The federal acts seem to recognize these findings. Provisions in the new acts reflecting this understanding of the school improvement process include:

• Congress increased local flexibility over the use of federal funds. For example, any school with more than half of its students qualifying as low-income will be able to use Title 1 funds for school-wide improvement. Previously, this flexibility was extended to schools with at least 75 percent of the students classified as poor. The waiver authority afforded the Secretary of Education is another example of promoting increased local flexibility.
• The acts recognize that state regulation must promote quality rather than enforce rules. Instead of a process-oriented regulatory approach, the federal legislation focuses on the Goals 2000 standards as the way to improve programs and provide accountability.
• The federal acts recognize the need to integrate services. All three acts use the Goals 2000 performance standards as a central measure of program accountability. Thus, students targeted by categorical programs will be held to the same standards as other students. In addition, all three acts contain coordination requirements. States may consolidate various program plans into one plan. States may also require LEAs to use consolidated planning.

Principles for Program Design

Our report on categorical programs developed five principles we believe the Legislature should use in reforming categorical programs. These five principles, shown in Figure 12, are remarkably consistent with the new federal framework. Both seek to clearly identify program goals, use those goals as an accountability structure, and increase local control over the use of funds. Greater coordination and consolidation also is emphasized in both our report and the federal strategy.

While our report was written to help the Legislature in the reform of state categorical programs, we think the state should implement the three federal acts based on these principles. These principles are consistent with the federal strategy and provide a more comprehensive program design checklist. For these reasons, the federal framework offers an important opportunity to improve the implementation of the federal acts and to rethink the state's education system as well.

These principles describe a process for improvement, rather than a recipe for success. As we discuss in the next section, not all of the implementation questions can be answered. As a result, we view the framework contained in the federal legislation and our recommended principles as a long-term process of refining how state and federal governments can most effectively help improve local education programs.

Significant Challenges to Effective Implementation Exist

As we described in previous sections, California is far along in developing many of the programs and elements required by the new federal acts. Curriculum frameworks are well- developed; significant experience with state-wide assessments has been garnered over the last 20 years; the state's school-to-work programs are among the more developed in the nation.

Despite California's progress on these issues, implementation of the three federal acts faces significant challenges. The difficult implementation issues that must be addressed range from major strategic questions--such as how to redirect existing bureaucracies to support improvement activities--to individual implementation issues, such as how Goals 2000 funds should be spent. Major challenges facing the state and LEAs are discussed below.

Complex Web of State and Federal Programs Remain

The three acts create more than 35 funding programs, some of which are administered by the state and others that are administered at the federal level. These programs, in addition to existing state categorical programs, create a complex financial and policy environment for LEAs. According to a 1988 SDE report: "[A]dding layers of multiple categorical programs onto the base program without a vision and cohesive strategy has impaired the prospects for significantly narrowing the achievement gap [between special needs students and other students] . . . "1

Reducing this complexity could promote effective implementation by LEAs. For instance, the state could create a less-complex program environment by eliminating or consolidating categorical programs. In addition, SDE could increase local flexibility by coordinating state and federal reforms at the state level, thereby freeing LEAs from that responsibility. Such changes probably would require state legislation and/or federal waivers.

The SDE and Many LEAs Are Not Well-Structured to Implement Acts

Many different divisions within the State Department of Education --we counted at least six--are directly responsible for administering part of these three federal acts. The department is structured along program lines, which magnifies the importance of specific program issues. As one study commented, "Most [state education] agencies--sectioned into offices corresponding to federal and other special programs--[aren't] well-suited to lead reforms..." For the most part, this comment applies to SDE.2

Similarly, many districts also are not structured to implement the federal strategy effectively. The federal changes highlight the importance of districts in assisting schools in their improvement efforts. Unfortunately, many school districts have adopted a "command- and-control" role over schools, similar to the existing regulatory strategy embedded in most state and federal programs. As a result, many districts will have to adopt a new role, one of supporting school-site improvement efforts.

These challenges to SDE--changing its own role and helping school districts grow into a new role--will require the department to rethink its organization and standard operating procedures. Communication within the agency will have to improve. Regulation development should become less important and technical assistance should become more important. Financial audits should become less common, and program evaluations should become more common.

Performance-Based Regulation Is Unproven

The new federal acts seek to judge local programs based on specific student outcomes. While focusing on performance rather than process makes sense, at least two potential issues could blunt the effectiveness of this system to improve student achievement:

• Performance-based regulation could encourage LEAs to manipulate performance scores rather than focus attention on improving instruction and curriculum. One unintended consequence of state examinations required in the 1980s was the attempt by some districts to improve school scores by changing student responses or permitting only higher achieving students to take the test. This illustrates one dangerous side-effect of performance- based systems--performance scores are perceived as the end rather than as a means to improve the system.
• Political and practical problems could inhibit improving achievement at low- performing schools and districts. What should the state do when a school or LEA exhibits chronic low performance? State intrusion into local education policy matters creates a political issue regarding the appropriate role of the state. Currently, the SDE may require only the most severely low-performing schools to undergo specific improvement activities as part of the Focus Schools program. The department is not authorized to require certain actions of less-severely affected schools or low-performing districts, however. State intervention into district affairs directly raises the political issue of state interference into local issues. State assistance to help improve school performance also encounters practical problems--educators have had limited success in quickly improving a school's outcomes. The problems of low-performing schools can stem from many sources and are difficult to overcome. It will take time and experience before the state becomes proficient at using the outcome-based regulatory system to address the needs of low-performing schools and districts.

Little Solid Evaluation Data Exists to Guide Local Improvement Efforts

Educators have almost no good data demonstrating the impact of many educational services. This lack of evaluation data reveals an obvious need for better information on the impact of various school reform efforts. This information is needed to help LEAs design the most effective programs to meet their students' needs.

The state needs to begin a systematic effort to evaluate local program models. It is an appropriate role for the state--the benefits of evaluation are statewide in nature. In fact, we think the audience for evaluation evidence is national. Since program models used in California may be replicated by other states and LEAs, data on effectiveness will have nationwide significance.

This argues for a broader evaluation effort, one in which the federal government and foundations are partners. For instance, federal funding has provided the core support for evaluations of social services programs. Perhaps such a state-federal partnership can be established in K-12 education. This would reduce the cost of evaluations to individual states and, through the federal government, make evaluation findings available to other states and LEAs.

Barriers to Change Will Remain

Even if states and LEAs emphasize improvement, local barriers to change will slow the pace of improvement, for a number of reasons. First, educators may resist reform efforts if they believe the quality and rigor of instruction will suffer. This is a particular problem in school-to-work, since vocational education has a lower status among many educators.

Second, schools find the power of "standard operating procedures" very strong. Effective reforms take great effort to develop and carry out. As a result, without strong teacher and parental support, changes are very difficult to effect. Even schools that seek to change often find reform elusive. For instance, in 1991 the Accelerated Schools Project--a national network of schools and educators--surveyed schools a few months after initial intensive training and found that one-third of the project's schools had not taken any actions to initiate reform at the school.

Third, lack of funding may inhibit improvement activities. Reform takes resources-- money to rewrite curriculum, create time for staff development, purchase new materials. Yet the amount of new funding provided in these programs is relatively small. The Goals 2000 and STWOA funding that California is expected to receive is small, relative to the amount needed to help all schools and districts--indeed, STWOA provides no long-term funding at all. In contrast, the Partnership Academy program, one of California's school-to-work programs, provides up to $1,000 per student annually to pay for the additional costs of the program.

These challenges to change will slow improvements to instruction and curriculum unless strong incentives for improvements are built into the state policy and implementation. The whole point of the new federal strategy is restructuring programs and state regulation to create incentives for improvement. The greater the focus the state can place on these incentives--through implementation, through restructuring state categorical programs--the more likely this new strategy can overcome local resistance to change.

Chapter 5
Recommendations

We believe the new federal legislation offers California several important opportunities for improving the state's K-12 system. First, the acts themselves provide a new regulatory structure--and limited new funding--for improving the effectiveness of the federal education programs. Second, the federal acts encourage consolidation of the various federal programs into a unified improvement effort. This will spur new efforts by SDE and LEAs to link federal programs more closely with the basic educational program.

The third opportunity created by the federal acts is to integrate the state's programs within the structure created by the new federal programs. We believe the federal legislation provides sufficient state flexibility that California would be able to create a policy and program structure that meets the state's needs, provides clear policy direction to LEAs and supplies more program flexibility than currently exists.

Based on the five principles of program design discussed in the previous section, we have developed an approach for implementing the new federal acts and beginning the process of restructuring California's education programs within the framework created by the acts. Figure 13 (next page) contains a summary of our proposal.

Develop Clear Goals and Standards as Part of Goals 2000

The Legislature should monitor the development of the state's Goals 2000 plan to ensure that the student performance standards provide clear, high, standards for California's schools.

The Goals 2000 requirement that states set student performance standards is, in many ways, the cornerstone of the framework established in the new federal acts. We believe the state should set high goals for students. In the short run, making yearly progress toward meeting the goals--rather than attaining the goals--should be the indicator of success for most districts. The state also should ensure that improvement reaches all students. Toward that end, performance data should be available for different sub-groups of students.

The choice of performance measures will be an important influence over the direction of reform in California. Initially, we suggest limiting the number of academic performance measures to English, writing, mathematics, science and history. Other outcome goals--such as graduation rates, employment rates and postsecondary school attendance rates--would help connect the Goals 2000 process to the goals of STWOA and ESEA. Too many goals, however, risks diluting the strength of the goal-setting process--the more focused the state's goals are, the clearer the message the state sends to LEAs.

Getting the Goals 2000 implementation under way quickly is essential. Effective implementation of the three acts depends on establishing the state's goals and standards. The state, however, has not yet moved forward in implementing Goals 2000. As a result, the implementation of STWOA and ESEA is occurring without a clear picture of the state's overall goals.

Because of the importance of the Goals 2000 goals and standards, we suggest the Legislature closely monitor the development of the state's improvement plan. The chairs of the Senate and Assembly Education Committees can provide an avenue for input, since these individuals will be appointed as the Legislature's representatives to the state panel that will develop the state plan.

Resolve Assessment Issues

Legislature Should Establish State Assessment Program

We recommend the Legislature enact legislation to reauthorize a state assessment program that meets the needs of the state in obtaining comparison data on the performance of each school.

The effectiveness of the federal framework will be greatly diminished if no common assessment tool is available. Assessments can fulfill two functions: (1) providing individual student scores, which affords teachers and parents diagnostic information on individual student performance and (2) supplying comparison data, which can be used to rate the performance of each school with other, similar, schools. The CLAS tests were designed to provide both diagnostic and comparison information.

The CLAS tests were unable to fulfill the diagnostic function, however, for two reasons. First, the tests were judged not sufficiently reliable for use at the student level due to inconsistencies in scoring. Second, because the CLAS tests were to be given only three times during a student's K-12 career, the tests could not generate an annual history of test scores for each student. Without a more complete history, it is difficult to determine, for instance, whether an individual student's poor performance on a test one year was due to poor instruction or because the student just had a bad day. For these reasons, the information to be gained from the CLAS tests did not easily lend itself to be used for diagnostic purposes.

Both of these problems can be overcome, but at a very high cost. To ensure a reliable student score and mandate testing in additional grades would result in a state testing program costing well over $100 million annually. Therefore, we believe the Legislature should review other options--including standardized tests that are available from private sources or portfolio assessments--to provide individual student information. Most schools already use similar tools for diagnostic purposes.

To provide the comparison data the state needs to assess school performance, we recommend the Legislature enact legislation reauthorizing a state testing program that will collect school-level data on student performance. If the Legislature also wants to mandate tests that are reliable at a student-level, we recommend the Legislature direct SDE to outline the costs and benefits of the different options available to the state.

Take Steps to Fill the Temporary Assessment Gap

We recommend the Legislature include in the reauthorization of the state assessment program the requirement that SDE provide staff development in using such an assessment to teachers and administrators.

With the Governor's veto of CLAS, it is unlikely that any new test could be available for at least two years, at the earliest. This leaves an assessment gap for both the state and for schools. For the state, little can be done until a new test is authorized and implemented.

For schools, however, two steps can be taken to fill the assessment gap. First, SDE should encourage schools to continue testing students with performance-based tests (such as the old CLAS tests or other similar tests). Schools, of course, would have the choice of whether to give the tests or not, and they could use only test questions approved by teachers and parents. Teachers at each school would score the tests. The state would not collect test results.

Continued testing would have important local benefits. For instance, the tests help focus schools on the "higher-level" skills that students must learn. In addition, by scoring the locally administered tests, teachers, parents, and administrators would develop a better sense of student achievement at the school.

The second step the state should take is to begin training teachers and administrators to (1) score the performance tests and (2) translate the scores into specific plans for improving the school program. Currently, many teachers have only a minimal understanding of performance-based assessment and its uses in improving instruction. Learning to score these tests would provide teachers and administrators with an understanding of the state's expectations for "high" student performance.

Translating actual student performance into a plan for improving the school's program is one of the primary purposes for the emphasis in Goals 2000 on performance and assessment. Thus, staff development in assessment during this period where there is no formal state test could yield statewide benefits by equipping schools to effectively use assessment as a tool for improvement.

For these reasons, we recommend the Legislature include in its reauthorization of the state assessment program the requirement that SDE provide staff development services in the scoring and uses of assessments. This training should be part of the department's larger plan to provide staff development as part of Goals 2000 and ESEA.

Consider Including Career Elements In State Assessments

We recommend the Legislature direct SDE to explore the costs and benefits of adding a new test element to the tenth grade test--one that would gauge student world-of-work skills.

Currently, state assessments have focused on academic knowledge and skills, such as mathematics and reading. With the emphasis on career issues in the STWOA, the state could echo that emphasis by placing career elements on the new state test.

Effective school-to-work programs begin in middle school and even elementary school. Career exploration, career counseling, and other work issues should be included in elementary and middle school curricula so that students are capable of making informed career decisions at the ninth or tenth grade. By adding a work-skills component or including related-issues as part of the existing test components, the state would reenforce its goal of helping students become more prepared for working upon graduation.

Therefore, to provide information to the Legislature on this issue, we recommend the Legislature require SDE to report on the costs and benefits of adding a career element to the tenth-grade state assessment.

Require a Consolidated State Plan

Legislature Should Direct SDE to Merge Federal Acts

We recommend the Legislature require SDE to submit a consolidated application to the federal government for Goals 2000, STWOA, and ESEA.

As we discussed earlier, the SDE is beginning the process of coordinating the three federal programs by:

• Beginning the process of developing performance and content standards required under Goals 2000 and ESEA. Since California has well-developed curriculum frameworks and assessments, the department is identifying the areas that require further work.
• Developing common visions of the role of assessment, technical assistance, and staff development in the school improvement process.
• Considering the consolidation of all Title 1 applications into one application.

Based on our review, the scope of these activities is limited. While SDE is headed in the right direction, the coordination of federal programs could go far beyond what SDE has initiated. Also, in some areas, we are concerned that each program essentially will be implemented separately from the others. The costs of this separation is extremely high. Below are examples of areas where we believe better coordination should be occurring.

Joint Planning

The department's divisions responsible for Goals 2000, STWOA, and ESEA should be jointly determining issues that are common to the programs. For instance, school-to-work is a school improvement strategy for high schools. As such, school-to-work programs should be considered part of the Goals 2000 effort and, therefore, eligible for Goals 2000 improvement funds.

The close relationship between school-to-work and Goals 2000 suggests that funding allocations and program decisions in the two programs should be made jointly. For example, how Goals 2000 grants are distributed to elementary, middle, and high school should be influenced by the amount of STWOA funding available and the relative "need" for improvement in the different types of schools.

Joint Reform Strategies

The STWOA task force appears to be adopting a different, and perhaps less effective, implementation strategy than the one being considered by SDE. The task force recommended a state-centered implementation strategy, using the STWOA funds for a number of demonstration programs around the state. These programs will provide solutions that "will guide the formulation of more general state policies, state technical assistance, and staff development." In other words, the state will learn how to better help LEAs structure their programs.

In Goals 2000, however, SDE is developing an LEA-centered strategy where demonstration programs become the source of technical assistance and policy guidance for other LEAs in the region. This strategy recognizes two important factors. First, the state's resources are too limited to meet the needs of every school district. Educators are finding that a coaching model--with periodic monitoring and help--to changing instructional practices works most effectively. It would be quite expensive to provide this type of help from Sacramento. Second, program assistance provided by another local practitioner--one who has worked to successfully improve local schools--is more likely to be more responsive and better received than help from the state level.

At the current time, we were not able to determine what implementation strategy SDE plans to use for ESEA. There may be reasons why different implementation strategies are needed for the different programs. In this case, however, the differences appear to be based more on institutional factors rather than a well-justified rationale.

Integrating Reform Components

Our review indicates that implementation of STWOA is not being integrated into the other federal programs. School-to-work programs are designed to reduce dropouts, improve the achievement of low-performing students, and increase attendance at college and technical schools. The federal legislation envisions these programs as part of the basic educational program, not as "add-ons," or separate special programs. Consistent with this view, STWOA provides no long-term funding; additional costs of these programs would come from existing sources, including categorical programs such as Title 1.

Currently, the department has not focused on how ESEA should support school-to-work objectives. We think the department should require that state and local Title 1 plans contain a school-to-work element. Local school-to-work designs would not be held to specific STWOA program requirements--greater flexibility should be provided to schools not seeking STWOA funds. Yet the goal of improving high schools through school-to-work programs should be manifested in all ESEA program activities.

State coordination of the federal acts appears to be falling short of what is needed to ensure that the three federal programs are working in concert. One way to encourage SDE to take further steps toward merging these acts is to require the department to submit to the federal government a consolidated plan for the three acts. A consolidated plan would tend to emphasize the different program connections and could lead SDE to a more unified approach to implementing the three acts. Therefore, to improve the coordination between the three new federal acts, we recommend the Legislature require SDE to submit a consolidated state plan for the three federal acts.

Within ESEA, we recommend the consolidation begin with Titles 1, 2, and 6. Title 1 must be included because the bulk of ESEA funds are channeled through the compensatory education program. Title 2 of ESEA should be included because staff development activities will play a critical role in helping teachers adapt to local reforms. Title 6 should be part of the consolidated effort in recognition that the funds provide flexible support for cementing the pieces of reform together into a whole.

The timing of such a consolidated plan is a problem, however. The STWOA planning is well underway while Goals 2000 implementation has yet to really begin. In addition, ESEA planning timelines are too short to accommodate a complicated rethinking of the state role. Because of these problems, the Legislature should require SDE to start the process of integrated planning but not require a consolidated plan until next year. Since a consolidated plan would result in some significant changes in the state's implementation of some aspects of the federal acts, the delay may cause some local confusion. We hope this confusion could be kept at a minimum by keeping LEAs informed of the state's intentions.

Require Consolidated Local Plans

Pursue Local Coordination

We recommend the Legislature require SDE to consolidate local plans for the Goals 2000, STWOA and ESEA. We also recommend the Legislature require SDE to include specific state categorical programs in these consolidated applications.

For the same reasons a consolidated plan for the state makes sense, we believe consolidated plans for LEAs also have merit. Under federal law, states can require consolidated local plans if the state submits a consolidated plan to the federal government.

The local plans could emphasize the connections between the different acts. Local ESEA plans should be required to address the standards set out in the state's Goals 2000 plan. Each ESEA plan affecting high schools also should have a school-to-work component. Local plans should map out district's goals in improving achievement over a five-year period and the strategy for fulfilling those goals.

The SDE faces a challenge in developing the criteria that the state should use to review and approve local plans. On the one hand, the SDE must be willing to reject local plans that do not have the potential to meet the state's goals. On the other hand, the state should not deny plans based on a unique vision of how to reach those goals. Districts should be given great flexibility over program design provided they can justify their approach.

Including State Categorical Programs In the Reform Efforts

A consolidated local application to the state for the three federal education acts could be strengthened substantially by including the major state categorical programs. We have identified several state categorical programs that could be included as part of a district's consolidated application for federal and state funds. For instance, along with Title 6 of ESEA, state resources for staff development are made available through the School Improvement program, SB 1882 Staff Development program, and the Mentor Teacher program. Similarly, the services for compensatory services should include Title 1 of ESEA and state Economic Impact Aid (EIA).

In addition, the Legislature could magnify the impact of state categorical programs by amending or consolidating these and other programs so that they reenforce the state's educational goals. Our Reform of Categorical Education Programs report provides recommendations for categorical program reform that are consistent with the strategy contained in the three federal acts.

Therefore, we recommend the Legislature require SDE to consolidate local plans for the three federal education programs and selected state categorical programs. Over time, the consolidated plan should include most major educational categorical programs, including special education and vocational education.

The federal government is headed in this direction. Reauthorization of the federal special and vocational education programs is expected to increase local flexibility and link with Goals 2000 and the other federal education programs. Regardless of whether the federal government follows through with these changes, however, the state should encourage integration of these programs with the other state and federal categorical programs.

Improve SDE Organization

Legislature Should Encourage Restructuring

We recommend the Legislature require SDE to report on how it plans to reorganize in order to improve communication and more effectively carry out the new federal school improvement framework.

The federal acts provide three direct leverage points for the state to foster reform at the local level. First, the state has the power to approve local plans and award grants to LEAs and other agencies that apply for funds. Second, the federal acts require the state to provide technical assistance to LEAs. Third, the SDE is required to coordinate staff development in support of the three programs. Many of the activities required by the different programs are similar in nature and could readily be consolidated into one effort.

As we discussed above, however, SDE is organized along program lines; plan approval, technical assistance, and staff development activities all take place within a program context. This organizational structure could pose a barrier to effective implementation. As a result, SDE needs to consider whether changes in the department's structure and operations could improve its ability to administer education programs. There are a number of options.

• Uniform policies throughout the department. The development of consistent policy statements could lead to a consistent vision of the elements of reform and its implementation. Over time, this process could help the department develop the internal communication needed to effectively coordinate the federal acts.
• Reorganize to emphasize staff development and technical assistance. Multi-disciplinary teams--consisting of experts in school-to-work, meeting the needs of low- income and low-performing students and in school reform--could be formed from existing program staff. These teams would be organized to coordinate needed services at the local level.
• Reorganize around grade levels. This would create an elementary, middle, and high school division. The department could use a variety of networks-- associations of reforming schools such as the Coalition of Essential Schools, the It's Elementary network, and the Accelerated Schools Project--to coordinate staff development and provide technical assistance.

Deciding how to organize is best left to the department. It may be that parts of all three options are needed to permit SDE to maximize its ability to foster local school reform through the implementation of state and federal categorical programs. To ensure the Legislature is informed of the department's plans for implementing the federal acts, we recommend the Legislature require SDE to submit a report on its organizational plan for carrying out the new federal legislation.

Improve Data Collection and Evaluation

Information is Critical for Performance-Based Regulation

We recommend the Legislature devote a portion of Goals 2000 funding to improving the SDE's capacity to (1) collect high quality data needed for a performance-based regulatory system and (2) conduct rigorous program evaluations of high-priority education services. We further recommend the Legislature require SDE to develop an estimate of the administrative costs associated with these tasks.

Goals 2000 provides modest new funding for state and local reform activities. In 1994-95 $9.9 million is available, and $36.3 million is anticipated for 1995-96. Based on its past priorities, we expect the Legislature will seek to maximize the amount of these funds that will be available to support LEA reform plans.

We suggest the Legislature also consider funding activities at the state level that will generate long-term dividends and have few other sources of support. Two areas that we believe are critical are data collection and evaluation.

Reduce and Refine Data Needs

A number of data issues should be addressed. First, continued effort is needed to find improved measures of performance and to refine the accuracy of some existing measures. Good quality data will be essential to the success of the performance-based regulatory system imbedded in the federal acts. With the cutbacks in General Fund support for the department, Goals 2000 offers one of the few sources of money to support such activities.

Second, the department also needs to develop a plan for reviewing its existing data collection practices. The plan should include a process for thoroughly reviewing whether currently collected data is needed and for collecting essential data in a way that is least disruptive to LEAs. Because the department will need information from LEAs that is not routinely collected, SDE should develop an internal process for authorizing and conducting surveys of LEAs.

Initiate Rigorous Program Evaluations

The situation is similar for program evaluation. No ongoing program for evaluating the major educational program exists. Yet, a performance-based system will magnify the need for proven models of service delivery for different subgroups of the student population.

Experience has shown that good evaluations are relatively expensive. Therefore, relying exclusively on Goals 2000 funding for this purpose is unrealistic. It is likely that the only way good evaluations can be funded is through partnerships of the state and federal governments and foundations interested in supporting an improved understanding of education programs. Goals 2000 can provide baseline funding to support the state administrative costs in this type of evaluation effort.

To provide critical support for these two activities, we recommend the Legislature use a portion of Goals 2000 funds to supplement existing SDE funding for these activities. We further recommend SDE submit to the Legislature a proposed expenditure plan for these activities that can serve as a starting point for the Legislature's consideration of this issue.

Take Advantage of the Federal Waiver Authority

Waiver Authority Opens Door to Innovation

The Legislature should explore how the federal waiver authority could create additional opportunities for improving the operation and effectiveness of California's K-12 programs.

The new federal waiver authority creates virtually unlimited possibilities for states and LEAs interested in reshaping existing programs. Below, we discuss three possible ways that this waiver authority could improve the operation of education programs in California.

• Allow the state to administer programs that are currently operated by the federal government. For instance, Title 5 provides funding for magnet schools used to assist in school desegregation efforts. The federal Department of Education operates this program by issuing grants directly to LEAs. California could request federal waivers to administer the grants so that this program would reenforce the state's reform strategy and goals.
• Permit the state to combine state and federal program funds to reduce the number and complexity of funding sources. For example, the state EIA and desegregation programs could be combined with funds from at least three ESEA programs to create one or two programs focused on meeting the needs of poor children with special learning needs.
• Authorize the state to combine state and federal funds to create additional local program flexibility. Combining state and federal child development programs, for instance, could greatly streamline the state administration of the programs and improve planning at the state and local level. In addition, combining these programs could help California develop a "seamless" system of care that would provide improved services to families receiving subsidized child care.

These concepts require more attention before they can realistically be considered as options. We encourage the Legislature to be receptive to using the federal waiver authority.

Conclusion

The state has a rare opportunity to thoroughly review the its K-12 improvement strategy by taking advantage of the school improvement framework--and funding--created by the three new federal education acts. Our recommendations seek to take advantage of this opportunity, not because it is emphasized by federal law, but because the federal framework reflects program design principles that we think can result in an improved K-12 system in California. In the end, we believe the state can use the federal programs as a springboard for creating a policy and program structure that meets the state's needs, provides clear policy direction to LEAs and supplies more flexibility than currently exists.