Repeals incentive and innovation grant trust fund under DOE; requires assistance from the DOE for selection and evaluation; requires any appropriation in budget Act for the incentive and innovation grant program to be under research and development; appropriates an unspecified amount in research and development costs for the grants. (SD1)

A BILL FOR AN ACT

SECTION 1. The legislature finds the department of education's incentive and innovation grants program was established by Act 364, Session Laws of Hawaii 1993, as part of a broad based effort to facilitate positive change in Hawaii's public schools. The purpose of this program was to empower schools by providing them with the tools needed to institute creative and innovative programs and to redirect resources towards those areas proven effective in improving student achievement.

The legislature further finds that in 1997 the auditor issued a follow up review of the incentive and innovation grant law and made a number of recommendations that could improve the program's successful implementation.

The purpose of this Act is to incorporate the auditor's recommendations into the current law.

SECTION 2. Section 302A-301, Hawaii Revised Statutes, is amended to read as follows:

"[[]§302A-301[]] Incentive and innovation grants. [(a) There is established in the state treasury a trust fund to be known as the incentive and innovation grant trust fund to provide incentive and innovation grants to qualified schools. Expenditures from the trust fund shall be made by the department and shall be subject to the allotment and expenditure plan required under section 37-34.5. Notwithstanding any other law to the contrary, tax deductible donations may be made to, and received by, this trust fund.

(b)] (a) Grants for the incentive and innovation program shall be for a three year period, with an option for renewal, and for such purposes as the funding of experimental and innovative instructional programs, in-service training, and other activities that promote innovation as outlined in the proposal. The department shall assist the grant award panel in defining "innovation" for purposes of grant selection with sufficient precision to provide guidance for grant applicants and with sufficient substance to reflect widely held understandings of innovation in the educational field.

[(c)] (b) The board shall establish and appoint the members of a grant award panel, which shall consist of at least one representative from each of the following groups:

The panel shall include a representative from each school district among its members.

The panel shall review proposals and make recommendations to the superintendent on grant awards. Panel members shall serve for a term of two years without compensation, but shall be entitled to reimbursement for necessary expenses while attending meetings and while in the discharge of their duties. [A portion of the moneys in the incentive and innovation grant trust fund, not to exceed one per cent, shall be used to offset the expenses incurred by the review panel.]

[(d)] (c) The panel shall develop a process for submitting proposals that is distinguished by its simplicity and minimization of paperwork.

[(e)] (d) All proposals for incentive and innovation grants shall include:

[(f)] (e) In the case of a renewal request, a school or schools shall demonstrate to the panel that the program is being conducted as described in the proposal, and shall submit a specific plan for establishing the program within the school or schools' biennium budget.

[(g)] (f) The panel shall assist the superintendent in the evaluation of all grant programs under this section [on a continuing basis]. The superintendent shall consult with programs that have received grants to establish what data shall be collected for evaluation purposes consistent with the evaluation plans set forth in the proposal submitted by the school or schools. Evaluations shall be conducted in the second year of a program and shall focus on the degree to which a program has improved student performance and is transferable to other schools.

If an approved program fails to meet the requirements of its proposal, the panel shall recommend to the superintendent that funding for the grant shall be terminated.

(g) If a program will be continued at the end of the grant, the department shall assist the school or schools to identify what, if any, other activities the program will replace. Following consultation, the department, as appropriate, shall identify programs for incorporation into a school's ongoing programs and budget, including replacement of an existing activity with the innovative approach.

(h) The superintendent shall submit [a] an annual report to the legislature on the operations of the review panel at least twenty days before the convening of each regular session[.], which shall include:

The superintendent shall share the annual report and any other information necessary with all schools."

SECTION 3. Any legislative appropriation, including the budget Act, for the incentive and innovation grant program of the department of education shall be considered as a research and development cost, as defined in section 37-62, Hawaii Revised Statutes, rather than as an operating and capital cost, pursuant to section 37-71, Hawaii Revised Statutes.

SECTION 4. There is appropriated out of the general revenues of the State of Hawaii the sum of $         , or so much thereof as may be necessary for fiscal year 2001-2002, for the research and development costs of the incentive and innovation grants.

SECTION 5. The sum appropriated shall be expended by the department of education for the purposes of this Act.

SECTION 6. This Act shall take effect on July 1, 2001.