at risk of
dropping out of school is considered to be a program supplemental to the
overall educational program, and authorizes a district to use its
compensatory education allotment for such a program, notwithstanding any
other provisions of this section. 

Makes nonsubstantive changes.

(q)  Makes conforming changes.  Requires the reporting requirements to be
managed electronically to minimize local administrative costs.  Requires a
district to submit a copy of the report required by this subsection within
150 days after the last day permissible for resubmission of information
required under Section 42.006.   

(q-1)  Requires the commissioner to develop a system to identify school
districts that are at high risk of having used compensatory education
funds other than in compliance with Subsection (c) or of having
inadequately reported compensatory education expenditures.  Prohibits the
district, if a review of the report submitted under Subsection (q), using
the risk-based system, indicates that a district is not at high risk of
having misused compensatory education expenditures, from being required to
perform a local audit of compensatory education expenditures and provides
that the district is not subject to on-site monitoring under this section. 

(q-2)  Requires the commissioner, if a review of the report submitted
under Subsection (q), using the risk-based system, indicates that a
district is at high risk of having misused compensatory education funds,
to notify the district of that determination.  Requires the district to
respond to the commissioner within 30 days after the date the commissioner
notifies the district of the commissioner's determination.  Requires the
commissioner to perform certain tasks, if the district's response does not
change the commissioner's determination that the district is at high risk
of having misused compensatory education funds or if the district does not
respond in a timely manner. 

(q-3)  Authorizes the commissioner, if a review of the report submitted
under Subsection (q), using the risk-based system, indicates that a
district is at high risk of having inadequately reported compensatory
education expenditures, to require agency staff to assist the district or
campus improvement plan under Chapter 11F.  Authorizes the commissioner to
perform certain tasks if the district does not take appropriate corrective
action before the 45th day after the date the agency staff notifies the
district of the action the district is expected to take. 

(q-4)  Adds "local" to existing text relating to the audit of compensatory
education expenditures being withheld from a district's foundation school
fund payment. 

(r)  Makes a conforming change. 

 SECTION 4.  Repealer:  Sections 39.055(b), (c), and (d), Education Code
(pertaining to the audit of dropout records and the corresponding report). 

SECTION 5.  Makes Section 42.152(c), Education Code, as amended by this
Act, applicable to the use of compensatory education funds allotted under
Chapter 42, Education Code, for any school year, including a school year
before September 1, 2003. 

SECTION 6.  Effective date:  September 1, 2003.