(c) CAPACITY BUILDING.

(1) IN GENERAL.-The Secretary, through a contract with one or more non-Federal entities, may conduct a capacity building and design initiative in order to increase the types of proven strategies for school dropout prevention and reentry that address the needs of an entire school population rather than a subset of students.

(2) NUMBER AND DURATION.

(A) NUMBER.-The Secretary may award not more than five contracts under this subsection.

(B) DURATION.-The Secretary may award a contract under this subsection for a period of not more than 5

years.

(d) SUPPORT FOR EXISTING REFORM NETWORKS.

(1) IN GENERAL.-The Secretary may provide appropriate support to eligible entities to enable the eligible entities to provide training, materials, development, and staff assistance to schools assisted under this part.

(2) DEFINITION OF ELIGIBLE ENTITY.—In this subsection, the term "eligible entity" means an entity that, prior to the date of enactment of the Dropout Prevention Act

(A) provided training, technical assistance, and materials related to school dropout prevention or reentry to 100 or more elementary schools or secondary schools; and

(B) developed and published a specific educational program or design related to school dropout prevention or reentry for use by the schools.

Subpart 2-School Dropout Prevention Initiative

SEC. 1821. [20 U.S.C. 6561] DEFINITIONS.

In this subpart:

(1) LOW-INCOME STUDENT.-The term "low-income student" means a student who is determined by a local educational agency to be from a low-income family using the measures described in section 1113(c).

(2) STATE.-The term "State" means each of the several States of the United States, the District of Columbia, the Commonwealth of Puerto Rico, the United States Virgin Islands, Guam, American Samoa, the Commonwealth of the Northern Mariana Islands, and the Bureau of Indian Affairs for purposes of serving schools funded by the Bureau.

SEC. 1822. [20 U.S.C. 6561a] PROGRAM AUTHORIZED.

(a) GRANTS TO STATE EDUCATIONAL AGENCIES AND LOCAL EDUCATIONAL AGENCIES.—

(1) AMOUNT LESS THAN $75,000,000.

(A) IN GENERAL.-If the amount appropriated under section 1803 for a fiscal year equals or is less than $75,000,000, then the Secretary shall use such amount to award grants, on a competitive basis, to—

(i) State

activities

educational agencies to support

(I) in schools that

(aa) serve students in grades 6 through 12; and

(bb) have annual school dropout rates that are above the State average annual school dropout rate; or

(II) in the middle schools that feed students into the schools described in subclause (I); or (ii) local educational agencies that operate— (I) schools that

(aa) serve students in grades 6 through 12; and

(bb) have annual school dropout rates that are above the State average annual school dropout rate; or

(II) middle schools that feed students into the schools described in subclause (I).

(B) USE OF GRANT FUNDS.-Grant funds awarded under this paragraph shall be used to fund effective, sustainable, and coordinated school dropout prevention and reentry programs that may include the activities described in subsection (b)(2), in

(i) schools serving students in grades 6 through 12 that have annual school dropout rates that are above the State average annual school dropout rate; or

(ii) the middle schools that feed students into the schools described in clause (i).

(2) AMOUNT LESS THAN $250,000,000 BUT MORE THAN $75,000,000.-If the amount appropriated under section 1803 for a fiscal year is less than $250,000,000 but more than $75,000,000, then the Secretary shall use such amount to award grants, on a competitive basis, to State educational agencies to enable the State educational agencies to award subgrants under subsection (b).

(3) AMOUNT EQUAL TO OR EXCEEDS $250,000,000.-If the amount appropriated under section 1803 for a fiscal year equals or exceeds $250,000,000, then the Secretary shall use such amount to award a grant to each State educational agency in an amount that bears the same relation to such appropriated amount as the amount the State educational agency received under part A for the preceding fiscal year bears to the amount received by all State educational agencies under such part for the preceding fiscal year, to enable the State educational agency to award subgrants under subsection (b). (b) SUBGRANTS TO LOCAL EDUCATIONAL AGENCIES.

(1) IN GENERAL.-From amounts made available to a State educational agency under paragraph (2) or (3) of subsection (a), the State educational agency shall award subgrants, on a competitive basis, to local educational agencies that operate public schools that serve students in grades 6 through 12 and that have annual school dropout rates that are above the State average annual school dropout rate, to enable those schools, or the middle schools that feed students into those schools, to implement effective, sustainable, and coordinated school dropout prevention and reentry programs that involve activities such

as

(A) professional development;

(B) obtaining curricular materials;

(C) release time for professional staff to obtain professional development;

(D) planning and research;

(E) remedial education;

(F) reduction in pupil-to-teacher ratios;

(G) efforts to meet State student academic achievement standards;

(H) counseling and mentoring for at-risk students; (I) implementing comprehensive school reform models, such as creating smaller learning communities; and

(J) school reentry activities.

(2) AMOUNT.-Subject to paragraph (3), a subgrant under this subpart shall be awarded

(A) in the first year that a local educational agency receives a subgrant payment under this subpart, in an amount that is based on factors such as

(i) the size of schools operated by the local educational agency;

(ii) costs of the model or set of prevention and reentry strategies being implemented; and

(iii) local cost factors such as poverty rates;

(B) in the second year, in an amount that is not less than 75 percent of the amount the local educational agency received under this subpart in the first such year;

(C) in the third year, in an amount that is not less than 50 percent of the amount the local educational agency received under this subpart in the first such year; and

(D) in each succeeding year, in an amount that is not less than 30 percent of the amount the local educational agency received under this subpart in the first year.

(3) DURATION.-A subgrant under this subpart shall be awarded for a period of 3 years, and may be continued for a period of 2 additional years if the State educational agency determines, based on the annual reports described in section 1830(a), that significant progress has been made in lowering the annual school dropout rate for secondary schools participating in the program assisted under this subpart.

SEC. 1823. [20 U.S.C. 6561b] APPLICATIONS.

(a) IN GENERAL.-To receive

(1) a grant under this subpart, a State educational agency or local educational agency shall submit an application and plan to the Secretary at such time, in such manner, and accompanied by such information as the Secretary may reasonably require; and

(2) a subgrant under this subpart, a local educational agency shall submit an application and plan to the State educational agency at such time, in such manner, and accompanied by such information as the State educational agency may reasonably require.

(b) CONTENTS.

(1) STATE EDUCATIONAL AGENCY AND LOCAL EDUCATIONAL AGENCY.-Each application and plan submitted under subsection (a) shall

(A) include an outline

(i) of the State educational agency's or local educational agency's strategy for reducing the State educational agency or local educational agency's annual school dropout rate;

(ii) for targeting secondary schools, and the middle schools that feed students into those secondary schools, that have the highest annual school dropout rates; and

(iii) for assessing the effectiveness of the efforts described in the plan;

(B) contain an identification of the schools in the State or operated by the local educational agency that have annual school dropout rates that are greater than the average annual school dropout rate for the State;

(C) describe the instructional strategies to be implemented, how the strategies will serve all students, and the effectiveness of the strategies;

(D) describe a budget and timeline for implementing the strategies;

(E) contain evidence of coordination with existing resources;

(F) provide an assurance that funds provided under this subpart will supplement, and not supplant, other State and local funds available for school dropout prevention and reentry programs; and

(G) describe how the activities to be assisted conform with research knowledge about school dropout prevention and reentry.

(2) LOCAL EDUCATIONAL AGENCY.-Each application and plan submitted under subsection (a) by a local educational agency shall contain, in addition to the requirements of paragraph (1)

(A) an assurance that the local educational agency is committed to providing ongoing operational support for such schools to address the problem of school dropouts for a period of 5 years; and

(B) an assurance that the local educational agency will support the plan, including

(i) provision of release time for teacher training; (ii) efforts to coordinate activities for secondary schools and the middle schools that feed students into those secondary schools; and

(iii) encouraging other schools served by the local educational agency to participate in the plan.

SEC. 1824. [20 U.S.C. 6561c] STATE RESERVATION.

A State educational agency that receives a grant under paragraph (2) or (3) of section 1822(a) may reserve not more than 5 percent of the grant funds for administrative costs and State activities related to school dropout prevention and reentry activities, of which

not more than 2 percent of the grant funds may be used for administrative costs.

SEC. 1825. [20 U.S.C. 6561d] STRATEGIES AND CAPACITY BUILDING.

Each local educational agency receiving a grant or subgrant under this subpart and each State educational agency receiving a grant under this subpart shall implement scientifically based, sustainable, and widely replicated strategies for school dropout prevention and reentry. The strategies may include

(1) specific strategies for targeted purposes, such as

(A) effective early intervention programs designed to identify at-risk students;

(B) effective programs serving at-risk students, including racial and ethnic minorities and pregnant and parenting teenagers, designed to prevent such students from dropping out of school; and

(C) effective programs to identify and encourage youth who have already dropped out of school to reenter school and complete their secondary education; and

(2) approaches such as breaking larger schools down into smaller learning communities and other comprehensive reform approaches, creating alternative school programs, and developing clear linkages to career skills and employment.

SEC. 1826. [20 U.S.C. 6561e] SELECTION OF LOCAL EDUCATIONAL AGENCIES FOR SUBGRANTS.

(a) STATE EDUCATIONAL AGENCY REVIEW AND AWARD.-The State educational agency shall review applications submitted under section 1823(a)(2) and award subgrants to local educational agencies with the assistance and advice of a panel of experts on school dropout prevention and reentry.

(b) ELIGIBILITY.-A local educational agency is eligible to receive a subgrant under this subpart if the local educational agency operates a public school (including a public alternative school)

(1) that is eligible to receive assistance under part A; and (2)(A) that serves students 50 percent or more of whom are low-income students; or

(B) in which a majority of the students come from feeder schools that serve students 50 percent or more of whom are low-income students.

SEC. 1827. [20 U.S.C. 6561f] COMMUNITY BASED ORGANIZATIONS.

A local educational agency that receives a grant or subgrant under this subpart and a State educational agency that receives a grant under this subpart may use the funds to secure necessary services from a community-based organization or other government agency if the funds are used to provide school dropout prevention and reentry activities related to schoolwide efforts.

SEC. 1828. [20 U.S.C. 6561g] TECHNICAL ASSISTANCE.

Notwithstanding any other provision of law, each local educational agency that receives funds under this subpart shall use the funds to provide technical assistance to secondary schools served by the agency that have not made progress toward lowering annual school dropout rates after receiving assistance under this subpart for 2 fiscal years.