Report Title:

Public School Teachers; Shortage

Description:

Implements various programs and amendments to encourage teacher retention and recruitment. Appropriates funds. (SD2)

HOUSE OF REPRESENTATIVES

H.B. NO.

844

TWENTY-THIRD LEGISLATURE, 2005

H.D. 1

STATE OF HAWAII

S.D. 2


 

A BILL FOR AN ACT

 

relating to education.

 

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

PART I. PURPOSE

SECTION 1. Hawaii depends on teachers to produce the intellectual capital that is the foundation of the State's future. Virtually everyone will agree that effective teaching is of high importance in the development of a successful educational system. Although the State values its teachers there is much more that can be done to:

(1) Recruit teachers aggressively;

(2) Compensate teachers in accordance with their value;

(3) Support teachers to further develop their craft; and

(4) Create vehicles for them to share their expertise.

Due to the State's teacher shortage, these are not issues that can wait. New federal mandates such as the No Child Left Behind Act require the states to achieve certain goals and maintain them. Without proper staffing with quality instructors and a means to attract such personnel, the State will certainly fall behind in meeting the national standards.

It is not only regular education classrooms that suffer from a shortage of teachers. Alternative learning environments such as the comprehensive school alienation program do as well. Students eligible for such programs often require additional personal attention from their instructors. If they do not receive it or cannot be placed in such specialized programs due to a lack of alternative education teachers, it can exacerbate the impact of the teacher shortage on the classroom management and academic achievement of regular education classrooms.

The structure of the portions of the Act that follows reflects, in rough chronological order, the development of a career in teaching. Part II creates a special fund and appropriates funding to support the promising teacher cadet program. Originally an initiative of the department of education, this program has since developed into a separate, 501(c)(3) nonprofit organization. It works with all of the major Hawaii-based teacher training programs and attempts to identify and support prospective teachers while they are still in their high school years.

Part III appropriates funding to support the establishment of a two-year associate of arts in teaching program at leeward community college.

Part IV includes various measures to support the students and faculty in the University of Hawaii college of education, including the funding of additional faculty positions and the establishment of an educator loan forgiveness program.

Part V deals with issues relevant to new hires, such as job offers, pay, and orientation procedures, as well as establishes a state teacher induction program to mentor new teachers.

Part VI aims at facilitating the licensure of employees entering the system by expanding the means by which people may become licensed, thus increasing the pool of highly qualified teachers. This would include licensure by means of professional experience, college degrees in relevant fields, or providing reciprocity for out-of-state licensure and national board certification. Various incentives to encourage in-service teachers to seek national board certification are also included in this part.

Part VII seeks to support the ongoing professional development of in-service teachers, a critical component of teacher quality and job satisfaction.

Part VIII offers various tax incentives designed to recruit and retain teachers.

Part IX deals with a variety of issues relative to the practical realities of a teaching career such as housing, as well as recognition and support of advanced teaching practice through master teacher programs.

PART II. TEACHER CADET PROGRAM

SECTION 2. Chapter 302A, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§302A-   Hawaii teacher cadet program fund. (a) There is established the Hawaii teacher cadet program fund as a separate fund of Hawaii Alliance for Future Teachers, a Hawaii nonprofit organization. Moneys received from the state, county, or federal government, private contributions of cash or other property, and the income and capital gains earned by the fund shall constitute its assets.

(b) Hawaii Alliance for Future Teachers shall expend moneys from the fund in the form of either grants to organizations or contracts with private vendors to provide programs for students who possess a high level of academic achievement and the personality traits found in good teachers to consider teaching as a career in accordance with this section.

(c) The fund may receive contributions, grants, endowments, or gifts in cash or otherwise from all sources, including corporations or other businesses, foundations, government, individuals, and other interested parties. The legislature intends that public and private sectors review and investigate all potential funding sources. The State may appropriate moneys to the fund.

(d) Hawaii Alliance for Future Teachers shall appoint the members of the Hawaii teacher cadet program advisory board, which shall be responsible for:

(1) Soliciting and otherwise raising funds for the fund;

(2) Establishing criteria for the expenditure of funds;

(3) Reviewing grant proposals using criteria established by Hawaii Alliance for Future Teachers; and

(4) Making recommendations for grants and other specific expenditures.

Members of the advisory board shall be stakeholders in Hawaii's public educational system, including students, parents, alumni, principals, community and business leaders, and representatives from the department of education and the department of accounting and general services, who shall be represented on the advisory board.

(e) In managing the moneys in the fund, Hawaii Alliance for Future Teachers shall exercise ordinary business care and prudence given the facts and circumstances prevailing at the time of action or decision. In doing so, Hawaii Alliance for Future Teachers shall consider its long- and short-term needs in carrying out its purposes, its present and anticipated financial requirements, expected total return on its investments, price trends, and general economic conditions.

(f) There may be an endowment component of the fund, and Hawaii Alliance for Future Teachers may accumulate net income and add the same to the principal.

(g) The use of any state moneys may be restricted by the legislation appropriating these moneys to the fund.

(h) Hawaii Alliance for Future Teachers may expend principal from the fund for the purposes of the fund.

(i) Any organization submitting a proposal to Hawaii Alliance for Future Teachers for moneys shall meet the following standards at the time of application:

(1) Be a for-profit organization duly registered under the laws of the State, or be a nonprofit organization determined by the Internal Revenue Service to be exempt from the federal income tax, or be an agency of the State or a county;

(2) In the case of a nonprofit organization, have a governing board whose members have no material conflict of interest and serve without compensation;

(3) In the case of an applicant that is not a state or county government agency, have bylaws or policies that describe the manner in which business is conducted and policies that relate to the management of a potential situation involving a conflict of interest;

(4) Have experience with the project or in the program area for which the proposal is being made; and

(5) Be licensed and accredited, as applicable, in accordance with the requirements of federal, state, and county governments.

(j) All proposals submitted to Hawaii Alliance for Future Teachers for moneys shall be approved by the department for consistency in meeting standards for public schools.

(k) Organizations or agencies to which moneys are awarded shall agree to comply with the following conditions before receiving the award:

(1) Use persons qualified to engage in the activity to be funded;

(2) Comply with the applicable federal, state, and county laws; and

(3) Comply with any other requirements prescribed by Hawaii Alliance for Future Teachers to ensure adherence by the recipient of the award with applicable federal, state, and county laws and with the purposes of this section.

(l) Chapter 103D shall not apply to organizations or agencies that apply for grants or contracts under this section; provided that Hawaii Alliance for Future Teachers shall be held accountable for the use of the funds under a contract with the department.

(m) Any contract awarded by Hawaii Alliance for Future Teachers shall be made with as much competition as is practical to execute its purposes.

(n) The fund shall be audited annually by an independent auditor. The results of each annual audit shall be submitted to the department not later than thirty days from the date Hawaii Alliance for Future Teachers receives the audit results. In addition, Hawaii Alliance for Future Teachers shall retain for a period of three years and permit the department, state legislators, and the auditor, or their duly authorized representatives, to inspect and have access to any documents, papers, books, records and other evidence that is pertinent to the fund.

(o) The fund shall not be placed in the state treasury, and the State shall not administer the fund, nor shall the State be liable for the operation or solvency of the fund or Hawaii Alliance for Future Teachers.

(p) For every dollar of state moneys granted by the fund to the project, there shall be a minimum of $1 in value matched by Hawaii Alliance for Future Teachers from private, federal, county, or community service.

(q) The superintendent of education shall submit an annual report of the progress of the Hawaii teacher cadet program fund no later than twenty days prior to the convening of each regular session of the legislature."

SECTION 3. 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 2005-2006, and the same sum, or so much thereof as may be necessary for fiscal year 2006-2007, to assist in the expansion of the teacher cadet program to include an additional six public schools in the program.

The sums appropriated shall be expended by the department of education for the purposes of this part.

PART III. UNIVERSITY OF HAWAII LEEWARD COMMUNITY COLLEGE

ASSOCIATE OF ARTS IN TEACHING

SECTION 4. The vast majority of traditional teacher training programs require participation in a four or five year program. Although this is a laudable means of developing an adequate pool of quality pre-service teachers, the legislature finds that this should not preclude other initiatives to develop capacity, including shorter term programs. These efforts could include the associate of arts in teaching that leeward community college is attempting to establish.

SECTION 5. 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 2005-2006, and the same sum, or so much thereof as may be necessary for fiscal year 2006-2007, to increase the capacity of teacher students at the University of Hawaii leeward community college by hiring eight full time equivalent (8.00 FTE) teacher education faculty positions to establish the associate of arts in teaching program.

The sums appropriated shall be expended by the University of Hawaii for the purposes of this part.

PART IV. UNIVERSITY OF HAWAII

SECTION 6. Currently, entering freshman students interested in a career in education at the University of Hawaii are not allowed to declare a major in education until fulfilling numerous requirements that can delay acceptance for over a year. On average, it would take a student at least five and a half years to complete a degree in education. This is unacceptable considering the State's teacher shortage.

The purpose of this part is to:

(1) Require the University of Hawaii to review its admission policies for the college of education; and

(2) Appropriate funds for faculty positions at the University of Hawaii.

SECTION 7. The University of Hawaii shall review its college of education's admission standards and consider allowing

incoming freshman to declare education as their major and enable them to graduate within four years.

SECTION 8. To further strengthen teacher preparation and to build the University of Hawaii school of education's capacity to meet the demand for more teachers to teach in Hawaii's public schools, the University of Hawaii shall increase the full time equivalent teacher education faculty positions by five additional full time equivalent positions each year until fiscal year 2014-2015 to allow the number of participants who complete the program to increase by one hundred per cent over the year 2004 total, so long as recruitment to the college warrants the need for additional facilities.

SECTION 9. 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 2005-2006, and the same sum, or so much thereof as may be necessary for fiscal year 2006-2007, to increase the capacity of teacher students at the University of Hawaii by hiring five full time equivalent (5.00 FTE) teacher education faculty positions by June 30, 2006, and an additional five FTE positions by June 30, 2007.

The sums appropriated shall be expended by the University of Hawaii for the purposes of this part.

SECTION 10. To strengthen teacher preparation and reduce the financial hardships faced by potential school of education student teachers, the University of Hawaii shall include in its budget requests the amount of $250,000 per fiscal year for the Hawaii educator loan forgiveness program. The University of Hawaii shall continue to request the amount until such time as the department of education determines that the program is no longer needed as an incentive to recruit student teachers.

SECTION 11. 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 2005-2006, for the educator loan forgiveness program.

The sum appropriated shall be expended by the department of education for the purposes of this part.

PART V. NEW TEACHER HIRES

SECTION 12. The difficulties that face newly hired teachers discourage many people from entering the profession and often lead to new teachers to quit shortly after they are hired. For instance, the legislature finds it unacceptable that it takes the department of education six to eight weeks to provide new employees and interdepartmental transfers with their first paycheck. The bottom line is that the private sector by and large pays its employees in a timely manner and the public sector should not be allowed to aim for a lower standard, especially when the technological and procedural capabilities to mitigate this problem are so clearly present and so easily applicable. Employees deserve to be paid for the work they do, especially new teachers, who have so much to adapt to and prepare for without having to deal with the added stress of tardy paychecks.

Another aid in the retention of new teachers is the new personnel orientation handbook recently developed by the department. The handbook is used as a tool to assist new employees to adapt to the operations of the department. Moreover, retention of personnel is partly influenced by how quickly an employee becomes familiar with an organization's system. The legislature finds that it would be beneficial to include a new teacher section in the handbook to give the newcomers a good first impression of how the department operates and cares for its personnel as well as serve as a reference guide.

The purpose of this part is to:

(1) Require schools to finalize teacher hiring before the end of the preceding fiscal year;

(2) Ensure that new hires of the department of education are paid in a timely manner and allow payments of partial wages to mitigate the financial hardships created by delayed paychecks;

(3) Provide all newly hired teachers with a teacher handbook; and

(4) Establish the statewide teacher induction program.

SECTION 13. Chapter 302A, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§302A-   Teacher hiring. Beginning with the 2006-2007 school year, principals shall finalize the hiring of all teachers for the school year no later than the end of the preceding fiscal year; provided that this section shall not apply to teachers hired due to retirement, resignation, or other unforeseen causes."

SECTION 14. Chapter 302A, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§302A-   Newly hired employees; paycheck deficits; partial wages. (a) The department shall establish and implement appropriate policies, procedures, technology, and accountability measures to ensure that newly hired employees receive timely and accurate wages.

(b) All newly hired employees shall receive their first paycheck no later than the second pay period after the date of their hire by the department.

(c) If the department is unable to pay the total wages due a newly hired employee pursuant to subsection (b), the department may pay the newly hired employee on the day the newly hired employee would have received pay, partial wages in an amount not less than fifty per cent of the amount due for the second pay period and for each consecutive pay period thereafter in which the department maintains a paycheck deficit with the newly hired employee. The amounts received shall be deducted from the total wages due for the respective pay period. Once the department resolves the paycheck deficit, the newly hired employee shall no longer receive partial wages as provided by this subsection."

SECTION 15. By December 31, 2005, the department shall adopt rules pursuant to chapter 91, Hawaii Revised Statutes, as may be necessary to administer section 14.

SECTION 16. The department of education shall provide each newly hired teacher with the new teacher orientation handbook to assist in their transition into the department's school system. The handbook shall serve as a reference guide and to provide the new employees with information on the following:

(1) Professional development and incentive programs;

(2) License requirements; and

(3) Other useful information to assist new teachers with their familiarity of the department's organization and educational system.

SECTION 17. 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 2005-2006, for equipment, supplies, and transportation for the department of education.

The sum appropriated shall be expended by the department of education for the purposes of this part.

SECTION 18. The department of education shall establish and maintain a standardized statewide teacher induction program that is available to every newly hired teacher. The program shall ensure that the new teacher to mentor ratio is no greater than fifteen to one and that all mentors are specially skilled and trained to work effectively with newly hired teachers as determined by the department.

SECTION 19. 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 2005-2006, and the same sum, or so much thereof as may be necessary for fiscal year 2006-2007, to establish and maintain a statewide teacher induction program that is available to every newly hired teacher.

The sums appropriated shall be expended by the department of education for the purposes of this part.

PART VI. CERTIFICATION, LICENSURE, AND RECIPROCITY

SECTION 20. (a) The legislature finds that there is no shortage of qualified people who want to become teachers in Hawaii's public schools. However, existing licensing requirements act as barriers to becoming a public school teacher. While the legislature supports high standards for teachers, those standards can be met while still expanding the types of qualifications that lead to licensure. Under the existing standards, people with higher education degrees are found to be not qualified to teach in Hawaii public schools if they do not hold a degree from a college of education. In addition, those with professional experience equivalent to a college degree are likewise currently deemed unqualified to become a teacher. Furthermore, teachers who taught on the mainland, come to Hawaii, and seek to continue teaching receive limited credit for their practical prior experience, even if they are national board certified. Also, no credit is given for time taught in private schools or at the university level.

The legislature further finds that there exists a tremendous amount of expertise in the professional world that could be utilized to relieve the teacher shortage in public schools. Although this could entail a professional becoming a full-time licensed teacher or full-time emergency hire, it could also entail a professional teaching in a part-time capacity on an as-needed basis. The legislature further finds that the department has had limited success in creating the kinds of public-private partnerships and outreach efforts that would enable them to tap this source of exceptional teachers.

Attracting the best people into teaching means reaching out not only to people at the start of their career but also to those with experience in other occupations and professions. More should be done to simplify the process for these people to become teachers.

In its 2004 report to the governor, the Hawaii workforce development council recommended as a priority action to "solve teacher shortages by honoring the credentials of people qualified in subject areas; e.g. hire professionals with degrees in a subject if they want to become full-time teachers; employers release employees to teach part-time."

Additionally, reciprocity with other states' teacher licensure programs and national board certification will minimize the bureaucratic difficulties that often cause many teachers to decide against teaching here, to quit after they are hired but before they actually begin teaching, or to resign within a year or so out of frustration. Furthermore, in light of initiatives launched in other jurisdictions, Hawaii may need to reevaluate the PRAXIS exam as a testing instrument for teacher licensure.

(b) The legislature finds that Hawaii can significantly reduce the teacher "shortage" by:

(1) Eliminating the unnecessary barriers to choosing a career in teaching;

(2) Putting more of the increased federal moneys from the No Child Left Behind Act into supporting teachers; and

(3) Preparing those who enter the field from another profession.

(c) The purpose of this part is to:

(1) Allow the department of education to license individuals who have a college degree; adequate professional experience that is appropriate to the subject area or program that they will teach in the department of education, be that garnered in private schools in Hawaii, public schools outside of the state, colleges or universities, or in settings that are not necessarily specifically educational in nature; national board certification; or a valid, current teaching license from certain specified states;

(2) Require the Hawaii teacher standards board to clearly state specific requirements needed for Hawaii certification for out-of-state licensed teachers;

(3) Provide an alternative licensing requirement to replace the PRAXIS exam;

(4) Conduct a study of the Hawaii teacher standards board's various policies for licensing;

(5) Authorize the Hawaii teacher standards board to convert nine positions from temporary to permanent and appropriate funds for these positions; and

(6) Appropriate funds for the positions with the Hawaii state teachers standards board.

SECTION 21. Section 302A-802, Hawaii Revised Statutes, is amended to read as follows:

"§302A-802 Licensing standards. (a) The board and department shall establish licensing standards that govern teacher licensing in Hawaii. Licensing standards established by the board and department shall be adopted as rules under chapter 91 unless otherwise specified in this subpart.

(b) In the development of its standards, the board and department shall consider the existing teacher applicant pool that is available in the State and the level of the qualification of these applicants, as well as the nature and availability of existing preservice higher education teacher training programs. [The board shall also consider alternative routes to licensing, such as national teacher examinations that certify competency in subject areas or programs taught in the public schools.] The board shall also clearly state, using a means easily accessed and format easily interpreted by the general public, precisely which specific requirements a licensed teacher from out of state needs, on a state-by-state basis, to complete to be a licensed teacher in Hawaii.

(c) The department may license any pre-service or in-service teacher who has:

(1) Completed a department-approved training program; and

(2) A college degree from an accredited college or university in a subject that is appropriate to the subject area or program that they will teach in the department, as determined by the department; or

(3) Adequate professional experience that is appropriate to the subject area or program that they will teach in the department, as determined by the department; or

(4) National board certification, irrespective of the state in which this certification may have been earned; or

(5) A valid, current teaching license from California, Colorado, Illinois, Michigan, New Jersey, New York, Oregon, Pennsylvania, or Washington;

provided that after five years an individual licensed under this subsection shall be subject to the license renewal provisions of section 302A-805 except the need to pass any testing instrument or instruments that may otherwise be required by the Hawaii teachers standards board under this section; provided further that such individual's performance has been deemed satisfactory by the school principal or designee. The department may pay teachers licensed under this subsection a salary that is commensurate with their professional experience and competitive with the private sector. The board, in consultation with the department, shall develop performance-based standards based on the licensing criteria of this subsection and utilize them for the licensing of teachers."

SECTION 22. The Hawaii teacher standards board shall review alternative licensing requirements to replace the PRAXIS examination requirement. The review of alternative requirements shall include but not be limited to the consideration of requiring a minimum amount of years of teaching experience to replace the PRAXIS examination requirement.

SECTION 23. (a) The Hawaii teacher standards board shall conduct a study to review the following:

(1) Teacher tests used in other key states to determine which tests are comparable to those used in Hawaii and the equivalent passing scores, ranked in order from highest to lowest, as determined by the board;

(2) Licensing requirements for out-of-state applicants seeking to be a licensed teacher in Hawaii;

(3) The role of prior learning or professional experience in partially meeting licensing requirements;

(4) License reciprocity with other states including the use of national board certification for licensing teachers;

(5) Use of performance-based standards for licensing and relicensing;

(6) Determining the extent to which current PRAXIS passing scores prevent applicants from becoming licensed;

(7) Valid and reliable alternative ways for assessing applicant performance of the Hawaii teacher standards board; and

(8) Development of a tiered licensing system in which provisional licenses are issued for a short term with expectation that an applicant meet all licensing requirements within a specified period of time before a full license is issued.

(b) The Hawaii teacher standards board shall submit a report of its findings and recommendations to the legislature not later than twenty days before the convening of the regular session of 2006.

SECTION 24. 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 2005-2006, for a comparability study of teacher tests used in other key states.

The sum appropriated shall be expended by the Hawaii teacher standards board for the purposes of this part.

SECTION 25. In order to ensure that the Hawaii teacher standards board is able to recruit and maintain a stable staff to process licenses in a timely manner, the legislature authorizes the conversion of its nine temporary positions to nine permanent full-time equivalent positions.

SECTION 26. 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 2005-2006, for the continued funding of positions that fulfill functions assigned to the board.

The sum appropriated shall be expended by the Hawaii teacher standards board for the purposes of this part.

PART VII. PROFESSIONAL DEVELOPMENT AND TEACHER RETENTION

SECTION 27. In order to adequately teach our children as they prepare for life in the twenty-first century, Hawaii’s public school teachers must keep up with emerging trends and be on the cutting edge of new knowledge and teaching techniques. To effectively meet these challenges, teachers must be encouraged to grow and develop professionally.

The purpose of this part is to:

(1) Create a teacher incentive program to reimburse fees spent on tuition, textbook, and other costs for teachers to pursue professional coursework from an accredited college;

(2) Appropriate funds for the professional development program; and

(3) Enact measures related to promoting teacher retention.

SECTION 28. Chapter 302A, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§302A-   Educational incentive program; tuition. There is established an educational incentive program in the form of reimbursement of fees paid for tuition, textbooks, and other related costs, which are approved by the department, by Hawaii resident public school teachers who pursue professional development coursework at the University of Hawaii system or an accredited college or university approved by the department of education. The department of education shall adopt rules in accordance with chapter 91 necessary for the implementation of this section."

SECTION 29. (a) The department of education shall allocate funds to professional development schools by means of competitive grants for up to five years subject to the availability of resources. A grant application shall include a description of how the professional development school will meet the professional development school standards of the National Council for the Accreditation of Teacher Education and the department's six images of success:

(1) Standards-based learning;

(2) Professionalism and the capacity of the system;

(3) Quality of student support;

(4) Coordinated team work;

(5) Responsiveness of the system; and

(6) Focused and sustained action.

(b) Not more than five per cent of the funds appropriated for the establishment and continued development of professional development schools shall be set aside for program administration, including an annual professional development school conference.

(c) Grants may be awarded for up to five years and may be renewable. Professional development schools shall present annual reports to the department and shall present findings at the annual professional development schools conference.

(d) The department of education shall ensure that by January 1, 2010, there shall be professional development school partnerships established in each school district with adequate funding.

SECTION 30. 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 2005-2006, and the same sum, or so much thereof as may be necessary for fiscal year 2006-2007, for the establishment and continued development of professional development schools in Hawaii public schools.

The sums appropriated shall be expended by the department of education for the purposes of this part.

SECTION 31. Encouraging and rewarding teaching knowledge and skill is key to acknowledging that teachers are valued and supported. For this reason, the legislature supports the maintenance of a professional development program that adheres to the staff development standards of the National Staff Development Council. The legislature further supports the funding of a professional development program that is based on a $1,000 compensation per teacher every two years.

SECTION 32. 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 2005-2006, for a professional development program that adheres to the staff development standards of the National Staff Development Council.

The sum appropriated shall be expended by the department of education for the purposes of this part.

SECTION 33. 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 2005-2006, for the reimbursement of tuition, textbooks, and other related costs approved by the department of education to Hawaii public school teachers who pursue professional development coursework.

The sum appropriated shall be expended by the department of education for the purposes of this part.

SECTION 34. The department, in partnership with the Hawaii state teachers association and representatives of the business community, shall prepare a package of incentives that responds to data gathered to identify the needs expressed recently by teachers in various surveys and studies. The incentives shall include financial commitments from the business community wherever possible.

SECTION 35. 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 2005-2006, and the same sum, or so much thereof as may be necessary for fiscal year 2006-2007, to strengthen the financial incentives currently available to the department of education to recruit teachers.

The sums appropriated shall be expended by the department of education for the purposes of this part.

SECTION 36. To address the teacher retention issue and its impact on the teacher shortage, the legislature also supports the development of an action plan that seeks to improve teacher compensation over the next ten years.

SECTION 37. The department of education shall prepare an action plan with the assistance of the Hawaii state teachers association. The action plan shall include recommendations on the following:

(1) How to achieve a salary of $100,000 for teachers;

(2) Incremental improvements to be made to teacher compensation over the ten-year period to fiscal year 2014-2015; and

(3) Improved teacher working conditions.

SECTION 38. 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 2005-2006, and the same sum or so much thereof as may be necessary for fiscal year 2006-2007, to develop an action plan for teacher retention.

The sums appropriated shall be expended by the department of education for the purposes of this part.

PART VIII. TAX INCENTIVES

SECTION 39. Everything must be done to make teaching a career chosen by the best and brightest individuals. Special incentives are needed to attract and retain those interested in an educational career. Providing tax incentives is an innovative route to raise awareness of the teaching profession.

Furthermore, the legislature finds that there is a pressing need to provide housing assistance for the recruitment and retention of teachers in hard-to-staff public schools, as determined by the department of education.

The purpose of this part is to provide a tax credit for the following:

(1) Public school teachers, depending upon their years of service;

(2) Developers who lease state-owned lands to build housing for lease or rental for teachers employed in hard-to-staff public schools;

(3) Landlords who provide housing for teachers employed in hard-to-staff public schools; and

(4) Provide a tax deduction for classroom supply expenses.

SECTION 40. Chapter 235, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§235-   Public school teacher tax credit. (a) There shall be allowed to each individual taxpayer who is a public school teacher and who is not claimed or is not otherwise eligible to be claimed as a dependent by another taxpayer for federal or Hawaii state individual income tax purposes, a public school teacher tax credit. The tax credit shall be deductible from the taxpayer's net income tax liability imposed by this chapter for the taxable year in which the tax credit is properly claimed.

(b) The tax credit shall only apply to public school teachers who were employed for the entire school year in which the tax credit is claimed. The amount of the tax credit shall be $250. As used in this section, "teacher" means those employees who:

(1) Are regulated or licensed under chapter 302A; and

(2) Spend not less than seventy per cent of their formal employment time in the direct classroom instruction of students.

(c) To qualify for the income tax credit, the taxpayer shall be in compliance with all applicable federal, state, and county laws, as well as department of education rules and internal regulations.

(d) If the tax credit under this section exceeds the taxpayer's net income tax liability under this chapter, any excess of the tax credit may be used as a credit against the taxpayer's income tax liability in subsequent taxable years until exhausted.

(e) Every claim, including amended claims, for the tax credit under this section shall be filed on or before the end of the twelfth month following the close of the taxable year for which the tax credit may be claimed. Failure to meet the filing requirements of this subsection shall constitute a waiver of the right to claim the tax credit.

(f) The director of taxation shall prepare such forms as may be necessary to claim a tax credit under this section, may require proof of the claim for the tax credit, and may adopt rules pursuant to chapter 91 to effectuate the purposes of this section. Specifically, the department of education shall certify to the department of taxation as to which public school teachers qualify for the tax credit allowed under this section.

(g) The department of taxation shall report to the legislature annually, no later than twenty days prior to the convening of every regular session, on the number of taxpayers claiming the tax credit and the total cost of the tax credit to the State during the past year."

SECTION 41. Chapter 235, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§235-   Teacher housing; developer tax credit program. (a) There is established in the department a teacher housing developer tax credit program which shall provide a tax credit for developers who lease state-owned lands to build housing for lease or rental to teachers employed in hard-to-staff public schools.

(b) As used in this section, "hard-to-staff public schools" includes any school or area determined to be hard-to-staff by the department of education; provided that:

(1) The department of education shall reevaluate and revise such a determination periodically to maintain a current listing of hard-to-staff public schools; and

(2) Any removal of a school from the hard-to-staff list shall not affect the tax credit until the next calendar year.

(c) Teacher housing shall be eligible for the teacher housing tax credit program if it is:

(1) Located in the state senatorial district of the hard-to-staff public school; provided that on Oahu teacher housing shall also be eligible if it is located in the state senatorial district adjacent to that of the hard-to-staff public school; and

(2) Built upon state-owned land and leased to a developer for a term and price to be determined by the department of land and natural resources.

(d) Each individual or corporate resident taxpayer that files an individual or corporate net income tax return for a taxable year may claim a tax credit under this section against the Hawaii state individual or corporate net income tax. The tax credit may be claimed for the cumulative difference, during any taxable year after June 30, 2005, between the fair market rental or lease rate for the relevant state senatorial district, as determined by the department, and the actual rental or lease rate charged by the landlord to teachers employed in hard-to-staff public schools.

(e) The director of taxation shall prepare any forms that may be necessary to claim a tax credit under this section. The director may also require the taxpayer to furnish reasonable information, including but not limited to an appraisal estimated by a licensed appraiser, to ascertain the validity of the claim for credit made under this section and may adopt rules necessary to effectuate the purposes of this section pursuant to chapter 91. The department of education shall certify to the department of taxation as to which state senatorial districts qualify for the tax credit allowed under this section."

SECTION 42. Chapter 235, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§235-   Teacher housing; tax credit program. (a) There is established in the department a teacher housing tax credit program which shall provide a tax credit for landlords renting or leasing housing to teachers employed in hard-to-staff public schools.

(b) As used in this section, "hard-to-staff public schools" includes any school or area determined to be hard-to-staff by the department of education; provided that the department of education shall reevaluate and revise such a determination periodically to maintain a current listing of hard-to-staff public schools; and provided further that any removal of a school from the hard-to-staff list shall not affect the tax credit until the next calendar year.

(c) Teacher housing shall be eligible for the teacher housing tax credit program if it is located in the state senatorial district of the hard-to-staff public school; provided that on Oahu teacher housing shall also be eligible if it is located in the state senatorial district adjacent to that of the hard-to-staff public school.

(d) The department shall maintain a current list of fair market rental and lease rates for areas where teacher housing is eligible for the teacher housing tax credit program.

(e) Each individual or corporate resident taxpayer that files an individual or corporate net income tax return for a taxable year may claim a tax credit under this section against the Hawaii state individual or corporate net income tax. The tax credit may be claimed for the cumulative difference during any taxable year after June 30, 2005 between the fair market rental or lease rate for housing in the relevant state senatorial district, as determined by the department, and the actual rental or lease rate charged by the landlord to teachers employed in hard-to-staff public schools.

(f) The director of taxation shall prepare any forms that may be necessary to claim a tax credit under this section. The director may also require the taxpayer to furnish reasonable information, including but not limited to an appraisal estimated by a licensed appraiser, to ascertain the validity of the claim for credit made under this section and may adopt rules necessary to effectuate the purposes of this section pursuant to chapter 91. The department of education shall certify to the department of taxation as to which state senatorial districts qualify for the tax credit allowed under this section."

SECTION 43. Section 235-7, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) There shall be excluded from gross income, adjusted gross income, and taxable income:

(1) Income not subject to taxation by the State under the Constitution and laws of the United States;

(2) Rights, benefits, and other income exempted from taxation by section 88-91, having to do with the state retirement system, and the rights, benefits, and other income, comparable to the rights, benefits, and other income exempted by section 88-91, under any other public retirement system;

(3) Any compensation received in the form of a pension for past services;

(4) Compensation paid to a patient affected with Hansen's disease employed by the State or the United States in any hospital, settlement, or place for the treatment of Hansen's disease;

(5) Except as otherwise expressly provided, payments made by the United States or this State, under an act of Congress or a law of this State, which by express provision or administrative regulation or interpretation are exempt from both the normal and surtaxes of the United States, even though not so exempted by the Internal Revenue Code itself;

(6) Any income expressly exempted or excluded from the measure of the tax imposed by this chapter by any other law of the State, it being the intent of this chapter not to repeal or supersede any such express exemption or exclusion;

(7) Income received by each member of the reserve components of the Army, Navy, Air Force, Marine Corps, or Coast Guard of the United States of America, and the Hawaii national guard as compensation for performance of duty, equivalent to pay received for forty-eight drills (equivalent of twelve weekends) and fifteen days of annual duty, at an:

(A) E-1 pay grade after eight years of service; provided that this subparagraph shall apply to taxable years beginning after December 31, 2004;

(B) E-2 pay grade after eight years of service; provided that this subparagraph shall apply to taxable years beginning after December 31, 2005;

(C) E-3 pay grade after eight years of service; provided that this subparagraph shall apply to taxable years beginning after December 31, 2006;

(D) E-4 pay grade after eight years of service; provided that this subparagraph shall apply to taxable years beginning after December 31, 2007; and

(E) E-5 pay grade after eight years of service; provided that this subparagraph shall apply to taxable years beginning after December 31, 2008;

(8) Income derived from the operation of ships or aircraft if the income is exempt under the Internal Revenue Code pursuant to the provisions of an income tax treaty or agreement entered into by and between the United States and a foreign country, provided that the tax laws of the local governments of that country reciprocally exempt from the application of all of their net income taxes, the income derived from the operation of ships or aircraft that are documented or registered under the laws of the United States;

(9) The value of legal services provided by a prepaid legal service plan to a taxpayer, the taxpayer's spouse, and the taxpayer's dependents;

(10) Amounts paid, directly or indirectly, by a prepaid legal service plan to a taxpayer as payment or reimbursement for the provision of legal services to the taxpayer, the taxpayer's spouse, and the taxpayer's dependents;

(11) Contributions by an employer to a prepaid legal service plan for compensation (through insurance or otherwise) to the employer's employees for the costs of legal services incurred by the employer's employees, their spouses, and their dependents; [and]

(12) Amounts received in the form of a monthly surcharge by a utility acting on behalf of an affected utility under section 269-16.3 shall not be gross income, adjusted gross income, or taxable income for the acting utility under this chapter. Any amounts retained by the acting utility for collection or other costs shall not be included in this exemption[.]; and

(13) The value of any out-of-pocket expenses incurred by a teacher for classroom supplies or materials (i.e. textbooks, pens, paper etc.); provided that the deduction shall not exceed $250 and may be claimed regardless of whether the teacher files an itemized return. For the purposes of this paragraph, "teacher" means any administrator, teacher, or other staff member regulated or licensed under chapter 302A and who works as such, at least nine hundred hours during the taxable year for which the deduction is claimed."

PART IX. ADVANCED TEACHING PRACTICE

SECTION 44. Most youths spend twelve to thirteen years in school gaining the knowledge and values they need for the rest of their lives. It is the teachers who nurture these young people and are the most valuable resource in schools. Raising awareness and appreciation of the value of teachers would make the profession more attractive. Positive environments in which teachers feel valued and respected are essential to effective teaching and learning. Furthermore, teachers with extensive experience and advanced practice are at the heart of any effective school system. They need to be supported and given the means by which to share their valuable knowledge with their peers.

The purpose of this part is to:

(1) Establish a master teacher training program for qualified teachers to increase the quality of their skills and serve as resource to other teachers; and

(2) Amend the national board certification incentive program to allow teachers, with seven to twelve years of experience in the department, time off to pursue the national certification.

SECTION 45. Chapter 302A, Hawaii Revised Statutes, is amended by adding three new sections to part III, subpart B, to be appropriately designated and to read as follows:

"§302A-   Master teachers training program. (a) The department shall establish a master teachers training program to assist teachers who desire to increase the quality of their teaching skills and serve as a resource to other teachers. Candidates for the master teachers training program shall:

(1) Possess a masters degree from an accredited university;

(2) Have not less than ten years of experience as a competent, skilled teacher according to criteria established by the department through rules adopted under chapter 91;

(3) Have experience in performing additional duties and responsibilities at the school-level;

(4) Teach at the mastery level in instruction and strategies and possess expertise in mathematics, English, science, or social studies; and

(5) Agree to serve as a master teacher or regular teacher in a school for not less than five years following the date of initial certification as a master teacher.

(b) The duties of a master teacher shall include, in addition to the master teacher's regular classroom responsibilities, serving as a mentor, supervisor, or staff developer for other teachers both in or out of the master teachers training program.

(c) At the successful conclusion of the master teachers training program, the department shall certify the teacher as a master teacher. The certification shall be conditional upon an annual review by the board that deems the master teacher's performance in the master teacher assignment to have been satisfactory.

(d) A certified master teacher who is actively serving as a mentor, supervisor, or staff developer at a public school shall be compensated in accordance with section 302A-622(b).

§302A-   Master teachers, staff developer. The department shall provide at least one master teacher staff developer in each school to assist the teachers at that school in preparing for master teacher training and certification, and for ongoing certification.

§302A-   Master teachers' salary schedule. (a) Upon certification as a master teacher, an employee shall receive compensation at the lowest step of the lowest grade in the master teacher series that exceeds the employee's existing compensation by at least eight per cent if such a step exists.

(b) Master teachers who have completed a year's satisfactory service shall be entitled to an annual increment. Teachers who lose their certification as master teachers shall be placed in the appropriate range and step of the regular teacher salary schedule as if they had remained regular teachers."

SECTION 46. Section 302A-622, Hawaii Revised Statutes, is amended to read as follows:

"[[]§302A-622[]] Salary ranges, teachers. (a) Salary ranges for teachers of the department, other than master teachers, shall be subject to the requirements of sections 302A-624 and 302A-626 and shall be as follows:

DEPARTMENT OF EDUCATION

SALARY RANGES

POSITIONS DOESR

Class I 1

II 3

III 5

IV 6

V 7

VI 8

VII 9

(b) Salary ranges for master teachers of the department:

(1) Shall be not less than the salary of a teacher at class V, step 9, at the first step of the master teacher series, for ten-month employees, notwithstanding section 89-19 to the contrary; and

(2) Shall be not less than the salary of an educational officer at EO 9, step 12, at the last step of the master teacher series, for ten-month employees, notwithstanding section 89-19 to the contrary, until such time that new salary ranges, grades, and schedules are negotiated for the master teacher series pursuant to section 89-9."

SECTION 47. Section 302A-706, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) There is established within the department the teacher national board certification incentive program to recognize and support exemplary teaching practice by supporting public school teachers who intend to pursue or have achieved national board certification under the certification program of the National Board for Professional Teaching Standards. The teacher national board certification incentive program shall provide:

(1) A $5,000 bonus per year for each public school teacher who maintains current national board certification;

(2) $1,500 upon completing the certification program of the National Board for Professional Teaching Standards; [and]

(3) A reimbursement of the remainder of the national board certification application fee upon achievement of national board certification[.]; and

(4) Time off for teachers with seven to twelve years of experience in the department to pursue national board certification; provided that the teacher affirms in good faith the intention to remain employed by the department for no less than five additional years after completing the certification program of the National Board for Professional Teaching Standards; provided further that during the approved time off they share their teaching expertise with colleagues or preservice teacher candidates at accredited institutions of higher education on a monthly basis."

SECTION 48. 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 2005-2006, for the master teachers training program.

The sum appropriated shall be expended by the department of education for the purposes of this part.

PART X. MISCELLANEOUS

SECTION 49. If any provision of this Act, or the application thereof to any person or circumstance is held invalid, the invalidity does not affect other provisions or applications of the Act, which can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.

SECTION 50. It is the intent of this Act not to jeopardize the receipt of any federal aid nor to impair the obligation of the State or any agency thereof to the holders of any bond issued by the State or by any such agency, and to the extent, and only to the extent, necessary to effectuate this intent, the governor may modify the strict provisions of this Act, but shall promptly report any such modification with reasons therefor tot he legislature at its next session thereafter for review by the legislature.

SECTION 51. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 52. This Act shall take effect on July 1, 2050; provided that:

(1) Sections 40 to 43 shall apply to taxable years beginning after December 31, 2004;

(2) Section 47 shall take effect on July 2, 2005; and

(3) Sections 3, 5, 9, 11, 17, 19, 24, 26, 30, 32, 33, 35, 37, 38, and 48 shall take effect on July 1, 2005.