HOUSE OF REPRESENTATIVES	H.B. NO.	1925
TWENTY-EIGHTH LEGISLATURE, 2016
STATE OF HAWAII

A BILL FOR AN ACT

RELATING TO DEPARTMENT OF EDUCATION fUNDS.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  The legislature finds that departmental leadership in the State's public education system needs to be improved.  Over the years, the State has improved the public education system through creating a heat abatement program, implementing a new school performance system, conducting more rigorous teacher and principal evaluations, and employing a comprehensive student support system to reduce the achievement gap.  In 2004, the legislature passed Act 51, also known as the Reinventing Education Act, giving principals, teachers and school-based councils, which included parents, more authority over school operations.  The legislature finds that despite these efforts, the department of education failed to implement sufficient autonomy and flexibility at the school level.  Twelve years later, the top-down system remains.

     The legislature further finds that school principals attend to every detail of school operations, without enough institutional support or discretion to expend funds.  In a 2015 survey conducted by the Education Institute of Hawaii, ninety-one per cent of the one hundred forty-four principals who participated in the survey favored greater control over their school's fair share of system-wide resources, expressing that if they are not satisfied with the support services provided by the department of education, they should have the funds needed, and the ability, to seek comparable services from a different provider.

     The legislature further finds that public school principals will be empowered to act as the educational leaders of their schools with more authority and flexibility relating to budget and expending funds.  Also, with these expanded powers and roles, the department of education and the State can rightfully hold public school principals accountable for their schools' performance.

     The purpose of this Act is to improve flexibility for public school principals by increasing the cap on yearly carryover funds from five to ten per cent.  This Act will also transfer the authority to expend carryover funds from the department of education to the school principals, improving the financial efficiency and accountability of the public school system while clearly distinguishing the school principals' role from the department of education and the superintendent.

     SECTION 2.  Section 37-41.5, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

     "(a) [The] Public school principals through the department of education may retain up to [five] ten per cent of any appropriation, except for appropriations to fund financing agreements entered into in accordance with chapter 37D, at the close of a fiscal year and the funds retained shall not lapse until June 30 of the first fiscal year of the next fiscal biennium. [The department of education shall submit:]

(1) Public school principals shall submit a report to the superintendent of education thirty days after the close of each fiscal year, which shall be prepared in the form prescribed by the director of finance and shall identify the total amount of funds that will be carried over to the next fiscal year.

     [(1)] (2) [A] The department of education shall submit:

(A) A report to the director of finance ninety

                   days after the close of each fiscal year,

which shall be prepared in the form prescribed by the director of finance and shall identify the total amount of funds that will carry over to the next fiscal year; and

     [(2)]     (B)  A copy of this report to the legislature, as

                   well as a report identifying the carryover

                   of funds on a school-by-school basis, at

                   least twenty days prior to the convening of

                   the next regular session of the

                   legislature."

     SECTION 3.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 4.  This Act shall take effect on July 1, 2016.

INTRODUCED BY:	_____________________________
	_____________________________

Report Title:

Department of Education; Public School Principals; Carryover of Funds.

Description:

Improves flexibility for public school principals by increasing the cap on money that principals can carry over from year to year.

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.