(a) Reservation of funds
From the total amount appropriated under section 6603(a) of this title for a fiscal year, the Secretary shall reserve—

(1) one-half of 1 percent for allotments for the United States Virgin Islands, Guam, American Samoa, and the Commonwealth of the Northern Mariana Islands, to be distributed among those outlying areas on the basis of their relative need, as determined by the Secretary, in accordance with the purpose of this subchapter; and

(2) one-half of 1 percent for the Secretary of the Interior for programs under this part in schools operated or funded by the Bureau of Indian Education.

(b) State allotments

(1) Hold harmless

(A) Fiscal years 2017 through 2022
For each of fiscal years 2017 through 2022, subject to paragraph (2) and subparagraph (C), from the funds appropriated under section 6603(a) of this title for a fiscal year that remain after the Secretary makes the reservations under subsection (a), the Secretary shall allot to each State an amount equal to the total amount that such State received for fiscal year 2001 under—

(i) section 2202(b) of this Act (as in effect on the day before January 8, 2002); and

(ii) section 306 of the Department of Education Appropriations Act, 2001 (as enacted into law by section 1(a)(1) of Public Law 106–554).

(B) Ratable reduction
If the funds described in subparagraph (A) are insufficient to pay the full amounts that all States are eligible to receive under subparagraph (A) for any fiscal year, the Secretary shall ratably reduce those amounts for the fiscal year.

(C) Percentage reduction
For each of fiscal years 2017 through 2022, the amount in subparagraph (A) shall be reduced by a percentage equal to the product of 14.29 percent and the number of years between the fiscal year for which the determination is being made and fiscal year 2016.

(2) Allotment of additional funds

(A) In general
Subject to subparagraph (B), for any fiscal year for which the funds appropriated under section 6603(a) of this title and not reserved under subsection (a) exceed the total amount required to make allotments under paragraph (1), the Secretary shall allot to each State the sum of—

(i) for fiscal year 2017—

(I) an amount that bears the same relationship to 35 percent of the excess amount as the number of individuals aged 5 through 17 in the State, as determined by the Secretary on the basis of the most recent satisfactory data, bears to the number of those individuals in all such States, as so determined; and

(II) an amount that bears the same relationship to 65 percent of the excess amount as the number of individuals aged 5 through 17 from families with incomes below the poverty line in the State, as determined by the Secretary on the basis of the most recent satisfactory data, bears to the number of those individuals in all such States, as so determined;

(ii) for fiscal year 2018—

(I) an amount that bears the same relationship to 30 percent of the excess amount as the number of individuals aged 5 through 17 in the State, as determined by the Secretary on the basis of the most recent satisfactory data, bears to the number of those individuals in all such States, as so determined; and

(II) an amount that bears the same relationship to 70 percent of the excess amount as the number of individuals aged 5 through 17 from families with incomes below the poverty line in the State, as determined by the Secretary on the basis of the most recent satisfactory data, bears to the number of those individuals in all such States, as so determined;

(iii) for fiscal year 2019—

(I) an amount that bears the same relationship to 25 percent of the excess amount as the number of individuals aged 5 through 17 in the State, as determined by the Secretary on the basis of the most recent satisfactory data, bears to the number of those individuals in all such States, as so determined; and

(II) an amount that bears the same relationship to 75 percent of the excess amount as the number of individuals aged 5 through 17 from families with incomes below the poverty line in the State, as determined by the Secretary on the basis of the most recent satisfactory data, bears to the number of those individuals in all such States, as so determined; and

(iv) for fiscal year 2020—

(I) an amount that bears the same relationship to 20 percent of the excess amount as the number of individuals aged 5 through 17 in the State, as determined by the Secretary on the basis of the most recent satisfactory data, bears to the number of those individuals in all such States, as so determined; and

(II) an amount that bears the same relationship to 80 percent of the excess amount as the number of individuals aged 5 through 17 from families with incomes below the poverty line in the State, as determined by the Secretary on the basis of the most recent satisfactory data, bears to the number of those individuals in all such States, as so determined.

(B) Exception
No State receiving an allotment under subparagraph (A) may receive less than one-half of 1 percent of the total excess amount allotted under such subparagraph for a fiscal year.

(3) Fiscal year 2021 and succeeding fiscal years
For fiscal year 2021 and each of the succeeding fiscal years—

(A) the Secretary shall allot funds appropriated under section 6603(a) of this title and not reserved under subsection (a) to each State in accordance with paragraph (2)(A)(iv); and

(B) the amount appropriated but not reserved shall be treated as the excess amount.

(4) Reallotment
If any State does not apply for an allotment under this subsection for any fiscal year, the Secretary shall reallot the amount of the allotment to the remaining States in accordance with this subsection.

(c) State uses of funds

(1) In general
Except as provided under paragraph (3), each State that receives an allotment under subsection (b) for a fiscal year shall reserve not less than 95 percent of such allotment to make subgrants to local educational agencies for such fiscal year, as described in section 6612 of this title.

(2) State administration
A State educational agency may use not more than 1 percent of the amount allotted to such State under subsection (b) for the administrative costs of carrying out such State educational agency's responsibilities under this part.

(3) Principals or other school leaders
Notwithstanding paragraph (1) and in addition to funds otherwise available for activities under paragraph (4), a State educational agency may reserve not more than 3 percent of the amount reserved for subgrants to local educational agencies under paragraph (1) for one or more of the activities for principals or other school leaders that are described in paragraph (4).

(4) State activities

(A) In general
The State educational agency for a State that receives an allotment under subsection (b) may use funds not reserved under paragraph (1) to carry out 1 or more of the activities described in subparagraph (B), which may be implemented in conjunction with a State agency of higher education (if such agencies are separate) and carried out through a grant or contract with a for-profit or nonprofit entity, including an institution of higher education.

(B) Types of State activities
The activities described in this subparagraph are the following:

(i) Reforming teacher, principal, or other school leader certification, recertification, licensing, or tenure systems or preparation program standards and approval processes to ensure that—

(I) teachers have the necessary subject-matter knowledge and teaching skills, as demonstrated through measures determined by the State, which may include teacher performance assessments, in the academic subjects that the teachers teach to help students meet challenging State academic standards;

(II) principals or other school leaders have the instructional leadership skills to help teachers teach and to help students meet such challenging State academic standards; and

(III) teacher certification or licensing requirements are aligned with such challenging State academic standards.

(ii) Developing, improving, or providing assistance to local educational agencies to support the design and implementation of teacher, principal, or other school leader evaluation and support systems that are based in part on evidence of student academic achievement, which may include student growth, and shall include multiple measures of educator performance and provide clear, timely, and useful feedback to teachers, principals, or other school leaders, such as by—

(I) developing and disseminating high-quality evaluation tools, such as classroom observation rubrics, and methods, including training and auditing, for ensuring inter-rater reliability of evaluation results;

(II) developing and providing training to principals, other school leaders, coaches, mentors, and evaluators on how to accurately differentiate performance, provide useful and timely feedback, and use evaluation results to inform decisionmaking about professional development, improvement strategies, and personnel decisions; and

(III) developing a system for auditing the quality of evaluation and support systems.

(iii) Improving equitable access to effective teachers.

(iv) Carrying out programs that establish, expand, or improve alternative routes for State certification of teachers (especially for teachers of children with disabilities, English learners, science, technology, engineering, mathematics, or other areas where the State experiences a shortage of educators), principals, or other school leaders, for—

(I) individuals with a baccalaureate or master's degree, or other advanced degree;

(II) mid-career professionals from other occupations;

(III) paraprofessionals;

(IV) former military personnel; and

(V) recent graduates of institutions of higher education with records of academic distinction who demonstrate the potential to become effective teachers, principals, or other school leaders.

(v) Developing, improving, and implementing mechanisms to assist local educational agencies and schools in effectively recruiting and retaining teachers, principals, or other school leaders who are effective in improving student academic achievement, including effective teachers from underrepresented minority groups and teachers with disabilities, such as through—

(I) opportunities for effective teachers to lead evidence-based (to the extent the State determines that such evidence is reasonably available) professional development for the peers of such effective teachers; and

(II) providing training and support for teacher leaders and principals or other school leaders who are recruited as part of instructional leadership teams.

(vi) Fulfilling the State educational agency's responsibilities concerning proper and efficient administration and monitoring of the programs carried out under this part, including provision of technical assistance to local educational agencies.

(vii) Developing, or assisting local educational agencies in developing—

(I) career opportunities and advancement initiatives that promote professional growth and emphasize multiple career paths, such as instructional coaching and mentoring (including hybrid roles that allow instructional coaching and mentoring while remaining in the classroom), school leadership, and involvement with school improvement and support;

(II) strategies that provide differential pay, or other incentives, to recruit and retain teachers in high-need academic subjects and teachers, principals, or other school leaders, in low-income schools and school districts, which may include performance-based pay systems; and

(III) new teacher, principal, or other school leader induction and mentoring programs that are, to the extent the State determines that such evidence is reasonably available, evidence-based, and designed to—

(aa) improve classroom instruction and student learning and achievement, including through improving school leadership programs; and

(bb) increase the retention of effective teachers, principals, or other school leaders.

(viii) Providing assistance to local educational agencies for the development and implementation of high-quality professional development programs for principals that enable the principals to be effective and prepare all students to meet the challenging State academic standards.

(ix) Supporting efforts to train teachers, principals, or other school leaders to effectively integrate technology into curricula and instruction, which may include training to assist teachers in implementing blended learning (as defined in section 7112(1) of this title) projects.

(x) Providing training, technical assistance, and capacity-building to local educational agencies that receive a subgrant under this part.

(xi) Reforming or improving teacher, principal, or other school leader preparation programs, such as through establishing teacher residency programs and school leader residency programs.

(xii) Establishing or expanding teacher, principal, or other school leader preparation academies, with an amount of the funds described in subparagraph (A) that is not more than 2 percent of the State's allotment, if—

(I) allowable under State law;

(II) the State enables candidates attending a teacher, principal, or other school leader preparation academy to be eligible for State financial aid to the same extent as participants in other State-approved teacher or principal preparation programs, including alternative certification, licensure, or credential programs; and

(III) the State enables teachers, principals, or other school leaders who are teaching or working while on alternative certificates, licenses, or credentials to teach or work in the State while enrolled in a teacher, principal, or other school leader preparation academy.

(xiii) Supporting the instructional services provided by effective school library programs.

(xiv) Developing, or assisting local educational agencies in developing, strategies that provide teachers, principals, or other school leaders with the skills, credentials, or certifications needed to educate all students in postsecondary education coursework through early college high school or dual or concurrent enrollment programs.

(xv) Providing training for all school personnel, including teachers, principals, other school leaders, specialized instructional support personnel, and paraprofessionals, regarding how to prevent and recognize child sexual abuse.

(xvi) Supporting opportunities for principals, other school leaders, teachers, paraprofessionals, early childhood education program directors, and other early childhood education program providers to participate in joint efforts to address the transition to elementary school, including issues related to school readiness.

(xvii) Developing and providing professional development and other comprehensive systems of support for teachers, principals, or other school leaders to promote high-quality instruction and instructional leadership in science, technology, engineering, and mathematics subjects, including computer science.

(xviii) Supporting the professional development and improving the instructional strategies of teachers, principals, or other school leaders to integrate career and technical education content into academic instructional practices, which may include training on best practices to understand State and regional workforce needs and transitions to postsecondary education and the workforce.

(xix) Enabling States, as a consortium, to voluntarily develop a process that allows teachers who are licensed or certified in a participating State to teach in other participating States without completing additional licensure or certification requirements, except that nothing in this clause shall be construed to allow the Secretary to exercise any direction, supervision, or control over State teacher licensing or certification requirements.

(xx) Supporting and developing efforts to train teachers on the appropriate use of student data to ensure that individual student privacy is protected as required by section 1232g of this title (commonly known as the "Family Educational Rights and Privacy Act of 1974") and in accordance with State student privacy laws and local educational agency student privacy and technology use policies.

(xxi) Supporting other activities identified by the State that are, to the extent the State determines that such evidence is reasonably available, evidence-based and that meet the purpose of this subchapter.

(d) State application

(1) In general
In order to receive an allotment under this section for any fiscal year, a State shall submit an application to the Secretary at such time and in such manner as the Secretary may reasonably require.

(2) Contents
Each application described under paragraph (1) shall include the following:

(A) A description of how the State educational agency will use funds received under this subchapter for State-level activities described in subsection (c).

(B) A description of the State's system of certification and licensing of teachers, principals, or other school leaders.

(C) A description of how activities under this part are aligned with challenging State academic standards.

(D) A description of how the activities carried out with funds under this part are expected to improve student achievement.

(E) If a State educational agency plans to use funds under this part to improve equitable access to effective teachers, consistent with section 6311(g)(1)(B) of this title, a description of how such funds will be used for such purpose.

(F) If applicable, a description of how the State educational agency will work with local educational agencies in the State to develop or implement State or local teacher, principal, or other school leader evaluation and support systems that meet the requirements of subsection (c)(4)(B)(ii).

(G) An assurance that the State educational agency will monitor the implementation of activities under this part and provide technical assistance to local educational agencies in carrying out such activities.

(H) An assurance that the State educational agency will work in consultation with the entity responsible for teacher, principal, or other school leader professional standards, certification, and licensing for the State, and encourage collaboration between educator preparation programs, the State, and local educational agencies to promote the readiness of new educators entering the profession.

(I) An assurance that the State educational agency will comply with section 7881 of this title (regarding participation by private school children and teachers).

(J) A description of how the State educational agency will improve the skills of teachers, principals, or other school leaders in order to enable them to identify students with specific learning needs, particularly children with disabilities, English learners, students who are gifted and talented, and students with low literacy levels, and provide instruction based on the needs of such students.

(K) A description of how the State will use data and ongoing consultation as described in paragraph (3) to continually update and improve the activities supported under this part.

(L) A description of how the State educational agency will encourage opportunities for increased autonomy and flexibility for teachers, principals, or other school leaders, such as by establishing innovation schools that have a high degree of autonomy over budget and operations, are transparent and accountable to the public, and lead to improved academic outcomes for students.

(M) A description of actions the State may take to improve preparation programs and strengthen support for teachers, principals, or other school leaders based on the needs of the State, as identified by the State educational agency.

(3) Consultation
In developing the State application under this subsection, a State shall—

(A) meaningfully consult with teachers, principals, other school leaders, paraprofessionals (including organizations representing such individuals), specialized instructional support personnel, charter school leaders (in a State that has charter schools), parents, community partners, and other organizations or partners with relevant and demonstrated expertise in programs and activities designed to meet the purpose of this subchapter;

(B) seek advice from the individuals, organizations, or partners described in subparagraph (A) regarding how best to improve the State's activities to meet the purpose of this subchapter; and

(C) coordinate the State's activities under this part with other related strategies, programs, and activities being conducted in the State.

(4) Limitation
Consultation required under paragraph (3) shall not interfere with the timely submission of the application required under this section.

(e) Prohibition
Nothing in this section shall be construed to authorize the Secretary or any other officer or employee of the Federal Government to mandate, direct, or control any of the following:

(1) The development, improvement, or implementation of elements of any teacher, principal, or other school leader evaluation system.

(2) Any State or local educational agency's definition of teacher, principal, or other school leader effectiveness.

(3) Any teacher, principal, or other school leader professional standards, certification, or licensing.