HOUSE OF REPRESENTATIVES

H.B. NO.

2733

TWENTY-EIGHTH LEGISLATURE, 2016

 

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT

 

 

relating to education.

 

 

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

 


PART I

     SECTION 1.  Whole child education promotes creative thinking and improves academic achievement across subject areas.  According to a 2014 study performed by Lois Hetland and Ellen Winner of the Harvard Graduate School of Education, education in music and drama shows a generalizable causal relationship to increases in verbal achievement and spatial reasoning.  Similarly, researchers in the Department of Education Reform at the University of Arkansas found in 2013 that instruction in visual arts led to gains in critical thinking skills.

     In addition, place-based curricula immerses students in the culture, history, and heritage of their local communities, engaging students in applying cultural content to local community experiences.  Given the unique history of Hawaii as a former sovereign nation and problems faced by communities dealing with the legacy of annexation, including higher risks of poverty and lower levels of academic achievement for native Hawaiians, place-based education is crucial to giving students the skills necessary to solve community problems.

     The purpose of this part is promote creative thinking, self-directed learning, and cultural understanding by requiring students in all grade levels to receive whole child education.

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

     "§302A-    Whole child education.  (a)  Notwithstanding any other law to the contrary, beginning with the 2017-2018 school year, all public schools shall provide education in whole child education, as follows:

     (1)  Beginning with the 2017-2018 school year, for all public elementary schools, twenty per cent of student hours shall be allocated to whole child education; and

     (2)  Beginning with the 2017-2018 school year, for all public middle and intermediate schools, ten per cent of student hours shall be allocated to whole child education.

     (b)  As used in this section:

     "Student hours" has the same meaning as in section 302A-251.

     "Whole child education" means instruction in visual arts, music, theater, dance, Hawaiian and Polynesian studies, Hawaiian language, native Hawaiian culture, native Hawaiian traditional and customary practices, and physical education."

PART II

     SECTION 3.  Special education instruction meets the unique needs of students with disabilities.  Special education services include academic, speech-language, psychological, physical, occupational, and counseling accommodations.  Governed by the federal Individuals with Disabilities Education Improvement Act of 2004 and state rules requiring the department of education to provide a free appropriate public education to eligible students, special education services are made available to any student aged three to twenty-two years who demonstrates a need for specially designed instruction.

     However, despite efforts at reform, special education in Hawaii requires additional support.  Most students with individualized education programs in Hawaii public schools are performing below grade level in reading and mathematics as measured by statewide assessments.  Only twenty-two per cent were proficient in reading and only fifteen per cent were proficient in math for the 2013-2014 school year.  Moreover, between the 2004-2005 and 2013-2014 school years, the achievement gap between special education students and their general education peers has increased significantly, from thirty-eight per cent to 48.2 per cent in reading and twenty-one per cent to 48.8 per cent in mathematics, or an approximate worsening of ten per cent in reading and twenty-seven per cent in mathematics.

     The legislature finds that increasing achievement for special education students demands lessening the workload of special education teachers and giving special education teachers funding for classroom materials that boost learning growth.  The purpose of this part is to provide support for special education teachers and students by:

     (1)  Providing special education teachers with additional preparation time for completion of individualized education program tasks;

     (2)  Providing special education teachers with $1,690 per year for instructional materials; and

     (3)  Requiring the department to establish a formula for equitable and sufficient allocation of special education teachers based on student need.

     SECTION 4.  Chapter 302A, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§302A-    Additional support for special education.  (a)  Special education teachers shall have no fewer than forty hours per year for completion of individualized education programs, in addition to planning time and preparation periods specified in a collectively bargained agreement negotiated for bargaining unit (5) and in force for that time period.

     (b)  Additional preparation time established pursuant to this section shall be used during the school day at the discretion of the special education teacher.

     (c)  Special education teachers shall receive up to $1,690 annually to purchase, at their discretion, instructional materials and equipment that support student learning."

     SECTION 5.  (a)  No later than June 30, 2016, the department shall convene a working group to discuss and provide feedback on the implementation of a weighted student formula for special education.  The working group may consider:

     (1)  The number and allocation of special education teachers, educational assistants, and support staff throughout the department;

     (2)  Funding and resource equity for special education;

     (3)  The amount of planning and consultation time available to special education teachers;

     (4)  Education options available to special education students; and

     (5)  Support services for special education students, including academic, speech-language, psychological, physical, occupational, and counseling services.

     (b)  The working group shall consist of:

     (1)  The superintendent of education, or the superintendent's designee;

     (2)  The chairperson of the board of education, or the chairperson's designee;

     (3)  Representatives from the affected collective bargaining units; and

     (4)  Any other members that the department deems appropriate.

     SECTION 6.  There is appropriated out of the general revenues of the State of Hawaii the sum of $3,726,450 or so much thereof as may be necessary for fiscal year 2016-2017 for the department of education to provide up to $1,690 to each special education teacher for instructional materials and equipment that support student learning.

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

PART III

     SECTION 7.  Vocational, technical, and career pathway programs equip students with the twenty-first-century skills necessary to qualify for in-demand jobs within the modern labor market.  Such programs emphasize innovation within high-growth industries, giving students opportunities to explore career options and link education with real-world activities.

     The purpose of this part is to expand vocational, technical, and career pathway programming by:

     (1)  Ensuring that all public high schools provide vocational, technical, and career pathway programs;

     (2)  Giving students the opportunity to complete up to fifty per cent of credits toward graduation requirements in vocational, technical, and career pathway programs;

     (3)  Giving students in grade nine the opportunity to enroll in a for-credit course in available vocational, technical, and career pathway programs;

     (4)  Allowing students to enroll in vocational, technical, and career pathway programs in any school district to maximize the potential reach of such programs;

     (5)  Providing students enrolled in vocational, technical, or career pathway programs with opportunities to participate in internships or apprenticeships;

     (6)  Allowing students to obtain dual credit for core content area courses taken as part of vocational, technical, or career pathway programs; and

     (7)  Providing up to $1,500 to vocational, technical, and career pathway program teachers to purchase instructional materials and equipment that support student learning.

     SECTION 8.  Chapter 302A, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§302A-    Vocational, technical, and career pathway programs.  (a)  Notwithstanding any other law to the contrary, beginning with the 2020-2021 school year, all public high schools shall offer students the opportunity to participate in vocational, technical, and career pathway programs.  Students who successfully complete all course requirements for a vocational, technical, or career pathway program of study, including all graduation requirements, shall be recognized by the department.

     (b)  Students participating in vocational, technical, or career pathway programs may complete up to fifty per cent of their graduation requirements in vocational, technical, or career pathway courses.

     (c)  In grade nine, all public high school students shall be given the opportunity to earn one credit in a course that describes and explains the vocational, technical, or career pathway programs made available by the department.

     (d)  Students participating in vocational, technical, or career pathway programs shall have the opportunity to complete an internship or apprenticeship in grade twelve, subject to the department's approval.  The department shall develop criteria for allowing qualified individuals and businesses to provide internship and apprenticeship opportunities to students.  The department shall be responsible for the review and monitoring of a student's vocational, technical, or career pathway education-related internship or apprenticeship.

     (e)  Students shall be given the opportunity to participate in a vocational, technical, or career pathway program in any district, subject to the department's approval.  The department shall provide suitable transportation to and from school for all students participating in vocational, technical, or career pathway programs.

     (f)  Vocational, technical, and career pathway programs may include courses in core content areas.  For courses in core content areas, dual credit may be given for graduation requirements and vocational, technical, or career pathway program requirements.

     (g)  To the greatest extent possible, teachers providing instruction in vocational, technical, or career pathway programs at any public secondary school shall be highly qualified.

     (h)  Teachers who are certified and licensed to teach in a vocational, technical, or career pathway program shall receive up to $1,500 annually to purchase, at their discretion, instructional materials and equipment that support student learning."

     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 2016-2017 for the department of education to provide up to $1,500 to each vocational, technical, or career pathway program teacher for instructional materials and equipment that support student learning.

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

PART IV

     SECTION 10.  Studies show that the difference between air conditioned and non-air conditioned environments can cause as much as a seventeen per cent gap on achievement tests.  Hawaii's public school classrooms are, on average, over sixty-five years old, with electrical infrastructure that often cannot support traditional air conditioning technology.  Recent departmental estimates have put the cost of air conditioning at $110,000 per classroom.

     To help address this problem, the legislature finds that the department should use available energy-efficient technology, including off-grid and photovoltaic technology, to reduce the electrical burden and cost of cooling classrooms.  Employing a combination of on-grid, off-grid, and photovoltaic technology could reduce the per-classroom cost of air conditioning to $20,000, or a total of $140,000,000 for the seven thousand classrooms currently in need of air conditioning.

     The purpose of this part is to:

     (1)  Provide energy-efficient air conditioning to all public school classrooms within five years;

     (2)  Fund facilities improvements for charter schools through the establishment of the Hawaii charter school facility development special fund and appropriating $10,000,000 to the special fund; and

     (3)  Establishing an income tax credit for contributions of money or in-kind goods and services for the development of charter school facilities.

     SECTION 11.  Chapter 302A, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§302A-    Classroom climate control and cooling.  (a)  The department shall provide air conditioning for all public school classrooms.

     (b)  Beginning with the 2016-2017 school year, the department shall:

     (1)  Provide air conditioning to at least ten schools using off-grid technology;

     (2)  Provide air conditioning to at least ten schools using photovoltaic technology; and

     (3)  Develop a plan to air condition additional schools using a mix of technologies, including off-grid technology, photovoltaic technology, and split air conditioning units.

     (c)  Beginning with the 2017-2018 school year, the department shall develop a master plan to provide air conditioning to all public school classrooms, including a list of priority schools to receive air conditioning by the 2018-2019 school year.

     (d)  No later than the 2019-2020 school year, the department shall provide air conditioning to at least fifty per cent of public school classrooms.

     (e)  No later than the 2021-2022 school year, the department shall provide air conditioning to all public school classrooms."

     SECTION 12.  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 2016-2017 for the initiation and expansion of projects that demonstrate efficient methods to air condition public school facilities, including but not limited to photovoltaic and off-grid technology.

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

     SECTION 13.  The director of finance is authorized to issue general obligation bonds in the sum of $         or so much thereof as may be necessary and the same sum or so much thereof as may be necessary is appropriated for fiscal year 2016-2017 for the purpose of funding public school air conditioning projects.

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

     SECTION 14.  The appropriation made for capital improvement projects authorized by this part shall not lapse at the end of the fiscal biennium for which the appropriation is made; provided that all moneys from the appropriation in section 13 that are unencumbered as of June 30, 2018, shall lapse as of that date.

     SECTION 15.  Chapter 235, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§235-    Credit for charter school facility development.  (a) There shall be allowed to each taxpayer who is subject to the tax imposed by this chapter, and does not owe the State delinquent taxes, penalties, or interest, a credit for contributions of money or in-kind goods and services for the development of charter school facilities.  The credit shall be deductible from the taxpayer's net income tax liability, if any, imposed by this chapter for the taxable year in which the credit is properly claimed.

     (b)  The amount of the tax credit established under this section shall be equal to fifty per cent of the value of:

     (1)  Contributions of in-kind goods and services; and

     (2)  Contributions of money,

to the Hawaii charter school facility development special fund for that taxable year; provided that the amount of the tax credit claimed by a taxpayer under this section shall not exceed $250 per taxable year.

     (c)  The tax credit allowed under this section shall be claimed against net income tax liability for the taxable year.  A tax credit under this section that exceeds the taxpayer's income tax liability may be used as a credit against the taxpayer's income tax liability in subsequent years until exhausted.

     (d)  All claims for tax credits under this section, including any amended claims, shall be filed on or before the end of the twelfth month following the close of the taxable year for which the credits may be claimed.  Failure to comply with the foregoing provision shall constitute a waiver of the right to claim the credit.

     (e)  If a deduction is taken under section 170 (with respect to charitable contributions and gifts) of the Internal Revenue Code, no tax credit shall be allowed for that portion of the contribution for which the deduction was taken.

     (f)  The state public charter school commission shall maintain records of the names of taxpayers eligible for the credit and the total value of money and in-kind goods and services contributed for the development of charter school facilities for the taxable year.  All contributions shall be verified by the state public charter school commission.  The state public charter school commission shall total all contributions that it certifies.  Upon each determination, the state public charter school commission shall issue a certificate to the taxpayer certifying:

     (1)  The amount of the contribution; and

     (2)  That the taxpayer has obtained a current and valid certificate signed by the director of taxation, showing that the taxpayer does not owe the State any delinquent taxes, penalties, or interest.

     The taxpayer shall file the certificate from the state public charter school commission with the taxpayer's tax return with the department of taxation.  When the total amount of certified contributions reaches $250, the state public charter school commission shall immediately discontinue certifying contributions and notify the department of taxation.  In no instance shall the total amount of certified contributions exceed $250 for each taxable year.

     (g)  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 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.

     (h)  As used in this section:

     "Charter school" has the same meaning as defined in section 302D-1.

     "Net income tax liability" means income tax liability reduced by all other credits allowed under this chapter.

     "Value of contributions of in-kind goods and services" means the fair market value of goods and uncompensated services or labor, as determined and certified by the department of accounting and general services."

     SECTION 16. Chapter 302D, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§302D-    Hawaii charter school facility development special fund.  (a)  There is established within the department a special fund to be known as the Hawaii charter school facility development special fund, which shall be administered by the commission.

     (b)  Moneys in the Hawaii charter school facility development special fund may be:

     (1)  Expended by the commission for the acquisition, planning, design, improvement, construction, equipping, furnishing, administering, operating, and maintaining of charter school facilities and any other purpose deemed necessary by the commission for the purpose of developing charter school facilities; or

     (2)  Pledged by the commission to secure loans from private lending institutions for financially sound charter schools.

     (c)  The Hawaii charter school facility development special fund may receive contributions, grants, endowments, gifts in cash or otherwise, loans, and bond financing from all sources, including corporations or other businesses, foundations, government, individuals, and other interested parties.  Any interest accrued on moneys in the fund shall become part of the fund. The legislature may appropriate moneys to the fund."

     SECTION 17.  There is appropriated out of the general revenues of the State of Hawaii the sum of $10,000,000 or so much thereof as may be necessary for fiscal year 2016-2017 to be deposited into the Hawaii charter school facility development special fund.

     SECTION 18.  There is appropriated out of the Hawaii charter school facility development special fund the sum of $10,000,000 or so much thereof as may be necessary for fiscal year 2016-2017 to support the development of charter school facilities.

     The sum appropriated shall be expended by the state public charter school commission for the purposes of this section.

PART V

     SECTION 19.  The purpose of this part is to improve funding for and staffing equity in public schools by:

     (1)  Requiring that weighted student formula funding be increased annually to account for inflation;

     (2)  Establishing a $1,000,000 baseline funding amount for all public schools; and

     (3)  Requiring all public schools to have on staff a librarian, technology coordinator, vice principal, counselor, and special education transition coordinator.

     SECTION 20.  Chapter 302A-1303.6, Hawaii Revised Statutes, is amended to read as follows:

     "§302A-1303.6  Weighted student formula.  (a)  Based upon recommendations from the committee on weights, the board of education may adopt a weighted student formula for the allocation of moneys to public schools that takes into account the educational needs of each student. The department, upon the receipt of appropriated moneys, shall use the weighted student formula to allocate funds to public schools.  Principals, in consultation with teachers and school community councils, shall expend moneys provided to the principals' schools.  This section shall only apply to charter schools for fiscal years in which the charter schools elect pursuant to section 302D-29 to receive allocations according to the procedures and methodology used to calculate the weighted student formula allocation.

     (b)  Moneys budgeted for the department for allocation to public schools through the weighted student formula shall be increased annually by no less than the inflation-adjusted minimum level of funding.  This subsection shall not apply when the consumer price index for the twelve-month period ending June 30 of the preceding calendar year is less than zero.

     (c)  Beginning with the 2017-2018 school year, each school shall receive no less than $1,000,000 annually in baseline funds. Funds allocated using the weighted student formula shall be in addition to baseline funds.

     (d)  Notwithstanding any other law to the contrary, beginning with the 2020-2021 school year, all public schools shall hire at least one person to staff each of the following positions:

     (1)  Librarian or library media specialist;

     (2)  Technology coordinator;

     (3)  Vice principal;

     (4)  Counselor; and

     (5)  Special education transition coordinator at all secondary schools.

     For schools at which these positions are vacant or do not exist, additional moneys shall be provided through the weighted student formula to carry out the requirements of this subsection.

     (e)  As used in this section:

     "Consumer price index" means the average over a twelve-month period of the National Consumer Price Index, not seasonally adjusted, published monthly by the Bureau of Labor Statistics, United States Department of Labor, designated as the "National Consumer Price Index for All Urban Consumers - United States City Average".

     "Inflation-adjusted minimum level of funding" means the total amount of funding provided to the department during the fiscal year in which Act    , Session Laws of Hawaii 2016, was enacted; provided that this amount shall increase by three per cent for each subsequent fiscal year."

PART VI

     SECTION 21.  In Hawaii, approximately ten per cent of teachers switch schools, relocate, or leave the profession each year.  Only fifty to sixty per cent of current teachers have taught at their school for five years or more.  Teacher recruitment and retention is especially difficult for poor and hard-to-staff communities, where as few as fifty-six per cent of teachers are highly qualified.  Comparatively, ninety-three per cent of teachers statewide are highly qualified.  Nationwide, fifty-six per cent of teachers have an advanced degree, while only thirty-six per cent of teachers in Hawaii do.

     Chronic teacher turnover forces the department of education to rely on emergency hires and substitute teachers to fill vacancies.  Although alternative licensure programs, incentive bonuses for hard-to-staff schools, and increased support for new teachers have helped administrators fill open teaching positions, these measures have not significantly reduced the overall problem of teacher recruitment and retention, nor have they ensured that every classroom is staffed by a highly qualified educator.

     The basic problem crippling the department of education's teacher recruitment and retention efforts is Hawaii's high cost of living.  According to a study conducted by WalletHub, Hawaii ranked fifty-first out of fifty states and the District of Columbia for starting teacher salary and median teacher salary, adjusted for cost of living.

     The purpose of this part is to improve teacher recruitment and retention by:

     (1)  Mandating annual salary step increases for all public school teachers who complete a year of service;

     (2)  Appropriating funds to align teacher salary steps with years of service throughout the department of education; and

     (3)  Establishing a student loan subsidy program and special fund to provide student loan repayment assistance to special education and vocational education teachers.

     SECTION 22.  Chapter 302A, Hawaii Revised Statutes, is amended by adding two new sections to be appropriately designated and to read as follows:

     "§302A-    Student loan subsidy program; established; administration.  (a)  There is established the student loan subsidy program to provide financial support to teachers who provide instruction in the following content areas:

     (1)  Special education; and

     (2)  Vocational education, technical education, or career pathway programs,

and who agree to teach in the State for at least three years.  The program shall be administered by the department.

     (b)  The department may award a subsidy to any eligible teacher upon confirmation that the teacher has been employed to provide instruction in an approved content area.  Subsidies:

     (1)  Shall only be used for the repayment of federal, state, or private student loans; and

     (2)  Shall not exceed $10,000 per applicant.

     (c)  Eligibility shall be determined by the department on a competitive basis and shall be need-based; provided that each applicant shall meet all of the following requirements:

     (1)  Show proof of employment in an approved content area;

     (2)  Comply with any conditions placed on the subsidy by the department; and

     (3)  Demonstrate financial need for a student loan subsidy to the extent required by the department.

     (d)  A teacher shall apply to the department and include all information and documentation required by the department.

     (e)  If a teacher terminates employment in a qualifying content area during the academic year in which a student loan subsidy is received, the teacher shall notify the department in writing and shall return all unused portions of the subsidy.  Returned amounts shall be used to fund other subsidies under this section.

     (f)  Subsidies awarded by the department shall be limited to funds contained in the student loan subsidy program special fund under section 302A-  .

     (g)  The department shall monitor and verify a teacher's eligibility and fulfillment of all work requirements under this section.

     (h)  The department shall adopt policies and procedures in accordance with chapter 91 to implement the program; provided that the department shall be exempt from the public notice and public hearing requirements of chapter 91 with regard to this section.

     §302A-    Student loan subsidy program special fund.  There is established the student loan subsidy program special fund, for the purpose of providing subsidies pursuant to section 302A-  .  Appropriations made by the legislature, private contributions, and moneys from other sources may be deposited into the special fund; provided that:

     (1)  Moneys on balance in the special fund at the close of each fiscal year shall remain in that fund and shall not lapse to the credit of the general fund; and

     (2)  Not more than five per cent of the total amount funds in the student loan subsidy program special fund may be set by the department for administrative expenses incurred in administering the special fund."

     SECTION 23.  Section 302A-624, Hawaii Revised Statutes, is amended to read as follows:

     "§302A-624  Teachers' salary schedule.  (a)  The salary schedule for all teachers of the department shall be negotiated pursuant to section 89-9.

     [(b)  All teachers shall meet the following requirements:

     (1)  A teacher shall earn at least five credits within a three-year cycle to receive increment or longevity step increases in the third year of the three-year cycle;

     (2)  A teacher who fails to meet the requirement set forth in paragraph (1) shall not be eligible for any increment or longevity step increases until the teacher earns the credit requirement for the three-year cycle;

     (3)  Any credit earned in excess of any three-year credit requirement may not be carried over beyond the three-year cycle; and

     (4)  Credits earned may be in the form of in-service, university, or other credits approved by the department.

     (c)] (b)  A teacher shall be required to spend at least one year in Class III before going on to Class IV, at least one year in Class IV before going on to Class V, at least one year in Class V before going on to Class VI, and at least one year in Class VI before going on to Class VII.

     [(d)] (c)  In case of promotion from a teaching position to an educational officer, the employee shall receive compensation at the lowest step of the higher grade that exceeds the employee's existing compensation by at least eight per cent if such a step exists.

     [(e)] (d)  Effective July 1, 2006, the minimum hourly or minimum per diem rate for substitute teachers shall be determined by the legislature as follows; provided that any individual in Class I, II, or III who works less than a full seven-hour work day shall be compensated on a pro-rated, hourly basis:

     (1)  Class I:  other individuals who do not possess a bachelor's degree shall be compensated at a rate of not less than $125 for a full work day;

     (2)  Class II:  individuals with a bachelor's degree shall be compensated at a rate of not less than $136 for a full work day; and

     (3)  Class III:  department of education teachers, or licensed or highly qualified teachers, shall be compensated at a rate of not less than $147 for a full work day.

     [(f)] (e)  Effective July 1, 2008, the board shall provide wage adjustments for substitute teachers.  The wage adjustments shall be comparable to the across-the-board wage adjustments for teachers that are negotiated for bargaining unit (5) subject to legislative approval, pursuant to section 89C-5.  The board may also adjust hours, benefits, and other terms and conditions of employment for substitute teachers."

     SECTION 24.  Section 302A-626, Hawaii Revised Statutes, is amended to read as follows:

     "§302A-626  Salary increases; annual[, longevity.  (a)].  Teachers [and educational officers] who have completed a year's [satisfactory] service and who have complied with the other requirements of sections 302A-602 to 302A-639, and 302A-701, shall [be entitled to an annual increment.] receive an annual step increase.  No teacher at the highest step within the teacher's classification shall be entitled to receive an annual step increase pursuant to this section.

     [(b)  Teachers and educational officers who have served satisfactorily for three years in their maximum increment step or in any longevity step and who have complied with the other requirements of sections 302A-602 to 302A-639, and 302A-701, shall receive longevity step increases; provided that the board may grant principals and vice-principals longevity step increases more frequently than once every three years pursuant to section 302A-625.]"

     SECTION 25.  There is appropriated out of the general revenues of the State of Hawaii the sum of $5,000,000 or so much thereof as may be necessary for fiscal year 2016-2017 to be deposited into the student loan subsidy program special fund.

     SECTION 26.  There is appropriated out of the student loan subsidy program special fund the sum of $5,000,000 or so much thereof as may be necessary for fiscal year 2016-2017 to provide subsidies pursuant to section 302A-  , Hawaii Revised Statutes.

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

     SECTION 27.  There is appropriated out of the general revenues of the State of Hawaii the sum of $73,500,000 or so much thereof as may be necessary for fiscal year 2016-2017 to align teacher salary steps with current years of service throughout the department of education.

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

PART VII

     SECTION 28.  The legislature finds that excessive use of standardized tests is counterproductive.  Since the enactment of the federal No Child Left Behind Act of 2001 and Race to the Top program in 2009, the State has been obliged to shift its focus in public education from teaching to testing.  Undue emphasis on testing leads to a situation in which teachers spend more time preparing students to take tests and less time educating, while students spend more time taking tests and less time learning.

     According to a 2014 study conducted by the National Education Association, seventy-two per cent of teachers feel considerable pressure to improve test scores.  Over half of teachers surveyed reported spending too much time on testing and test preparation, with the average teacher spending approximately thirty per cent of the teacher's time on tasks related to standardized tests.  At the same time, a 2014 PDK/Gallup poll on public attitudes toward public schools found that only thirty-one per cent of parents support using standardized test scores to evaluate teachers, despite the implementation of numerous reforms increasing the use of test scores in assessing the performance of schools and educators.

     The purpose of this part is to minimize the adverse effects of standardized testing by:

     (1)  Limiting the number of days and hours that students are required to participate in standardized testing;

     (2)  Banning the use of standardized test scores in evaluating schools, teachers, and educational officers;

     (3)  Allowing teachers of special education students and student with limited English proficiency to request that such students be excused from standardized testing; and

     (4)  Requiring the board of education to inform students and their parents or guardians of their right to opt out of standardized testing.

     SECTION 29.  Chapter 302A, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§302A-    Conditions for standardized testing in public schools.  (a)  No public school student shall be required to attend more than three testing days in a school year.

     (b)  The department shall not use standardized test results for the purpose of assessing the performance of any public school.

     (c)  Standardized testing shall not be used to rate a school as recognition, continuous improvement, focus, priority, or superintendent's zone, or other similar designation, as determined by the department.

     (d)  Standardized testing shall not be used in any evaluation of teachers or educational officers, including any evaluation performed under section 302A-638.

     (e)  For any special education student or student with limited English proficiency, a teacher may request and the department may grant that the student be excused from participating in statewide standardized testing.

     (f)  Every public school student and parent or guardian of a public school student shall have the right to opt out of standardized testing.  Not more than ten days after the beginning of each school year, the department shall notify students and their parents or guardians about their right to opt out of participating in statewide standardized testing.

     (g)  As used in this section, "testing day" means any day in which a student spends three or more hours taking or preparing for standardized tests."

PART VIII

     SECTION 30.  Act 109, Session Laws of Hawaii 2015, established the executive office on early learning public prekindergarten program to be administered by the executive office on early learning and provided through department of education public schools and public charter schools.

     The purpose of this part is to appropriate funds for the executive office on early learning public prekindergarten program and mandate universal preschool for all eligible children by the 2020-2021 school year.

     SECTION 31.  Chapter 302L-7, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:

     "(b)  The program shall serve children in the year prior to the year of kindergarten eligibility, with priority extended to underserved or at-risk children, as defined in section 302L-1.  No later than the 2020-2021 school year, the program shall be available to all children in the year prior to the year of kindergarten eligibility.  The department of education may grant geographic exceptions for children to attend prekindergarten outside their assigned service area, as the department of education deems appropriate; provided that the department of education shall grant a request for geographic exception to attend a prekindergarten in another service area if the request is based on the employment location of the parent or guardian of the student."

     SECTION 32.  There is appropriated out of the general revenues of the State of Hawaii the sum of $125,000,000 or so much thereof as may be necessary for fiscal year 2016-2017 for the executive office on early learning to administer the executive office on early learning public prekindergarten program.

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

PART IX

     SECTION 33.  The purpose of this part is to amend state law requiring evaluations of teachers and educational officers by:

     (1)  Requiring the department of education to consult with exclusive representatives in establishing an evaluation program for teachers and educational officers;

     (2)  Providing that no teacher or educational officer shall be responsible for the achievement of a student who is chronically absent; and

     (3)  Providing that an evaluation program established by the department of education shall not be used to affect the compensation or employment status of any teacher or educational officer.

     SECTION 34.  Section 302A-101, Hawaii Revised Statutes, is amended by adding a new definition to be appropriately inserted and to read as follows:

     ""Student achievement" means the change in performance for an individual student between two or more school years."

     SECTION 35.  Section 302A-638, Hawaii Revised Statutes, is amended to read as follows:

     "[[]§302A-638[]]  Evaluation of teachers and educational officers.  (a)  The department shall establish an evaluation program for all teachers and educational officers[.] in consultation with the exclusive representatives of the appropriate bargaining units.  [The evaluation shall be performed at least once in each school year.]  The program shall define the criteria for evaluation and assign responsibilities for the application of the criteria.  [The evaluation of a teacher or educational officer shall be on the basis of efficiency, ability, and such other criteria as the department shall determine.]

     (b)  No teacher or educational officer shall be responsible for the student achievement of an enrolled student who misses ten or more days of instruction in two or more consecutive months, or whose non-attendance is chronic and has become a significant factor that hinders the student's learning.

     (c)  No evaluation performed in compliance with this section shall be used to determine the compensation or employment status of any teacher or educational officer, unless otherwise specified in a collectively bargained agreement negotiated pursuant to chapter 89."

PART X

     SECTION 36.  In a survey conducted by the Hawaii State Teachers Association, forty-seven per cent of respondents cited personal expenditures of between $250 and $500 each year on classroom supplies, with many claiming expenditures in excess of $1,000.

     The purpose of this part is to provide teachers with financial support for classroom expenses by:

     (1)  Establishing and appropriating funds for a debit card system for purchasing school supplies at the individual school level; and

     (2)  Establishing a $500 tax credit for teachers to offset personal expenditures on school and classroom supplies.

     SECTION 37.  Chapter 235, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§235-    Certain expenses; classrooms; tax credit.  (a)  There shall be allowed to each qualified taxpayer subject to the tax imposed by this chapter a tax credit for certain expenses of school teachers that shall be deductible from the taxpayer's net income tax liability, if any, imposed by this chapter for the taxable year in which the credit is properly claimed.

     (b)  The amount of the tax credit shall be equal to the amounts expended for certain expenses in a taxable year; provided that the credit shall not exceed $500 per taxable year.

     (c)  If the tax credit under this section exceeds the taxpayer's net income tax liability, the excess of credit over liability may be used as a tax credit against the taxpayer's net income tax liability in subsequent years until exhausted.  All claims for a tax credit under this section, including amended claims, 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 comply with the foregoing provision shall constitute a waiver of the right to claim the tax credit.

     (d)  No other tax credit may be claimed under this chapter for the certain expenses used to properly claim a tax credit under this section for the taxable year.

     (e)  The director of taxation shall prepare any forms that may be necessary to claim a credit under this section.  The director may also require the taxpayer to furnish reasonable information 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.

     (f)  As used in this section:

     "Certain expenses" means expenses paid or incurred by a qualifying taxpayer who incurs the expenses in connection with books; supplies, other than athletic supplies, for courses of instruction in health or physical education; computer equipment, including related software and services; and supplementary materials used by the qualifying taxpayer in the classroom.

     "Qualifying taxpayer" means a school teacher, special education teacher, school librarian, or counselor employed by the department of education, a public charter school, or a private school in the State who instructs students in any grade between prekindergarten and twelfth grade."

     SECTION 38.  Chapter 302A, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§302A-    Purchases of supplies; debit card system.  (a)  The department shall establish, use, and manage a debit card system to be based at the individual school level for the purpose of purchasing school supplies and other related curriculum support supplies.

     (b)  The department may contract the services of another entity to provide debit cards or any related services that may be required pursuant to this section.

     (c)  In implementing the debit card system, the department shall allow debit card purchases to be made at any vendor or business that sells school supplies.  Debit card purchases under this section shall be exempt from chapter 103D."

     SECTION 39.  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 2016-2017 for the implementation of a debit card system based at the individual school level for the purpose of purchasing school supplies and other related curriculum support supplies.

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

PART XI

     SECTION 40.  The Institute of Education Sciences, the research arm of the United States Department of Education, concludes that class-size reduction is one of only four evidence-based reforms that have been proven to increase student achievement.

     Experiments in Tennessee, Wisconsin, and other states have demonstrated that students in smaller classes score better on standardized tests, receive better grades, and exhibit improved attendance.  Moreover, these students benefiting the most from smaller class sizes are from poor and minority backgrounds, who experience twice the achievement gains of the average student.  Additionally, a study commissioned by the United States Department of Education analyzed the achievement of students in 2,561 schools across the nation by their performance on the National Assessment of Educational Progress exams.  After controlling for student background, the only objective factor that correlated with higher test scores was class size.

     The purpose of this part is to reduce class size in all grade levels.

     SECTION 41. Chapter 302A, Hawaii Revised Statutes, is amended by adding three new sections to be appropriately designated and to read as follows:

     "§302A-    Class size.  (a)  Notwithstanding any other law to the contrary:

     (1)  Beginning with the 2020-2021 school year, excluding charter schools, no public elementary school class shall exceed an enrollment of twenty students; and

     (2)  Beginning with the 2020-2021 school year, excluding charter schools, no public secondary school class shall exceed an enrollment of twenty-six students.

     (b)  The total number of students in all classes for which a teacher is responsible in any school year shall not exceed one hundred fifty students.

     (c)  This section shall not apply to any class that provides instruction in band, orchestra, choir, or theater.

     §302A-    Class size for students with disabilities.  (a)  The maximum number of students with disabilities that may be assigned to a teacher shall be as follows:

     (1)  Beginning with the 2020-2021 school year, no inclusion class at any elementary school shall exceed an enrollment of fifteen students;

     (2)  Beginning with the 2020-2021 school year, no fully self-contained class at any elementary school shall exceed an enrollment of four students;

     (3)  Beginning with the 2020-2021 school year, no inclusion class at any secondary school shall exceed an enrollment of twenty students; and

     (4)  Beginning with the 2020-2021 school year, no fully self-contained class at any secondary school shall exceed an enrollment of six students.

     (b)  This section shall not apply to any class that provides instruction in band, orchestra, choir, or theatre.

     (c)  As used in this section:

     "Fully self-contained class" means any class that provides instruction only to special education students.

     "Inclusion class" means any class that provides instruction to both general education and special education students.

     §302A-    Class size for students with limited English proficiency.  (a)  The maximum number of students with limited English proficiency that may be assigned to a teacher shall be as follows:

     (1)  Beginning with the 2020-2021 school year, no content-based English language learning class at any elementary school shall exceed an enrollment of fifteen students; and

     (2)  Beginning with the 2020-2021 school year, no content-based English language learning class at any secondary school shall exceed an enrollment of twenty students.

     (b)  As used in this section, "content-based English language learning class" means any class providing instruction only to students with limited English language proficiency."

     SECTION 42.  The board of education shall amend any board of education policies related to class size, pursuant to the class size ratio established in section 302A-  , section 302A-  , and section 302A-  , Hawaii Revised Statutes.

PART XII

     SECTION 43.  The purpose of this part is to increase funding for public education in Hawaii by:

     (1)  Raising the general excise tax by one per cent; provided that nothing in this section shall be construed to interfere with a county's ability to levy a surcharge for public works pursuant to the Hawaii Revised Statutes;

     (2)  Depositing all additional revenue collected by the imposition of the general excise tax increase imposed by this part into a special account in the general fund for appropriation to and expenditure for operations, including salaries and maintenance costs, of the department of education;

     (3)  Providing that the moneys budgeted for the department of education from sources of funding other than the special account, including capital improvement projects, shall remain equal to or greater than an inflation-adjusted minimum level of funding for each subsequent fiscal year; and

     (4)  Increasing the state income tax for taxpayers earning above $300,000 per year.

     This part minimizes the adverse effect of increasing the general excise by:

     (1)  Increasing the state tax credit for renters earning less than $60,000 per year and linking future increases in the state tax credit for renters to the consumer price index; and

     (2)  Increasing the state food/excise tax credit by specified amounts and linking future increases in the state food/excise tax credit to the consumer price index.

     SECTION 44.  Section 235-51, Hawaii Revised Statutes, is amended by amending subsections (a), (b), and (c) to read as follows:

     "(a)  There is hereby imposed on the taxable income of (1) every taxpayer who files a joint return under section 235-93; and (2) every surviving spouse a tax determined in accordance with the following table:

     In the case of any taxable year beginning after December 31, 2001:

          If the taxable income is:    The tax shall be:

          Not over $4,000              1.40% of taxable income

          Over $4,000 but              $56.00 plus 3.20% of

            not over $8,000              excess over $4,000

          Over $8,000 but              $184.00 plus 5.50% of

            not over $16,000             excess over $8,000

          Over $16,000 but             $624.00 plus 6.40% of

            not over $24,000             excess over $16,000

          Over $24,000 but             $1,136.00 plus 6.80% of

            not over $32,000             excess over $24,000

          Over $32,000 but             $1,680.00 plus 7.20% of

            not over $40,000             excess over $32,000

          Over $40,000 but             $2,256.00 plus 7.60% of

            not over $60,000             excess over $40,000

          Over $60,000 but             $3,776.00 plus 7.90% of

            not over $80,000             excess over $60,000

          Over $80,000                 $5,356.00 plus 8.25% of

                                         excess over $80,000.

     In the case of any taxable year beginning after December 31, 2006:

          If the taxable income is:    The tax shall be:

          Not over $4,800              1.40% of taxable income

          Over $4,800 but              $67.00 plus 3.20% of

            not over $9,600              excess over $4,800

          Over $9,600 but              $221.00 plus 5.50% of

            not over $19,200             excess over $9,600

          Over $19,200 but             $749.00 plus 6.40% of

            not over $28,800             excess over $19,200

          Over $28,800 but             $1,363.00 plus 6.80% of

            not over $38,400             excess over $28,800

          Over $38,400 but             $2,016.00 plus 7.20% of

            not over $48,000             excess over $38,400

          Over $48,000 but             $2,707.00 plus 7.60% of

            not over $72,000             excess over $48,000

          Over $72,000 but             $4,531.00 plus 7.90% of

            not over $96,000             excess over $72,000

          Over $96,000                 $6,427.00 plus 8.25% of

                                         excess over $96,000.

     In the case of any taxable year beginning after December 31, 2015:

          If the taxable income is:    The tax shall be:

          Not over $4,800              1.40% of taxable income

          Over $4,800 but              $67.00 plus 3.20% of

            not over $9,600              excess over $4,800

          Over $9,600 but              $221.00 plus 5.50% of

            not over $19,200             excess over $9,600

          Over $19,200 but             $749.00 plus 6.40% of

            not over $28,800             excess over $19,200

          Over $28,800 but             $1,363.00 plus 6.80% of

            not over $38,400             excess over $28,800

          Over $38,400 but             $2,016.00 plus 7.20% of

            not over $48,000             excess over $38,400

          Over $48,000 but             $2,707.00 plus 7.60% of

            not over $72,000             excess over $48,000

          Over $72,000 but             $4,531.00 plus 7.90% of

            not over $96,000             excess over $72,000

          Over $96,000 but             $6,427.00 plus 8.25% of

            not over $300,000              excess over $96,000

          Over $300,000 but            $23,257.00 plus 9.00% of not over $350,000                  excess over $300,000

          Over $350,000 but            $27,757.00 plus 10.00% of not over $400,000         excess over $350,000

       Over $400,000                $32,757.00 plus 11.00% of excess over $400,000.

     (b)  There is hereby imposed on the taxable income of every head of a household a tax determined in accordance with the following table:

     In the case of any taxable year beginning after December 31, 2001:

          If the taxable income is:    The tax shall be:

          Not over $3,000              1.40% of taxable income

          Over $3,000 but              $42.00 plus 3.20% of

            not over $6,000              excess over $3,000

          Over $6,000 but              $138.00 plus 5.50% of

            not over $12,000             excess over $6,000

          Over $12,000 but             $468.00 plus 6.40% of

            not over $18,000             excess over $12,000

          Over $18,000 but             $852.00 plus 6.80% of

            not over $24,000             excess over $18,000

          Over $24,000 but             $1,260.00 plus 7.20% of

            not over $30,000             excess over $24,000

          Over $30,000 but             $1,692.00 plus 7.60% of

            not over $45,000             excess over $30,000

          Over $45,000 but             $2,832.00 plus 7.90% of

            not over $60,000             excess over $45,000

          Over $60,000                 $4,017.00 plus 8.25% of

                                         excess over $60,000.

     In the case of any taxable year beginning after December 31, 2006:

          If the taxable income is:    The tax shall be:

          Not over $3,600              1.40% of taxable income

          Over $3,600 but              $50.00 plus 3.20% of

            not over $7,200              excess over $3,600

          Over $7,200 but              $166.00 plus 5.50% of

            not over $14,400             excess over $7,200

          Over $14,400 but             $562.00 plus 6.40% of

            not over $21,600             excess over $14,400

          Over $21,600 but             $1,022.00 plus 6.80% of

            not over $28,800             excess over $21,600

          Over $28,800 but             $1,512.00 plus 7.20% of

            not over $36,000             excess over $28,800

          Over $36,000 but             $2,030.00 plus 7.60% of

            not over $54,000             excess over $36,000

          Over $54,000 but             $3,398.00 plus 7.90% of

            not over $72,000             excess over $54,000

          Over $72,000                 $4,820.00 plus 8.25% of

                                         excess over $72,000.

     In the case of any taxable year beginning after December 31, 2015:

          If the taxable income is:    The tax shall be:

          Not over $3,600              1.40% of taxable income

          Over $3,600 but              $50.00 plus 3.20% of

               not over $7,200              excess over $3,600

          Over $7,200 but              $166.00 plus 5.50% of

               not over $14,400             excess over $7,200

          Over $14,400 but             $562.00 plus 6.40% of

               not over $21,600             excess over $14,400

          Over $21,600 but             $1,022.00 plus 6.80% of

               not over $28,800             excess over $21,600

          Over $28,800 but             $1,512.00 plus 7.20% of

               not over $36,000             excess over $28,800

          Over $36,000 but             $2,030.00 plus 7.60% of

               not over $54,000             excess over $36,000

          Over $54,000 but             $3,398.00 plus 7.90% of

               not over $72,000             excess over $54,000

          Over $72,000 but             $4,820.00 plus 8.25% of

               not over $225,000            excess over $72,000

          Over $225,000 but            $17,443.00 plus 9.00% of not over $262,500           excess over

                                           $225,000

          Over $262,500 but            $20,818.00 plus 10.00% of not over $300,000      excess over

                                           $262,500

          Over $300,000                $24,568.00 plus 11.00%

                                           of excess over

                                           $300,000.

     (c)  There is hereby imposed on the taxable income of (1) every unmarried individual (other than a surviving spouse, or the head of a household) and (2) on the taxable income of every married individual who does not make a single return jointly with the individual's spouse under section 235-93 a tax determined in accordance with the following table:

     In the case of any taxable year beginning after December 31, 2001:

          If the taxable income is:    The tax shall be:

          Not over $2,000              1.40% of taxable income

          Over $2,000 but              $28.00 plus 3.20% of

            not over $4,000              excess over $2,000

          Over $4,000 but              $92.00 plus 5.50% of

            not over $8,000              excess over $4,000

          Over $8,000 but              $312.00 plus 6.40% of

            not over $12,000             excess over $8,000

          Over $12,000 but             $568.00 plus 6.80% of

            not over $16,000             excess over $12,000

          Over $16,000 but             $840.00 plus 7.20% of

            not over $20,000             excess over $16,000

          Over $20,000 but             $1,128.00 plus 7.60% of

            not over $30,000             excess over $20,000

          Over $30,000 but             $1,888.00 plus 7.90% of

            not over $40,000             excess over $30,000

          Over $40,000                 $2,678.00 plus 8.25% of

                                         excess over $40,000.

     In the case of any taxable year beginning after December 31, 2006:

          If the taxable income is:    The tax shall be:

          Not over $2,400              1.40% of taxable income

          Over $2,400 but              $34.00 plus 3.20% of

            not over $4,800              excess over $2,400

          Over $4,800 but              $110.00 plus 5.50% of

            not over $9,600              excess over $4,800

          Over $9,600 but              $374.00 plus 6.40% of

            not over $14,400             excess over $9,600

          Over $14,400 but             $682.00 plus 6.80% of

            not over $19,200             excess over $14,400

          Over $19,200 but             $1,008.00 plus 7.20% of

            not over $24,000             excess over $19,200

          Over $24,000 but             $1,354.00 plus 7.60% of

            not over $36,000             excess over $24,000

          Over $36,000 but             $2,266.00 plus 7.90% of

            not over $48,000             excess over $36,000

          Over $48,000                 $3,214.00 plus 8.25% of

                                         excess over $48,000.

     In the case of any taxable year beginning after December 31, 2015:

          If the taxable income is:    The tax shall be:

          Not over $2,400              1.40% of taxable income

          Over $2,400 but              $34.00 plus 3.20% of

            not over $4,800              excess over $2,400

          Over $4,800 but              $110.00 plus 5.50% of

            not over $9,600              excess over $4,800

          Over $9,600 but              $374.00 plus 6.40% of

            not over $14,400             excess over $9,600

          Over $14,400 but             $682.00 plus 6.80% of

            not over $19,200             excess over $14,400

          Over $19,200 but             $1,008.00 plus 7.20% of

            not over $24,000             excess over $19,200

          Over $24,000 but             $1,354.00 plus 7.60% of

            not over $36,000             excess over $24,000

          Over $36,000 but             $2,266.00 plus 7.90% of

            not over $48,000             excess over $36,000

          Over $48,000 but             $3,214.00 plus 8.25% of

            not over $150,000              excess over $48,000

          Over $150,000 but            $11,629.00 plus 9.00% of not over $175,000                  excess over $150,000

          Over $175,000 but            $13,879.00 plus 10.00% of not over $200,000         excess over $175,000

       Over $200,000                $16,379.00 plus 11.00% of excess over $200,000."

     SECTION 45.  Section 235-55.7, Hawaii Revised Statutes, is amended to read as follows:

     "§235-55.7  Income tax credit for low-income household renters.  (a)  As used in this section:

     (1)  "Adjusted gross income" is defined by section 235-1.

     (2)  "Qualified exemption" includes those exemptions permitted under this chapter; provided that a person for whom exemption is claimed has physically resided in the State for more than nine months during the taxable year; and provided that multiple exemption shall not be granted because of deficiencies in vision, hearing, or other disability.

     (3)  "Rent" means the amount paid in cash in any taxable year for the occupancy of a dwelling place which is used by a resident taxpayer or the resident taxpayer's immediate family as the principal residence in this State.  Rent is limited to the amount paid for the occupancy of the dwelling place only, and is exclusive of charges for utilities, parking stalls, storage of goods, yard services, furniture, furnishings, and the like.  Rent shall not include any rental claimed as a deduction from gross income or adjusted gross income for income tax purposes, any ground rental paid for use of land only, and any rent allowance or subsidies received.

     (4)  "Consumer price index" means the consumer price index for all urban consumers published by the United States Department of Labor.

     (b)  Each resident taxpayer who occupies and pays rent for real property within the State as the resident taxpayer's residence or the residence of the resident taxpayer's immediate family which is not partially or wholly exempted from real property tax, who is not eligible to be claimed as a dependent for federal or state income taxes by another, and who files an individual net income tax return for a taxable year, may claim a tax credit under this section against the resident taxpayer's Hawaii state individual net income tax.

     (c)  Each taxpayer with an adjusted gross income of less than [$30,000] $60,000 who has paid more than $1,000 in rent during the taxable year for which the credit is claimed may claim a tax credit of [$50] $150 multiplied by the number of qualified exemptions to which the taxpayer is entitled; provided each taxpayer sixty-five years of age or over may claim double the tax credit; and provided that a resident individual who has no income or no income taxable under this chapter may also claim the tax credit as set forth in this section.

     (d)  If a rental unit is occupied by two or more individuals, and more than one individual is able to qualify as a claimant, the claim for credit shall be based upon a pro rata share of the rent paid.

     (e)  The tax credits shall be deductible from the taxpayer's individual net income tax for the tax year in which the credits are properly claimed; provided that a husband and wife filing separate returns for a taxable year for which a joint return could have been made by them shall claim only the tax credits to which they would have been entitled had a joint return been filed.  In the event the allowed tax credits exceed the amount of the income tax payments due from the taxpayer, the excess of credits over payments due shall be refunded to the taxpayer; provided that allowed tax credits properly claimed by an individual who has no income tax liability shall be paid to the individual; and provided further that no refunds or payments on account of the tax credits allowed by this section shall be made for amounts less than $1.

     (f)  The director of taxation shall prepare and prescribe the appropriate form or forms to be used herein, may require proof of the claim for tax credits, and may adopt rules pursuant to chapter 91.

     (g)  All of the provisions relating to assessments and refunds under this chapter and under section 231-23(c)(1) shall apply to the tax credits hereunder.

     (h)  Claims for tax credits under this section, including any amended claims thereof, shall be filed on or before the end of the twelfth month following the taxable year for which the credit may be claimed.

     (i)  For any taxable year beginning in a calendar year after 2017, each dollar amount contained in subsection (c) shall be increased by an amount equal to such dollar amount multiplied by the percentage, if any, by which the consumer price index for the preceding calendar year exceeds the consumer price index for the calendar year 2016."

     SECTION 46.  Section 235-55.85, Hawaii Revised Statutes, is amended as follows:

     1.  By amending subsections (b) and (c) to read:

     "(b)  Each individual taxpayer may claim a refundable food/excise tax credit multiplied by the number of qualified exemptions to which the taxpayer is entitled in accordance with the table below; provided that a husband and wife filing separate tax returns for a taxable year for which a joint return could have been filed by them shall claim only the tax credit to which they would have been entitled had a joint return been filed.

     Adjusted gross income       Credit per exemption

     for taxpayers filing

     a single return

Under $5,000                               [$110] $170

$5,000 under $10,000                        [$100] $150

$10,000 under $15,000                       [$85] $130

$15,000 under $20,000                       [$70] $110

$20,000 under $30,000                       [$55] $90

$30,000 and over                               $0

     Adjusted gross income       Credit per exemption

     for heads of household,

     married individuals filing

     separate returns, and

     married couples filing

     joint returns

Under $5,000                               [$110] $170

$5,000 under $10,000                        [$100]$150

$10,000 under $15,000                       [$85] $130

$15,000 under $20,000                       [$70] $110

$20,000 under $30,000                       [$55] $90

$30,000 under $40,000                       [$45] $75

$40,000 under $50,000                       [$35] $55

$50,000 under $60,000                         $45

[$50,000] $60,000 and over                     $0

     (c)  [For the purposes of this section, a qualified exemption is defined to include those exemptions permitted under this chapter; provided that no additional exemption may be claimed by a taxpayer who is sixty-five years of age or older; provided that a person for whom exemption is claimed has been physically present in the State for more than nine months during the taxable year; and provided further that multiple exemptions shall not be granted because of deficiencies in vision or hearing, or other disability.  For purposes of claiming this credit only, a minor child receiving support from the department of human services of the State, social security survivor's benefits, and the like, may be considered a dependent and a qualified exemption of the parent or guardian.] For any taxable year beginning in a calendar year after 2016, each dollar amount contained in subsection (b) shall be increased by an amount equal to such dollar amount multiplied by the percentage, if any, by which the consumer price index for the preceding calendar year exceeds the consumer price index for the calendar year 2015."

     2.  By amending subsection (g) to read:

     "(g)  For the purposes of this section[, "adjusted]:

     "Adjusted gross income" means adjusted gross income as defined by the Internal Revenue Code.

     "Consumer price index" means the consumer price index for all urban consumers published by the United States Department of Labor.

     "Qualified exemption" means those exemptions permitted under this chapter; provided that no additional exemption may be claimed by a taxpayer who is sixty-five years of age or older; provided further that a person who claims such an exemption shall have physically resided in the State for more than nine months during the taxable year; provided further that multiple exemptions shall not be granted because of deficiencies in vision or hearing or other disability.  For purposes of claiming this credit only, a minor child receiving support from the department of human services, Social Security survivor's benefits, and the like, may be considered a dependent and a qualified exemption of the parent or guardian."

     SECTION 47.  Section 237-13, Hawaii Revised Statutes, is amended to read as follows:

     "§237-13  Imposition of tax.  There is hereby levied and shall be assessed and collected annually privilege taxes against persons on account of their business and other activities in the State measured by the application of rates against values of products, gross proceeds of sales, or gross income, whichever is specified, as follows:

     (1)  Tax on manufacturers.

         (A)  Upon every person engaging or continuing within the State in the business of manufacturing, including compounding, canning, preserving, packing, printing, publishing, milling, processing, refining, or preparing for sale, profit, or commercial use, either directly or through the activity of others, in whole or in part, any article or articles, substance or substances, commodity or commodities, the amount of the tax to be equal to the value of the articles, substances, or commodities, manufactured, compounded, canned, preserved, packed, printed, milled, processed, refined, or prepared for sale, as shown by the gross proceeds derived from the sale thereof by the manufacturer or person compounding, preparing, or printing them, multiplied by one-half of one per cent.

         (B)  The measure of the tax on manufacturers is the value of the entire product for sale, regardless of the place of sale or the fact that deliveries may be made to points outside the State.

         (C)  If any person liable for the tax on manufacturers ships or transports the person's product, or any part thereof, out of the State, whether in a finished or unfinished condition, or sells the same for delivery to points outside the State (for example, consigned to a mainland purchaser via common carrier f.o.b. Honolulu), the value of the products in the condition or form in which they exist immediately before entering interstate or foreign commerce, determined as hereinafter provided, shall be the basis for the assessment of the tax imposed by this paragraph.  This tax shall be due and payable as of the date of entry of the products into interstate or foreign commerce, whether the products are then sold or not.  The department shall determine the basis for assessment, as provided by this paragraph, as follows:

              (i)  If the products at the time of their entry into interstate or foreign commerce already have been sold, the gross proceeds of sale, less the transportation expenses, if any, incurred in realizing the gross proceeds for transportation from the time of entry of the products into interstate or foreign commerce, including insurance and storage in transit, shall be the measure of the value of the products;

             (ii)  If the products have not been sold at the time of their entry into interstate or foreign commerce, and in cases governed by clause (i) in which the products are sold under circumstances such that the gross proceeds of sale are not indicative of the true value of the products, the value of the products constituting the basis for assessment shall correspond as nearly as possible to the gross proceeds of sales for delivery outside the State, adjusted as provided in clause (i), or if sufficient data are not available, sales in the State, of similar products of like quality and character and in similar quantities, made by the taxpayer (unless not indicative of the true value) or by others.  Sales outside the State, adjusted as provided in clause (i), may be considered when they constitute the best available data.  The department shall prescribe uniform and equitable rules for ascertaining the values;

            (iii)  At the election of the taxpayer and with the approval of the department, the taxpayer may make the taxpayer's returns under clause (i) even though the products have not been sold at the time of their entry into interstate or foreign commerce; and

             (iv)  In all cases in which products leave the State in an unfinished condition, the basis for assessment shall be adjusted so as to deduct the portion of the value as is attributable to the finishing of the goods outside the State.

     (2)  Tax on business of selling tangible personal property; producing.

         (A)  Upon every person engaging or continuing in the business of selling any tangible personal property whatsoever (not including, however, bonds or other evidence of indebtedness, or stocks), there is likewise hereby levied, and shall be assessed and collected, a tax equivalent to [four] five per cent of the gross proceeds of sales of the business; provided that, in the case of a wholesaler, the tax shall be equal to one-half of one per cent of the gross proceeds of sales of the business; and provided further that insofar as the sale of tangible personal property is a wholesale sale under section 237-4(a)(8), the tax shall be one-half of one per cent of the gross proceeds.  Upon every person engaging or continuing within this State in the business of a producer, the tax shall be equal to one-half of one per cent of the gross proceeds of sales of the business, or the value of the products, for sale, if sold for delivery outside the State or shipped or transported out of the State, and the value of the products shall be determined in the same manner as the value of manufactured products covered in the cases under paragraph (1)(C).

         (B)  Gross proceeds of sales of tangible property in interstate and foreign commerce shall constitute a part of the measure of the tax imposed on persons in the business of selling tangible personal property, to the extent, under the conditions, and in accordance with the provisions of the Constitution of the United States and the Acts of the Congress of the United States which may be now in force or may be hereafter adopted, and whenever there occurs in the State an activity to which, under the Constitution and Acts of Congress, there may be attributed gross proceeds of sales, the gross proceeds shall be so attributed.

         (C)  No manufacturer or producer, engaged in such business in the State and selling the manufacturer's or producer's products for delivery outside of the State (for example, consigned to a mainland purchaser via common carrier f.o.b. Honolulu), shall be required to pay the tax imposed in this chapter for the privilege of so selling the products, and the value or gross proceeds of sales of the products shall be included only in determining the measure of the tax imposed upon the manufacturer or producer.

         (D)  When a manufacturer or producer, engaged in such business in the State, also is engaged in selling the manufacturer's or producer's products in the State at wholesale, retail, or in any other manner, the tax for the privilege of engaging in the business of selling the products in the State shall apply to the manufacturer or producer as well as the tax for the privilege of manufacturing or producing in the State, and the manufacturer or producer shall make the returns of the gross proceeds of the wholesale, retail, or other sales required for the privilege of selling in the State, as well as making the returns of the value or gross proceeds of sales of the products required for the privilege of manufacturing or producing in the State.  The manufacturer or producer shall pay the tax imposed in this chapter for the privilege of selling its products in the State, and the value or gross proceeds of sales of the products, thus subjected to tax, may be deducted insofar as duplicated as to the same products by the measure of the tax upon the manufacturer or producer for the privilege of manufacturing or producing in the State; provided that no producer of agricultural products who sells the products to a purchaser who will process the products outside the State shall be required to pay the tax imposed in this chapter for the privilege of producing or selling those products.

         (E)  A taxpayer selling to a federal cost-plus contractor may make the election provided for by paragraph (3)(C), and in that case the tax shall be computed pursuant to the election, notwithstanding this paragraph or paragraph (1) to the contrary.

         (F)  The department, by rule, may require that a seller take from the purchaser of tangible personal property a certificate, in a form prescribed by the department, certifying that the sale is a sale at wholesale; provided that:

              (i)  Any purchaser who furnishes a certificate shall be obligated to pay to the seller, upon demand, the amount of the additional tax that is imposed upon the seller whenever the sale in fact is not at wholesale; and

             (ii)  The absence of a certificate in itself shall give rise to the presumption that the sale is not at wholesale unless the sales of the business are exclusively at wholesale.

     (3)  Tax upon contractors.

         (A)  Upon every person engaging or continuing within the State in the business of contracting, the tax shall be equal to [four] five per cent of the gross income of the business.

         (B)  In computing the tax levied under this paragraph, there shall be deducted from the gross income of the taxpayer so much thereof as has been included in the measure of the tax levied under subparagraph (A), on:

              (i)  Another taxpayer who is a contractor, as defined in section 237-6;

             (ii)  A specialty contractor, duly licensed by the department of commerce and consumer affairs pursuant to section 444-9, in respect of the specialty contractor's business; or

            (iii)  A specialty contractor who is not licensed by the department of commerce and consumer affairs pursuant to section 444-9, but who performs contracting activities on federal military installations and nowhere else in this State;

              provided that any person claiming a deduction under this paragraph shall be required to show in the person's return the name and general excise number of the person paying the tax on the amount deducted by the person.

         (C)  In computing the tax levied under this paragraph against any federal cost-plus contractor, there shall be excluded from the gross income of the contractor so much thereof as fulfills the following requirements:

              (i)  The gross income exempted shall constitute reimbursement of costs incurred for materials, plant, or equipment purchased from a taxpayer licensed under this chapter, not exceeding the gross proceeds of sale of the taxpayer on account of the transaction; and

             (ii)  The taxpayer making the sale shall have certified to the department that the taxpayer is taxable with respect to the gross proceeds of the sale, and that the taxpayer elects to have the tax on gross income computed the same as upon a sale to the state government.

         (D)  A person who, as a business or as a part of a business in which the person is engaged, erects, constructs, or improves any building or structure, of any kind or description, or makes, constructs, or improves any road, street, sidewalk, sewer, or water system, or other improvements on land held by the person (whether held as a leasehold, fee simple, or otherwise), upon the sale or other disposition of the land or improvements, even if the work was not done pursuant to a contract, shall be liable to the same tax as if engaged in the business of contracting, unless the person shows that at the time the person was engaged in making the improvements the person intended, and for the period of at least one year after completion of the building, structure, or other improvements the person continued to intend to hold and not sell or otherwise dispose of the land or improvements.  The tax in respect of the improvements shall be measured by the amount of the proceeds of the sale or other disposition that is attributable to the erection, construction, or improvement of such building or structure, or the making, constructing, or improving of the road, street, sidewalk, sewer, or water system, or other improvements.  The measure of tax in respect of the improvements shall not exceed the amount which would have been taxable had the work been performed by another, subject as in other cases to the deductions allowed by subparagraph (B).  Upon the election of the taxpayer, this paragraph may be applied notwithstanding that the improvements were not made by the taxpayer, or were not made as a business or as a part of a business, or were made with the intention of holding the same.  However, this paragraph shall not apply in respect of any proceeds that constitute or are in the nature of rent; all such gross income shall be taxable under paragraph (9); provided that insofar as the business of renting or leasing real property under a lease is taxed under section 237-16.5, the tax shall be levied by section 237-16.5.

     (4)  Tax upon theaters, amusements, radio broadcasting stations, etc.

         (A)  Upon every person engaging or continuing within the State in the business of operating a theater, opera house, moving picture show, vaudeville, amusement park, dance hall, skating rink, radio broadcasting station, or any other place at which amusements are offered to the public, the tax shall be equal to [four] five per cent of the gross income of the business, and in the case of a sale of an amusement at wholesale under section 237-4(a)(13), the tax shall be one-half of one per cent of the gross income.

         (B)  The department may require that the person rendering an amusement at wholesale take from the licensed seller a certificate, in a form prescribed by the department, certifying that the sale is a sale at wholesale; provided that:

              (i)  Any licensed seller who furnishes a certificate shall be obligated to pay to the person rendering the amusement, upon demand, the amount of additional tax that is imposed upon the seller whenever the sale is not at wholesale; and

             (ii)  The absence of a certificate in itself shall give rise to the presumption that the sale is not at wholesale unless the person rendering the sale is exclusively rendering the amusement at wholesale.

     (5)  Tax upon sales representatives, etc.  Upon every person classified as a representative or purchasing agent under section 237-1, engaging or continuing within the State in the business of performing services for another, other than as an employee, there is likewise hereby levied and shall be assessed and collected a tax equal to [four] five per cent of the commissions and other compensation attributable to the services so rendered by the person.

     (6)  Tax on service business.

         (A)  Upon every person engaging or continuing within the State in any service business or calling including professional services not otherwise specifically taxed under this chapter, there is likewise hereby levied and shall be assessed and collected a tax equal to [four] five per cent of the gross income of the business, and in the case of a wholesaler under section 237-4(a)(10), the tax shall be equal to one-half of one per cent of the gross income of the business.

         (B)  The department may require that the person rendering a service at wholesale take from the licensed seller a certificate, in a form prescribed by the department, certifying that the sale is a sale at wholesale; provided that:

              (i)  Any licensed seller who furnishes a certificate shall be obligated to pay to the person rendering the service, upon demand, the amount of additional tax that is imposed upon the seller whenever the sale is not at wholesale; and

             (ii)  The absence of a certificate in itself shall give rise to the presumption that the sale is not at wholesale unless the person rendering the sale is exclusively rendering services at wholesale.

         (C)  Where any person is engaged in the business of selling interstate or foreign common carrier telecommunication services within and without the State, other than as a home service provider, the tax shall be imposed on that portion of gross income received by a person from service which is originated or terminated in this State and is charged to a telephone number, customer, or account in this State notwithstanding any other state law (except for the exemption under section 237-23(a)(1)) to the contrary.  If, under the Constitution and laws of the United States, the entire gross income as determined under this paragraph of a business selling interstate or foreign common carrier telecommunication services cannot be included in the measure of the tax, the gross income shall be apportioned as provided in section 237-21; provided that the apportionment factor and formula shall be the same for all persons providing those services in the State.

         (D)  Where any person is engaged in the business of a home service provider, the tax shall be imposed on the gross income received or derived from providing interstate or foreign mobile telecommunications services to a customer with a place of primary use in this State when such services originate in one state and terminate in another state, territory, or foreign country; provided that all charges for mobile telecommunications services which are billed by or for the home service provider are deemed to be provided by the home service provider at the customer's place of primary use, regardless of where the mobile telecommunications originate, terminate, or pass through; provided further that the income from charges specifically derived from interstate or foreign mobile telecommunications services, as determined by books and records that are kept in the regular course of business by the home service provider in accordance with section 239-24, shall be apportioned under any apportionment factor or formula adopted under subparagraph (C).  Gross income shall not include:

              (i)  Gross receipts from mobile telecommunications services provided to a customer with a place of primary use outside this State;

             (ii)  Gross receipts from mobile telecommunications services that are subject to the tax imposed by chapter 239;

            (iii)  Gross receipts from mobile telecommunications services taxed under section 237-13.8; and

             (iv)  Gross receipts of a home service provider acting as a serving carrier providing mobile telecommunications services to another home service provider's customer.

              For the purposes of this paragraph, "charges for mobile telecommunications services", "customer", "home service provider", "mobile telecommunications services", "place of primary use", and "serving carrier" have the same meaning as in section 239-22.

     (7)  Tax on insurance producers.  Upon every person engaged as a licensed producer pursuant to chapter 431, there is hereby levied and shall be assessed and collected a tax equal to 0.15 per cent of the commissions due to that activity.

     (8)  Tax on receipts of sugar benefit payments.  Upon the amounts received from the United States government by any producer of sugar (or the producer's legal representative or heirs), as defined under and by virtue of the Sugar Act of 1948, as amended, or other Acts of the Congress of the United States relating thereto, there is hereby levied a tax of one-half of one per cent of the gross amount received; provided that the tax levied hereunder on any amount so received and actually disbursed to another by a producer in the form of a benefit payment shall be paid by the person or persons to whom the amount is actually disbursed, and the producer actually making a benefit payment to another shall be entitled to claim on the producer's return a deduction from the gross amount taxable hereunder in the sum of the amount so disbursed.  The amounts taxed under this paragraph shall not be taxable under any other paragraph, subsection, or section of this chapter.

     (9)  Tax on other business.  Upon every person engaging or continuing within the State in any business, trade, activity, occupation, or calling not included in the preceding paragraphs or any other provisions of this chapter, there is likewise hereby levied and shall be assessed and collected, a tax equal to four per cent of the gross income thereof.  In addition, the rate prescribed by this paragraph shall apply to a business taxable under one or more of the preceding paragraphs or other provisions of this chapter, as to any gross income thereof not taxed thereunder as gross income or gross proceeds of sales or by taxing an equivalent value of products, unless specifically exempted."

     SECTION 48.  Section 237-15, Hawaii Revised Statutes, is amended to read as follows:

     "§237-15  Technicians.  When technicians supply dentists or physicians with dentures, orthodontic devices, braces, and similar items which have been prepared by the technician in accordance with specifications furnished by the dentist or physician, and such items are to be used by the dentist or physician in the dentist's or physician's professional practice for a particular patient who is to pay the dentist or physician for the same as a part of the dentist's or physician's professional services, the technician shall be taxed as though the technician were a manufacturer selling a product to a licensed retailer, rather than at the rate of [four] five per cent which is generally applied to professions and services."

     SECTION 49.  Section 237-16.5, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

     "(a)  This section relates to the leasing of real property by a lessor to a lessee.  There is hereby levied, and shall be assessed and collected annually, a privilege tax against persons engaging or continuing within the State in the business of leasing real property to another, equal to [four] five per cent of the gross proceeds or gross income received or derived from the leasing; provided that where real property is subleased by a lessee to a sublessee, the lessee, as provided in this section, shall be allowed a deduction from the amount of gross proceeds or gross income received from its sublease of the real property.  The deduction shall be in the amount allowed under this section.

     All deductions under this section and the name and general excise tax number of the lessee's lessor shall be reported on the general excise tax return.  Any deduction allowed under this section shall only be allowed with respect to leases and subleases in writing and relating to the same real property."

     SECTION 50.  Section 237-18, Hawaii Revised Statutes, is amended by amending subsection (f) to read as follows:

     "(f)  Where tourism related services are furnished through arrangements made by a travel agency or tour packager and the gross income is divided between the provider of the services and the travel agency or tour packager, the tax imposed by this chapter shall apply to each such person with respect to such person's respective portion of the proceeds, and no more.

     As used in this subsection "tourism related services" means catamaran cruises, canoe rides, dinner cruises, lei greetings, transportation included in a tour package, sightseeing tours not subject to chapter 239, admissions to luaus, dinner shows, extravaganzas, cultural and educational facilities, and other services rendered directly to the customer or tourist, but only if the providers of the services other than air transportation are subject to a [four] five per cent tax under this chapter or chapter 239."

     SECTION 51.  Section 237-31, Hawaii Revised Statutes, is amended to read as follows:

     "§237-31  Remittances.  (a)  All remittances of taxes imposed by this chapter shall be made by money, bank draft, check, cashier's check, money order, or certificate of deposit to the office of the department of taxation to which the return was transmitted.

     (b)  The department shall issue its receipts therefor to the taxpayer and shall pay the moneys into the state treasury as a state realization, to be kept and accounted for as provided by law; provided that:

     (1)  A sum, not to exceed $5,000,000, from all general excise tax revenues realized by the State shall be deposited in the state treasury in each fiscal year to the credit of the compound interest bond reserve fund;

     (2)  A sum from all general excise tax revenues realized by the State that is equal to one-half of the total amount of funds appropriated or transferred out of the hurricane reserve trust fund under sections 4 and 5 of Act 62, Session Laws of Hawaii 2011, shall be deposited into the hurricane reserve trust fund in fiscal year 2013-2014 and in fiscal year 2014-2015; provided that the deposit required in each fiscal year shall be made by October 1 of that fiscal year; and

[[](3)[]] Commencing with fiscal year 2018-2019, a sum from all general excise tax revenues realized by the State that represents the difference between the state public employer's annual required contribution for the separate trust fund established under section 87A-42 and the amount of the state public employer's contributions into that trust fund shall be deposited to the credit of the State's annual required contribution into that trust fund in each fiscal year, as provided in section 87A-42.

     (c)  Notwithstanding subsection (b), beginning on July 1, 2016, the additional revenues generated and collected from the increase in general excise tax rates imposed by sections 47, 48, 49, and 50 of Act    , Session Laws of Hawaii 2016, shall be deposited into a special account in the general fund for appropriation to and expenditure for operations, including salaries and maintenance costs, of the department of education under chapter 302A; provided that moneys budgeted for the department of education from sources of funding other than the special account, including capital improvement projects, shall remain equal to or greater than the inflation-adjusted minimum level of funding, except when the consumer price index for the twelve-month period ending June 30 of the preceding calendar year is less than zero.

     (d)  For the purposes of this section:

     "Consumer price index" means the average over a twelve-month period of the National Consumer Price Index, not seasonally adjusted, published monthly by the Bureau of Labor Statistics, United States Department of Labor, designated as the "National Consumer Price Index for All Urban Consumers - United States City Average".

     "Inflation-adjusted minimum level of funding" means the total amount of funding provided to the department of education in the fiscal year that Act , Session Laws of Hawaii 2016, was enacted; provided that this amount shall increase by three per cent for each subsequent fiscal year."

     SECTION 52.  Section 4 of Act 223, Session Laws of Hawaii 2015, is amended to read as follows:

     "SECTION 4.  This Act, upon its approval, shall apply to taxable years beginning after December 31, 2015[; provided that this Act shall be repealed on December 31, 2017, and section 235-55.85, Hawaii Revised Statutes, shall be reenacted in the form in which it read on the day prior to the effective date of this Act]."

PART XIII

     SECTION 53.  There is appropriated out of the general revenues of the State of Hawaii the sum of $10,000,000, or so much thereof as may be necessary for the fiscal year 2016-2017, to hire one hundred full-time equivalent regular education teachers to provide instruction in the following areas:

     (1)  Fine arts, including visual arts, drama, dance, and music;

     (2)  Hawaiian and Polynesian studies;

     (3)  Hawaiian language;

     (4)  Vocational, technical, and career pathway programs; and

     (5)  Mentor teachers.

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


PART XIV

     SECTION 54.  Not later than twenty days prior to the convening of the regular sessions of 2017, 2018, 2019, 2020, and 2021, the superintendent of education shall submit a report, including any proposed legislation, to the legislature concerning the progress of implementing this Act.  The report shall include the following:

     (1)  Progress on the implementation of a weighted student formula for special education and additional preparation time for special education teachers;

     (2)  Progress in providing air conditioning to all public school classrooms, including the number of classrooms without air conditioning and the status of air conditioning improvements using off-grid and photovoltaic technology;

     (3)  Plans, timetables, and budgetary projections to reduce class size for public elementary, middle and intermediate, and high schools, including cost estimates for necessary personnel and information regarding the total number of classes at each school not in compliance with part XI of this Act;

     (4)  Information on the impact of weighted student formula adjustments required by this Act on funding equity, including progress on staffing all public schools with a librarian, technology coordinator, vice principal, counselor, and special education transition coordinator, as applicable;

     (5)  Integration of whole child education curriculum into elementary, middle, and intermediate schools;

     (6)  Expansion of vocational, technical, and career pathway programming, including the number of students enrolled in such programs and cost estimates for any necessary additional personnel;

     (7)  Progress in aligning teacher salary steps with years of service, including the number of teachers whose salary steps are not aligned with years of service and budgetary projections for providing annual step increases to all teachers beginning with the 2016-2017 school year;

     (8)  Progress in recruiting and retaining new teachers, especially with regard to hard-to-staff positions;

     (9)  Information on the operation of the student loan subsidy program, including the total number of teachers receiving subsidies and total amount of subsidies provided to teachers;

    (10)  Progress on limiting the overuse of standardized testing in public schools, including the total number of student hours used for standardized testing and test preparation at each grade level, the number of students and parents or guardians opting out of standardized testing, and the number of special education students and students with limited English language proficiency receiving exemptions from standardized testing;

    (11)  Progress in implementing a debit card system for classroom supplies, including the cost of implementing the debit card system, total number of debit card purchases, total amount of debit card expenditures, and protocols for preventing abuse;

    (12)  Information on funding increases to the department of education as a result of this Act, including allocation of funds placed in the special account contained in part XII of this Act and strategies for minimizing administrative costs related to programs and functions required by this Act; and

    (13)  Any additional information that the department of education deems appropriate with the regard to the implementation of this Act.

     SECTION 55.  The board of education shall adopt rules in accordance with chapter 91, Hawaii Revised Statutes, to effectuate this Act.

     SECTION 56.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 57.  This Act shall take effect upon its approval.

 

INTRODUCED BY:

_____________________________

 

 


 


 

Report Title:

Public Education; Omnibus

 

Description:

Amends laws affecting the public education system in Hawaii, including whole child education, special education, vocational education, facilities, weighted student formula, teacher recruitment and retention, standardized testing, early childhood education, evaluations, classroom supplies, class size, and funding.

 

 

 

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