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SECTION 1. SHORT TITLE.

This Act may be cited as the ''No Child Left Behind Reform Act''.

SEC. 2. ADEQUATE YEARLY PROGRESS.

(a) Definition of Adequate Yearly Progress.--Section 1111(b)(2) of
the Elementary and Secondary Education Act of 1965 (20 U.S.C.
6311(b)(2)) is amended--
(1) in subparagraph (C)(vii)--
(A) by striking ''such as'';
(B) by inserting ''such as measures of individual
or cohort growth over time based on the academic
assessments implemented in accordance with paragraph
(3),'' after ''described in clause (v),''; and
(C) by striking ''attendance rates,''; and
(2) in subparagraph (D)--
(A) by striking clause (ii);
(B) by striking ''the State'' and all that follows
through ''ensure'' and inserting ''the State shall
ensure''; and
(C) by striking ''; and'' and inserting a period.
(b) Academic Assessment and Local Educational Agency and School
Improvement.--Section 1116(a)(1)(B) of the Elementary and Secondary
Education Act of 1965 (20 U.S.C. 6316(a)(1)(B)) is amended by striking
'', except that'' and all that follows through ''action or
restructuring''.

SEC. 3. GRANTS FOR INCREASING DATA CAPACITY FOR PURPOSES OF AYP.

Subpart 1 of part A of title I of the Elementary and Secondary
Education Act of 1965 (20 U.S.C. 6311 et seq.) is amended by adding at
the end the following:

''SEC. 1120C. GRANTS FOR INCREASING DATA CAPACITY FOR PURPOSES OF AYP.

''(a) Grant Authority.--The Secretary may award grants, on a
competitive basis, to State educational agencies to enable the State
educational agencies--
''(1) to develop or increase the capacity of data systems
for accountability purposes; and
''(2) to award subgrants to increase the capacity of local
educational agencies to upgrade, create, or manage information
databases for the purpose of measuring adequate yearly
progress.
''(b) Priority.--In awarding grants under this section the
Secretary shall give priority to State educational agencies that have
created, or are in the process of creating, a growth model or
proficiency index as part of their adequate yearly progress
determination.
''(c) State Use of Funds.--Each State that receives a grant under
this section shall use--
''(1) not more than 20 percent of the grant funds for the
purpose of increasing the capacity of, or creating, State
databases to collect information related to adequate yearly
progress; and
''(2) not less than 80 percent of the grant funds to award
subgrants to local educational agencies within the State to
enable the local educational agencies to carry out the
authorized activities described in subsection (d).
''(d) Authorized Activities.--Each local educational agency that
receives a subgrant under this section shall use the subgrant funds to
increase the capacity of the local educational agency to upgrade
databases or create unique student identifiers for the purpose of
measuring adequate yearly progress, by--
''(1) purchasing database software or hardware;
''(2) hiring additional staff for the purpose of managing
such data;
''(3) providing professional development or additional
training for such staff; and
''(4) providing professional development or training for
principals and teachers on how to effectively use such data to
implement instructional strategies to improve student
achievement.
''(e) State Application.--Each State educational agency desiring a
grant under this section shall submit an application to the Secretary
at such time, in such manner, and containing such information as the
Secretary may require.
''(f) LEA Application.--Each local educational agency desiring a
subgrant under this section shall submit an application to the State
educational agency at such time, in such manner, and containing such
information as the State educational agency may require. Each such
application shall include, at a minimum, a demonstration of the local
educational agency's ability to put such a database in place.
''(g) Authorization of Appropriations.--There are authorized to be
appropriated to carry out this part $80,000,000 for each of fiscal
years 2006, 2007, and 2008.''

SEC. 4. TARGETING TRANSFER OPTIONS AND SUPPLEMENTAL SERVICES.

(a) Targeting Transfer Options and Supplemental Services.--Section
1116 of the Elementary and Secondary Education Act of 1965 (20 U.S.C.
6316) is amended--
(1) in paragraphs (1)(E)(i), (5)(A), (7)(C)(i), and
(8)(A)(i) of subsection (b), by striking the term ''all
students enrolled in the school'' each place such term appears
and inserting ''all students enrolled in the school, who are
members of a group described in section 1111(b)(2)(C)(v) that
fails to make adequate yearly progress as defined in the
State's plan under section 1111(b)(2),'';
(2) in subsection (b)(1), by adding at the end the
following:
''(G) Maintenance of least restrictive
environment.--A student who is eligible to receive
services under the Individuals with Disabilities
Education Act and who uses the option to transfer under
subparagraph (E), paragraph (5)(A), (7)(C)(i), or
(8)(A)(i), or subsection (c)(10)(C)(vii), shall be
placed and served in the least restrictive environment
appropriate, in accordance with the Individuals with
Disabilities Education Act.'';
(3) in clause (vii) of subsection (c)(10)(C), by inserting
'', who are members of a group described in section
1111(b)(2)(C)(v) that fails to make adequate yearly progress as
defined in the State's plan under section 1111(b)(2),'' after
''Authorizing students''; and
(4) in subparagraph (A) of subsection (e)(12), by inserting
'', who is a member of a group described in section
1111(b)(2)(C)(v) that fails to make adequate yearly progress as
defined in the State's plan under section 1111(b)(2)'' after
''under section 1113(c)(1)''.
(b) Student Already Transferred.--A student who transfers to
another public school pursuant to section 1116(b) of the Elementary and
Secondary Education Act of 1965 (20 U.S.C. 6316(b)) before the
effective date of this section and the amendments made by this section,
may continue enrollment in such public school after the effective date
of this section and the amendments made by this section.
(c) Effective Date.--This section and the amendments made by this
section shall be effective for each fiscal year for which the amount
appropriated to carry out title I of the Elementary and Secondary
Education Act of 1965 for the fiscal year, is less than the amount
authorized to be appropriated to carry out such title for the fiscal
year.

SEC. 5. DEFINITION OF HIGHLY QUALIFIED TEACHERS.

Section 9101(23)(B)(ii) of the Elementary and Secondary Act of 1965
(20 U.S.C. 7801(23)(B)(ii)) is amended--
(1) in subclause (I), by striking ''or'' after the
semicolon;
(2) in subclause (II), by striking ''and'' after the
semicolon; and
(3) by adding at the end the following:
''(III) in the case of a middle
school teacher, passing a State
approved middle school generalist exam
when the teacher receives the teacher's
license to teach middle school in the
State;
''(IV) obtaining a State social
studies certificate that qualifies the
teacher to teach history, geography,
economics, and civics in middle or
secondary schools, respectively, in the
State; or
''(V) obtaining a State science
certificate that qualifies the teacher
to teach earth science, biology,
chemistry, and physics in middle or
secondary schools, respectively, in the
State; and''.
Output:
No Child Left Behind Reform Act - Amends the Elementary and Secondary Education Act of 1965 (ESEA) to allow states to include measures of individual or cohort growth over time in determining whether students are making adequate yearly progress (AYP) toward state academic performance standards. Eliminates the consideration of student attendance rates.

Allows schools to be given credit for performing well on measures other than test scores when calculating student achievement.

Authorizes the Secretary of Education to award competitive: (1) grants to state educational agencies to develop or increase the capacity of data systems for accountability purposes; and (2) subgrants to increase the capacity of local educational agencies to upgrade, create, or manage information databases for the purpose of measuring AYP.

Allows schools to target school choice and supplemental services to the students who are members of specified types of groups that fail to make AYP. Requires placement and service in the least restrictive environment for students who receive services under the Individuals With Disabilities Education Act who use an option to transfer under ESEA.

Revises the definition of highly qualified teacher to authorize states to: (1) use a generalist exam for middle school teachers; and (2) issue certificates that qualify teachers to teach a number of subjects in social studies or in science.