1.1                          A bill for an act 
  1.2             relating to education; providing for a high 
  1.3             performance teacher reward pilot project; 
  1.4             appropriating money. 
  1.5   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.6      Section 1.  [HIGH PERFORMANCE TEACHER REWARD PILOT 
  1.7   PROJECT.] 
  1.8      Subdivision 1.  [PURPOSE.] A low-performing public school 
  1.9   with a high number of disadvantaged students may participate in 
  1.10  a five-year pilot project that authorizes the school to attract 
  1.11  and retain high-quality, experienced, and successful teachers by 
  1.12  providing teacher compensation that rewards and recognizes 
  1.13  exceptional teacher effort and success in helping students 
  1.14  achieve academic growth. 
  1.15     Subd. 2.  [ELIGIBLE SCHOOL.] (a) The commissioner of 
  1.16  education shall use school performance report cards developed 
  1.17  under Minnesota Statutes, section 120B.36, and the school's free 
  1.18  and reduced price lunch count as a percent of the fall 
  1.19  enrollment using the preceding October 1 enrollment data to 
  1.20  identify low-performing schools with a high number of 
  1.21  disadvantaged students.  This list of ranked schools must be 
  1.22  separated into the following geographic areas: 
  1.23     (1) Special School District No. 1, Minneapolis, Independent 
  1.24  School District No. 625, St. Paul, and charter schools within 
  1.25  the boundaries of the Minneapolis and St. Paul school districts; 
  2.1      (2) suburban Twin Cities school districts and charter 
  2.2   schools in all of the metropolitan counties listed in Minnesota 
  2.3   Statutes, section 473.121, subdivision 4; and 
  2.4      (3) school districts and charter schools in greater 
  2.5   Minnesota. 
  2.6   Schools shall apply for the pilot project on a form and in a 
  2.7   manner established by the commissioner. 
  2.8      (b) The commissioner must select one school from each of 
  2.9   the three geographic areas in paragraph (a) to participate in 
  2.10  the pilot project.  The commissioner must first consider the 
  2.11  lowest-ranked schools identified under paragraph (a) for 
  2.12  participation.  If no low-ranked schools apply to participate in 
  2.13  the pilot project, the commissioner may invite existing schools 
  2.14  to participate or sponsor or request an entity authorized under 
  2.15  Minnesota Statutes, section 124D.10, subdivision 3, to sponsor a 
  2.16  charter school to participate in the project. 
  2.17     Subd. 3.  [GOVERNANCE.] (a) The superintendent of the 
  2.18  school district of a school participant or the director of a 
  2.19  charter school, in consultation with the commissioner of 
  2.20  education, must select a school principal.  A group of teachers 
  2.21  may form a cooperative to assume the responsibilities of a 
  2.22  principal if approved by the superintendent in consultation with 
  2.23  the commissioner. 
  2.24     (b) The principal or teacher cooperative has the general 
  2.25  control and responsibility of the school and the broad authority 
  2.26  to establish the educational focus of the school. 
  2.27     (c) The principal or teacher cooperative, in consultation 
  2.28  with the school district, shall hire the school's licensed and 
  2.29  nonlicensed employees.  Criteria for hiring must include 
  2.30  evidence of teacher effectiveness in raising student academic 
  2.31  achievement as determined by the principal or teacher 
  2.32  cooperative and approved by the commissioner.  
  2.33     (d) The principal or teacher cooperative may hire a core 
  2.34  staff to assist in determining the curriculum, instructional 
  2.35  strategies, and length of school day and year for the school.  
  2.36  The school must provide instruction each year for at least the 
  3.1   number of days required by Minnesota Statutes, section 120A.41. 
  3.2      Subd. 4.  [EXEMPTION FROM STATUTES AND RULES.] (a) Except 
  3.3   as provided in this section, the school is exempt from all 
  3.4   statutes and rules applicable to a school, a school board, or a 
  3.5   district, although it may elect to comply with one or more 
  3.6   provisions of statutes or rules. 
  3.7      (b) The school is subject to and must comply with Minnesota 
  3.8   Statutes, chapter 363A and section 121A.04. 
  3.9      (c) The school is subject to and must comply with the Pupil 
  3.10  Fair Dismissal Act, Minnesota Statutes, sections 121A.40 to 
  3.11  121A.56, and the Minnesota Public School Fee Law, Minnesota 
  3.12  Statutes, sections 123B.34 to 123B.39. 
  3.13     (d) The school is subject to the same financial audits, 
  3.14  audit procedures, and audit requirements as a district.  Audits 
  3.15  must be conducted in compliance with generally accepted 
  3.16  governmental auditing standards, the Federal Single Audit Act, 
  3.17  if applicable, and Minnesota Statutes, section 6.65.  The school 
  3.18  is subject to and must comply with Minnesota Statutes, sections 
  3.19  15.054; 118A.01; 118A.02; 118A.03; 118A.04; 118A.05; 118A.06; 
  3.20  123B.52, subdivision 5; 471.38; 471.391; 471.392; 471.425; 
  3.21  471.87; 471.88, subdivisions 1, 2, 3, 4, 5, 6, 12, 13, and 15; 
  3.22  471.881; and 471.89.  The audit must comply with the 
  3.23  requirements of Minnesota Statutes, sections 123B.75 to 123B.83, 
  3.24  except to the extent deviations are necessary because of the 
  3.25  program at the school.  Deviations must be approved by the 
  3.26  commissioner.  The Department of Education, state auditor, or 
  3.27  legislative auditor may conduct financial, program, or 
  3.28  compliance audits.  
  3.29     (e) The school must comply with Minnesota Statutes, 
  3.30  sections 13.32; 120A.22, subdivision 7; 121A.75; and 260B.171, 
  3.31  subdivisions 3 and 5.  
  3.32     (f) The school is subject to the Pledge of Allegiance 
  3.33  requirement under Minnesota Statutes, section 121A.11, 
  3.34  subdivision 3. 
  3.35     Subd. 5.  [PUPILS WITH A DISABILITY.] The school must 
  3.36  comply with Minnesota Statutes, sections 125A.02, 125A.03 to 
  4.1   125A.24, and 125A.65, and rules relating to the education of 
  4.2   pupils with a disability as though it were a district.  
  4.3      Subd. 6.  [TRANSPORTATION.] Transportation for pupils must 
  4.4   be provided by the school district in which the school is 
  4.5   located.  
  4.6      Subd. 7.  [EMPLOYMENT AND OTHER OPERATING MATTERS.] The 
  4.7   school must employ or contract with necessary teachers, as 
  4.8   defined by Minnesota Statutes, section 122A.15, subdivision 1, 
  4.9   who hold valid licenses to perform the particular service for 
  4.10  which they are employed in the school.  The school may employ 
  4.11  necessary employees who are not required to hold teaching 
  4.12  licenses to perform duties other than teaching and may contract 
  4.13  for other services.  The school may discharge teachers and 
  4.14  nonlicensed employees.  The principal or teacher cooperative 
  4.15  also shall decide matters relating to the operation of the 
  4.16  school, including, among other matters, budgeting, curriculum, 
  4.17  teacher classroom assignment, teacher bonus pay, and operating 
  4.18  procedures.  
  4.19     Subd. 8.  [EMPLOYEES.] (a) Employees of the school remain 
  4.20  employees of the school district for salary, benefits, 
  4.21  seniority, retirement, and other personnel issues, except that, 
  4.22  notwithstanding any law or agreement to the contrary, the 
  4.23  principal or teacher cooperative, in consultation with the 
  4.24  school district, and aligned with the criteria described in 
  4.25  subdivision 3, determines who is hired or transferred within the 
  4.26  district into licensed and nonlicensed positions at the school 
  4.27  site. 
  4.28     (b) If employed at a school under this section, a teacher 
  4.29  will be granted a leave of absence.  Except as otherwise 
  4.30  provided in this subdivision, and except for Minnesota Statutes, 
  4.31  section 122A.46, subdivision 7, the leave is governed by 
  4.32  Minnesota Statutes, section 122A.46, including, but not limited 
  4.33  to, reinstatement, notice of intention to return, seniority, 
  4.34  salary, and insurance. 
  4.35     (c) During a leave, the teacher may continue to aggregate 
  4.36  benefits and credits in the Teachers' Retirement Association 
  5.1   account by paying both the employer and employee contributions 
  5.2   based upon the annual salary of the teacher for the last full 
  5.3   pay period before the leave began.  The retirement association 
  5.4   may impose reasonable requirements to efficiently administer 
  5.5   this paragraph. 
  5.6      (d) Teachers in a school under this section must be public 
  5.7   school teachers for the purposes of Minnesota Statutes, chapters 
  5.8   354 and 354A. 
  5.9      (e) Except for teachers under paragraph (d), employees in a 
  5.10  school under this section must be public employees for the 
  5.11  purposes of Minnesota Statutes, chapter 353. 
  5.12     Subd. 9.  [TEACHER PERFORMANCE; PERFORMANCE 
  5.13  PAY.] Notwithstanding any law to the contrary, the principal or 
  5.14  teacher cooperative, in consultation with and the approval of 
  5.15  the commissioner of education, shall determine performance 
  5.16  indicators used to measure teacher performance eligible for 
  5.17  performance payments, the amounts of the performance pay, and 
  5.18  the payment schedule.  Performance pay must be linked to student 
  5.19  academic achievement and performance indicators including, among 
  5.20  other indicators, multiple rigorous teacher evaluation and 
  5.21  student and school performance gains.  A teacher's annual salary 
  5.22  including performance pay may not exceed $100,000. 
  5.23     Subd. 10.  [REPORTS.] The commissioner of education shall 
  5.24  report annually by March 1 during the pilot project with a final 
  5.25  report due by January 1, 2011, to the house of representatives 
  5.26  and senate committees having jurisdiction over education on the 
  5.27  progress of the pilot project including, among other project 
  5.28  components, the growth of student academic achievement when 
  5.29  teachers are paid on the basis of performance and the 
  5.30  characteristics of highly effective teachers. 
  5.31     <b>[EFFECTIVE DATE.]</b> This section is effective July 1, 2004, 
  5.32  and applies to the 2005-2006 through 2009-2010 school years. 
  5.33     Sec. 2.  [APPROPRIATION.] 
  5.34     $....... is appropriated in fiscal year 2005 from the 
  5.35  general fund to the commissioner of education for the purposes 
  5.36  of section 1.