Alabama	Arkansas	Delaware	Florida
Georgia	Kentucky	Louisiana	Maryland
Mississippi	North Carolina	Oklahoma	South Carolina
Tennessee	Texas	Virginia	West Virginia

Final legislative and budget actions

Alabama (http://www.legislature.state.al.us)

The governor called a special session last fall to address the revenue shortfall for 2001-2002. In order to prevent cuts to schools’ and colleges’ operating funds, the Legislature increased telephone taxes and closed corporate-tax loopholes that allowed some businesses to avoid paying their share of taxes.

The Educational Trust Fund budget that supports schools and colleges and universities will increase in 2002-2003 by 2.4 percent to $4.2 billion. Funding through the finance formula for elementary and secondary schools will increase by almost 2.5 percent to nearly $2.8 billion. State law ties teacher pay raises to revenue increases. Even though revenues are not expected to increase enough to require raises, the Legislature approved pay raises averaging 3 percent for 2002-2003. 

Funding for the state Department of Education — including support for programs that benefit schools and students — will increase by 5.7 percent to $81.8 million. Reductions were approved for several initiatives, including assistance to low-performing schools, alternative education and a dropout-prevention pilot program. Increased funding went to the Alabama Reading Initiative, which provides teacher training (up 10.6 percent to $12.5 million); programs for young children (up 18.7 percent to $5.9 million); and support for teachers who pursue certification through the National Board for Professional Teaching Standards (up 76.8 percent to more than $2.5 million).

Community colleges will operate with $226.4 million, an increase of 2.7 percent. Faculty pay raises will average 3 percent. Universities will receive $853.4 million — 2.9 percent more than in 2001-2002. University boards will determine faculty pay raises. Community college and university boards will set tuition increases.

Legislation (SB 21) expands the requirements for criminal history checks of personnel at public and private schools. The bill expands both the types of background checks required and the classes of employees who must be checked. The current requirements are that state background checks be conducted on newly hired, certified staff and on applicants for certification. The legislation would require these people — as well as any new or existing employee (certified or uncertified) who has unsupervised access to students — to undergo both state and national background checks. New applicants will pay the costs of the background checks. The Children First Trust Fund will pay for the criminal history checks of existing employees. The fund, which was created in 1998, is supported by revenues from the national settlement of the tobacco lawsuit and other sources.

Other legislation:

HB 410 appropriates $55 million from the Children First Trust Fund for criminal background checks of school employees (mentioned above), alternative schools, school safety, grant programs for at-risk children, children’s health issues and other educational programs. 

HB 465 transfers from the state Department of Education to the Department of Postsecondary Education the responsibility for adult education and for the program that licenses postsecondary private, for-profit schools.

Arkansas (http://www.arkleg.state.ar.us)

The General Assembly passed a general-revenue budget in 2001 for the 2001-2003 biennium. Based on revenue projections at that time, state spending was estimated at $3.4 billion in 2001-2002 and $3.5 billion in 2002-2003 — annual increases of about 4.3 percent and 4.5 percent, respectively. Budget reductions have lowered the 2001-2002 state budget by 5 percent ($171 million) to about $3.2 billion. In June 2002, the governor said that another $56 million (1.74 percent) had to be cut from the 2001-2002 budget; he called a special session and the legislature transferred funds to cover the shortfall. The estimate of general funds at that time for 2002-2003 reflected $225.7 million (6.4 percent) less than the amount forecast when the budget was adopted originally.

Elementary and secondary schools were expected to operate in the first year of the biennium with $1.6 billion, 5.6 percent more than in 2000-2001. Funding was expected to increase by another 5.9 percent to $1.7 billion in 2002-2003. The 2001-2002 reductions have resulted in a cut of 4.3 percent, bringing funding down to $1.5 billion. Schools stand to lose another $27 million (1.74 percent) in the latest cuts under consideration. Funding in 2002-2003 is expected to be nearly $1.6 billion, 5.6 percent less than the amount originally adopted.

The original budget allocated $543.1 million for colleges and universities in 2001-2002. This amount was an increase of 5.5 percent over the budget for 2000-2001. Funding for 2002-2003 was expected to be $561.1 million (up another 3.3 percent). Midyear budget cuts in 2001-2002 reduced the budget by 3.5 percent to $524.3 million. Reductions anticipated in 2002-2003 are expected to result in $521.7 million for the operation of colleges and universities, 7 percent less than was adopted originally.

Details of the originally adopted budget in Arkansas are in SREB’s Final Legislative Actions (October 2001), which is available online at www.sreb.org/main/LegAction/legactions/2001FinalLegAction.asp.

Delaware (http://www.state.de.us/delegis.htm)

The Legislature passed a general fund budget that will provide nearly $2.4 billion in 2002-2003 for state operations — 3.9 percent more than the original appropriation for 2001-2002. All agencies, including education agencies, were required to make midyear budget cuts of 2 percent in 2001-2002. Public education will receive $795 million in general funds, an increase of 2.8 percent over the original 2001-2002 budget. Teachers will receive pay raises of 2 percent, and those who are eligible also will receive longevity increases. The $407.1 million bond bill includes $116.6 million for school districts’ construction projects. Local districts will pick up more of the cost of programs for some exceptional students.

In 2002-2003, higher education will operate with $204.7 million — 1.1 percent more than the original appropriation for 2001-2002. Funding for Delaware State University will increase by 2.9 percent to $35.5 million. Funding for the University of Delaware ($111.5 million) and Delaware Technical and Community College ($57.7 million) each will increase by less than 1 percent. 

Tuition for in-state undergraduate students will increase by 6.2 percent at the University of Delaware, 8 percent at Delaware State and 4.5 percent at Delaware Tech. Faculty at Delaware Tech will receive pay raises of 2 percent. Delaware State and the University of Delaware will determine faculty pay raises; the budget provides funding for average increases of 2 percent.

Senate Bill 322 amends the student accountability law to require individual improvement plans for students who attend summer programs yet increase their performance only to “below the standard.” Without individual improvement plans, these students cannot be promoted to the next grade. Previously, students who performed “well below the standard” on the state testing program would not be promoted unless they attended summer school and demonstrated proficiency before the next school year began. 

Other legislation

HB 17 aims to increase the number of substitute teachers by allowing retired teachers to serve as substitutes without affecting their retirement benefits.

SB 369 amends the Professional Development and Educator Accountability Act of 2000 by delaying for one year (to 2004) pay supplements of between 2 percent and 6 percent for teachers who gain additional skills and knowledge.

Florida (http://www.leg.state.fl.us)

During a special session, the Legislature passed a state budget for 2002-2003 that reorganizes budgets to reflect the new governance structure for education (described below). The budget will provide $20.7 billion in general funds for state operations, an increase of 4.2 percent. 

The reorganization of education budgets makes it difficult to compare the funding for 2002-2003 with that of 2001-2002 for individual budgets. Education budgets will receive $10.4 billion in general funds, an increase of 7.4 percent. This total does not reflect increases in local tax support for K-12 schools. It also does not take into account the reduction in the employer contribution rate to retirement funds; schools and colleges can redirect to other priorities some of the funds pre-viously paid to the retirement system. Another part of the budget includes $31 million for 2.5 percent pay increases for university faculty; another $600,000 will support 2.5 percent pay raises for graduate assistants. 

Colleges and universities will receive additional revenue through tuition increases. Tuition for in-state undergraduates at universities will go up 5 percent, and university boards have the option to increase tuition by another 5 percent. Tuition for students at community colleges will increase 
by 3 percent.

When state and local funds are considered (local property taxes and general and other state funds), per-student funding at elementary and secondary schools will increase by 6 percent. Teacher pay raises will be determined through local collective-bargaining agreements.

Senate Bill 20-E revises the entire education code to bring it in line with the new education governance structure mandated by constitutional amendments in 1998. Legislation in 2000 (HB 2263) and 2001 (SB 1162) facilitated the reorganization. The new structure has a single board, the Florida Board of Education, to oversee all levels of education. The Board of Regents and the State Board of Community Colleges both were eliminated, and their duties were transferred to the Board of Education. Boards of trustees govern individual colleges and universities. The new Department of Education comprises divisions for elementary and secondary schools, community colleges, universities, and independent education. 

SB 20-E designates universities as public corporations rather than state agencies. University governing boards will establish programs for personnel and pay, make decisions based on local collective bargaining, hold titles to land, and set up procedures for making purchases and contracts. University employees will remain in the state health-insurance and retirement systems. 

Each community college now will submit a budget request to the Department of Education. Individual colleges’ budgets previously were not considered in preparing legislative budget requests; one budget was prepared for the entire community-college system. Community colleges also will have the authority to offer alternative tuition rates for out-of-state students who live in areas that border Florida.

Under the bill, each local school board will have the authority to develop alternative-certification programs for teachers and administrators, set salaries for its board members, and employ principals who are not certified educators if they later earn certification through an alternative route provided by the district. The bill creates an appeals commission to review charter-school appeals when local districts deny charters. The Florida Board of Education makes the final decision on appeals.

Other legislation:

HB 519, the Nursing Shortage Solution Act, authorizes the state Department of Health to make payments on the student loans of graduates from accredited nursing programs who work in certain public facilities. The bill creates a grant program that will support nursing education programs in middle and high schools if funds are appropriated annually. 

SB 1914 allows part-time students to be eligible for need-based Florida Public Student Assistance Grants.

Georgia (http://www.ganet.org/services/newleg)

The General Assembly amended the 2001-2002 budget and adopted a budget for 2002-2003. Most state agencies’ budgets were reduced by 2.5 percent in 2001-2002 and by 5 percent in 2002-2003. Funds then were added back for priorities and for debt payments associated with construction bonds designed to jump-start the economy. Neither the amended 2001-2002 nor the 2002-2003 budget cuts instructional programs for elementary and secondary schools. The amended 2001-2002 budget increases spending to $15.8 billion — 2.1 percent more than in the original budget. Lottery funds for scholarships, prekindergarten and technology will increase by 27.8 percent to $703 million. 

The 2002-2003 state budget totals $16.1 billion, an increase of 4.2 percent over the original 2001-2002 budget. Elementary and secondary schools will operate with $6 billion in state funds, an increase of 2.9 percent. Funds to schools through the finance formula will increase by 2.1 percent to $5.3 billion. The budget includes increases for charter schools ($8.8 million, up 22.1 percent), bonuses for teachers who achieve certification through the National Board for Professional Teaching Standards ($2.4 million, up from $560,000) and student testing ($14.3 million, up from $5.6 million). Teachers will receive pay raises of 3.25 percent.

Total funds for instruction at colleges and universities will increase, but state funding will decrease by 1.7 percent to $1.5 billion. The Board of Regents has approved tuition increases of 6 percent at research institutions and 4 percent at other two- and four-year colleges and universities. Required fees will increase by about 4 percent. Technical and adult education institutions will operate with $289.7 million, an increase of 4.5 percent. Faculty at postsecondary institutions will receive pay raises of 3.25 percent.

Funds from the lottery will provide $245.2 million (up 3.1 percent) for prekindergarten programs and $366.1 million (42.4 percent more than the original 2001-2002 allocation) for the various merit-based HOPE Scholarship programs. 

HB 210 allows retired teachers, under certain circumstances, to return to teaching while continuing to collect retirement benefits. Teachers who retired prior to January 2002, who retire with 30 years of service or who are at least 60 years old can return after one month of retirement to teach for up to five years in low-performing schools. Retired teachers cannot account for more than 1 percent of the full-time classroom teachers employed by a school system. Returning teachers will be paid according to qualifications and experience. They will not accrue additional service credit, and they will not contribute further to the retirement system. 

HB 1200 extensively revises the Charter Schools Act of 1998. The bill calls for the state Board of Education to develop policies to govern the contents of charter applications, deletes several specific requirements and sets timelines and procedures for addressing charter applications. It also specifies that conversion charter schools (existing schools that become charter schools) are to be treated as equals to other local schools with respect to funding. Start-up charter schools (schools that are charter schools from the beginning) are to receive their share of funds for instruction and administration and, when feasible, should receive funds for transportation, food service and building programs.

Other legislation:

SB 368 clarifies that the 10 percent bonuses for teachers who earn certification through the National Board for Professional Teaching Standards will be recalculated each year. The bill also requires the Office of Education Accountability to study how teachers with such certification affect student achievement. 

Several new committees will study the state testing program (SR 293), teacher retirement policies (SR 522), school bus safety (SR 612), health screenings for young children entering school (SR 677) and paraprofessionals’ duties and responsibilities (HR 1413). 

HR 789 encourages the Board of Regents to allow paraprofessionals who pursue teaching degrees to substitute past teaching experience for the mandatory student-teaching experience. 

HB 417 creates the Georgia Higher Education Savings Plan for people who wish to save for future college costs.

Kentucky (http://www.lrc.state.ky.us/)

The General Assembly did not adopt a budget for the 2002-2004 biennium during its session. The state currently is operating under a spending plan developed by the governor.

House Bill 74 will strengthen the state’s participation in the College Board’s Advanced Placement Program and will expand its availability to students. The bill establishes criteria that courses must meet to be designated as Advanced Placement courses, expands training for teachers and calls for the new Kentucky Virtual Advanced Placement Academy to offer a core Advanced Placement curriculum through the Kentucky Virtual High School. 

Beginning in 2002-2003, high schools will award credit toward graduation for any course a student successfully completes through the Kentucky Virtual High School. By 2003-2004, all secondary schools must offer advanced courses (such as Advanced Placement, International Baccalaureate and dual enrollment) through either on-site or online instruction. The Council on Postsecondary Education will require colleges and universities to award college credit for a score of 3 or higher on a College Board Advanced Placement exam.

House Bill 402 requires that teachers receive pay raises at least equal to the cost-of-living increase received by state employees, beginning in the 2004-2006 biennium. The bill allows districts to develop differentiated compensation programs. These programs would provide additional pay above the minimum salary schedule for any of the following purposes: to recruit and retain teachers in shortage areas; to recruit and retain highly skilled teachers for difficult assignments and hard-to-fill positions; to help reduce the number of emergency-certified teachers in the district; to provide career advancement for teachers; or to reward teachers for increasing their skills, knowledge and instructional leadership. The Department of Education will study these programs and will send to a legislative committee its assessment of whether a statewide program is feasible as well as its other ideas for modifying teacher compensation.

Other legislation:

SB 166 charges the Office of Education Accountability with reviewing personnel policies, particularly in districts where minorities account for at least 8 percent of students but fewer than 8 percent of teachers and administrators. 

SB 168 requires the Department of Education to provide each school with disaggregated data on its students’ performance and an analysis of the achievement gaps between groups of students (between male and female students, disabled and nondisabled students, students who are and are not economically disadvantaged, students with and without English proficiency, and minority and nonminority students). Each school council will review the data and revise the school’s comprehensive plan to address the gaps.

SB 192 permits one-year provisional certification for a teacher who has not successfully completed the required assessments if the employing district and teacher preparation program agree to assist the new teacher.

SB 289 creates the Nursing Workforce Foundation to increase the state’s supply of nurses. The foundation will solicit contributions from public and private sources to support awards to nursing education programs, nurses seeking advanced degrees, nursing employers and other groups.

HB 637 allows a person who works part time or as a substitute in a position traditionally included in the Teacher Retirement System to participate in the system. This bill also changes the law that allows retirees to return to work without losing retirement benefits. Retirees who return to work full time may earn no more than 75 percent of their salaries at the time they retired. Retirees currently are paid no less than a district’s salary schedule designates for teachers with 10 years of experience.

Louisiana (http://www.legis.state.la.us)

The Legislature took several tax actions to bolster revenues. It renewed temporary sales taxes on groceries and utilities and increased taxes on cigarettes by 12 cents per pack. The temporary sales tax on groceries and utilities, previously 4 cents, drops to 3.9 cents in 2002-2003 (when it will generate an estimated $450 million in revenue) and will drop to 3.8 cents in 2003-2004. In 2004-2005 it will drop to only 1 cent, which will be permanent. The Legislature also renewed but reduced an income-tax increase on people who itemize on their federal tax returns and suspended for two years a $25 income-tax credit for each school-aged child. 

Voters will decide in November on a plan that would eliminate state sales taxes (including the permanent 1 cent mentioned above) on groceries, utilities and medicines and would increase income taxes for wealthier taxpayers.

The state budget for 2002-2003 provides $6.6 billion in general funds (up 3.5 percent), $115.8 million from the lottery (16 percent more than in 2001-2002) and $135.5 million in revenue from the gaming industry (no change). Colleges and universities will receive nearly $1 billion, an increase of 2.8 percent. This amount includes $961.3 million in general funds (up 2.9 percent) and $38.7 million from gaming revenues. No funds were earmarked for faculty pay raises. Tuition for in-state undergraduates will increase by 3 percent. In 2001 management boards were authorized to increase tuition by up to 3 percent annually with approval from the Joint Legislative Committee on the Budget.

Elementary and secondary schools will receive nearly $2.7 billion, 2.3 percent more than in 2001-2002. This amount includes $96.8 million in gaming revenues and $115.8 million from the lottery. No funds were earmarked specifically for teacher pay raises, but SCR 139 of 2001 requires that, if no other pay raises are provided in fiscal years through 2004-2005, 50 percent of increases to the finance formula (after allocations for enrollment growth) must go toward pay raises for teachers and other certified staff. 

Senate Bill 33 amends Act 1146 of 2001 that established an early-childhood development program. The original law required every district (except the largest ones) that chose to provide a prekindergarten program for 4-year-olds to offer services — including before- and after-school child care (now called enrichment activities) — to all children in the district for a total of 10 hours per day. SB 33 renames the program LA4 and allows districts, with permission from the state Board of Education, to delay full implementation of the enrichment activities if the districts have specific plans to meet that requirement by the beginning of the third year of the programs. The bill also increases the number of districts that are not required to offer programs to all children in the districts.

Other legislation:

Studies will be conducted on the increasing cost of insurance and its impact on local districts’ budgets (SR 14); the feasibility of dividing large school districts into smaller units (SR 31); the feasibility of providing incentives to encourage students to attend Louisiana colleges and universities and pursue careers in which there are critical shortages of personnel (SCR 30); and the possibility of a wireless-classroom pilot program that would provide laptop computers to students and teachers (SCR 35).

HB 21 allows parents or guardians to request that their 16-year-old children (previously 17) be allowed to attend alternative or vocational/technical education programs. 

SB 19 addresses the START college-savings program. The bill expands the types of expenses for which funds from these accounts may be used. Acceptable expenses now will include tuition and required fees for undergraduate and graduate students, tuition and fees for nonresidents with START accounts who are attending Louisiana colleges and universities, room and board, and other similar fees and charges. (Previously, only in-state undergraduate tuition and required fees were eligible expenses.)

Maryland (http://mlis.state.md.us)

In 2001-2002, the governor ordered a hiring freeze, 1.5 percent cuts to agency budgets and the reduction of $65 million from funds for construction projects. The General Assembly passed a state budget that provides an estimated $10.4 billion in general funds for operations in 2002-2003, about 3.7 percent more than in the adjusted 2001-2002 budget. Cash for building projects will decrease by 86.5 percent to $49.6 billion. Some legislation that affects the budget has not been incorporated into the overall budget figures.

The General Assembly took several actions to balance the budget and raise spending for public schools. These actions included increasing cigarette taxes (from 66 cents to $1 per pack), scaling back funding for construction and information technology projects, limiting general-fund spending for public and independent institutions of higher education, using reserve funds, and ensuring that changes in federal income-tax laws do not affect state income-tax revenues. The budget includes the final step in the five-year, 10 percent income-tax cut. 

Senate Bill 856, the Bridge to Excellence in Public Schools Act, was based on the recommendations of a study commission created two years ago. The bill revises the way the state finances public schools and includes the cigarette-tax increase that is estimated to raise about $100 million in 2002-2003. Of that amount, $83.1 million will go to schools; the rest will go to the general fund. The bill plans to increase state funding to schools by $1.3 billion over six years (through 2007-2008) in addition to increases already required by law.

Between 2003-2004 and 2007-2008, 27 programs that provide state aid to schools will be eliminated. Funding previously distributed through these programs — as well as the increased funding mentioned above — will be distributed to school districts based on student enrollment and local wealth. These funds will provide districts with more flexibility to achieve state performance standards. The bill also requires school districts to provide full-day kindergarten for all children and free prekindergarten for 4-year-olds from low-income families by 2007-2008.

The law creates a gap between the spending plan and anticipated revenues beginning in 2004-2005; the bill requires the General Assembly to affirm by joint resolution in the 2004 session that the funding increase is within the state’s resources. If no resolution is passed, funding will increase only by about 5 percent in each fiscal year through 2007-2008. Another bill (HB 1) creates a commission to study Maryland’s budget, tax structure and revenues. In December 2002, the commission will recommend to the General Assembly ways to pay for the state’s future needs, including the school finance plan.

Direct aid for elementary and secondary schools (including general and special state funds) will increase by 8 percent to $3.1 billion in 2002-2003. The budget continues to fund 1 percent pay raises for teachers in districts that approve increases of 4 percent. The $83.1 million from the cigarette-tax increase includes $62.7 million for school districts’ priorities; $4.8 million for the new Maryland Infant and Toddler Program, which will serve young children who have developmental delays (SB 419; HB 371); and $1.1 million for adult education and literacy services. Another $10 million supports restructuring the administration of the Prince George’s district to facilitate improvements in student achievement. HB 949 replaces the elected school board with one jointly appointed by the governor and county executive officer. This change is similar to the change made in the Baltimore City school system in 1997.

General funds for higher education operations will increase by 2.4 percent to $1.2 billion. Tuition is estimated to increase by 5.5 percent for in-state undergraduates. No funds were earmarked for faculty pay raises. Four-year colleges and universities will operate with $945.9 million, an increase of 1.5 percent. Most of these funds ($876.4 million, an increase of 1.4 percent) support the University System of Maryland. Direct aid to community colleges will reach nearly $188.9 million, an increase of about 5.8 percent. State support is provided through a formula that had allocated to two-year colleges 25 percent of the per-student funding at four-year colleges and universities. However, this percentage will decline to about 23 percent in 2002-2003. The General Assembly plans gradually to increase the percentage until it reaches 25 percent again in 2005-2006. 

Other legislation:

HB 7 establishes the Principal Training Pilot Program. A school, a group of schools, a local board or a group of local boards can apply for a grant by submitting to the state Board of Education a plan for a program to train principals. 

HB 15 requires that, to be eligible for a $1,000 signing bonus, a teacher education graduate hired to teach must graduate with a grade-point average equivalent to a 3.5 on a 4.0 scale. New teachers also have to meet the previous two requirements: They have to be in the top 10 percent of their graduating class and have to remain in the classroom for three years.

HB 661/SB 453 creates the College Readiness for Disadvantaged and Capable Students Act to help ninth- and 10th-graders prepare for college.

HB 1172/SB 734 expands eligibility for the Maryland Teacher Scholarship Program to teaching assistants who have worked in the public schools for at least two years.

HB 1197 authorizes the state superintendent of education to develop online courses and services, develop standards for these courses and services, and review courses to ensure that they are aligned with Maryland’s curriculum standards. 

Mississippi (http://billstatus.ls.state.ms.us)

The 2001-2002 state budget was reduced by about 5 percent because of the economic downturn. The Legislature adopted a general-fund budget for 2002-2003 that will provide $3.5 billion for state operations — about 1.4 percent less than the original 2001-2002 budget and about 3.7 percent more than the reduced budget.

Midyear budget cuts to elementary and secondary schools in 2001-2002 were restored with money from a reserve fund. The 2002-2003 budget provides nearly $1.8 billion in funding for elementary and secondary schools, an increase of 6.1 percent. This amount includes $187 million from the Education Enhancement Fund (from earmarked sales taxes), $57 million in one-time funds (from accelerated tax collections and other sources) and $20 million that normally would be used for building renovations. Schools will receive through the finance formula nearly $1.5 billion, an increase of 7.2 percent. Most of the increase supports teacher pay raises averaging 6 percent — the second step in a multiyear effort to raise the average salary for teachers to the Southeastern average.

Midyear budget cuts to community colleges in 2001-2002 resulted in a 5 percent reduction in general funds (the reduction was 4.6 percent overall when Education Enhancement Funds were included). General funds for community colleges will decrease by another 3.1 percent to $112.3 million in 2002-2003. When all state funds are considered, community colleges will operate with $151 million, 1.5 percent less than the reduced 2001-2002 budget. Faculty will receive 2 percent pay raises in January 2003.

The budget for four-year colleges and universities (including general funds, Education Enhancement Funds and funds to address the settlement of a desegregation lawsuit) were reduced by 4.8 percent during 2001-2002. The budget adopted for 2002-2003 reduces spending by another 0.8 percent to $558.8 million. (The appropriation is 5.6 percent lower than the original 2001-2002 appropriation.) This amount includes $48.2 million in one-time funds and $42.6 million from the Education Enhancement Fund. Funds through the formula for the general operation of colleges and universities will remain nearly the same as in the reduced 2001-2002 budget ($314.7 million). Faculty will receive 2 percent pay raises beginning in January 2003. Tuition for in-state undergraduates will increase by 8 percent.

Senate Bill 2370 establishes the Teach Mississippi Institute, a pilot alternative-certification program for career-changers who are interested in teaching. The program requires candidates (who must have bachelor’s degrees and passing scores on the PRAXIS examinations) to complete a training program during the summer and then to complete a one-semester teaching internship. When participants complete the program, they are eligible for one-year provisional certification and will participate in another internship. Near the end of the year, school districts will submit evaluations of the teachers to the Department of Education. If a district recommends licensure, the applicant will receive a renewable standard license.

Two bills address financial accountability. House Bill 492 creates a task force to examine the financial practices of the state Department of Education and of school districts. The task force will focus on improving the management of school districts and their use of resources and on identifying cost savings. House Bill 1069 requires audits of school districts to determine whether they comply with legal requirements for the distribution and use of funds for classroom supplies. 

Other legislation:

SB 2626 clarifies that community colleges can administer the General Educational Development (GED) Testing Program. The State Board of Community and Junior Colleges can set fees for scoring the test and for issuing transcripts and diplomas. 

HB 1612 requires the State Board of Community and Junior Colleges to hire a consultant to study the funding formula for state community colleges and to report the findings to the Legislature in December 2002.

SCR 522 places a proposed constitutional amendment before voters in November 2003. If passed, the amendment will change the structure of the 12-member Board of Trustees of State Institutions of Higher Learning. As positions become vacant, trustees will be appointed from each of the three Mississippi Supreme Court districts until there are four members from each district. Trustees will serve nine-year (rather than 12-year) terms. 

North Carolina (http://www.ncga.state.nc.us)

The General Assembly amended the second year of the 2001-2003 biennial budget that was adopted in 2001. The original 2002-2003 budget provided nearly $14.8 billion for state operations, 3.3 percent more than in 2001-2002. Education budgets received $8.5 billion, about 1.2 percent more than in 2001-2002.

The General Assembly’s amendments reduce the 2002-2003 budget by 3.1 percent ($432.8 million) to $14.3 billion. The budget retains at the state level $333 million that in prior years went to local governments. Local governments may increase sales taxes by one-half cent to help make up for the revenue lost. The amended budget reduces allocations to individual state agencies, but an additional block of reductions has not yet been charged to individual agencies’ budgets. These reductions appear in a separate section of the budget and will be assigned to the various state agencies as appropriate.

The largest portion of the reduction not yet assigned comes from the elimination of the state contribution to the retirement system for state employees and teachers ($144.5 million). This funding is being eliminated because of gains in the system’s value. The amendments also will save $25 million by implementing the recommendations of the Governor’s Efficiency Commission, make $41.5 million in general reductions, retain $36.7 million by adjusting debt payments to reflect more accurately the payments required, and save $61 million by refinancing debt. The budget provides most employees with an additional 10 days of paid leave in lieu of pay raises. Teachers and principals are not eligible for the leave days but will receive longevity-based pay raises averaging about 1.8 percent.

The amended budget provides nearly $5.9 billion for the operation of elementary and secondary schools, 0.5 percent less than the original allocation for 2002-2003. In addition, $51.9 million in another part of the budget provides the longevity-based pay raises mentioned above. The budget funds 1,056 additional instructional positions to accommodate enrollment growth and class-size reductions and deletes funding for 585 administrative and noninstructional positions. 

New spending estimates made some budget reductions possible. For example, funding for salaries was reduced because actual salaries paid to certified personnel were less than originally anticipated and because of adjustments in projected salary needs. Each local school district will determine how to absorb its share of a $42.6 million general reduction. In addition, $44.5 million in general funds is replaced by tax funds that normally are used for building projects. The amended budget adds $101 million for bonuses to certified staff in schools that meet or exceed expectations for improved performance. It also adds funding to expand the state’s preschool program for at-risk 4-year-olds.

Two-year colleges will operate with $669.3 million, 4.1 percent more than the original appropriation for 2002-2003. The budget reduces funding for 12 administrative positions at the system office and for professional development. The State Board of Community Colleges will decide how to make $5 million in general reductions. An increase of $51.8 million will support enrollment growth. Tuition for in-state students increased by 10.5 percent.

The $1.8 billion for universities is 1.7 percent less than the original 2002-2003 budget. Increases support systemwide enrollment growth ($66.8 million) and specific enrollment increases at seven campuses ($13.7 million). A $50.2 million reduction will result in 2.9 percent cuts to universities, which will determine where to make the reductions. Some general funds used for financial aid programs were replaced with fund balances from other state accounts. Tuition for in-state undergraduates increased by 8 percent.

Senate Bill 1443 will facilitate job-sharing by K-12 teachers who want to work part time. Classroom teachers who share a single teaching position and each work half time will be eligible for a prorated share of leave and benefits, including health insurance and retirement funds. The Legislative Research Commission will study benefits for state and education employees in part-time and job-sharing positions.

Senate Bill 1275 calls for the State Board of Education to plan ways to improve the collection of dropout data. The same bill encourages local school boards to require superintendents to assign more experienced teachers with positive evaluations to teach core academic courses in the middle grades. Another section directs the State Board of Education to take control of a school when the school and the local board do not take steps to improve student performance as recommended by a school improvement team.

Other legislation:

SB 98 authorizes the Joint Legislative Education Oversight Committee to study the recruitment and retention of teachers and local flexibility for school systems. The bill also creates a legislative commission to study issues related to the Teachers’ and State Employees’ Retirement System.

SB 911 directs the State Board of Education to adopt guidelines for local boards to use in developing care plans for students with diabetes. 

The budget bill (SB 1115) requires the Joint Legislative Education Oversight Committee to study the state testing program and to determine which tests comply with federal assessment and accountability provisions, with state accountability laws and with a court ruling regarding the state’s school-finance system. The bill also calls for the State Board of Education and other entities to review teacher preparation programs and the teacher certification process. The State Board of Community Colleges will offer some programs regionally to reduce program duplication by colleges that are near one another. An outside consultant will study the organization and structure of the Community College System.

Oklahoma (http://www.lsb.state.ok.us)

The legislative session focused on the economy and the state budget, which had a shortfall of 8.9 percent — the greatest budget deficit since the late 1980s. Legislators cut the budget by 3.9 percent to satisfy restrictions in the state constitution, which allows the state to appropriate only 95 percent of anticipated revenues. State agencies, including education agencies, were required to reduce spending to balance the budget. In 2001-2002, April’s allocation was cut by 6.6 percent, and the allocations for May and June each were reduced by 16.8 percent. 

The Legislature appropriated $5.5 billion for 2002-2003 — 0.5 percent more than the original budget for 2001-2002. This amount included $170.3 million in funds from a reserve account, and most state agencies were required to reduce their ongoing budgets by 5 percent. Education budgets were reduced by less than 1.6 percent for 2002-2003.

Funding for elementary and secondary schools increased slightly. Schools will operate with more than $2 million, an increase of 0.3 percent. This increase is because of additional funding for employee benefits provided in HB 1968. The bill calls for the budget to pay for 75 percent (up from 50 percent) of teachers’ health insurance in 2002-2003 and 100 percent of their coverage in 2003-2004. No funding was earmarked for teacher pay raises.

General funds for colleges and universities will decline by 1.1 percent to $851 million. Tuition for in-state undergraduates will increase by 7 percent at most colleges and universities. The Legislature in 2001 (SB 596) authorized the state regents to raise tuition over the next five years by as much as 7 percent annually for in-state undergraduate and graduate students. Increases can be higher for out-of-state students and those in professional schools, such as law and medicine. Funding for career and technical colleges will decline by 0.5 percent to $131.2 million. Colleges and universities will determine pay raises for faculty.

Legislation will help school districts through economic difficulties by granting them some budget flexibility. SB 1003 allows the state Board of Education to waive penalties for districts that violate class-size limits because of economic hardship. HB 2231 enables districts to increase the amount of unused funding that they may carry over from one fiscal year to the next.

Other legislation

SB 992, the School Bullying Prevention Act, requires local school boards’ discipline policies to prohibit bullying. The state Board of Education will distribute a list of programs that aim to prevent bullying.

HB 2738 allows students who graduate from high schools that are not accredited by the state Board of Education to qualify for financial aid through the Oklahoma Higher Learning Access program if they meet the other eligibility requirements.

HB 2886 allows certain “contextual” math and science courses to count toward high school graduation requirements. Contextual courses are defined as those that utilize “real-world problems and projects in a way that helps students understand the application of that knowledge.”

South Carolina (http://www.state.sc.us/legislature.html)

The Legislature adopted a budget for 2002-2003 that provides $5.4 billion in general funds for state operations — 2.1 percent less than the budget originally adopted for 2001-2002. The state budget, including funding for education, was reduced by 6.5 percent in 2001-2002. 

The Legislature passed Senate Bill 496, which establishes a commission to oversee the operation of the new lottery. Legislators also budgeted $259 million (including $80 million in one-time funds) from the lottery for student financial-aid programs ($94.3 million), endowed chairs ($30 million), technology for colleges and universities ($21.7 million), kindergarten through fifth-grade academic programs ($32.9 million), education accountability ($23.9 million) and school bus purchases ($29 million). 

Elementary and secondary schools will operate with nearly $2 billion in general funds, an increase of less than 1 percent over the original 2001-2002 appropriation. The Legislature began with an ongoing base budget of nearly $1.9 billion, which included a 4 percent reduction and deleted one-time funds. The Legislature made additional reductions and increases: a general reduction of $59 million; other reductions to specific programs; and additions of $24 million for the finance formula, $20.8 million for bonuses for teachers who earn certification through the National Board for Professional Teaching Standards, $7 million for education accountability initiatives and $5 million for school bus operations and maintenance. These additions and reductions resulted in a net reduction of $4.8 million in recurring funds. The Legislature then added $67.4 million (from one-time general funds and other sources) to the finance formula and $7 million in one-time funds for school readiness. In addition, $543.3 million in earmarked sales-tax funds (slightly less than in the original 2001-2002 budget) will support education improvement efforts. 

The budget does not include general pay raises for teachers. However, bonuses for teachers with certification through the National Board for Professional Teaching Standards and for teacher specialists who work in low-performing schools are expected to raise South Carolina’s average salary for teachers to $300 more than the estimated Southeastern average. 

The $853.4 million in general funds for higher education is 4.6 percent less than the original appropriation for 2001-2002. The 2001-2002 appropriation later was cut by 6.5 percent. The ongoing base budget for colleges and universities of $606.5 million (including a 4 percent reduction and the deletion of one-time funds) was reduced by 4.3 percent to $580.4 million. Technical institutes will operate with $173.9 million — 5.4 percent less than the ongoing base budget. New funds of $33.9 million (including $11.5 million in one-time funds) will help support scholarship programs.

Tuition for in-state undergraduate students will increase by an average of 18.2 percent at research universities, 15.1 percent at four-year colleges and universities, 27.8 percent at community colleges and 21.9 percent at technical colleges. Undergraduates at the Medical University of South Carolina will pay 7 percent more. 

Senate Bill 12 amends the charter-school law that was ruled unconstitutional in 2000. The new law allows a charter school’s demographics to differ from that of the surrounding district by up to 20 percent (previously 10 percent) and allows more variation under certain circumstances. The bill creates the Charter School Advisory Committee to review applications for charters and to ensure that they comply with the new law. The bill also requires all charter-school teachers in core aca-demic subjects to be certified or to have degrees in the subjects they teach.

House Bill 4879, the Budget Proviso Codification Act, creates a review board and an endowment to support university research. The endowment will receive annual appropriations from the lottery. The amount may not exceed $200 million by 2010. The board will review universities’ applications for endowment funds to create research centers of excellence. The same bill calls for the state Board of Education to study the benefits of establishing one date on which all schools statewide would begin the school year. 

Other legislation

SB 834 requires the state Department of Education to help low-performing schools implement mentoring programs to improve student achievement.

HB 4663 gives school districts some spending flexibility in 2002-2003. Districts may transfer up to 20 percent of their allocations among programs that receive funding from the same source.

Tennessee (http://www.legislature.state.tn.us)

For the second straight year, discussions about tax reform dominated the session. After discussing several plans, including the creation of a personal income tax, the Legislature raised $900 million in new revenues by increasing several taxes: the state sales tax (up one percentage point to 7 percent, now one of the nation’s highest rates; groceries are exempt from this tax increase); business taxes; taxes on alcohol and tobacco; and license fees for professionals such as certified public accountants and medical doctors.

The state budget provides $7.9 billion in general funds for 2002-2003, an increase of 3.5 percent. State agencies were required to return a total of $97 million in funds — about 1.3 percent of the state budget — because of revenue shortfalls. K-12 education returned $15 million (0.6 percent of its budget); higher education returned $12 million (1.1 percent of its budget). 

Elementary and secondary schools will operate in 2002-2003 with $2.7 billion — 2.6 percent more than in 2001-2002. The formula for school operations was fully funded. State funding for the Governor’s Reading Program was eliminated ($70 million), but $19.9 million in federal funding still is available for the program.

Higher education budgets will increase by 3.9 percent to nearly $1.2 billion. Funding through the formula for colleges, universities and technology centers will reach $810.6 million, an increase of 2.2 percent. Need-based financial aid will increase by 17 percent. Tuition for in-state undergra-duate students is expected to increase by 7.5 percent. Higher education faculty and K-12 teachers will receive 2 percent pay raises in January 2003.

Public Chapter 850 (HB 1131/SB 887) authorizes the creation of charter schools. Local boards of education will review applications for charters and can approve charters for new schools or for existing schools that wish to convert. The legislation allows three types of charters: those that provide alternatives for students in schools that fail to make adequate yearly progress in the state’s accountability system (limited to the number of low-performing schools in the state); those that serve special-education students; and those that will serve primarily at-risk students and that are created through partnerships with teacher education programs at public colleges or universities (limited to nine charters).

Public Chapter 875 (SB 2919/HB 2789) calls for the gradual implementation of performance-based budgeting for Tennessee state government. The commissioner of finance and administration will develop a schedule to include all agencies in the process by 2011-2012. Each agency annually will develop a strategic plan, performance measures and standards. The commissioner of finance and administration will evaluate each agency’s compliance with its plan and its performance and will report the findings to the governor and Legislature. The commissioner also may recommend rewards and sanctions for inclusion in the appropriations bill.

Other legislation:

Public Chapter 738 (HB 2897/SB 2944) deletes the requirement that students take an exit examination in order to graduate from high school. Students still will have the opportunity to take an exit examination, and the results will be shared with the Legislative Oversight Committee on Education.

Public Chapter 860 (HB 3159/SB 3086) revises procedures to place schools on probation and to review schools that are on probation for failing to meet performance standards or the regulations of the state Board of Education.

Public Chapter 770 (SB 2632/HB 2295) requires local districts to adopt policies regarding the employment of substitute teachers.

Texas (http://www.capitol.state.tx.us)

The Legislature adopted a state budget for the 2002-2003 biennium during its 2001 session that increased general funds by 9.1 percent to $61.7 billion. Education budgets increased by 4.7 percent to $36.4 billion. The 2002-2003 biennial budget for elementary and secondary education is $26 billion in general funds — 2 percent more than in the 2000-2001 biennium. General funds for higher education total $10.4 billion for the 2002-2003 biennium — 12 percent more than in the 2000-2001 biennium. 

Details of the originally adopted budget in Texas are in SREB’s Final Legislative Actions (October 2001), which is available online at www.sreb.org/main/LegAction/legactions/2001FinalLegAction.asp.

Virginia (http://leg1.state.va.us)

The General Assembly adjusted the budget for the second year of the 2000-2002 biennium and adopted a biennial budget for 2002-2004. Legislators took several actions to close the estimated revenue shortfalls of $1.4 billion in 2001-2002 and $2.4 billion in the 2002-2004 biennium. These actions included budget cuts, fee increases, transfers to the general fund from other funds, use of reserve funds, use of trust fund balances to pay for some general-fund expenditures, and reductions to retirement contribution rates. In House Bill 29, the General Assembly reduced by 3 percent the state general-fund budget for the second year of the 2000-2002 biennium — from $12.4 billion to a little more than $12 billion. Direct aid to elementary and secondary schools was not cut. 

For the 2002-2004 biennium, most state agencies’ budgets were reduced by 7 percent in the first year of the biennium and by 8 percent in the second year before increased funds for priority initiatives were added back in. The $24.7 billion general-fund budget for the biennium is nearly the same as the 2000-2002 biennial budget that was trimmed in HB 29 because of the revenue shortfall. Total funds from all sources for the biennium will increase by 1.2 percent to $50.9 billion. This amount includes $785 million in revenues from fee increases, transfers to the general fund from other state funds, and other adjustments.

The budget bill for the 2002-2004 biennium provides an overall increase in aid for elementary and secondary schools. General funds for the biennium will increase by 0.5 percent to nearly $8 billion. New spending of $513.1 million in the general fund is offset partly by $483.3 million in reductions. Increases in funds from other state sources ($190.1 million) and the federal government ($60.9 million) will raise nongeneral funds by 23.5 percent to $1.3 billion. These amounts will bring the total appropriation for schools to nearly $9.3 billion, an increase of 3.2 percent.

No funds were included in 2002-2003 for teacher pay raises. Teachers will receive raises averaging 2.75 percent in 2003-2004 if revenues meet or exceed estimates. The budget postpones for one year (from spring 2003 to spring 2004) the Web-based state testing program adopted in 2000. The budget includes full funding in both years of the biennium for bonuses for teachers with certification through the National Board for Professional Teaching Standards. 

The $2.9 billion in general funds for higher education in the 2002-2004 biennium is 6.2 percent lower than the adjusted budget for the 2000-2002 biennium. Most colleges and universities are raising tuition and some required fees for in-state undergraduates by 9 percent to make up part of the reduction. Other fees are likely to increase significantly. The budget provides additional funding for need-based financial aid to ease the effect of the tuition increase on low-income students. Colleges and universities also are encouraged to use a portion of the new tuition revenue for financial aid. Another area of the budget includes funds to support 2.5 percent bonuses for faculty in 2002-2003. Faculty will receive pay raises of 2.75 percent in the second year of the biennium if revenues meet or exceed estimates. 

House Bill 1137 amends the conditions under which a retired teacher can return to teaching while continuing to receive retirement benefits. The bill requires a teacher to be retired for at least 30 days before returning to work. (Though no previous law outlined a separation period, state policy requires a 12-month separation period.) The bill also specifies that these teachers will serve under one-year contracts. 

House Bill 335 establishes the Advisory Council on Career and Technical Education. The advisory council will consult with work-force training programs and other agencies and institutions to facilitate the coordination of career and technical education in the public schools. It also will recommend policies and funding and will promote public-private partnerships. Senate Bill 477 authorizes the state Board of Education to accept industry certification and state licensure examinations in the place of state assessments in awarding credit for career and technical education courses.

Other legislation

HB 159 requires the state Department of Education to maintain a Web site on which elementary and secondary educators can recommend improvements to state standards and assessments. 

HB 498/SB 295 defines “school resource officer” and “school security officer” and calls for requirements to govern the employment, training and certification of school security officers.

HB 734 clarifies that colleges and universities may apply to establish charter schools. The state Board of Education now will include in its annual report the governor and General Assembly the number of charters denied. SB 625 also addresses colleges’ and universities’ eligibility to apply for charters. It requires all local school boards to accept and review charter applications and to include charter-school enrollment in membership counts upon which state and local funding are based.

HB 1136 sets staffing requirements for guidance counselors in elementary schools. 

HB 1277 directs the state Board of Education to require students who plan to earn a standard high school diploma to complete at least two sequential electives that will provide a foundation for further education, training or preparation for employment.

West Virginia (http://www.legis.state.wv.us)

The Legislature adopted a 2002-2003 budget that increases state general funds by 4.8 percent to $2.9 billion. Elementary and secondary schools will receive more than $1.5 billion, an increase of 5.1 percent. Funding to schools through the finance formula will increase by 5.4 percent to nearly $1.5 billion.

Much of the increase will support teacher pay raises averaging $1,465 per year — likely one of the region’s largest increases for 2002-2003. Funds from the lottery will provide $36.8 million for various efforts, including $16.1 million (down slightly) for classroom computers, $5.1 million (up 42.2 percent) for the student assessment program and $300,000 each (no change) for reading and math programs for students in kindergarten through fourth grade who are not performing at grade level. In addition, $18 million (no change) will pay debt on bonds issued by the School Building Authority.

General funds for higher education in 2002-2003 will remain nearly the same at $377.1 million. The budget includes $4.3 million to reduce budget cuts to institutions from 3 percent to about 1.5 percent and $4.5 million to help colleges and universities remain competitive with peer institutions in the South. The $41.4 million allocated from the lottery includes $18 million (no change) for need-based financial aid to full-time students and $3 million (up 50 percent) for need-based aid to part-time students. In addition to the $41.4 million allocation, lottery funds of $10 million (up from $5.5 million) will support merit-based PROMISE Scholarships. College and university boards will determine pay raises for faculty.

Institutional boards determine tuition increases. Four of 12 two-year colleges will not increase tuition for in-state students. Increases at the other two-year colleges will range from 2.7 percent to 8.3 percent, with a median of about 5.4 percent. Tuition increases for in-state undergraduates at four-year colleges and universities will range from 7.5 percent to 9.9 percent. The median increase will be 9.2 percent.

Legislation (SB 247) requires each county board of education to establish a voluntary early-education program for 4-year-olds before the 2012-2013 school year. Each school district is expected to submit an annual implementation plan to the Department of Health and Human Services and the state Board of Education, beginning in 2003-2004. Each district must coordinate its plans with existing programs, such as Head Start and private child-care providers, and those existing programs can be counted toward fulfilling the requirements of the legislation. The bill also requires local districts to provide K-12 students with at least 180 instructional days, provides teachers with pay raises and calls for a study of the student-to-teacher ratios in the elementary and middle grades.

HB 4319 calls for a standards-based system to hold schools accountable for students’ academic performance and improvement. It creates the Council to Monitor Student Performance — which comprises members of the Legislative Oversight Commission on Education Accountability, the governor and the chancellor of the Higher Education Policy Commission — to track students’ academic performance and progress. The bill clarifies the role of the Office of Education Performance Audits, which was created in 1998 legislation to provide independent reviews of schools and school districts. The office will focus on student performance so as not to duplicate other state agencies’ reviews. The bill also clarifies the Regional Education Service Agencies’ role of assisting low-performing schools and providing high-quality professional development.

Other legislation:

SB 217 requires higher education institutions to develop rules regarding credit card solicitation on campuses.

SB 423 allows retired teachers to teach up to 120 days per year while collecting retirement benefits. This bill clarifies that those who teach for only half a day may not be charged for a full day toward the limit.

HB 4362 requires college and university governing boards to develop policies to award credit toward graduation to college students who tutor or mentor students in public schools. 

HB 4534 establishes the West Virginia Financial Aid Council to recommend strategies for coordinating various sources of student financial aid.

HB 4579 allows retired public school teachers to work full time or part time for colleges or universities without losing their retirement benefits.

Contact Gale F. Gaines for additional information. Christine Smith, an SREB research assistant, contributed to this report.