[Federal Register: December 2, 2002 (Volume 67, Number 231)]
[Rules and Regulations]               
[Page 71709-71771]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr02de02-25]                         




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Part IV










Department of Education










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34 CFR Part 200






Title I--Improving the Academic Achievement of the Disadvantaged; Final 
Rule




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DEPARTMENT OF EDUCATION


34 CFR Part 200


RIN 1810-AA91


 
Title I--Improving the Academic Achievement of the Disadvantaged


AGENCY: Office of Elementary and Secondary Education, Department of 
Education.


ACTION: Final regulations.


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SUMMARY: The Secretary amends the regulations governing the programs 
administered under Title I, parts A, C, and D of the Elementary and 
Secondary Education Act of 1965 (ESEA), as amended (hereinafter 
referred to as the Title I programs.) These regulations are needed to 
implement recent changes to Title I of the ESEA made by the No Child 
Left Behind Act of 2001 (NCLB Act).


DATES: These regulations are effective January 2, 2003.


FOR FURTHER INFORMATION CONTACT: For subparts A, D, and E of part 200, 
Jacquelyn C. Jackson, Ed. D. Acting Director, Student Achievement and 
School Accountability Programs, Office of Elementary and Secondary 
Education, U.S. Department of Education, 400 Maryland Avenue, SW., room 
3W202, FB-6, Washington, DC 20202-6132. Telephone: (202) 260-0826.
    For subparts B and C of part 200, Francisco Garcia, Director, 
Migrant Education Program, Office of Elementary and Secondary 
Education, U.S. Department of Education, 400 Maryland Avenue, SW., room 
3E217, FB-6, Washington, DC 20202-6135. Telephone: (202) 260-0089.
    If you use a telecommunications device for the deaf (TDD), you may 
call the Federal Information Relay Service (FIRS) at 1-800-877-8339.
    Individuals with disabilities may obtain this document in an 
alternative format (e.g., Braille, large print, audiotape, or computer 
diskette) on request to the contact persons listed under FOR FURTHER 
INFORMATION CONTACT.


SUPPLEMENTARY INFORMATION: These regulations implement changes to Title 
I of the ESEA, as amended by the NCLB Act (Public Law 107-110), enacted 
January 8, 2002. On August 6, 2002, the Secretary published a notice of 
proposed rulemaking (NPRM) for these programs in the Federal Register 
(67 FR 50986).
    In the preamble to the NPRM, the Secretary discussed on pages 50986 
through 51001 the major revisions proposed in that document to 
implement changes in the provisions of Title I made by the NCLB Act. 
These included the following:
    [sbull] Clarifying in Sec.  200.11 that a condition of receiving 
Title I funds is that, if selected, the local educational agency (LEA) 
must participate in the National Assessment for Educational Progress 
(NAEP).
    [sbull] Specifying in Sec.  200.12 that the implementation of the 
statutory provisions requiring a single, statewide accountability 
system take effect beginning with the 2002-2003 school year.
    [sbull] Requiring in Sec.  200.12 that States include, in their 
accountability systems, guidelines for identifying the students with 
disabilities who should take alternate assessments and that States 
report on the number of students who take an alternate assessment.
    [sbull] Clarifying in Sec. Sec.  200.13 through 200.20 statutory 
provisions in section 1111(b)(2) of the NCLB Act requiring each State 
to demonstrate what constitutes adequate yearly progress (AYP), 
particularly the interrelationship among the timeline, starting points, 
intermediate goals, and annual measurable objectives that are part of 
AYP.
    [sbull] Clarifying in Sec.  200.13(c)(1) and (2) that States can 
define achievement standards for students with the most significant 
cognitive disabilities who take an alternate assessment, but that the 
percentage of students with disabilities included in accountability 
measures using alternate standards cannot be more than .5 percent of 
all students assessed in a State or LEA.
    [sbull] Specifying in Sec.  200.16 that a State must set separate 
starting points for reading/language arts and mathematics, and 
permitting the establishment of separate starting points by grade span.
    [sbull] Clarifying in Sec.  200.20 the statutory requirement that 
95 percent of the students enrolled in each subgroup must take the 
State's academic assessment for the school to make AYP.
    [sbull] Requiring in Sec.  200.21 that the Secretary review both a 
State's AYP and its annual measurable achievement objectives relating 
to the English proficiency of limited English proficient students.
    [sbull] Reorganizing in Sec. Sec.  200.25 through 200.28 schoolwide 
program regulations to emphasize the fundamental purpose of a 
schoolwide program and to create smaller and simpler sections.
    [sbull] Clarifying in Sec. Sec.  200.30 and 200.31 the statutory 
requirement that an LEA conduct an annual review of the performance of 
all schools receiving funds under subpart A of the ESEA and provide 
schools with the data on which it has based a proposed identification 
for improvement, corrective action, or restructuring.
    [sbull] Clarifying in Sec. Sec.  200.32 through 200.35 the 
statutory provisions related to the LEA's identification of schools for 
improvement, corrective action, and restructuring as well as provisions 
governing the delay or termination of requirements related to 
identification.
    [sbull] Clarifying in Sec. Sec.  200.36 through 200.38 the manner 
in which State educational agencies (SEAs), LEAs, and schools must meet 
notification requirements under section 1116 of the ESEA.
    [sbull] Restating in Sec. Sec.  200.39 through 200.41 the statutory 
requirements related to both LEA and school-level responsibilities 
under the school improvement process.
    [sbull] Clarifying in Sec. Sec.  200.42 and 200.43 the statutory 
requirements related to corrective action and restructuring.
    [sbull] Restating and reorganizing in Sec.  200.44 the statutory 
provisions related to the public school choice option and clarifying 
the statutory deadline to provide this option.
    [sbull] Specifying in Sec. Sec.  200.45 through 200.47 requirements 
for the provision of supplemental services.
    [sbull] Clarifying in Sec.  200.48 statutory provisions regarding 
the reservation of funds to pay for choice-related transportation and 
supplemental educational services.
    [sbull] Clarifying in Sec. Sec.  200.49 through 200.51 statutory 
provisions related to SEA responsibilities in the school improvement 
process, including SEA review of LEA progress and notice requirements.
    [sbull] Including in Sec. Sec.  200.52 and 200.53 the statutory 
requirements for LEA improvement and corrective action.
    [sbull] Incorporating in Sec.  200.54 the statutory provision with 
respect to State or local laws or collective bargaining agreements in 
effect on January 8, 2002--the day the NCLB Act was signed into law.
    [sbull] Incorporating in Sec. Sec.  200.55 through 200.57 the 
statutory provisions regarding qualifications of teachers, and 
clarifying that the requirements apply to teachers of the core academic 
subjects and do not apply to teachers who do not teach core subjects, 
employees of third-party contractors, or supplemental services 
providers.
    [sbull] Incorporating in Sec. Sec.  200.58 and 200.59 statutory 
provisions governing paraprofessionals, clarifying that the term 
applies to individuals performing instructional support duties and to 
paraprofessionals in both targeted assistance and schoolwide program


[[Page 71711]]


schools supported by funds under subpart A of this part.
    [sbull] Clarifying in Sec.  200.60 that professional development 
funds may be used for paraprofessionals as well as teachers.
    [sbull] Incorporating in Sec. Sec.  200.61 through 200.66 statutory 
changes from the previous law governing the participation of eligible 
children in private schools and clarifying provisions in this area 
about which questions have arisen in the past.
    [sbull] Specifying in Sec. Sec.  200.70 through 200.75 procedures 
that SEAs must follow in adjusting allocations determined by the 
Secretary to account for unique situations within their states.
    [sbull] Clarifying in Sec. Sec.  200.77 and 200.78 within-district 
allocation procedures as specified in section 1113 of the ESEA.
    [sbull] Restating in Sec.  200.79 the criteria a State or local 
program must meet in order to be excluded from ``supplement not 
supplant'' and ``comparability'' determinations, and incorporating a 
change in the poverty threshold for schoolwide programs.
    [sbull] Clarifying in Sec. Sec.  200.81 through 200.88 program 
specific regulations for subpart C--Migrant Education Program (MEP).
    [sbull] Specifying that the regulations for subpart D--Prevention 
Programs for Children and Youth Who Are Neglected, Delinquent, or At-
risk of Dropping Out have not changed.
    [sbull] Clarifying in Sec. Sec.  200.100 through 200.103 new 
procedures an SEA must follow when reserving funds for school 
improvement, State administration, and the State academic achievement 
awards program, addressing the use of funds reserved for State 
administration, and providing certain definitions that apply to all of 
the programs governed by the regulations.
    The final regulations reflect these provisions, modified as noted 
in the analysis of comments and changes in the appendix.


Significant Changes From the NPRM


    [sbull] AYP Requirements: Numerous comments were received from 
states requesting information on potential flexibility in determining 
AYP. One of the cornerstones of the NCLB is its strong emphasis on 
accountability for results. Only if we hold schools and LEAs 
accountability for the improved achievement of all students will we 
meet the goal of leaving no child behind. As a result, the NCLB Act 
included very specific, rigorous requirements that States must 
implement to determine the AYP of each public school, LEA, and the 
State itself. In preparing the final regulations, the Secretary has 
faithfully implemented the statutory provisions governing AYP, 
addressing additional flexibility wherever possible. The Secretary 
realizes that the accountability systems currently in place in many 
States may not fully meet the statutory and regulatory requirements. To 
meet the requirements in NCLB and these final regulations, a State may 
continue to use its current State accountability system, consistent 
with Secretary's July 24, 2002 Dear Colleague letter, if that system 
integrates AYP, as defined in the statute and regulations, into its 
system. A State must submit evidence to the Secretary, for peer review, 
that thoroughly describes the State's accountability system and 
demonstrates how it has integrated the AYP provisions required by the 
statute and regulations.
    [sbull] AYP for students with the most significant cognitive 
disabilities: Section 200.13 of the NPRM would have allowed the use of 
alternate achievement standards for students with the most significant 
cognitive disabilities for determining the AYP of states and LEAs, 
provided that use did not exceed 0.5 percent of all students. Numerous 
comments were received on this proposal, with many of them indicating 
that commenters misunderstood this proposal as limiting the number of 
students with disabilities who could take an alternate assessment, 
rather than providing flexibility by allowing the use of alternate 
achievement standards to determine proficiency for calculating AYP for 
a limited group of students with disabilities. Because the Secretary 
believes that the policy may need further clarification, the Secretary 
will be seeking public comment in an NPRM to be published shortly on a 
proposed policy regarding the appropriate use of alternate achievement 
standards in determining AYP for students with the most significant 
cognitive disabilities.
    However, because it is critical to ensure that students with 
disabilities are not excluded from state accountability systems, the 
final regulations provide that the same grade level academic content 
and achievement standards that apply to all public schools and public 
school students in the State will be applied to alternate assessments. 
The Secretary anticipates that the separate NPRM will propose an 
exception to this policy for a small group of students with 
disabilities.
    [sbull] Graduation Rates and Other Indicators: Section 200.19 of 
the NPRM required States to include in their definition of AYP 
graduation rates and one other academic indicator for elementary and 
middle schools. The final regulation clarifies that States are required 
to use the other indicators to determine whether or not a school or LEA 
has made AYP.
    [sbull] Restructuring: Section 200.34 of the NPRM did not address 
school status after implementation of restructuring. The final 
regulations modify the NPRM by clarifying that a school in 
restructuring must continue to provide supplemental educational 
services and choice, and to implement its restructuring plan, until it 
has made AYP for two consecutive years.
    [sbull] School choice and capacity: Numerous commenters requested 
clarification of the NPRM on the issue of a school district's capacity 
to provide choice for all students. Section 200.44(d) of the final 
regulation clarifies that an LEA may not use lack of capacity to deny 
an eligible student the opportunity to transfer to another school not 
identified for improvement.
    [sbull] LEA responsibility for supplemental educational services. 
Sections 200.46(a)(4) and 200.47(a)(5) of the NPRM did not address the 
responsibility of LEAs and SEAs to ensure that limited English 
proficient students receive appropriate educational services and 
language assistance in the provision of supplemental services. The 
final regulation clarifies that both the LEA and SEA are required to 
ensure that students with limited English proficiency receive 
appropriate supplemental educational services and language assistance 
in the provision of those services.
    [sbull] Providers of supplemental educational services: Section 
200.47(b)(3) of the NPRM stated: ``A private provider may not, on the 
basis of disability, exclude a qualified student with disabilities or a 
student covered under Section 504 if the student can, with minor 
adjustments, be provided supplemental educational services designed to 
meet the individual educational needs of the student unless otherwise 
provided by law.'' NPRM provisions Sec. Sec.  200.46(a)(4) and 
200.47(a)(5) provided that LEAs and SEAs must ensure that eligible 
students with disabilities and students covered by Section 504 receive 
appropriate supplemental educational services and accommodations in the 
provision of those services. The final regulation is amended to 
eliminate the ``minor adjustments'' standard for private providers of 
supplemental services.
    [sbull] Scientifically Based Research and Supplemental Services 
Providers: Section 200.47(b)(4)(ii) of the NPRM prohibited states from 
requiring


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providers to demonstrate that their instructional strategies were based 
on scientifically based research as a condition of approval. The final 
regulation removes this restriction.
    [sbull] Alternate Certification: The NPRM specified that one of the 
requirements of being a ``highly qualified teacher'' is having obtained 
full State certification as a teacher--which may include certification 
obtained through alternative routes to certification. The final 
regulation adds language that requires teachers who are enrolled in 
alternative route programs to receive high-quality professional 
development before and while teaching, to participate in a program of 
intensive supervision or a teacher mentoring program, to assume the 
functions of a teacher while in the alternative route program only for 
a specified period of time not to exceed three years, and to 
demonstrate satisfactory progress toward full certification as 
prescribed by the State. The regulations have been further amended by 
requiring the State to ensure, through its certification and licensure 
process, that these provisions are met.


Analysis of Comments and Changes


    In response to the Secretary's invitation in the NPRM, 
approximately 140 parties submitted comments. An analysis of the 
comments and of the changes in the regulations since publication of the 
NPRM is published as an appendix at the end of these final regulations.
    We group major issues according to subject. We discuss other 
substantive issues under the sections of these regulations to which 
they pertain. Generally, we do not address regulatory provisions that 
are technical or otherwise minor in effect.


Waiver of Rulemaking


    In response to comments, the Secretary has added Sec.  200.61 in 
these final regulations regarding parents' right to know the 
qualifications of their child's teachers. This section merely 
incorporates statutory requirements in section 1111(h)(6) of Title I. 
The Secretary has included it, however, to emphasize the important 
responsibility of LEAs to notify parents of students in Title I schools 
that they have a right to request information regarding the 
professional qualifications of their child's teachers. Under the 
Administrative Procedure Act (5 U.S.C. 553), the Department generally 
offers interested parties the opportunity to comment on proposed 
regulations. However, these regulations merely reflect statutory 
provisions and do not establish or affect substantive policy. 
Therefore, under 5 U.S.C. 553(b)(B), the Secretary has determined that 
proposed regulations are unnecessary.


Executive Order 12866


    We have reviewed these final regulations in accordance with 
Executive Order 12866. Under the terms of the order, we have assessed 
the potential costs and benefits of this regulatory action.
    The potential costs associated with the final regulations are those 
resulting from statutory requirements, and those we have determined to 
be necessary for administering this program effectively and 
efficiently. Based on our assessment of the regulatory burden on 
States, LEAs, and schools, we estimate that the total cost of 
administering these regulations is $52 million. In deriving this cost 
estimate, we calculated the burden hours at the SEA level to be 55,952 
hours. Using a cost rate of $25 per hour at the SEA level, we estimated 
the administrative burden cost to States to be $1.4 million. At the LEA 
and school levels, we calculated the burden hours to be 2,530,476 
hours. Based on a cost rate of $20 per hour, the estimated 
administrative burden cost at the local level is $50.6 million. The 
section of this preamble on the Paperwork Reduction Act of 1995 
discusses the burden that the statutory requirements of the NCLB Act 
impose on States, LEAs, and schools in more detail. The fiscal year 
(FY) 2002 appropriation for Title I, part A provided a $1.6 billion (18 
percent) increase in funds. This increase in funding will enable 
States, LEAs, and schools to meet the administrative costs associated 
with the requirements of the NCLB Act at the State, LEA, and school 
levels.
    In assessing the potential costs of implementing these regulations 
compared to the $10.6 billion in Title I, Part A, Part C, and Part D, 
subpart 1 funds received by the States and LEAs, we have determined 
that the benefits of the regulations justify the costs. The FY 2002 
appropriation of $10.6 billion for these programs, which represents an 
18 percent increase over the prior year appropriation, will provide 
enough resources for States, LEAs, and schools to carry out the 
requirements of the statute. The NCLB Act represents a sweeping 
overhaul of Federal efforts to support elementary and secondary 
education in the United States and is a landmark in education reform 
designed to improve student achievement and change the culture of our 
nation's schools. The new law is based on four basic principles--
stronger accountability for results; greater flexibility for States, 
school districts, and schools in the use of Federal funds; more choices 
for parents of children from disadvantaged backgrounds; and an emphasis 
on teaching methods that have been demonstrated to work.
    We have also determined that this regulatory action does not unduly 
interfere with State, local, and tribal governments in the exercise of 
their governmental functions.
    Most of the final regulations would add clarity where the statute 
is ambiguous or unclear or would reorganize statutory provisions to 
facilitate a better understanding of their requirements. These 
regulations would not add significantly to the costs of implementing 
the Title I programs authorized by the Elementary and Secondary 
Education Act (ESEA) or alter the benefits that the Secretary believes 
will be obtained through successful implementation. The vast majority 
of the implementation costs and benefits will stem from the underlying 
legislation.
    The programs authorized by Title I of the ESEA, as reauthorized by 
the No Child Left Behind Act of 2001, have as their goal the education 
of all students, including students who are economically disadvantaged, 
limited English proficient, disabled, migratory, residing in 
institutions for neglected or delinquent youth and adults, or members 
of other groups typically considered ``at risk,'' so that they can 
achieve to challenging content and academic achievement standards. 
Thus, the benefits that will be obtained through the reauthorized Title 
I and its implementing regulations are those primarily of a more 
educated society. National data sets and studies by prominent 
researchers have demonstrated repeatedly that better education has 
major benefits, both economic and non-economic, not only for the 
individuals who receive it but for society as a whole. Nations that 
invest in quality education enjoy higher levels of growth and 
productivity, and a high-quality education system is an indispensable 
element of a strong economy and successful civil society.
    Data from the 1999 Current Population Survey, conducted by the 
Census Bureau, indicate that adults with a high school diploma (but no 
further education) had a median income of $23,061, compared to $17,015 
for those with no diploma and $15,098 for those with less than 9 years 
of education. High school graduates are more likely to continue their 
education and receive the additional skills and knowledge necessary to 
compete for jobs in a high-technology, knowledge-driven economy.


[[Page 71713]]


Scholars have also found strong, positive correlations between higher 
levels of schooling and higher lifetime earnings, higher savings rates, 
and reduced costs of job search.
    Researchers have, in addition, found that more and better education 
correlates with other outcomes that, while not directly related to 
employment and earnings, have a major, positive benefit on society. 
More educated individuals lead healthier lives and have lower mortality 
rates. They are more likely to donate time and money to charity, and to 
vote in elections. Researchers have demonstrated the intergenerational 
impact of education, as the educational level of parents is a positive 
predictor of children's health, cognitive development, education, 
occupational status, and future earnings. In addition, education is 
negatively correlated with criminal activity and incarceration, and 
more educated mothers are less likely to have daughters who give birth 
out of wedlock as teens.
    The reauthorized Title I programs, and the final regulations for 
those programs, will also lead to improvements in the qualifications of 
teachers, both in programs supported by Title I and in schools 
generally. The Department believes that the new teacher qualifications 
provisions will also convey major benefits on students and on society 
generally. Research has found that the academic success of children is 
more dependent on teacher quality than on any other variable, with the 
exception of family background; it is, in other words, the most 
important school-related determinant of achievement.
    The major costs to States and to LEAs imposed by the statute and 
the regulations are the costs of administering the Title I programs: At 
the State level, distributing funds to LEAs, monitoring LEA activities, 
providing technical assistance, and carrying out other activities 
specified in the statute, and, at the local level, administering 
programs in schools and classrooms, providing professional development 
to teachers and other staff, and ensuring program accountability, among 
other things. The Department believes that these activities will be 
financed through the appropriations for Title I and other Federal 
programs and that the responsibilities encompassed in the law and 
regulations will not impose a financial burden that States and LEAs 
will have to meet from non-Federal resources. For purposes of the 
Unfunded Mandates Reform Act of 1995, these regulations do not include 
a Federal mandate that might result in increased expenditures by State, 
local, and tribal governments, or increased expenditures by the private 
sector of more than $100 million in any one year.


Regulatory Flexibility Act


    This Final Regulatory Flexibility Analysis (FRFA) has been prepared 
in accordance with the Regulatory Flexibility Act. It involves final 
regulations under Title I of the ESEA, as amended by the NCLB Act. Its 
provisions require LEAs, without regard to size, to take certain 
actions to improve student academic achievement.


1. Need for, Objectives of, and Legal Basis for Final Regulations


    The purpose of the final regulations is to implement recent changes 
to Title I of the ESEA made by the NCLB Act. We are issuing final 
regulation under the authority in section 1901(a) of Title I.


2. Summary of Significant Issues Raised in Response to the Initial 
Regulatory Flexibility Analysis (IRFA)


    We have received no comments concerning the cost implications of 
these regulations on small entities as result of our request for 
comments to the IRFA published in the NPRM on August 6, 2002. However, 
there was one comment on the proposed regulation regarding the impact 
of particular provisions on small LEAs.
    Comment: One commenter recommended that the final regulations 
provide flexibility in defining AYP for small school districts, and 
single-school LEAs in particular, that may find it difficult to 
implement the subgroup-based accountability requirements of the Act.
    Discussion: The intent of the law is to ensure that all schools and 
districts are held accountable for student achievement. In those 
instances where schools and districts are too small to include any 
subgroups, the school and district will need to make a decision about 
AYP at least on the basis of all its students who were within the 
school or district for a full academic year. The Department of 
Education will issue nonregulatory guidance to advise States about 
particular methodologies for handling this issue. The regulations 
clarify at Sec.  200.7(d) that subgroups too small to be reported or 
identified at one level must be included at the next higher level, 
assuming the subgroup reaches the appropriate size.


3. A Description of the Small Entities to Which These Regulations Will 
Apply


    The small entities that would be affected by these final 
regulations are small LEAs receiving Federal funds under Title I 
programs. Based on the Small Business Administration's (SBA) standards, 
which defines ``small entities'' as those jurisdictions serving a 
population of less than 50,000, 13,231 LEAs out of a total of 13,335 
LEAs that receive Title I, part A funds would be considered small. As 
noted earlier, the FY 2002 appropriation provides a $1.6 billion 
increase in the Title I, part A amount available for school year 2002-
03 to States and to all LEAs, both large and small.


4. Reporting, Recordkeeping and Other Compliance Requirements


    Under these regulations, an LEA must: (1) Publicize and disseminate 
the results of its annual progress review, (2) notify parents and 
teachers of any school identified for improvement or subject to 
corrective action or restructuring, (3) publicize and disseminate 
information regarding any action taken by the school and LEA to address 
the problems that led to the identification, and (4) for schools 
subject to restructuring, prepare a plan to carry out alternative 
governance arrangements. An LEA also must maintain in its records, and 
provide to the SEA, a written affirmation, signed by officials of each 
private school with participating children or appropriate private 
school representatives, that the required consultation has occurred. 
The potential costs and benefits of associated with these regulations 
are discussed in the section on Executive Order 12866.


5. Agency Action To Minimize Effect on Small Entities


    The Regulatory Flexibility Act directs us to consider significant 
alternatives that would accomplish the stated objectives, while 
minimizing any significant adverse impact on small entities. Although 
the NCLB Act makes no special provisions for ``small'' LEAs that serve 
fewer than 50,000 students, which account for 99 percent of all school 
districts receiving Title I part A funds, the Department has, to the 
extent allowable under the statute accommodated small LEAs in these 
regulations. For example, Sec.  200.74 of the regulations outlines 
procedures a State must use in using alternative poverty data, which it 
believes better reflect where poor children are located, to determine 
final Title I allocations for LEAs with a total population of less than 
20,000. This provision potentially applies to roughly 80 percent of all 
LEAs nationally that meet this criteria. LEAs with fewer than 1,000 
students enrolled are exempt from the within-district allocation 
requirements outlined


[[Page 71714]]


in Sec.  200.78. More than 4,060 LEAs receiving Title I Part A funds 
are affected by this policy. Moreover, activities required under these 
regulations would be financed through the appropriations for Title I 
programs, which have increased by $1.6 billion for FY 2002, and the 
responsibilities encompassed in the law and regulations would not 
impose a financial burden that small entities would have to meet from 
non-Federal resources.


Paperwork Reduction Act of 1995


    The Paperwork Reduction Act of 1995 does not require you to respond 
to a collection of information unless it displays a valid Office of 
Management and Budget (OMB) control number. We display the valid OMB 
control numbers assigned to the collections of information in these 
final regulations at the end of the affected sections of the 
regulations.
    Title I, part A of the Elementary and Secondary Education, as 
amended by the No Child Left Behind Act, contains several provisions 
that require SEAs, LEAs, or schools to collect or disseminate 
information. They are: Sections 200.26, 200.27, 200.28, 200.30, 200.31, 
200.34, 200.36, 200.37, 200.38, 200.39, 200.41, 200.42, 200.43, 200.45, 
200.46, 200.47, 200.49, 200.50, 200.51, 200.52, 200.57, 200.61, and 
200.62. Section 200.61 was added to the final regulation to incorporate 
statutory language requiring LEAs to notify parents that they may 
request information about the professional qualifications of their 
child's classroom teacher. All these sections relate to OMB control 
number 1810-0581. Sections 200.12, 200.13, and 200.33 are covered under 
OMB control number 1810-0576. Section 200.53 is covered under OMB 
control number 1810-0516. Sections 200.70 through 200.75 and 200.100 
are covered under OMB control numbers 1810-0620 and 1810-0622. Section 
200.83, 200.84, and 200.88 are covered under OMB control number 1810-
0659. Section 200.91 is covered under OMB control number 1810-0060.
    SEAs must: (1) Provide annual notice to potential supplemental 
service providers of the opportunity to provide such services, (2) 
maintain an updated list of approved providers from which parents may 
select, and (3) publicly report on standards and techniques for 
monitoring the quality and effectiveness of the services offered by 
each approved provider and for withdrawing approval from a provider 
that fails, for two consecutive years, to contribute to increasing the 
academic proficiency of students receiving supplemental services. As 
part of their responsibility to annually review the progress of each 
LEA to determine whether schools are making AYP, SEAs must: (1) 
Provide, before the beginning of the next school year, the results of 
academic assessments administered as part of the State assessment 
system in a given school year to LEAs, (2) publicize and disseminate 
the results of the State review, (3) notify parents when LEAs are 
identified for improvement or corrective action, including providing 
information on the corrective action, and (4) notify the Secretary of 
Education of major factors that have significantly affected student 
academic achievement in schools identified for improvement. 
Additionally, under Title I, part D, States must submit a count of 
children and youth under the age of 21 enrolled in a regular program of 
instruction operated or supported by State agencies in institutions or 
community day programs for neglected children and youth and adult 
correctional institutions.
    As part of their responsibility to annually review the progress of 
schools to determine whether they are making AYP, each LEA must (1) 
publicize and disseminate the results of its annual progress review, 
(2) notify parents and teachers of any school identified for 
improvement or subject to corrective action or restructuring, (3) 
publicize and disseminate information regarding any action taken by the 
school and LEA to address the problems that lead to the identification, 
and (4) for schools subject to restructuring, prepare a plan to carry 
out alternative governance arrangements. LEAs also must maintain in 
their records, and provide to the SEA, written affirmation signed by 
officials of each private school with participating children, or 
appropriate private school representatives, that the required 
consultation has occurred.
    At the school level, an eligible school choosing to operate a 
schoolwide program must develop a comprehensive schoolwide plan and 
maintain records demonstrating that it addresses the intent and purpose 
of each Federal program included.
    The total estimated burden hours for SEA activities covered by the 
paperwork requirements are 55,952 across 52 SEAs. The total estimated 
burden hours for LEA activities covered by the paperwork requirements 
are 1,119,500 hours across 13,335 LEAs. The total estimated burden 
hours for school-level activities is 1,410,976 hours. Almost all the 
burden hours at the LEA and school level result from statutory 
requirements that require: (1) LEAs to prepare restructuring plans for 
schools that do not make AYP after one full year in corrective action, 
and (2) schools seeking to operate schoolwide programs to develop 
schoolwide program plans. The actual impact on an individual LEA or 
school will vary depending on whether the LEA or school is subject to 
these specific requirements. The estimate of the burden hours at the 
LEA level includes an estimate of additional hours that result from 
adding a new Sec.  200.61 to the final regulations, which requires an 
LEA to notify parents that they can request information about the 
professional qualifications of their child's classroom teacher.
    Section 200.83 outlines an SEA's responsibility to implement its 
State Title I, part C (Migrant Education) program through a 
comprehensive needs assessment and a comprehensive State plan for 
service delivery. Section 200.84 outlines an SEA's responsibility for 
evaluating the effectiveness of its Title I, part C (Migrant Education) 
program. The yearly estimated public reporting burden for the 
collection of information to implement these two regulatory 
requirements is 19,925 hours. The Department requested that the Office 
of Management and Budget (OMB)review the information collections, 1810-
0581 and 1810-0659, on an emergency basis. Although these information 
collections have been approved on an emergency basis, we continue to 
invite your comments through January 31, 2003. We request those wishing 
to comment to send their comments to the individual identified in the 
FOR FURTHER INFORMATION CONTACT section of this notice.


Unfunded Mandates Reform Act of 1995


    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) 
establishes requirements for Federal agencies to assess the effect of 
their regulatory actions on State, local and tribal government and the 
private sector. These regulations contain no Federal mandates (under 
the regulatory provisions of Title II of the UMRA) for State, local, 
and tribal governments or the private sector. As noted in the cost/
benefit analysis, the fiscal year 2002 appropriation for Title I, part 
A provided a $1.6 billion (18 percent) increase in funds for States to 
use in implementing the changes mandated by the NCLB Act. Therefore, 
these regulations are not subject to the requirements of sections 202 
and 205 of UMRA.


Federalism


    Executive Order 13132 requires us to ensure meaningful and timely 
input by State and local elected officials in the


[[Page 71715]]


development of regulatory policies that have federalism implications. 
``Federalism implications'' means substantial direct effects on the 
States, on the relationship between the National Government and the 
States, or on the distribution of power and responsibilities among the 
various levels of government. Although we did not believe our NPRM 
would have federalism implications, we encouraged State and local 
elected officials to review the NPRM for federalism implications and to 
provide comments. We did not receive any comments on federalism 
implications. We also consulted extensively with Chief State School 
Officers, other State representatives, Superintendents, and leaders of 
various education organizations. In May of 2002, we hosted a series of 
regional meetings to share important information about the proposed 
regulations during the public comment period. We also conducted 
numerous teleconferences with State Chiefs and their staff to learn 
more about the implications of these regulations.
    These regulations implement various statutory changes to Title I of 
the ESEA made by the NCLB Act. We do not believe that these regulations 
have federalism implications as defined in Executive Order 13132 or 
that they preempt State law. Accordingly, the Secretary has determined 
that these regulations do not contain policies that have federalism 
implications.


Electronic Access to This Document


    You may view this document, as well as all other Department of 
Education documents published in the Federal Register, in text or Adobe 
Portable Document Format (PDF) on the Internet at the following site: 
http://www.ed.gov/legislation/FedRegister.
    To use PDF you must have Adobe Acrobat Reader, which is available 
free at this site. If you have questions about using PDF, call the U.S. 
Government Printing Office (GPO), toll free, at 1-888-293-6498; or in 
the Washington, DC, area at (202) 512-1530.


    Note: The official version of this document is the document 
published in the Federal Register. Free Internet access to the 
official edition of the Federal Register and the Code of Federal 
Regulations is available on GPO Access at: http://www.access.gpo.gov/nara/index.html
.


(Catalog of Federal Domestic Assistance Numbers: 84.010 Improving 
Programs Operated by Local Educational Agencies, 84.011 Education of 
Migrant Children, 84.013, Prevention and Intervention Programs for 
Children and Youth Who Are Neglected, Delinquent, or At-Risk of 
Dropping Out, 84.214A Even Start--Migrant Education)


List of Subjects in 34 CFR Part 200


    Administrative practice and procedure, Adult education, Children, 
Coordination, Education of children with disabilities, Education of 
disadvantaged children, Elementary and secondary education, 
Eligibility, Family, Family-centered education, Grant programs-
education, Indians education, Institutions of higher education, 
Interstate coordination, Intrastate coordination, Juvenile delinquency, 
Local educational agencies, Migratory children, Migratory workers, 
Neglected, Nonprofit private agencies, Private schools, Public 
agencies, Reporting and recordkeeping requirements, State-administered 
programs, State educational agencies, Subgrants.


    Dated: November 25, 2002.
Rod Paige,
Secretary of Education.




    The Secretary amends part 200 of title 34 of the Code of Federal 
Regulations as follows:


PART 200--TITLE I--IMPROVING THE ACADEMIC ACHIEVEMENT OF THE 
DISADVANTAGED


    1-2. The authority citation for part 200 is revised to read as 
follows:


    Authority: 20 U.S.C. 6301 through 6578, unless otherwise noted.


Subpart A--Improving Basic Programs Operated by Local Educational 
Agencies


    3. In Sec.  200.6, revise paragraph (a)(2) to read as follows:




Sec.  200.6  Inclusion of all students.


    (a) * * *
    (2) Alternate assessments. (i) The State's academic assessment 
system must provide for one or more alternate assessments for a child 
with a disability as defined under section 602(3) of the Individuals 
with Disabilities Education Act (IDEA) whom the child's IEP team 
determines cannot participate in all or part of the State assessments 
under paragraph (a)(1) of this section, even with appropriate 
accommodations.
    (ii) Alternate assessments must yield results for the grade in 
which the student is enrolled in at least reading/language arts, 
mathematics, and, beginning in the 2007-2008 school year, science.
* * * * *


    4. In Sec.  200.7, add new paragraphs (c) and (d) to read as 
follows:




Sec.  200.7  Disaggregation of data.


* * * * *
    (c) Inclusion of subgroups in assessments. If a subgroup under 
Sec.  200.2(b)(10) is not of sufficient size to produce statistically 
reliable results, the State must still include students in that 
subgroup in its State assessments under Sec.  200.2.
    (d) Disaggregation at the LEA and State. If the number of students 
in a subgroup is not statistically reliable at the school level, the 
State must include those students in disaggregations at each level for 
which the number of students is statistically reliable--e.g., the LEA 
or State level.


    5. In subpart A to part 200, remove the undesignated center 
headings ``Participation of Eligible Children in Private Schools'', 
``Capital Expenses'', ``Schoolwide Programs'', Procedures for the 
Within-State Allocation of LEA Program Funds'', and ``Procedures for 
the Within-District Allocation of LEA Program Funds''.


    6. Add a new undesignated center heading to subpart A of part 200 
and place it after Sec.  200.10 to read as follows:


Participation in National Assessment of Educational Progress (NAEP)


    7. Revise Sec.  200.11 and place it under the new undesignated 
center heading ``Participation in National Assessment of Educational 
Progress (NAEP)'' in subpart A of part 200 to read as follows:




Sec.  200.11  Participation in NAEP.


    (a) State participation. Beginning in the 2002-2003 school year, 
each State that receives funds under subpart A of this part must 
participate in biennial State academic assessments of fourth and eighth 
grade reading and mathematics under the State National Assessment of 
Educational Progress (NAEP), if the Department pays the costs of 
administering those assessments.
    (b) Local participation. In accordance with section 1112(b)(1)(F) 
of the Elementary and Secondary Education Act of 1965 (ESEA), and 
notwithstanding section 411(d)(1) of the National Education Statistics 
Act of 1994, an LEA that receives funds under subpart A of this part 
must participate, if selected, in the State-NAEP assessments referred 
to in paragraph (a) of this section.


(Authority: 20 U.S.C. 6311(c)(2); 6312(b)(1)(F), 9010(d)(1))


    8. Add a new undesignated center heading to subpart A of part 200 
and place it after revised Sec.  200.11 to read as follows:


[[Page 71716]]


State Accountability System


    9. Revise Sec.  200.12 and place it under the new undesignated 
center heading ``State Accountability System'' in subpart A of part 200 
to read as follows:




Sec.  200.12  Single State accountability system.


    (a)(1) Each State must demonstrate in its State plan that the State 
has developed and is implementing, beginning with the 2002-2003 school 
year, a single, statewide accountability system.
    (2) The State's accountability system must be effective in ensuring 
that all public elementary and secondary schools and LEAs in the State 
make adequate yearly progress (AYP) as defined in Sec. Sec.  200.13 
through 200.20.
    (b) The State's accountability system must--
    (1) Be based on the State's academic standards under Sec.  200.1, 
academic assessments under Sec.  200.2, and other academic indicators 
under Sec.  200.19;
    (2) Take into account the achievement of all public elementary and 
secondary school students;
    (3) Be the same accountability system the State uses for all public 
elementary and secondary schools and all LEAs in the State; and
    (4) Include sanctions and rewards that the State will use to hold 
public elementary and secondary schools and LEAs accountable for 
student achievement and for making AYP, except that the State is not 
required to subject schools and LEAs not participating under subpart A 
of this part to the requirements of section 1116 of the ESEA. (Approved 
by the Office of Management and Budget under control number 1810-0576)


(Authority: 20 U.S.C. 6311(b)(2)(A))




    10. Add a new undesignated center heading to subpart A of part 200 
and place it after revised Sec.  200.12 to read as follows:


Adequate Yearly Progress (AYP)


    11. Revise Sec. Sec.  200.13 through 200.18 and place them under 
the new undesignated center heading ``Adequate Yearly Progress (AYP)'' 
in subpart A of part 200 to read as follows:




Sec.  200.13  Adequate yearly progress in general.


    (a) Each State must demonstrate in its State plan what constitutes 
AYP of the State and of all public schools and LEAs in the State--
    (1) Toward enabling all public school students to meet the State's 
student academic achievement standards; while
    (2) Working toward the goal of narrowing the achievement gaps in 
the State, its LEAs, and its public schools.
    (b) A State must define, in accordance with Sec. Sec.  200.14 
through 200.20, in a manner that--
    (1) Applies the same high standards of academic achievement to all 
public school students in the State;
    (2) Is statistically valid and reliable;
    (3) Results in continuous and substantial academic improvement for 
all students;
    (4) Measures the progress of all public schools, LEAs, and the 
State based primarily on the State's academic assessment system under 
Sec.  200.2;
    (5) Measures progress separately for reading/language arts and for 
mathematics;
    (6) Is the same for all public schools and LEAs in the State; and
    (7) Consistent with Sec.  200.7, applies the same annual measurable 
objectives under Sec.  200.18 separately to each of the following:
    (i) All public school students.
    (ii) Students in each of the following subgroups:
    (A) Economically disadvantaged students.
    (B) Students from major racial and ethnic groups.
    (C) Students with disabilities, as defined in section 9101(5) of 
the ESEA.
    (D) Students with limited English proficiency, as defined in 
section 9101(25) of the ESEA.
    (c) The State must establish a way to hold accountable schools in 
which no grade level is assessed under the State's academic assessment 
system (e.g., K-2 schools), although the State is not required to 
administer a formal assessment to meet this requirement.


(Approved by the Office of Management and Budget under control 
number 1810-0576)


(Authority: 20 U.S.C. 6311(b)(2))


Sec.  200.14  Components of Adequate Yearly Progress.


    A State's definition of AYP must include all of the following:
    (a) A timeline in accordance with Sec.  200.15.
    (b) Starting points in accordance with Sec.  200.16.
    (c) Intermediate goals in accordance with Sec.  200.17.
    (d) Annual measurable objectives in accordance with Sec.  200.18.
    (e) Other academic indicators in accordance with Sec.  200.19.
(Authority: 20 U.S.C. 6311(b)(2))




Sec.  200.15  Timeline.


    (a) Each State must establish a timeline for making AYP that 
ensures that, not later than the 2013-2014 school year, all students in 
each group described in Sec.  200.13(b)(7) will meet or exceed the 
State's proficient level of academic achievement.
    (b) Notwithstanding subsequent changes a State may make to its 
academic assessment system or its definition of AYP under Sec. Sec.  
200.13 through 200.20, the State may not extend its timeline for all 
students to reach proficiency beyond the 2013-2014 school year.


(Authority: 20 U.S.C. 6311(b)(2))


Sec.  200.16  Starting points.


    (a) Using data from the 2001-2002 school year, each State must 
establish starting points in reading/language arts and in mathematics 
for measuring the percentage of students meeting or exceeding the 
State's proficient level of academic achievement.
    (b) Each starting point must be based, at a minimum, on the higher 
of the following percentages of students at the proficient level:
    (1) The percentage in the State of proficient students in the 
lowest-achieving subgroup of students under Sec.  200.13(b)(7)(ii).
    (2) The percentage of proficient students in the school that 
represents 20 percent of the State's total enrollment among all schools 
ranked by the percentage of students at the proficient level. The State 
must determine this percentage as follows:
    (i) Rank each school in the State according to the percentage of 
proficient students in the school.
    (ii) Determine 20 percent of the total enrollment in all schools in 
the State.
    (iii) Beginning with the lowest-ranked school, add the number of 
students enrolled in each school until reaching the school that 
represents 20 percent of the State's total enrollment among all 
schools.
    (iv) Identify the percentage of proficient students in the school 
identified in paragraph (iii).
    (c)(1) Except as permitted under paragraph (c)(2) of this section, 
each starting point must be the same throughout the State for each 
school, each LEA, and each group of students under Sec.  200.13(b)(7).
    (2) A State may use the procedures under paragraph (b) of this 
section to establish separate starting points by grade span.


(Authority: 20 U.S.C. 6311(b)(2))


Sec.  200.17  Intermediate goals.


    Each State must establish intermediate goals that increase in equal


[[Page 71717]]


increments over the period covered by the timeline under Sec.  200.15 
as follows:
    (a) The first incremental increase must take effect not later than 
the 2004-2005 school year.
    (b) Each following incremental increase must occur in not more than 
three years.


(Authority: 20 U.S.C. 6311(b)(2))




Sec.  200.18  Annual measurable objectives.


    (a) Each State must establish annual measurable objectives that--
    (1) Identify for each year a minimum percentage of students that 
must meet or exceed the proficient level of academic achievement on the 
State's academic assessments; and
    (2) Ensure that all students meet or exceed the State's proficient 
level of academic achievement within the timeline under Sec.  200.15.
    (b) The State's annual measurable objectives--
    (1) Must be the same throughout the State for each school, each 
LEA, and each group of students under Sec.  200.13(b)(7); and
    (2) May be the same for more than one year, consistent with the 
State's intermediate goals under Sec.  200.17.


(Authority: 20 U.S.C. 6311(b)(2))


    12. Add Sec.  200.19 and place it under the new undesignated center 
heading ``Adequate Yearly Progress (AYP)'' in subpart A of part 200 to 
read as follows:




Sec.  200.19  Other academic indicators.


    (a) Each State must use the following other academic indicators to 
determine AYP:
    (1) High schools. (i) The graduation rate for public high schools, 
which means--
    (A) The percentage of students, measured from the beginning of high 
school, who graduate from high school with a regular diploma (not 
including an alternative degree that is not fully aligned with the 
State's academic standards, such as a certificate or a GED) in the 
standard number of years; or
    (B) Another definition, developed by the State and approved by the 
Secretary in the State plan, that more accurately measures the rate of 
students who graduate from high school with a regular diploma as 
defined in paragraph (a)(1)(i)(A) of this section.
    (ii) In defining graduation rate, the State must avoid counting a 
dropout as a transfer.
    (2) Elementary and middle schools. At least one academic indicator 
for public elementary schools and at least one academic indicator for 
public middle schools, such as those under paragraph (b) of this 
section.
    (b) The State may include additional academic indicators determined 
by the State, including, but not limited to, the following:
    (1) Additional State or locally administered assessments not 
included in the State assessment system under Sec.  200.2.
    (2) Grade-to-grade retention rates.
    (3) Attendance rates.
    (4) Percentages of students completing gifted and talented, 
advanced placement, and college preparatory courses.
    (c) A State must ensure that its other academic indicators are--
    (1) Valid and reliable;
    (2) Consistent with relevant, nationally recognized professional 
and technical standards, if any; and
    (3) Consistent throughout the State within each grade span.
    (d)(1) A State may, but is not required to, increase the goals of 
its other academic indicators over the course of the timeline under 
Sec.  200.15.
    (2) The State--
    (i) Must disaggregate its other academic indicators by each group 
in Sec.  200.13(b)(7) for purposes of Sec.  200.20(b)(2) and section 
1111(h) of the ESEA; but
    (ii) Need not disaggregate those indicators for determining AYP 
except as required under section 1111(b)(2)(C)(vii) of the ESEA.
    (e) Except as provided in Sec.  200.20(b)(2), a State--
    (1) May not use the indicators in paragraphs (a) and (b) of this 
section to reduce the number, or change the identity, of schools that 
would otherwise be subject to school improvement, corrective action, or 
restructuring if those indicators were not used; but
    (2) May use the indicators to identify additional schools for 
school improvement, corrective action, or restructuring.


(Authority: 20 U.S.C. 6311(b)(2), (h))




    13. Revise Sec. Sec.  200.20 and 200.21 and place them under the 
new undesignated center heading ``Adequate Yearly Progress (AYP)'' in 
subpart A of part 200 to read as follows:




Sec.  200.20  Making adequate yearly progress.


    A school or LEA makes AYP if it complies with paragraph (c) and 
with either paragraph (a) or (b) of this section separately in reading/
language arts and in mathematics.
    (a)(1) A school or LEA makes AYP if--
    (i) Each group of students under Sec.  200.13(b)(7) meets or 
exceeds the State's annual measurable objectives under Sec.  200.18; 
and
    (ii) The school or LEA, respectively, meets or exceeds the State's 
other academic indicators under Sec.  200.19.
    (2) For a group under Sec.  200.13(b)(7) to be included in the 
determination of AYP for a school or LEA, the number of students in the 
group must be sufficient to yield statistically reliable information 
under Sec.  200.7(a).
    (b) If students in any group under Sec.  200.13(b)(7) in a school 
or LEA do not meet the State's annual measurable objectives under Sec.  
200.18, the school or LEA makes AYP if--
    (1) The percentage of students in that group below the State's 
proficient achievement level decreased by at least 10 percent from the 
preceding year; and
    (2) That group made progress on one or more of the State's academic 
indicators under Sec.  200.19 or the LEA's academic indicators under 
Sec.  200.30(c).
    (c)(1) A school or LEA makes AYP if--
    (i) Not less than 95 percent of the students enrolled in each group 
under Sec.  200.13(b)(7) takes the State assessments under Sec.  200.2; 
and
    (ii) The group is of sufficient size to produce statistically 
reliable results under Sec.  200.7(a).
    (2) The requirement in paragraph (c)(1) of this section does not 
authorize a State, LEA, or school to systematically exclude 5 percent 
of the students in any group under Sec.  200.13(b)(7).
    (3) If a student takes the State assessments for a particular 
subject or grade level more than once, the State must use the student's 
results from the first administration to determine AYP.
    (d) For the purpose of determining whether a school or LEA has made 
AYP, a State may establish a uniform procedure for averaging data that 
includes one or more of the following:
    (1) Averaging data across school years. (i) A State may average 
data from the school year for which the determination is made with data 
from one or two school years immediately preceding that school year.
    (ii) If a State averages data across school years, the State must--
    (A) Implement, on schedule, the assessments in reading/language 
arts and mathematics in grades 3 through 8 and once in grades 10 
through 12 required under Sec.  200.5(a)(2);
    (B) Report data resulting from the assessments under Sec.  
200.5(a)(2);
    (C) Determine AYP under Sec. Sec.  200.13 through 200.20, although 
the State may base that determination on data only from the reading/
language arts and mathematics assessments in the three grade spans 
required under Sec.  200.5(a)(1); and
    (D) Implement the requirements in section 1116 of the ESEA.


[[Page 71718]]


    (iii) A State that averages data across years must determine AYP on 
the basis of the assessments under Sec.  200.5(a)(2) as soon as it has 
data from two or three years to average. Until that time, the State may 
use data from the reading/language arts and mathematics assessments 
required under Sec.  200.5(a)(1) to determine adequate yearly progress.
    (2) Combining data across grades. Within each subject area and 
subgroup, the State may combine data across grades in a school or LEA.
    (e)(1) In determining the AYP of an LEA, a State must include all 
students who were enrolled in schools in the LEA for a full academic 
year, as defined by the State.
    (2) In determining the AYP of a school, the State may not include 
students who were not enrolled in that school for a full academic year, 
as defined by the State.


(Authority: 20 U.S.C. 6311(b)(2), (b)(3)(C)(xi))


Sec.  200.21  Adequate yearly progress of a State.


    For each State that receives funds under subpart A of this part and 
under subpart 1 of part A of Title III of the ESEA, the Secretary must, 
beginning with the 2004-2005 school year, annually review whether the 
State has--
    (a)(1) Made AYP as defined by the State in accordance with 
Sec. Sec.  200.13 through 200.20 for each group of students in Sec.  
200.13(b)(7); and
    (2) Met its annual measurable achievement objectives under section 
3122(a) of the ESEA relating to the development and attainment of 
English proficiency by limited English proficient students.
    (b) A State must include all students who were enrolled in schools 
in the State for a full academic year in reporting on the yearly 
progress of the State.


(Authority: 20 U.S.C. 7325)




    14. Remove and reserve Sec. Sec.  200.22 through 200.24 and place 
them under the new undesignated center heading ``Adequate Yearly 
Progress (AYP)'' in subpart A of part 200.


    15. Add a new undesignated center heading to subpart A of part 200 
and place it after Sec.  200.24 to read as follows:


Schoolwide Programs


    16. Revise Sec.  200.25 and place it under the undesignated center 
heading ``Schoolwide Programs'' in subpart A of part 200 to read as 
follows:




Sec.  200.25  Schoolwide programs in general.


    (a) Purpose. (1) The purpose of a schoolwide program is to improve 
academic achievement throughout a school so that all students, 
particularly the lowest-achieving students, demonstrate proficiency 
related to the State's academic standards under Sec.  200.1.
    (2) The improved achievement is to result from improving the entire 
educational program of the school.
    (b) Eligibility. (1) A school may operate a schoolwide program if--
    (i) The school's LEA determines that the school serves an eligible 
attendance area or is a participating school under section 1113 of the 
ESEA; and
    (ii) For the initial year of the schoolwide program--
    (A) The school serves a school attendance area in which not less 
than 40 percent of the children are from low-income families; or
    (B) Not less than 40 percent of the children enrolled in the school 
are from low-income families.
    (2) In determining the percentage of children from low-income 
families under paragraph (b)(1)(ii) of this section, the LEA may use a 
measure of poverty that is different from the measure or measures of 
poverty used by the LEA to identify and rank school attendance areas 
for eligibility and participation under subpart A of this part.
    (c) Participating students and services. A school operating a 
schoolwide program is not required to--
    (1) Identify particular children as eligible to participate; or
    (2) As required under section 1120A(b) of the ESEA, provide 
services that supplement, and do not supplant, the services 
participating children would otherwise receive if they were not 
participating in a program under subpart A of this part.
    (d) Supplemental funds. A school operating a schoolwide program 
must use funds available under subpart A of this part and under any 
other Federal program included under paragraph (e) of this section and 
Sec.  200.29 only to supplement the total amount of funds that would, 
in the absence of the Federal funds, be made available from non-Federal 
sources for that school, including funds needed to provide services 
that are required by law for children with disabilities and children 
with limited English proficiency.
    (e) Consolidation of funds. An eligible school may, consistent with 
Sec.  200.29, consolidate and use funds or services under subpart A of 
this part, together with other Federal, State, and local funds that the 
school receives, to operate a schoolwide program in accordance with 
Sec. Sec.  200.25 through 200.29.
    (f) Prekindergarten program. A school operating a schoolwide 
program may use funds made available under subpart A of this part to 
establish or enhance prekindergarten programs for children below the 
age of 6, such as Even Start programs or Early Reading First programs.


(Authority: 20 U.S.C. 6314)




    17. Add a new Sec.  200.26 and place it under the undesignated 
center heading ``Schoolwide Programs'' in subpart A of part 200 to read 
as follows:




Sec.  200.26  Core elements of a schoolwide program.


    (a) Comprehensive needs assessment. (1) A school operating a 
schoolwide program must conduct a comprehensive needs assessment of the 
entire school that--
    (i) Is based on academic achievement information about all students 
in the school, including all groups under Sec.  200.13(b)(7) and 
migratory children as defined in section 1309(2) of the ESEA, relative 
to the State's academic standards under Sec.  200.1 to--
    (A) Help the school understand the subjects and skills for which 
teaching and learning need to be improved; and
    (B) Identify the specific academic needs of students and groups of 
students who are not yet achieving the State's academic standards; and
    (ii) Assesses the needs of the school relative to each of the 
components of the schoolwide program under Sec.  200.28.
    (2) The comprehensive needs assessment must be developed with the 
participation of individuals who will carry out the schoolwide program 
plan.
    (3) The school must document how it conducted the needs assessment, 
the results it obtained, and the conclusions it drew from those 
results.
    (b) Comprehensive plan. Using data from the comprehensive needs 
assessment under paragraph (a) of this section, a school that wishes to 
operate a schoolwide program must develop a comprehensive plan, in 
accordance with Sec.  200.27, that describes how the school will 
improve academic achievement throughout the school, but particularly 
for those students furthest away from demonstrating proficiency, so 
that all students demonstrate at least proficiency on the State's 
academic standards.
    (c) Evaluation. A school operating a schoolwide program must--
    (1) Annually evaluate the implementation of, and results achieved 
by, the schoolwide program, using data from the State's annual 
assessments and other indicators of academic achievement;


[[Page 71719]]


    (2) Determine whether the schoolwide program has been effective in 
increasing the achievement of students in meeting the State's academic 
standards, particularly for those students who had been furthest from 
achieving the standards; and
    (3) Revise the plan, as necessary, based on the results of the 
evaluation, to ensure continuous improvement of students in the 
schoolwide program.


(Approved by the Office of Management and Budget under control 
number 1810-0581)


(Authority: 20 U.S.C. 6314)




    18. Revise Sec. Sec.  200.27 and 200.28 and place them under the 
undesignated center heading ``Schoolwide Programs'' in subpart A of 
part 200 to read as follows:




Sec.  200.27  Development of a schoolwide program plan.


    (a)(1) A school operating a schoolwide program must develop a 
comprehensive plan to improve teaching and learning throughout the 
school.
    (2) The school must develop the comprehensive plan in consultation 
with the LEA and its school support team or other technical assistance 
provider under section 1117 of the ESEA.
    (3) The comprehensive plan must--
    (i) Describe how the school will carry out each of the components 
under Sec.  200.28;
    (ii) Describe how the school will use resources under subpart A of 
this part and from other sources to carry out the components under 
Sec.  200.28; and
    (iii) Include a list of State and local programs and other Federal 
programs under Sec.  200.29 that the school will consolidate in the 
schoolwide program.
    (b)(1) The school must develop the comprehensive plan, including 
the comprehensive needs assessment, over a one-year period unless--
    (i) The LEA, after considering the recommendations of its technical 
assistance providers under section 1117 of the ESEA, determines that 
less time is needed to develop and implement the schoolwide program; or
    (ii) The school was operating a schoolwide program on or before 
January 7, 2002, in which case the school may continue to operate its 
program, but must amend its existing plan to reflect the provisions of 
Sec. Sec.  200.25 through 200.29 during the 2002-2003 school year.
    (2) The school must develop the comprehensive plan with the 
involvement of parents, consistent with the requirements of section 
1118 of the ESEA, and other members of the community to be served and 
individuals who will carry out the plan, including--
    (i) Teachers, principals, and administrators, including 
administrators of programs described in other parts of Title I of the 
ESEA;
    (ii) If appropriate, pupil services personnel, technical assistance 
providers, and other school staff; and
    (iii) If the plan relates to a secondary school, students from the 
school.
    (3) If appropriate, the school must develop the comprehensive plan 
in coordination with other programs, including those carried out under 
Reading First, Early Reading First, Even Start, the Carl D. Perkins 
Vocational and Technical Education Act of 1998, and the Head Start Act.
    (4) The comprehensive plan remains in effect for the duration of 
the school's participation under Sec. Sec.  200.25 through 200.29.
    (c)(1) The schoolwide program plan must be available to the LEA, 
parents, and the public.
    (2) Information in the plan must be--
    (i) In an understandable and uniform format, including alternative 
formats upon request; and
    (ii) To the extent practicable, provided in a language that the 
parents can understand.


(Approved by the Office of Management and Budget under control 
number 1810-0581)


(Authority: 20 U.S.C. 6314)




Sec.  200.28  Schoolwide program components.


    A schoolwide program must include the following components:
    (a) Schoolwide reform strategies. The schoolwide program must 
incorporate reform strategies in the overall instructional program. 
Those strategies must--
    (1) Provide opportunities for all students to meet the State's 
proficient and advanced levels of student academic achievement;
    (2)(i) Address the needs of all students in the school, 
particularly the needs of low-achieving students and those at risk of 
not meeting the State's student academic achievement standards who are 
members of the target population of any program included in the 
schoolwide program; and
    (ii) Address how the school will determine if those needs have been 
met;
    (3) Use effective methods and instructional practices that are 
based on scientifically based research, as defined in section 9101 of 
the ESEA, and that--
    (i) Strengthen the core academic program;
    (ii) Provide an enriched and accelerated curriculum;
    (iii) Increase the amount and quality of learning time, such as 
providing an extended school year and before- and after-school and 
summer programs and opportunities;
    (iv) Include strategies for meeting the educational needs of 
historically underserved populations; and
    (v) Are consistent with, and are designed to implement, State and 
local improvement plans, if any.
    (b) Instruction by highly qualified teachers. A schoolwide program 
must ensure instruction by highly qualified teachers and provide 
ongoing professional development. The schoolwide program must--
    (1) Include strategies to attract highly qualified teachers, as 
defined in Sec.  200.56;
    (2)(i) Provide high-quality and ongoing professional development in 
accordance with sections 1119 and 9101(34) of the ESEA for teachers, 
principals, paraprofessionals and, if appropriate, pupil services 
personnel, parents, and other staff, to enable all students in the 
school to meet the State's student academic standards; and
    (ii) Align professional development with the State's academic 
standards;
    (3) Devote sufficient resources to carry out effectively the 
professional development activities described in paragraph (b)(2) of 
this section; and
    (4) Include teachers in professional development activities 
regarding the use of academic assessments described in Sec.  200.2 to 
enable them to provide information on, and to improve, the achievement 
of individual students and the overall instructional program.
    (c) Parental involvement. (1) A schoolwide program must involve 
parents in the planning, review, and improvement of the schoolwide 
program plan.
    (2) A schoolwide program must have a parental involvement policy, 
consistent with section 1118(b) of the ESEA, that--
    (i) Includes strategies, such as family literacy services, to 
increase parental involvement in accordance with sections 1118(c) 
through (f) and 9101(32) of the ESEA; and
    (ii) Describes how the school will provide individual student 
academic assessment results, including an interpretation of those 
results, to the parents of students who participate in the academic 
assessments required by Sec.  200.2.
    (d) Additional support. A schoolwide program school must include 
activities to ensure that students who experience difficulty attaining 
the proficient or advanced levels of academic achievement standards 
required by Sec.  200.1 will be provided with effective, timely 
additional support, including measures to--


[[Page 71720]]


    (1) Ensure that those students' difficulties are identified on a 
timely basis; and
    (2) Provide sufficient information on which to base effective 
assistance to those students.
    (e) Transition. A schoolwide program in an elementary school must 
include plans for assisting preschool students in the successful 
transition from early childhood programs, such as Head Start, Even 
Start, Early Reading First, or a preschool program under IDEA or a 
State-run preschool program, to the schoolwide program.


(Approved by the Office of Management and Budget under control 
number 1810-0581)


(Authority: 20 U.S.C. 6314)


    19. Add Sec.  200.29 and place it under the undesignated center 
heading ``Schoolwide Programs'' in subpart A of part 200 to read as 
follows:




Sec.  200.29  Consolidation of funds in a schoolwide program.


    (a) In addition to funds under subpart A of this part, a school may 
consolidate and use in its schoolwide program Federal funds from any 
program administered by the Secretary that is included in the most 
recent notice published for this purpose in the Federal Register.
    (2) For purposes of Sec. Sec.  200.25 through 200.29, the authority 
to consolidate funds from other Federal programs also applies to 
services provided to the school with those funds.
    (b)(1) Except as provided in paragraphs (b)(2) and (c) of this 
section, a school that consolidates and uses in a schoolwide program 
funds from any other Federal program administered by the Secretary--
    (i) Is not required to meet the statutory or regulatory 
requirements of that program applicable at the school level; but
    (ii) Must meet the intent and purposes of that program to ensure 
that the needs of the intended beneficiaries of that program are 
addressed.
    (2) A school that chooses to consolidate funds from other Federal 
programs must meet the requirements of those programs relating to--
    (i) Health;
    (ii) Safety;
    (iii) Civil rights;
    (iv) Student and parental participation and involvement;
    (v) Services to private school children;
    (vi) Maintenance of effort;
    (vii) Comparability of services;
    (viii) Use of Federal funds to supplement, not supplant non-Federal 
funds in accordance with Sec.  200.25(d); and
    (ix) Distribution of funds to SEAs or LEAs.
    (c) A school must meet the following requirements if the school 
consolidates and uses funds from these programs in its schoolwide 
program:
    (1) Migrant education. Before the school chooses to consolidate in 
its schoolwide program funds received under part C of Title I of the 
ESEA, the school must--
    (i) Use these funds, in consultation with parents of migratory 
children or organizations representing those parents, or both, first to 
meet the unique educational needs of migratory students that result 
from the effects of their migratory lifestyle, and those other needs 
that are necessary to permit these students to participate effectively 
in school, as identified through the comprehensive Statewide needs 
assessment under Sec.  200.83; and
    (ii) Document that these needs have been met.
    (2) Indian education. The school may consolidate funds received 
under subpart 1 of part A of Title VII of the ESEA if the parent 
committee established by the LEA under section 7114(c)(4) of the ESEA 
approves the inclusion of these funds.
    (3) Special education. (i) The school may consolidate funds 
received under part B of the IDEA.
    (ii) However, the amount of funds consolidated may not exceed the 
amount received by the LEA under part B of IDEA for that fiscal year, 
divided by the number of children with disabilities in the jurisdiction 
of the LEA, and multiplied by the number of children with disabilities 
participating in the schoolwide program.
    (iii) The school may also consolidate funds received under section 
8003(d) of the ESEA (Impact Aid) for children with disabilities in a 
schoolwide program.
    (iv) A school that consolidates funds under part B of IDEA or 
section 8003(d) of the ESEA may use those funds for any activities 
under its schoolwide program plan but must comply with all other 
requirements of part B of IDEA, to the same extent it would if it did 
not consolidate funds under part B of IDEA or section 8003(d) of the 
ESEA in the schoolwide program.
    (d) A school that consolidates and uses in a schoolwide program 
funds under subpart A of this part or from any other Federal program 
administered by the Secretary--
    (1) Is not required to maintain separate fiscal accounting records, 
by program, that identify the specific activities supported by those 
particular funds; but
    (2) Must maintain records that demonstrate that the schoolwide 
program, as a whole, addresses the intent and purposes of each of the 
Federal programs whose funds were consolidated to support the 
schoolwide program.
    (e) Each State must--
    (1) Encourage schools to consolidate funds from other Federal, 
State, and local sources in their schoolwide programs; and
    (2) Modify or eliminate State fiscal and accounting barriers so 
that schools can easily consolidate funds from other Federal, State, 
and local sources in their schoolwide programs.


(Authority: 20 U.S.C. 6314, 1413(a)(s)(D), 6396(b), 7703(d), 
7815(c))




    20. Add a new undesignated center heading to subpart A of part 200 
and place it after Sec.  200.29 to read as follows:


LEA and School Improvement


    21. Transfer Sec. Sec.  200.30 through 200.69 to subpart A of part 
200.


    22. Revise Sec.  200.30 and place it under the new undesignated 
center heading ``LEA and School Improvement'' in subpart A of part 200 
to read as follows:




Sec.  200.30  Local review.


    (a) Each LEA receiving funds under subpart A of this part must use 
the results of the State assessment system described in Sec.  200.2 to 
review annually the progress of each school served under subpart A of 
this part to determine whether the school is making AYP in accordance 
with Sec.  200.20.
    (b)(1) In reviewing the progress of an elementary or secondary 
school operating a targeted assistance program, an LEA may choose to 
review the progress of only the students in the school who are served, 
or are eligible for services, under subpart A of this part.
    (2) The LEA may exercise the option under paragraph (b)(1) of this 
section so long as the students selected for services under the 
targeted assistance program are those with the greatest need for 
special assistance, consistent with the requirements of section 1115 of 
the ESEA.
    (c)(1) To determine whether schools served under subpart A of this 
part are making AYP, an LEA also may use any additional academic 
assessments or any other academic indicators described in the LEA's 
plan.
    (2)(i) The LEA may use these assessments and indicators--
    (A) To identify additional schools for school improvement or in 
need of corrective action or restructuring; and


[[Page 71721]]


    (B) To permit a school to make AYP if, in accordance with Sec.  
200.20(b), the school also reduces the percentage of a student group 
not meeting the State's proficient level of academic achievement by at 
least 10 percent.
    (ii) The LEA may not, with the exception described in paragraph 
(c)(2)(i)(B) of this section, use these assessments and indicators to 
reduce the number of, or change the identity of, the schools that would 
otherwise be identified for school improvement, corrective action, or 
restructuring if the LEA did not use these additional indicators.
    (d) The LEA must publicize and disseminate the results of its 
annual progress review to parents, teachers, principals, schools, and 
the community.
    (e) The LEA must review the effectiveness of actions and activities 
that schools are carrying out under subpart A of this part with respect 
to parental involvement, professional development, and other activities 
assisted under subpart A of this part.


(Approved by the Office of Management and Budget under control 
number 1810-0581)


(Authority: 20 U.S.C. 6316(a) and (b))




    23. Add new Sec. Sec.  200.31 through 200.39 and place them under 
the new undesignated center heading ``LEA and School Improvement'' in 
subpart A of part 200 to read as follows:




Sec.  200.31  Opportunity to review school-level data.


    (a) Before identifying a school for school improvement, corrective 
action, or restructuring, an LEA must provide the school with an 
opportunity to review the school-level data, including academic 
assessment data, on which the proposed identification is based.
    (b)(1) If the principal of a school that an LEA proposes to 
identify for school improvement, corrective action, or restructuring 
believes, or a majority of the parents of the students enrolled in the 
school believe, that the proposed identification is in error for 
statistical or other substantive reasons, the principal may provide 
supporting evidence to the LEA.
    (2) The LEA must consider the evidence referred to in paragraph 
(b)(1) of this section before making a final determination.
    (c) The LEA must make public a final determination of the status of 
the school with respect to identification not later than 30 days after 
it provides the school with the opportunity to review the data on which 
the proposed identification is based.


(Approved by the Office of Management and Budget under control 
number 1810-0581)


(Authority: 20 U.S.C. 6316(b)(2))


Sec.  200.32  Identification for school improvement.


    (a)(1) An LEA must identify for school improvement any elementary 
or secondary school served under subpart A of this part that fails, for 
two consecutive years, to make AYP as defined under Sec. Sec.  200.13 
through 200.20.
    (2) The LEA must make the identification described in paragraph 
(a)(1) of this section before the beginning of the school year 
following the year in which the LEA administered the assessments that 
resulted in the school's failure to make AYP for a second consecutive 
year.
    (b)(1) An LEA must treat any school that was in the first year of 
school improvement status on January 7, 2002 as a school that is in the 
first year of school improvement under Sec.  200.39 for the 2002-2003 
school year.
    (2) Not later than the first day of the 2002-2003 school year, the 
LEA must, in accordance with Sec.  200.44, provide public school choice 
to all students in the school.
    (c)(1) An LEA must treat any school that was identified for school 
improvement for two or more consecutive years on January 7, 2002 as a 
school that is in its second year of school improvement under Sec.  
200.39 for the 2002-2003 school year.
    (2) Not later than the first day of the 2002-2003 school year, the 
LEA must--
    (i) In accordance with Sec.  200.44, provide public school choice 
to all students in the school; and
    (ii) In accordance with Sec.  200.45, make available supplemental 
educational services to eligible students who remain in the school.
    (d) An LEA may remove from improvement status a school otherwise 
subject to the requirements of paragraphs (b) or (c) of this section 
if, on the basis of assessments the LEA administers during the 2001-
2002 school year, the school makes AYP for a second consecutive year.
    (e)(1) An LEA may, but is not required to, identify a school for 
improvement if, on the basis of assessments the LEA administers during 
the 2001-2002 school year, the school fails to make AYP for a second 
consecutive year.
    (2) An LEA that does not identify such a school for improvement, 
however, must count the 2001-2002 school year as the first year of not 
making AYP for the purpose of subsequent identification decisions under 
paragraph (a) of this section.
    (f) If an LEA identifies a school for improvement after the 
beginning of the school year following the year in which the LEA 
administered the assessments that resulted in the school's failure to 
make AYP for a second consecutive year--
    (1) The school is subject to the requirements of school improvement 
under Sec.  200.39 immediately upon identification, including the 
provision of public school choice; and
    (2) The LEA must count that school year as a full school year for 
the purposes of subjecting the school to additional improvement 
measures if the school continues to fail to make AYP.


(Authority: 20 U.S.C. 6316)




Sec.  200.33  Identification for corrective action.


    (a) If a school served by an LEA under subpart A of this part fails 
to make AYP by the end of the second full school year after the LEA has 
identified the school for improvement under Sec.  200.32(a) or (b), or 
by the end of the first full school year after the LEA has identified 
the school for improvement under Sec.  200.32(c), the LEA must identify 
the school for corrective action under Sec.  200.42.
    (b) If a school was subject to corrective action on January 7, 
2002, the LEA must--
    (1) Treat the school as a school identified for corrective action 
under Sec.  200.42 for the 2002-2003 school year; and
    (2) Not later than the first day of the 2002-2003 school year--
    (i) In accordance with Sec.  200.44, provide public school choice 
to all students in the school;
    (ii) In accordance with Sec.  200.45, make available supplemental 
educational services to eligible students who remain in the school; and
    (iii) Take corrective action under Sec.  200.42.
    (c) An LEA may remove from corrective action a school otherwise 
subject to the requirements of paragraphs (a) or (b) of this section 
if, on the basis of assessments administered by the LEA during the 
2001-2002 school year, the school makes AYP for a second consecutive 
year.


(Approved by the Office of Management and Budget under control 
number 1810-0576)


(Authority: 20 U.S.C. 6316)




Sec.  200.34  Identification for restructuring.


    (a) If a school continues to fail to make AYP after one full school 
year of corrective action under Sec.  200.42, the LEA must prepare a 
restructuring plan for the school and make arrangements to implement 
the plan.
    (b) If the school continues to fail to make AYP, the LEA must 
implement the


[[Page 71722]]


restructuring plan no later than the beginning of the school year 
following the year in which the LEA developed the restructuring plan 
under paragraph (a) of this section.


(Approved by the Office of Management and Budget under control 
number 1810-0576)


(Authority: 20 U.S.C. 6316(b)(8))




Sec.  200.35  Delay and removal.


    (a) Delay. (1) An LEA may delay, for a period not to exceed one 
year, implementation of requirements under the second year of school 
improvement, under corrective action, or under restructuring if--
    (i) The school makes AYP for one year; or
    (ii) The school's failure to make AYP is due to exceptional or 
uncontrollable circumstances, such as a natural disaster or a 
precipitous and unforeseen decline in the financial resources of the 
LEA or school.
    (2) The LEA may not take into account a period of delay under 
paragraph (a) of this section in determining the number of consecutive 
years of the school's failure to make AYP.
    (3) Except as provided in paragraph (b) of this section, the LEA 
must subject the school to further actions as if the delay never 
occurred.
    (b) Removal. If any school identified for school improvement, 
corrective action, or restructuring makes AYP for two consecutive 
school years, the LEA may not, for the succeeding school year--
    (1) Subject the school to the requirements of school improvement, 
corrective action, or restructuring; or
    (2) Identify the school for improvement.


(Authority: 20 U.S.C. 6316(b))




Sec.  200.36  Communication with parents.


    (a) Throughout the school improvement process, the State, LEA, or 
school must communicate with the parents of each child attending the 
school.
    (b) The State, LEA, or school must ensure that, regardless of the 
method or media used, it provides the information required by 
Sec. Sec.  200.37 and 200.38 to parents--
    (1) In an understandable and uniform format, including alternative 
formats upon request; and
    (2) To the extent practicable, in a language that parents can 
understand.
    (c) The State, LEA, or school must provide information to parents--
    (1) Directly, through such means as regular mail or e-mail, except 
that if a State does not have access to individual student addresses, 
it may provide information to the LEA or school for distribution to 
parents; and
    (2) Through broader means of dissemination such as the Internet, 
the media, and public agencies serving the student population and their 
families.
    (d) All communications must respect the privacy of students and 
their families.


(Approved by the Office of Management and Budget under control 
number 1810-0581)


(Authority: 20 U.S.C. 6316)




Sec.  200.37  Notice of identification for improvement, corrective 
action, or restructuring.


    (a) If an LEA identifies a school for improvement or subjects the 
school to corrective action or restructuring, the LEA must, consistent 
with the requirements of Sec.  200.36, promptly notify the parent or 
parents of each child enrolled in the school of this identification.
    (b) The notice referred to in paragraph (a) of this section must 
include the following:
    (1) An explanation of what the identification means, and how the 
school compares in terms of academic achievement to other elementary 
and secondary schools served by the LEA and the SEA involved.
    (2) The reasons for the identification.
    (3) An explanation of how parents can become involved in addressing 
the academic issues that led to identification.
    (4)(i) An explanation of the parents' option to transfer their 
child to another public school, including the provision of 
transportation to the new school, in accordance with Sec.  200.44.
    (ii) The explanation of the parents' option to transfer must 
include, at a minimum, information on the academic achievement of the 
school or schools to which the child may transfer.
    (iii) The explanation may include other information on the school 
or schools to which the child may transfer, such as--
    (A) A description of any special academic programs or facilities;
    (B) The availability of before- and after-school programs;
    (C) The professional qualifications of teachers in the core 
academic subjects; and
    (D) A description of parental involvement opportunities.
    (5)(i) If the school is in its second year of improvement or 
subject to corrective action or restructuring, a notice explaining how 
parents can obtain supplemental educational services for their child in 
accordance with Sec.  200.45.
    (ii) The annual notice of the availability of supplemental 
educational services must include, at a minimum, the following:
    (A) The identity of approved providers of those services available 
within the LEA, including providers of technology-based or distance-
learning supplemental educational services, and providers that make 
services reasonably available in neighboring LEAs.
    (B) A brief description of the services, qualifications, and 
demonstrated effectiveness of the providers referred to in paragraph 
(b)(5)(ii)(A) of this section.


(Approved by the Office of Management and Budget under control 
number 1810-0581)


(Authority: 20 U.S.C. 6316)




Sec.  200.38  Information about action taken.


    (a) An LEA must publish and disseminate to the parents of each 
student enrolled in the school, consistent with the requirements of 
Sec.  200.36, and to the public information regarding any action taken 
by a school and the LEA to address the problems that led to the LEA's 
identification of the school for improvement, corrective action, or 
restructuring.
    (b) The information referred to in paragraph (a) of this section 
must include the following:
    (1) An explanation of what the school is doing to address the 
problem of low achievement.
    (2) An explanation of what the LEA or SEA is doing to help the 
school address the problem of low achievement.
    (3) If applicable, a description of specific corrective actions or 
restructuring plans.


(Approved by the Office of Management and Budget under control 
number 1810-0581)


(Authority: 20 U.S.C. 6316(b))




Sec.  200.39  Responsibilities resulting from identification for school 
improvement.


    (a) If an LEA identifies a school for school improvement under 
Sec.  200.32--
    (1) The LEA must--
    (i) Not later than the first day of the school year following 
identification, with the exception described in Sec.  200.32(f), 
provide all students enrolled in the school with the option to 
transfer, in accordance with Sec.  200.44, to another public school 
served by the LEA; and
    (ii) Ensure that the school receives technical assistance in 
accordance with Sec.  200.40; and
    (2) The school must develop or revise a school improvement plan in 
accordance with Sec.  200.41.
    (b) If a school fails to make AYP by the end of the first full 
school year after the LEA has identified it for improvement under Sec.  
200.32, the LEA must--
    (1) Continue to provide all students enrolled in the school with 
the option


[[Page 71723]]


to transfer, in accordance with Sec.  200.44, to another public school 
served by the LEA;
    (2) Continue to ensure that the school receives technical 
assistance in accordance with Sec.  200.40; and
    (3) Make available supplemental educational services in accordance 
with Sec.  200.45.


(Approved by the Office of Management and Budget under control 
number 1810-0581)


(Authority: 20 U.S.C. 6316(b))


    24. Revise Sec. Sec.  200.40 through 200.45 and place them under 
the new undesignated center heading ``LEA and School Improvement'' in 
subpart A of part 200 to read as follows:




Sec.  200.40  Technical assistance.


    (a) An LEA that identifies a school for improvement under Sec.  
200.32 must ensure that the school receives technical assistance as the 
school develops and implements its improvement plan under Sec.  200.41 
and throughout the plan's duration.
    (b) The LEA may arrange for the technical assistance to be provided 
by one or more of the following:
    (1) The LEA through the statewide system of school support and 
recognition described under section 1117 of the ESEA.
    (2) The SEA.
    (3) An institution of higher education that is in full compliance 
with all of the reporting provisions of Title II of the Higher 
Education Act of 1965.
    (4) A private not-for-profit organization, a private for-profit 
organization, an educational service agency, or another entity with 
experience in helping schools improve academic achievement.
    (c) The technical assistance must include the following:
    (1) Assistance in analyzing data from the State assessment system, 
and other examples of student work, to identify and develop solutions 
to problems in--
    (i) Instruction;
    (ii) Implementing the requirements for parental involvement and 
professional development under this subpart; and
    (iii) Implementing the school plan, including LEA- and school-level 
responsibilities under the plan.
    (2) Assistance in identifying and implementing professional 
development and instructional strategies and methods that have proved 
effective, through scientifically based research, in addressing the 
specific instructional issues that caused the LEA to identify the 
school for improvement.
    (3) Assistance in analyzing and revising the school's budget so 
that the school allocates its resources more effectively to the 
activities most likely to--
    (i) Increase student academic achievement; and
    (ii) Remove the school from school improvement status.
    (d) Technical assistance provided under this section must be based 
on scientifically based research.


(Authority: 20 U.S.C. 6316(b)(4))




Sec.  200.41  School improvement plan.


    (a)(1) Not later than three months after an LEA has identified a 
school for improvement under Sec.  200.32, the school must develop or 
revise a school improvement plan for approval by the LEA.
    (2) The school must consult with parents, school staff, the LEA, 
and outside experts in developing or revising its school improvement 
plan.
    (b) The school improvement plan must cover a 2-year period.
    (c) The school improvement plan must--
    (1) Specify the responsibilities of the school, the LEA, and the 
SEA serving the school under the plan, including the technical 
assistance to be provided by the LEA under Sec.  200.40;
    (2)(i) Incorporate strategies, grounded in scientifically based 
research, that will strengthen instruction in the core academic 
subjects at the school and address the specific academic issues that 
caused the LEA to identify the school for improvement; and
    (ii) May include a strategy for implementing a comprehensive school 
reform model described in section 1606 of the ESEA;
    (3) With regard to the school's core academic subjects, adopt 
policies and practices most likely to ensure that all groups of 
students described in Sec.  200.13(b)(7) and enrolled in the school 
will meet the State's proficient level of achievement, as measured by 
the State's assessment system, not later than the 2013-2014 school 
year;
    (4) Establish measurable goals that--
    (i) Address the specific reasons for the school's failure to make 
adequate progress; and
    (ii) Promote, for each group of students described in Sec.  
200.13(b)(7) and enrolled in the school, continuous and substantial 
progress that ensures that all these groups meet the State's annual 
measurable objectives described in Sec.  200.18;
    (5) Provide an assurance that the school will spend not less than 
10 percent of the allocation it receives under subpart A of this part 
for each year that the school is in school improvement status, for the 
purpose of providing high-quality professional development to the 
school's teachers, principal, and, as appropriate, other instructional 
staff, consistent with section 9101(34) of the ESEA, that--
    (i) Directly addresses the academic achievement problem that caused 
the school to be identified for improvement;
    (ii) Is provided in a manner that affords increased opportunity for 
participating in that professional development; and
    (iii) Incorporates teacher mentoring activities or programs;
    (6) Specify how the funds described in paragraph (c)(5) of this 
section will be used to remove the school from school improvement 
status;
    (7) Describe how the school will provide written notice about the 
identification to parents of each student enrolled in the school;
    (8) Include strategies to promote effective parental involvement at 
the school; and
    (9) As appropriate, incorporate activities before school, after 
school, during the summer, and during any extension of the school year.
    (d)(1) Within 45 days of receiving a school improvement plan, the 
LEA must--
    (i) Establish a peer-review process to assist with review of the 
plan;
    (ii) Promptly review the plan;
    (iii) Work with the school to make any necessary revisions; and
    (iv) Approve the plan if it meets the requirements of this section.
    (2) The LEA may condition approval of the school improvement plan 
on--
    (i) Inclusion of one or more of the corrective actions specified in 
Sec.  200.42; or
    (ii) Feedback on the plan from parents and community leaders.
    (e) A school must implement its school improvement plan immediately 
on approval of the plan by the LEA.


(Approved by the Office of Management and Budget under control 
number 1810-0581)


(Authority: 20 U.S.C. 6316(b)(3))




Sec.  200.42  Corrective action.


    (a) Definition. ``Corrective action'' means action by an LEA that--
    (1) Substantially and directly responds to--
    (i) The consistent academic failure of a school that led the LEA to 
identify the school for corrective action; and
    (ii) Any underlying staffing, curriculum, or other problems in the 
school;
    (2) Is designed to increase substantially the likelihood that each 
group of students described in Sec.  200.13(b)(7) and enrolled in the 
school will meet or exceed the State's proficient levels of achievement 
as


[[Page 71724]]


measured by the State assessment system; and
    (3) Is consistent with State law.
    (b) Requirements. If an LEA identifies a school for corrective 
action, in accordance with Sec.  200.33, the LEA must do the following:
    (1) Continue to provide all students enrolled in the school with 
the option to transfer to another public school in accordance with 
Sec.  200.44.
    (2) Continue to ensure that the school receives technical 
assistance consistent with the requirements of Sec.  200.40.
    (3) Make available supplemental educational services in accordance 
with Sec.  200.45.
    (4) Take at least one of the following corrective actions:
    (i) Replace the school staff who are relevant to the school's 
failure to make AYP.
    (ii) Institute and fully implement a new curriculum, including the 
provision of appropriate professional development for all relevant 
staff, that--
    (A) Is grounded in scientifically based research; and
    (B) Offers substantial promise of improving educational achievement 
for low-achieving students and of enabling the school to make AYP.
    (iii) Significantly decrease management authority at the school 
level.
    (iv) Appoint one or more outside experts to advise the school on--
    (A) Revising the school improvement plan developed under Sec.  
200.41 to address the specific issues underlying the school's continued 
failure to make AYP and resulting in identification for corrective 
action; and
    (B) Implementing the revised improvement plan.
    (v) Extend for that school the length of the school year or school 
day.
    (vi) Restructure the internal organization of the school.


(Approved by the Office of Management and Budget under control 
number 1810-0581)


(Authority: 20 U.S.C. 6316(b)(7))




Sec.  200.43  Restructuring.


    (a) Definition. ``Restructuring'' means a major reorganization of a 
school's governance arrangement by an LEA that--
    (1) Makes fundamental reforms, such as significant changes in the 
school's staffing and governance, to improve student academic 
achievement in the school;
    (2) Has substantial promise of enabling the school to make AYP as 
defined under Sec. Sec.  200.13 through 200.20; and
    (3) Is consistent with State law.
    (b) Requirements. If the LEA identifies a school for restructuring 
in accordance with Sec.  200.34, the LEA must do the following:
    (1) Continue to provide all students enrolled in the school with 
the option to transfer to another public school in accordance with 
Sec.  200.44.
    (2) Make available supplemental educational services in accordance 
with Sec.  200.45.
    (3) Prepare a plan to carry out one of the following alternative 
governance arrangements:
    (i) Reopen the school as a public charter school.
    (ii) Replace all or most of the school staff, which may include the 
principal, who are relevant to the school's failure to make AYP.
    (iii) Enter into a contract with an entity, such as a private 
management company, with a demonstrated record of effectiveness, to 
operate the school as a public school.
    (iv) Turn the operation of the school over to the SEA, if permitted 
under State law and agreed to by the State.
    (v) Any other major restructuring of a school's governance 
arrangement consistent with this section.
    (4) Provide to parents and teachers--
    (i) Prompt notice that the LEA has identified the school for 
restructuring; and
    (ii) An opportunity for parents and teachers to--
    (A) Comment before the LEA takes any action under a restructuring 
plan; and
    (B) Participate in the development of any restructuring plan.
    (c) Implementation. (1) If a school continues to fail to make AYP, 
the LEA must--
    (i) Implement the restructuring plan no later than the beginning of 
the school year following the year in which the LEA developed the 
restructuring plan under paragraph (b)(3) of this section; and
    (ii) Continue to offer public school choice and supplemental 
educational services in accordance with Sec. Sec.  200.44 and 200.45.
    (2) An LEA is no longer required to carry out the requirements of 
paragraph (c)(1) of this section if the restructured school makes AYP 
for two consecutive school years.
    (d) Rural schools. On request, the Secretary will provide technical 
assistance for developing and carrying out a restructuring plan to any 
rural LEA--
    (1) That has fewer than 600 students in average daily attendance at 
all of its schools; and
    (2) In which all of the schools have a School Locale Code of 7 or 
8, as determined by the National Center for Education Statistics.


(Approved by the Office of Management and Budget under control 
number 1810-0581)


(Authority: 20 U.S.C. 6316(b)(8))




Sec.  200.44  Public school choice.


    (a) Requirements. (1) In the case of a school identified for school 
improvement under Sec.  200.32, for corrective action under Sec.  
200.33, or for restructuring under Sec.  200.34, the LEA must provide 
all students enrolled in the school with the option to transfer to 
another public school served by the LEA.
    (2) The LEA must offer this option not later than the first day of 
the school year following the year in which the LEA administered the 
assessments that resulted in its identification of the school for 
improvement, corrective action, or restructuring.
    (3) The schools to which students may transfer under paragraph 
(a)(1) of this section--
    (i) May not include schools that--
    (A) The LEA has identified for improvement under Sec.  200.32, 
corrective action under Sec.  200.33, or restructuring under Sec.  
200.34; or
    (B) Are persistently dangerous as determined by the State; and
    (ii) May include one or more public charter schools.
    (4) If more than one school meets the requirements of paragraph 
(a)(3) of this section, the LEA must--
    (i) Provide to parents of students eligible to transfer under 
paragraph (a)(1) of this section a choice of more than one such school; 
and
    (ii) Take into account the parents' preferences among the choices 
offered under paragraph (a)(4)(i) of this section.
    (5) The LEA must offer the option to transfer described in this 
section unless it is prohibited by State law in accordance with 
paragraph (b) of this section.
    (6) Except as described in Sec. Sec.  200.32(d) and 200.33(c), if a 
school was in school improvement or subject to corrective action before 
January 8, 2002, the State must ensure that the LEA provides a public 
school choice option in accordance with paragraph (a)(1) of this 
section not later than the first day of the 2002-2003 school year.
    (b) Limitation on State law prohibition. An LEA may invoke the 
State law prohibition on choice described in paragraph (a)(5) of this 
section only if the State law prohibits choice through restrictions on 
public school assignments or the transfer of students from one public 
school to another public school.
    (c) Desegregation plans. (1) If an LEA is subject to a 
desegregation plan, whether that plan is voluntary, court-


[[Page 71725]]


ordered, or required by a Federal or State administrative agency, the 
LEA is not exempt from the requirement in paragraph (a)(1) of this 
section.
    (2) In determining how to provide students with the option to 
transfer to another school, the LEA may take into account the 
requirements of the desegregation plan.
    (3) If the desegregation plan forbids the LEA from offering the 
transfer option required under paragraph (a)(1) of this section, the 
LEA must secure appropriate changes to the plan to permit compliance 
with paragraph (a)(1) of this section.
    (d) Capacity. An LEA may not use lack of capacity to deny students 
the option to transfer under paragraph (a)(1) of this section.
    (e) Priority. (1) In providing students the option to transfer to 
another public school in accordance with paragraph (a)(1) of this 
section, the LEA must give priority to the lowest-achieving students 
from low-income families.
    (2) The LEA must determine family income on the same basis that the 
LEA uses to make allocations to schools under subpart A of this part.
    (f) Status. Any public school to which a student transfers under 
paragraph (a)(1) of this section must ensure that the student is 
enrolled in classes and other activities in the school in the same 
manner as all other students in the school.
    (g) Duration of transfer. (1) If a student exercises the option 
under paragraph (a)(1) of this section to transfer to another public 
school, the LEA must permit the student to remain in that school until 
the student has completed the highest grade in the school.
    (2) The LEA's obligation to provide transportation for the student 
may be limited under the circumstances described in paragraph (i) of 
this section and in Sec.  200.48.
    (h) No eligible schools within an LEA. If all public schools to 
which a student may transfer within an LEA are identified for school 
improvement, corrective action, or restructuring, the LEA--
    (1) Must, to the extent practicable, establish a cooperative 
agreement for a transfer with one or more other LEAs in the area; and
    (2) May offer supplemental educational services to eligible 
students under Sec.  200.45 in schools in their first year of school 
improvement under Sec.  200.39.
    (i) Transportation. (1) If a student exercises the option under 
paragraph (a)(1) of this section to transfer to another public school, 
the LEA must, consistent with Sec.  200.48, provide or pay for the 
student's transportation to the school.
    (2) The limitation on funding in Sec.  200.48 applies only to the 
provision of choice-related transportation, and does not affect in any 
way the basic obligation to provide an option to transfer as required 
by paragraph (a) of this section.
    (3) The LEA's obligation to provide transportation for the student 
ends at the end of the school year in which the school from which the 
student transferred is no longer identified by the LEA for school 
improvement, corrective action, or restructuring.
    (j) Students with disabilities and students covered under Section 
504 of the Rehabilitation Act of 1973 (Section 504). For students with 
disabilities under the IDEA and students covered under Section 504, the 
public school choice option must provide a free appropriate public 
education as that term is defined in section 602(8) of the IDEA or 34 
CFR 104.33, respectively.


(Authority: 20 U.S.C. 6316)




Sec.  200.45  Supplemental educational services.


    (a) Definition. ``Supplemental educational services'' means 
tutoring and other supplemental academic enrichment services that are--
    (1) In addition to instruction provided during the school day;
    (2) Specifically designed to--
    (i) Increase the academic achievement of eligible students as 
measured by the State's assessment system; and
    (ii) Enable these children to attain proficiency in meeting State 
academic achievement standards; and
    (3) Of high quality and research-based.
    (b) Eligibility. (1) Only students from low-income families are 
eligible for supplemental educational services.
    (2) The LEA must determine family income on the same basis that the 
LEA uses to make allocations to schools under subpart A of this part.
    (c) Requirement. (1) If an LEA identifies a school for a second 
year of improvement under Sec.  200.32, corrective action under Sec.  
200.33, or restructuring under Sec.  200.34, the LEA must arrange, 
consistent with paragraph (d) of this section, for each eligible 
student in the school to receive supplemental educational services from 
a State-approved provider selected by the student's parents.
    (2) Except as described in Sec. Sec.  200.32(d) and 200.33(c), if a 
school was in school improvement status for two or more consecutive 
school years or subject to corrective action on January 7, 2002, the 
State must ensure that the LEA makes available, consistent with 
paragraph (d) of this section, supplemental educational services to all 
eligible students not later than the first day of the 2002-2003 school 
year.
    (3) The LEA must, consistent with Sec.  200.48, continue to make 
available supplemental educational services to eligible students until 
the end of the school year in which the LEA is making those services 
available.
    (4)(i) At the request of an LEA, the SEA may waive, in whole or in 
part, the requirement that the LEA make available supplemental 
educational services if the SEA determines that--
    (A) None of the providers of those services on the list approved by 
the SEA under Sec.  200.47 makes those services available in the area 
served by the LEA or within a reasonable distance of that area; and
    (B) The LEA provides evidence that it is not otherwise able to make 
those services available.
    (ii) The SEA must notify the LEA, within 30 days of receiving the 
LEA's request for a waiver under paragraph (c)(4)(i) of this section, 
whether it approves or disapproves the request and, if it disapproves, 
the reasons for the disapproval, in writing.
    (iii) An LEA that receives a waiver must renew its request for that 
waiver on an annual basis.
    (d) Priority. If the amount of funds available for supplemental 
educational services is insufficient to provide services to each 
student whose parents request these services, the LEA must give 
priority to the lowest-achieving students.


(Approved by the Office of Management and Budget under control 
number 1810-0581)


(Authority: 20 U.S.C. 6316)
    25. Add new Sec. Sec.  200.46 through 200.49 and place them under 
the new undesignated center heading ``LEA and School Improvement'' in 
subpart A of part 200 to read as follows:




Sec.  200.46  LEA responsibilities for supplemental educational 
services.


    (a) If an LEA is required to make available supplemental 
educational services under Sec.  200.39(b)(3), Sec.  200.42(b)(3), or 
Sec.  200.43(b)(2), the LEA must do the following:
    (1) Provide the annual notice to parents described in Sec.  
200.37(b)(5).
    (2) If requested, assist parents in choosing a provider from the 
list of approved providers maintained by the SEA.
    (3) Apply fair and equitable procedures for serving students if the 
number of spaces at approved providers is not sufficient to serve all 
eligible


[[Page 71726]]


students whose parents request services consistent with Sec.  200.45.
    (4) Ensure that eligible students with disabilities under IDEA and 
students covered under Section 504 receive appropriate supplemental 
educational services and accommodations in the provision of those 
services.
    (5) Ensure that eligible students who have limited English 
proficiency receive appropriate supplemental educational services and 
language assistance in the provision of those services.
    (6) Not disclose to the public, without the written permission of 
the student's parents, the identity of any student who is eligible for, 
or receiving, supplemental educational services.
    (b)(1) In addition to meeting the requirements in paragraph (a) of 
this section, the LEA must enter into an agreement with each provider 
selected by a parent or parents.
    (2) The agreement must--
    (i) Require the LEA to develop, in consultation with the parents 
and the provider, a statement that includes--
    (A) Specific achievement goals for the student;
    (B) A description of how the student's progress will be measured; 
and
    (C) A timetable for improving achievement;
    (ii) Describe procedures for regularly informing the student's 
parents and teachers of the student's progress;
    (iii) Provide for the termination of the agreement if the provider 
is unable to meet the goals and timetables specified in the agreement;
    (iv) Specify how the LEA will pay the provider; and
    (v) Prohibit the provider from disclosing to the public, without 
the written permission of the student's parents, the identity of any 
student who is eligible for, or receiving, supplemental educational 
services.
    (3) In the case of a student with disabilities under IDEA or a 
student covered under Section 504, the provisions of the agreement 
referred to in paragraph (b)(2)(i) of this section must be consistent 
with the student's individualized education program under section 
614(d) of the IDEA or the student's individualized services under 
Section 504.
    (4) The LEA may not pay the provider for religious worship or 
instruction.
    (c) If State law prohibits an SEA from carrying out one or more of 
its responsibilities under Sec.  200.47 with respect to those who 
provide, or seek approval to provide, supplemental educational 
services, each LEA must carry out those responsibilities with respect 
to its students who are eligible for those services.


(Authority: 20 U.S.C. 6316(e))


(Approved by the Office of Management and Budget under control 
number 1810-0581)




Sec.  200.47  SEA responsibilities for supplemental educational 
services.


    (a) If one or more LEAs in a State are required to make available 
supplemental educational services under Sec.  200.39(b)(3), Sec.  
200.42(b)(3), or Sec.  200.43(b)(2), the SEA for that State must do the 
following:
    (1)(i) In consultation with affected LEAs, parents, teachers, and 
other interested members of the public, promote participation by as 
many providers as possible.
    (ii) This promotion must include annual notice to potential 
providers of--
    (A) The opportunity to provide supplemental educational services; 
and
    (B) Procedures for obtaining the SEA's approval to be a provider of 
those services.
    (2) Consistent with paragraph (b) of this section, develop and 
apply to potential providers objective criteria.
    (3) Maintain by LEA an updated list of approved providers, 
including any technology-based or distance-learning providers, from 
which parents may select.
    (4) Develop, implement, and publicly report on standards and 
techniques for--
    (i) Monitoring the quality and effectiveness of the services 
offered by each approved provider; and
    (ii) Withdrawing approval from a provider that fails, for two 
consecutive years, to contribute to increasing the academic proficiency 
of students receiving supplemental educational services from that 
provider.
    (5) Ensure that eligible students with disabilities under IDEA and 
students covered under Section 504 receive appropriate supplemental 
educational services and accommodations in the provision of those 
services.
    (6) Ensure that eligible students who have limited English 
proficiency receive appropriate supplemental educational services and 
language assistance in the provision of those services.
    (b) Standards for approving providers. (1) As used in this section 
and in Sec.  200.46, ``provider'' means a non-profit entity, a for-
profit entity, an LEA, an educational service agency, a public school, 
including a public charter school, or a private school that--
    (i) Has a demonstrated record of effectiveness in increasing the 
academic achievement of students in subjects relevant to meeting the 
State's academic content and student achievement standards described 
under Sec.  200.1;
    (ii) Is capable of providing supplemental educational services that 
are consistent with the instructional program of the LEA and with the 
State academic content standards and State student achievement 
standards described under Sec.  200.1;
    (iii) Is financially sound; and
    (iv) In the case of--
    (A) A public school, has not been identified under Sec. Sec.  
200.32, 200.33, or 200.34; or
    (B) An LEA, has not been identified under Sec.  200.50(d) or (e).
    (2) In order for the SEA to include a provider on the State list, 
the provider must agree to--
    (i)(A) Provide parents of each student receiving supplemental 
educational services and the appropriate LEA with information on the 
progress of the student in increasing achievement; and
    (B) This information must be in an understandable and uniform 
format, including alternative formats upon request, and, to the extent 
practicable, in a language that the parents can understand;
    (ii) Ensure that the instruction the provider gives and the content 
the provider uses--
    (A) Are consistent with the instruction provided and the content 
used by the LEA and the SEA;
    (B) Are aligned with State student academic achievement standards; 
and
    (C) Are secular, neutral, and nonideological; and
    (iii) Meet all applicable Federal, State, and local health, safety, 
and civil rights laws.
    (3) As a condition of approval, a State may not require a provider 
to hire only staff who meet the requirements under Sec. Sec.  200.55 
and 200.56.


(Approved by the Office of Management and Budget under control 
number 1810-0581)


(Authority: 20 U.S.C. 6316(e))




Sec.  200.48  Funding for choice-related transportation and 
supplemental educational services.


    (a) Amounts required. (1) To pay for choice-related transportation 
and supplemental educational services required under section 1116 of 
the ESEA, an LEA may use--
    (i) Funds allocated under subpart A of this part;
    (ii) Funds, where allowable, from other Federal education programs; 
and
    (iii) State, local, or private resources.
    (2) Unless a lesser amount is needed, the LEA must spend an amount 
equal to 20 percent of its allocation under subpart A of this part to--
    (i) Provide, or pay for, transportation of students exercising a 
choice option under Sec.  200.44;
    (ii) Satisfy all requests for supplemental educational services 
under Sec.  200.45; or


[[Page 71727]]


    (iii) Pay for both paragraph (a)(2)(i) and (ii) of this section, 
except that--
    (A) The LEA must spend a minimum of an amount equal to 5 percent of 
its allocation under subpart A of this part on transportation under 
paragraph (a)(2)(i) of this section and an amount equal to 5 percent of 
its allocation under subpart A of this part for supplemental 
educational services under paragraph (a)(2)(ii) of this section, unless 
lesser amounts are needed to meet the requirements of Sec. Sec.  200.44 
and 200.45; and
    (B) The LEA may not include costs for administration or 
transportation incurred in providing supplemental educational services, 
or administrative costs associated with the provision of public school 
choice options under Sec.  200.44, in the amounts required under 
paragraph (a)(2) of this section.
    (3) If the amount specified in paragraph (a)(2) of this section is 
insufficient to pay all choice-related transportation costs, or to meet 
the demand for supplemental educational services, the LEA may make 
available any additional needed funds from Federal, State, or local 
sources.
    (4) To assist an LEA that does not have sufficient funds to make 
available supplemental educational services to all students requesting 
these services, an SEA may use funds that it reserves under part A of 
Title I and part A of Title V of the ESEA.
    (b) Cap on school-level reduction. (1) An LEA may not, in applying 
paragraph (a) of this section, reduce by more than 15 percent the total 
amount it makes available under subpart A of this part to a school it 
has identified for corrective action or restructuring.
    (c) Per-child funding for supplemental educational services. For 
each student receiving supplemental educational services under Sec.  
200.45, the LEA must make available the lesser of--
    (1) The amount of its allocation under subpart A of this part, 
divided by the number of students from families below