Teacher Incentive Fund, 28714-28739 [2010-12218]

Agencies

• DEPARTMENT OF EDUCATION

[Federal Register Volume 75, Number 98 (Friday, May 21, 2010)]
[Rules and Regulations]
[Pages 28714-28739]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-12218]



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Part III





Department of Education





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34 CFR Subtitle B, Chapter II



Teacher Incentive Fund; Notice Inviting Applications for New Awards for 
Fiscal Year (FY) 2010; Rule and Notice

Federal Register / Vol. 75, No. 98 / Friday, May 21, 2010 / Rules and 
Regulations

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DEPARTMENT OF EDUCATION

34 CFR Subtitle B, Chapter II

[Docket ID ED-2010-OESE-0001]
RIN 1810-AB08


Teacher Incentive Fund

Catalog of Federal Domestic Assistance (CFDA) Numbers: 84.385 and 
84.374.
AGENCY: Office of Elementary and Secondary Education, Department of 
Education.

ACTION: Notice of final priorities, requirements, definitions, and 
selection criteria.

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SUMMARY: The Secretary of Education (Secretary) establishes priorities, 
requirements, definitions, and selection criteria under the Teacher 
Incentive Fund (TIF) program. These priorities, requirements, 
definitions, and selection criteria will be used in two separate and 
distinct TIF grant competitions: The Main TIF competition, which will 
provide TIF funding to eligible entities to support their 
implementation of a performance-based compensation system (PBCS) in 
accordance with the priorities, the Main TIF competition requirements, 
the definitions, and the selection criteria established in this 
document; and the TIF Evaluation competition, which will provide, in 
accordance with the priorities, the Main TIF competition requirements, 
the definitions, and the selection criteria, as well as the Evaluation 
requirements established in this document, TIF funding to help pay the 
costs of implementing the eligible entity's PBCS in exchange for an 
agreement to participate in the national evaluation. The Secretary may 
use these TIF priorities, requirements, definitions, and selection 
criteria in fiscal year (FY) 2010 and subsequent years. We intend the 
priorities, requirements, definitions, and selection criteria announced 
in this document to help improve student achievement (as defined in 
this document) in high-need schools (as defined in this document) and 
provide incentives for effective teachers, principals, and other 
personnel (in those sites in which the grantee wishes to expand the 
PBCS to additional staff in its schools) in these schools to take on 
additional responsibilities and leadership roles.

DATES: These priorities, requirements, definitions, and selection 
criteria are effective July 6, 2010.

FOR FURTHER INFORMATION CONTACT: April Lee, Telephone: (202) 205-5224; 
or by e-mail: TIF@ed.gov; or by mail: (Attention: Teacher Incentive 
Fund), U.S. Department of Education, 400 Maryland Avenue, SW., Room 
3E120, Washington, DC 20202.

SUPPLEMENTARY INFORMATION: 
    Purpose of Program: The purpose of the TIF program is to support 
projects that develop and implement PBCSs for teachers, principals, and 
other personnel in order to increase educator effectiveness and student 
achievement (as defined in this notice), measured in significant part 
by student growth (as defined in this notice), in high-need schools (as 
defined in this notice).
    Program Authority: The Departments of Labor, Health and Human 
Services, and Education, and Related Agencies Appropriations Act, 2008, 
Division G, Title III, Public Law 110-161; Departments of Labor, Health 
and Human Services, and Education, and Related Agencies Appropriations 
Act, 2010, Division D, Title III, Public Law 111-117; and the American 
Recovery and Reinvestment Act of 2009, Division A, Title VIII, Public 
Law 111-5.
    Background: Signed into law by President Obama on February 17, 
2009, the American Recovery and Reinvestment Act of 2009 (ARRA) 
constitutes an unprecedented effort to revive the Nation's economy, 
create and save millions of jobs, and address long-neglected challenges 
so the Nation can thrive in the 21st century.
    In addition to measures that modernize the Nation's infrastructure, 
enhance energy independence, preserve and improve affordable health 
care, provide tax relief, and protect those in greatest need, the ARRA 
provides an unprecedented sum--approximately $100 billion dollars--to 
fundamentally transform our public education system.
    Section 14005(d) of the ARRA requires that this funding be used to 
promote effective school reform in four assurance areas: (1) Adopting 
internationally benchmarked standards and assessments that prepare 
students for success in college and the workplace; (2) Building data 
systems that measure student success and inform teachers and principals 
in how they can improve their practices; (3) Increasing teacher 
effectiveness and achieving equity in teacher distribution; and (4) 
Turning around our lowest-achieving schools.
    The ARRA's second and third assurances are based on evidence that 
teachers are the single most critical in-school factor in improving 
student achievement. In addition, the ARRA recognizes the contribution 
a principal makes toward running an effective school. However, too many 
students, particularly those attending high-need schools, are provided 
instruction by unqualified or ineffective teachers. Accordingly, the 
ARRA requires the Department to promote efforts that ensure an 
equitable distribution of effective teachers between high- and low-
poverty schools so that economically disadvantaged students have the 
same access to effective teachers as other students.
    TIF is one such effort that advances the ARRA's third assurance of 
recruiting, developing, and retaining effective teachers. To meet this 
assurance, Congress appropriated an additional $200 million dollars of 
funding for the TIF program.
    The Department plans, to the extent feasible and appropriate, to 
align TIF with the requirements of other ARRA programs, including the 
State Fiscal Stabilization Fund, Race to the Top, and Title I School 
Improvement Grants. The Department's intention in doing so is to 
maximize the efficient use of resources and encourage applicants to 
develop plans for evaluating educator effectiveness and for providing 
educators the useful feedback and professional development needed to 
improve classroom practice and student achievement that complement, and 
are consistent with, plans developed across other ARRA programs.
    Along with appropriating TIF funds to be used to support projects 
that implement PBCSs, the ARRA also requires the Department to use some 
of the appropriated funds to conduct a ``rigorous national evaluation * 
* * utilizing randomized controlled methodology to the extent feasible, 
that assesses the impact of performance-based teacher and principal 
compensation systems supported by the funds provided in this Act on 
teacher and principal recruitment and retention in high-need schools 
and subjects.'' The ARRA thus requires the Department to award funds in 
a way that will ensure adequate participation of both a treatment group 
and control group in the national evaluation. The TIF Evaluation 
competition is designed to permit the Department to meet this 
responsibility and, at the same time, to seek answers to research 
questions about the effect of PBCSs on student achievement in high-need 
schools that are of great importance to those who would implement such 
systems.
    The Department published a notice of proposed priorities, 
requirements, definitions, and selection criteria (NPP) for this 
program in the Federal Register on February 26, 2010 (75 FR 8854). That 
notice contained background information and our reasons for proposing 
the particular priorities,

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requirements, definitions, and selection criteria.
    Public Comment: We received comments on the NPP from 40 commenters, 
including State educational agencies (SEAs), local educational agencies 
(LEAs), nonprofit organizations, teachers' unions, universities, 
professional associations, parents, and other public citizens. We used 
these comments to revise, improve, and clarify the priorities, 
requirements, definitions, and selection criteria.

Major Changes in the Final Priorities, Requirements, Definitions, and 
Selection Criteria

    In addition to minor technical and editorial changes, there are 
several substantive differences between the priorities, requirements, 
definitions, and selection criteria proposed in the NPP and the final 
priorities, requirements, definitions, and selection criteria that we 
establish in this notice. Those substantive changes are summarized in 
this section and discussed in greater detail in the Analysis of 
Comments and Changes that follows. We do not discuss minor technical or 
editorial changes, nor do we address comments that suggested changes 
that we are not authorized to make under the law.

Priorities

    We are making the following changes to the priorities for this 
program:
     In clause (b) of absolute priority 1 (Differentiated 
Levels of Compensation for Effective Teachers and Principals), we have 
clarified the need for observation-based assessments of both teachers 
and principals as part of the evaluation system used to support a TIF-
funded PBCS. This change is in response to a recommendation from a 
commenter to amend proposed priority 1 to be consistent with core 
element (c), which requires classroom observations of teachers and 
principals at least twice during the school year.
     In competitive preference priority 4 (Use of Value-Added 
Measures of Student Achievement), we have changed the language to read: 
``Clearly explain the chosen value-added model to teachers to enable 
them to use the data generated through the model to improve classroom 
practices.'' This change was made in response to a commenter's request 
to provide clarification as to whether applicants could meet this 
priority by using value-added models only, or whether they also must 
provide feedback to teachers aimed at improving instruction.
     We have added a new competitive preference priority 6 to 
address the issue regarding whether current TIF grantees would be 
restricted from applying for TIF funds. Under this new competitive 
preference priority, the following applicants can receive additional 
points: Nonprofit organizations that are current TIF grantees that 
propose to work with a new eligible scope of SEAs and LEAs, and those 
applicants that do not already have a TIF grant in place. This 
competitive preference priority is titled Competitive Preference 
Priority 6--New Applicants to the Teacher Incentive Fund. Please see 
the Final Priorities section of this notice for the full language of 
this new competitive preference priority.

Requirements

    We are making the following changes to the requirements for this 
program:
     The NPP stated that ``[a]lthough [the applicable statutes] 
provide that Federal TIF funds may support PBCSs only for teachers and 
principals, grantees may extend their PBCSs to additional school 
personnel by using non-TIF funds to pay for additional compensation for 
non-instructional personnel.'' 75 FR 8856. Under the Department's FY 
2010 Appropriations Act, Congress authorized FY 2010 TIF funds to be 
used for PBCSs for teachers, principals, and other school personnel. 
Therefore, while requiring TIF-supported PBCSs to extend to both 
teachers and principals, we have revised the requirements to permit 
applicants to propose the use of TIF funds to support PBCSs that also 
benefit such other school personnel as the applicants may identify. 
(This change does not otherwise affect the program's priorities, 
requirements, or selection criteria as proposed in the NPP.)
     For both the Main TIF competition and the TIF Evaluation 
competition, the proposed Additional Eligibility Requirement that would 
have precluded applications that proposed to implement their PBCSs in 
schools currently served by a TIF grant award has been revised to 
permit applicants who are already TIF grantees to propose expansion of 
their existing PBCSs to cover new categories of staff in schools 
currently served by TIF funding. Thus, for example, current TIF 
grantees whose projects focus only on principals could seek TIF funding 
to expand their PBCSs to teachers and other personnel (in those sites 
in which the grantee wishes to expand the PBCS to additional staff in 
its schools) as well.
     In paragraph (d) of the Core Elements, we have added a 
footnote to remind applicants that data systems that link teacher and 
principal incentives based on student growth (as defined in this 
notice) must comply with any applicable requirements under both the 
Family Educational Rights and Privacy Act (FERPA) and State and local 
privacy laws. This change was made in response to two commenters who 
urged the Department to ensure that the data management systems 
required by paragraph (d) of the Core Elements protect privacy of 
students and educators.
     Under the TIF Evaluation Competition Requirements, a new 
design that incorporates a 1 percent across-the-board bonus has been 
selected for the control schools. The requirement to provide a match 
that would have been required if Comparison Design 2 was selected has 
been eliminated.
     We have added a Local Evaluation requirement. The new 
requirement clarifies (1) that, in order to be eligible to receive 
points under the Quality of Local Evaluation selection criterion, 
applicants must include a description of their local evaluation in 
their application although it will not be considered when ranking 
applicants under the TIF Evaluation competition, and (2) that 
applicants selected under the TIF Evaluation competition will not be 
required to conduct the local evaluation they propose in response to 
the selection criterion. This was in response to three commenters who 
expressed concern that some applicants might mistakenly believe that 
applying for the TIF Evaluation competition obviates the need to 
address the Quality of Local Evaluation criterion.
     We have clarified that the Department will waive the 
Advance Notice requirement under the TIF Evaluation competition for any 
applicant that is eligible to implement its PBCS in school year 2010-11 
(i.e., for applicants that meet the five core requirements) so long as 
the program is implemented according to the evaluator's assigned group 
status. (Note: The evaluator will be ready to assign group status 
immediately upon grant award.) We made this change in response to a 
commenter who expressed concern that, depending on when FY 2010 TIF 
grants are awarded, applicants might not be able to provide the two 
months notice to teachers and principals involved in the evaluation, as 
required under the proposed Advance Notice requirement.
     Under the Evaluation Competition requirements, the 
eligibility requirement was broadened to include consortia and 
intermediary units that have centralized coordination of data and that 
could meet the minimum requirement of 8 schools in grades 3 through 8.

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Definitions

    We have made no changes to the proposed definitions.

Selection Criteria

    We have made the following change to the selection criteria for 
this program:
     We have added new sub-criterion to the Project Design 
selection criterion that concerns the extent to which an applicant 
provides a clear definition of how teachers, principals and other 
personnel (in those sites in which the grantee wishes to expand the 
PBCS to additional staff in its schools) are determined to be 
``effective'' for the purposes of the proposed PBCS. We have added this 
sub-criterion because our proposed criterion would have had applicants 
address how effectiveness would be determined but had neglected to have 
reviewers examine the actual definition of teacher and principal 
effectiveness applicants would use.

Analysis of Comments and Changes

    An analysis of the comments received on, and any changes to, the 
priorities, requirements, definitions, and selection criteria since 
publication of the NPP for this program follows.

    Note about general comments: We received many comments 
expressing general support or making general recommendations for 
this program. In most cases, these comments were effectively 
duplicated by other comments expressing support or making specific 
recommendations for the program's proposed priorities, requirements, 
definitions, or selection criteria, which we discuss in the sections 
that follow. We accordingly do not discuss those general comments 
here. In other cases, we interpreted a general comment as applying 
to a specific priority, requirement, definition, or selection 
criterion. We address the comment in the discussion that relates to 
the relevant priority, requirement, definition, or selection 
criterion.


    Note about comments on program issues not covered in the NPP: We 
received a number of comments relating to program issues that were 
not proposed for public comment in the NPP for this program. These 
issues include: specific funding ranges or award amounts for the 
grant categories, the number of grant awards, uses of funds, length 
of grant periods, and technical assistance for applicants. We do not 
address comments on these issues here. We note, however, that 
information on these issues will be made available through other 
Department documents, including the notice inviting applications for 
this program.

General Comments

    Comment: Several commenters expressed strong support for the TIF 
program, as outlined in the NPP, both for the overall effort to improve 
recruitment, development, and retention of effective teachers and for 
specific components of the NPP, such as encouraging the use of value-
added models as part of teacher evaluation systems and allowing 
planning periods for grantees.
    Discussion: The Department appreciates the support of these 
commenters for the priorities, requirements, definitions, and selection 
criteria proposed in the NPP.
    Changes: None.
    Comment: Several commenters expressed concern that the NPP relied 
excessively on indicators of student achievement and student growth as 
meaningful predictive measures of teacher and principal effectiveness. 
These commenters cited research that cautions against the use of 
student test scores to predict future teacher performance and that 
discourages the use of assessment results for purposes for which they 
have not been validated. One commenter also objected to the 
Department's statement in the NPP that studies using value-added 
assessments indicate that individual teachers make a significant 
difference in student achievement, claiming that this statement was 
``an inaccurate summation of the research'' on the use of value-added 
models to estimate individual teacher impact on student performance. 
Other commenters asserted that assessment data do not reflect other 
essential aspects of teacher performance, such as planning and 
preparation, the classroom environment, instructional methods, and 
other professional duties. In addition, two commenters claimed that the 
NPP ignored research and survey data showing that ``nearly all 
teachers'' would prefer supportive leadership and collaborative working 
environments to monetary rewards. These commenters noted that requiring 
payments ``substantial enough'' to change teacher behavior may be 
ineffective if leadership, climate, and other supports are lacking.
    Discussion: As noted in the NPP, the Department believes that 
student achievement (as defined in this notice) and student growth (as 
defined in this notice) data are meaningful measures of teacher and 
principal effectiveness, and, therefore, should be a significant factor 
in the PBCSs funded by the TIF program as part of rigorous, 
transparent, and fair evaluation systems that include multiple 
measures. The Department's citation of research showing that value-
added assessments can be used to demonstrate that individual teachers 
make a significant difference in student achievement was not intended 
to summarize all available research on the use of value-added models to 
measure teacher performance. Rather the citation was included in the 
NPP to emphasize research supporting the central premises of the TIF 
program: That since we know good teachers matter, it makes sense for 
compensation to take into account effectiveness, as measured by growth 
(as defined in this notice) in student achievement (as defined in this 
notice), and to offer financial incentives to encourage the most 
effective teachers to work in high-need schools. In addition, Congress 
has authorized and appropriated funding for the TIF program 
specifically to support the development and use of PBCSs that consider 
growth (as defined in this notice) in student achievement (as defined 
in this notice), among other factors. Thus, requiring growth (as 
defined in this notice) in student achievement (as defined in this 
notice) to be a significant factor in any PBCS supported with TIF funds 
is wholly consistent with the statutory authority for the TIF program.
    Moreover, this final notice, like the NPP, heeds the conclusion of 
much of the research cited by commenters that student achievement, no 
matter how it is measured, should not be the sole basis for making 
consequential decisions about teachers. In particular, this final 
notice retains the proposed requirement for at least two observation-
based assessments of teacher performance in TIF projects, while 
permitting an applicant to include other measures of its own choosing. 
This flexibility allows applicants to take into account other measures 
of teacher effectiveness and performance when developing teacher 
evaluation systems for use as part of their PBCSs. In addition, the 
final notice retains the emphasis on the need for each applicant to 
demonstrate that its PBCS is part of a coherent and integrated approach 
to strengthening the educator workforce, which may include efforts to 
improve school climate, create collaborative environments, and other 
support for teachers, as recommended by the commenters.
    Changes: None.
    Comment: Two commenters stated that the standard of reliability and 
validity for any teacher evaluation system must be higher when the 
results are used for high-stakes compensation, tenure, and termination 
decisions than when the results are used simply to identify and meet 
professional development needs. Another commenter recommended that the 
Department require multiple measures of teacher performance.

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    Discussion: The Department agrees that the teacher and principal 
evaluation systems used by TIF grantees as part of their PBCSs must be 
rigorous, transparent, and fair, in part through the use of multiple 
measures of performance. The Department believes that this goal was 
fully reflected in the NPP and has been retained in this final notice. 
For example, priority 1 requires LEAs to use a combination of student 
achievement (as defined in this notice), classroom observation, and 
other measures of the LEA's choosing to evaluate teacher and principal 
effectiveness. Priority 2 requires evidence that the proposed PBCS is 
aligned with a coherent and integrated strategy for strengthening the 
educator workforce, including the use of data and evaluations for 
professional development, retention, and tenure decisions. The core 
elements that all applicants must put into place before beginning to 
make incentive payments are specifically intended to ensure that 
teachers and principals are involved in developing a PBCS and 
understand how it works, that evaluation systems include objectively 
collected data on classroom performance, and that applicant data 
systems are sufficiently robust to accurately link student achievement 
(as defined in this notice) data to individual teachers and human 
resources systems. The Department believes that these priorities and 
requirements, collectively, will ensure that TIF grantees implement a 
PBCS that meets the higher standard of reliability and validity for 
teacher evaluation systems called for by the commenters.
    Changes: None.
    Comment: One commenter expressed the view that increasing funding 
for education, including for programs to support teachers, is not 
likely to improve the overall quality of our education system. 
According to this commenter, spending has increased dramatically since 
the 1960s, but test scores have not improved. The commenter also stated 
that teachers need respect and support from parents and administrators.
    Discussion: The Department believes that increased resources for 
education, effectively used, will improve the quality of our education 
system. However, the TIF program is focused on improving the efficacy 
of existing State and local education resources by encouraging LEAs and 
other applicants to use a greater proportion of those resources to 
reward effective teaching and school leadership and provide new 
incentives for our best teachers and principals to work in our most 
challenging schools. The Department believes that one of the best ways 
to demonstrate respect and increase support for teachers and principals 
is to increase the compensation of those who demonstrate effectiveness, 
in particular, by raising student achievement (as defined in this 
notice).
    Changes: None.
    Comment: One commenter cautioned that while teacher evaluation is 
an essential component of a PBCS, effective teachers cannot be measured 
by test scores alone. Two other commenters emphasized the importance of 
collaborative partnerships of union leaders and administrators in the 
development of a successful PBCS, while another added that such 
collaboration is more important than the use of test scores. Other 
commenters asserted that changing the Nation's education system to 
improve teaching and learning requires more than just changes in 
compensation; they argued that it also requires professional teaching 
standards, standards for teaching and learning conditions, and 
standards for professional development.
    Discussion: The Department agrees that effective teachers cannot be 
measured by test scores alone. The final requirements for this program, 
like those in the NPP, do not provide otherwise. Rather, as required by 
the program's authorizing legislation, a PBCS must include the use of 
student achievement (as defined in this notice) data, classroom 
observations, and other measures selected by the grantee. Moreover, 
paragraph (c) of the Core Elements requires ``the involvement and 
support of unions in participating LEAs where they are the designated 
exclusive representatives for the purpose of collective bargaining that 
is needed to carry out the grant.'' Finally, the Professional 
Development requirement provides that applicants must demonstrate that 
their PBCSs include high-quality professional development targeted to 
needs identified through an evaluation system. We, therefore, believe 
that the final notice adequately addresses the commenters' concerns.
    Changes: None.
    Comment: One commenter urged the Department to make publicly 
available all successful grant applications so that these applications 
can serve as templates for future applicants and promote the sharing of 
promising practices.
    Discussion: The Department agrees with this commenter, and will 
post all successful TIF applications, for both the Main TIF competition 
and TIF Evaluation competitions, on its Web site at www.ed.gov.
    Changes: None.
    Comment: Two commenters asked for clarification as to whether the 
PBCSs required by the NPP must include both teachers and principals.
    Discussion: The Department interprets the program's authorizing 
legislation as requiring each PBCS supported with TIF funds to cover 
both teachers and principals in high-need schools. However, this does 
not mean that TIF funds must be used to pay performance-based 
compensation to both teachers and principals. If an LEA's PBCS already 
provides compensation to either teachers or principals, the LEA may 
implement a TIF project that would benefit the other group, provided 
that the PBCS, as a whole, covers both groups of educators for the 
duration of the TIF project period.
    Thus, in response to this commenter's question, the Department has 
revised the Additional Eligibility Requirement to extend eligibility to 
those applicants that have current PBCSs in their States or LEAs 
(including charter school LEAs), but currently provide performance-
based compensation either only to principals or only to teachers. The 
requirement now allows an applicant to propose to expand an existing 
PBCS to cover teachers or principals who are not currently being served 
through the PBCS provided that TIF funds are used to expand the 
coverage of existing projects only in high-need schools (as defined in 
this notice). An applicant creating an entirely new PBCS must apply to 
use TIF funds to develop and implement a PBCS for both teachers and 
principals, as required by absolute priority 1.
    Changes: The Additional Eligibility Requirement has been revised to 
allow applicants that are current TIF grantees with principal- or 
teacher-only projects to expand their current PBCSs to those teachers 
or principals who work in high-need schools (as defined in this notice) 
and who are not currently being served through the PBCS currently in 
place. If funded under the new competition, the PBCS for both teachers 
and principals must remain in place for the duration of the TIF 
project.
    Comment: One commenter recommended adding a definition of the term 
``teacher'' to the final notice, while two other commenters suggested 
clarifying that, under the TIF program, ``teachers and principals'' 
include other staff such as instructional specialists, counselors, 
librarians and media specialists, and assistant principals.
    Discussion: As in prior TIF competitions, the Department interprets 
the term ``teacher'' to include resource teachers and other staff who 
provide direct instruction, such as

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paraprofessionals and classroom aides. However, in general, because the 
term ``teacher'' is not defined in Federal statute or regulation, the 
Department believes the definition of ``teacher'' should reflect 
applicable State and local laws and policy regarding the inclusion of 
other school staff, such as counselors, librarians, and media 
specialists.
    Moreover, during our review of public comments, we realized that 
the language authorizing the TIF program in the Department's FY 2010 
Appropriations Act expressly provides that TIF funds may support PBCSs 
that benefit teachers, principals, and other personnel (in those sites 
in which the grantee wishes to expand the PBCS to additional staff in 
its schools).
    Therefore, an applicant has flexibility to extend its PBCS to cover 
school personnel who are not teachers or principals and to define the 
range of other personnel who are eligible to participate in the PBCS.
    Changes: We have revised the requirements for the program to 
clarify that an applicant's PBCS must cover teachers and principals 
and, at the discretion of the applicant, may cover other school 
personnel.
    Comment: One commenter strongly recommended that the Department 
require teacher evaluators in the PBCS to have subject- or specialty-
area expertise specific to the position or positions that they are 
evaluating.
    Discussion: The Department believes that the language in paragraph 
(c) of the Core Elements, which specifies (1) that the evaluation 
process use objective evidence-based rubrics for observation, aligned 
with professional teaching standards, and (2) that evaluators have 
specialized training, is sufficient to ensure fair classroom 
observations of participating teachers. Moreover, requiring each 
evaluator to have the same subject or specialty area expertise as the 
individuals they are evaluating would be impracticable in many LEAs and 
would potentially limit the inclusion of classroom observations in 
teacher evaluation systems. For this reason, we do not believe it is 
appropriate to make the change requested by the commenter.
    Changes: None.
    Comment: One commenter recommended increasing to three the minimum 
number of observation-based assessments required each year under 
proposed priorities 1 and 4, believing that two observations are 
insufficient to obtain a fair review.
    Discussion: While the requirement for multiple observations 
necessitates at least two observations per year, as was proposed in the 
NPP, the Department believes that the precise number of observation-
based assessments should be left to the considered judgment of the 
applicant and its process of securing input from stakeholders. In 
particular, the quality of the observation-based assessment is likely 
to matter more than the number; two comprehensive observations by a 
well-prepared evaluator may provide a more accurate picture of teacher 
performance than five cursory classroom visits. For this reason, the 
Department declines to make the change recommended by the commenter. 
However, we note that grantees would have the flexibility to conduct 
additional assessments if desired.
    Changes: None.
    Comment: One commenter urged the Department to add statewide 
support, such as technical assistance, electronic networks, and 
regional meetings, to the list of activities described in the 
Background section of the NPP that may be supported with TIF funds.
    Discussion: Our final notice does not include the background 
statements provided in the NPP, so we are not making the change 
requested by the commenter. That said, to the extent that SEAs apply 
for TIF funds in conjunction with eligible LEAs, the activities 
described by the commenter generally would be permitted under the 
statutory authority for the TIF program, which allows the use of TIF 
funds to develop or improve systems and tools that would enhance the 
quality and success of the PBCS. The Department does not believe it is 
necessary to create a separate ``statewide support'' category.
    Changes: None.

Priority 1

    Comment: Several commenters recommended modifications to proposed 
priority 1 regarding differentiated levels of compensation for 
effective teachers and principals. One commenter stated that the 
requirement to give ``significant weight'' to student growth exceeded 
statutory authority, while others interpreted the requirement that LEAs 
give ``significant weight'' to student growth as the equivalent of 
basing the evaluation of teacher performance ``on a single test 
score.'' A few commenters also stated that because growth data are 
available for only 30 percent of the teaching force, a PBCS must use 
other measures to determine the effectiveness of most teachers and 
principals. One commenter suggested allowing applicants in States that 
do not have growth models to use status models to measure student 
learning. Other commenters recommended changing priority 1 to emphasize 
the use of multiple measures in a TIF-funded PBCS, such as classroom 
observations, portfolio reviews, student grades, and appraisals of 
lesson plans.
    One commenter also urged inclusion of school climate, resources, 
and professional development in teacher evaluations. Another commenter 
recommended including certification by the National Board for 
Professional Teaching Standards (NBPTS) as a specific option for 
measuring teacher effectiveness. On the other hand, one commenter 
called for maintaining the requirement in a previous TIF competition 
that bonuses be based ``primarily'' on student achievement and urged 
that the final notice require applicants to ``fully utilize'' student 
achievement data by mandating a 50-percent weighting for such data. 
Another commenter recommended strengthening the program's emphasis on 
student achievement by changing ``significant'' to ``predominant'' so 
that student achievement will not ``be obfuscated by multiple other 
objective and subjective criteria.''
    Discussion: The statute requires the Department to use TIF funds to 
support the development and implementation of PBCSs that use student 
achievement (as defined in this notice) and multiple classroom 
observations, as well as other factors, to determine incentive payments 
for teachers and principals. The Department believes that given the 
wide range of possible factors that might be included in their teacher 
evaluation systems, as well as the fact that improving student 
achievement is the underlying purpose of the TIF program, it is both 
appropriate and consistent with the statute to ensure that TIF grantees 
give student achievement ``significant'' weight among the factors 
included in such systems.
    While the Department appreciates the concerns of commenters who 
argued for giving greater, ``predominant'' weight to student growth (as 
defined in this notice) in TIF-funded PBCSs, we continue to require 
that this factor be given ``significant'' weight in this final notice. 
We do so both (1) to emphasize, consistent with the Department's Race 
to the Top program, that teacher effectiveness for TIF should not be 
determined solely on the basis of standardized test scores, and (2) in 
the belief that, given the statutory requirement that grantees also 
base their evaluations on multiple annual observations, among other 
factors, the LEA, in consultation with school staff and with the 
support of any teacher's union that represents teachers in collective 
bargaining, is in the best

[[Page 28719]]

position to determine the relative weight to give these other factors. 
Hence, this final notice requires a TIF-supported PBCS to use (1) 
student growth (as defined in this notice), (2) multiple classroom 
observations, and (3) other measures selected by the grantee to inform 
the payment decisions of the PBCS. These other measures might include, 
for example, outputs such as student portfolios or grades and inputs 
such as NBPTS certification.
    Congress established TIF as a competitive grant program to promote 
the use of PBCSs to improve student achievement (as defined in this 
notice) in high-need schools (as defined in this notice). Therefore, it 
is necessary only that LEAs that wish to apply for TIF funds be able to 
use the required student achievement (as defined in this notice) and 
growth (as defined in this notice) data for their teachers. Moreover, 
States or LEAs may, as a part of the TIF program, determine how to use 
assessments such as annual district assessments, interim assessments, 
or pre-tests/post-tests, to generate growth (as defined in this notice) 
data for a larger percentage of teachers and principals. However, the 
use of status model assessment data alone is not consistent with the 
emphasis of the TIF program on using student growth (as defined in this 
notice) to inform the decisions made under a PBCS.
    Changes: None.
    Comment: One commenter stated that priority 1 and paragraph (c) of 
the Core Elements are inconsistent with regard to the need to include 
principal observations in determinations of principal effectiveness. 
This commenter recommended revising priority 1 to reflect the 
requirement for at least two yearly observations of principals in 
paragraph (c) of the Core Elements. Another commenter recommended 
emphasizing ``growth'' in graduation and postsecondary enrollment rates 
in the examples of supplemental measures for determining the 
effectiveness of principals, while a third commenter proposed including 
in those examples nine separate ``measures of highly effective school 
leaders.''
    Discussion: The Department agrees that proposed absolute priority 1 
was unclear on the need for observation-based assessments of both 
teachers and principals as part of the evaluation system used to 
support a TIF-funded PBCS. In the final notice, we have changed the 
priority to include principal observations in determinations of 
principal effectiveness. We believe this change is fully consistent 
with the statutory requirement that a PBCS for teachers and principals 
include multiple classroom observations. We decline, however, to modify 
or add any other examples of specific measures of principal 
performance, as the absolute priority is not meant to provide an 
exhaustive list of all possible supplemental measures an LEA might use. 
We will, however, consider including such examples in any non-
regulatory guidance that we may issue for the TIF program.
    Changes: In paragraph (b) of priority 1, we have changed ``include 
observation-based assessments of teacher performance at multiple points 
in the year'' to read ``include observation-based assessments of 
teacher and principal performance at multiple points in the year.''
    Comment: One commenter recommended adding to proposed priority 1 a 
requirement that each applicant describe how its PBCS will include 
educators of both students with disabilities and gifted and talented 
students.
    Discussion: We do not believe that the Department should require an 
LEA to ensure that its PBCS apply to any specific group of teachers. 
Rather we believe that the LEA, in consultation with school staff and 
any teachers' union that represents teachers for the purpose of 
collective bargaining, where applicable, should extend to all teachers 
in a high-need school or to a subset of those teachers based on hard-
to-staff subjects or needs in particular specialty areas.
    We note that in the NPP, and now in this notice, we describe 
several ways in which a PBCS may include educators of both students 
with disabilities and gifted and talented students. First, under 
paragraph (a)(1)(i) of the selection criteria, the Department considers 
the extent to which the applicant demonstrates that the high-need 
schools that would participate in its PBCS have difficulty in 
recruiting highly qualified or effective teachers, particularly in 
hard-to-staff subject and specialty areas such as special education 
(these specialty areas also could include gifted and talented 
education).
    Second, under priority 5, the Department will give a competitive 
preference to an applicant showing that its proposed PBCS is designed 
to assist high-need schools to (1) serve high-need students (which, as 
defined in this notice, includes students with disabilities); (2) 
retain effective teachers in teaching positions in hard-to-staff 
subjects and specialty areas, such as mathematics, science, special 
education, and English language acquisition, and (3) fill vacancies 
with teachers of those subjects or specialty areas who are effective or 
likely to be effective. By implication, an LEA with a particular need 
for special education teachers could use its PBCS specifically to hire 
and retain such teachers. The Department has retained both of these 
provisions in this final notice, and believes that no additional 
language is needed to respond to the commenter's concern.
    Changes: None.

Priority 2

    Comment: Commenters had mixed reactions to absolute priority 2's 
requirements regarding the fiscal sustainability of a PBCS. For 
example, while one commenter stated that the current fiscal climate 
will make it difficult to meet this priority, other commenters 
supported the priority for the same reason, suggesting that current 
budget constraints make it even more important for each applicant to 
demonstrate a strong commitment to sustaining its PBCS. One commenter 
also expressed concern that requiring grantees to demonstrate 
sustainability could ``aggravate serious problems of school finance'' 
in States with school funding equity problems. Another commenter urged 
the Department to acknowledge the dependence of sustainability plans on 
economic and budget factors and to include ``contingency options'' for 
LEAs that may face extreme financial hardship both during and after the 
grant period.
    Other commenters objected to the priority's reference to the 
``redeployment'' of other existing resources, stating that most LEAs 
already have reallocated available resources to meet the current budget 
crisis, that such redeployment may undermine other LEA program 
priorities, that resources used to support continuing education for 
teachers and principals are essential to improving the skills of these 
staff, and that redeploying resources used for salary increments 
potentially would lower the standard of living for teachers and make it 
more difficult to obtain mortgages and own their own homes.
    Discussion: The Department acknowledges all of the concerns raised 
by commenters regarding the difficulty of ensuring the fiscal 
sustainability of TIF-funded PBCSs. However, in Public Law 111-117, the 
FY 2010 Appropriations Act that included funding for TIF, Congress 
provided that all applications for TIF grants ``shall include a plan to 
sustain financially the activities conducted and systems developed 
under the grant once the grant period has expired.'' We do not

[[Page 28720]]

believe any credible plan for financial sustainability is likely to 
succeed without a demonstration by an applicant of its readiness to 
make the hard choices needed to ensure that the funding will be 
available to sustain the PBCS after the TIF grant ends. For this 
reason, the Department also is extending this requirement to TIF awards 
made with ARRA funds.
    In addition, this final notice, like the NPP, does take into 
account the economic conditions facing the Nation's school systems. 
Unlike previous TIF awards, which required an increasing non-TIF share 
in years in which performance-based compensation is provided and 
established a percentage ceiling on the amount of TIF funds that could 
be used for incentive payments during the last year of the grant 
period, this notice requires only an increasing non-TIF share in years 
when performance-based compensation is provided. For all of these 
reasons, the Department declines to make the recommended changes to 
priority 2.
    Changes: None.
    Comment: One commenter requested clarification regarding the 
duration of an applicant's fiscal sustainability plan, i.e., how many 
years following the end of TIF funding must a PBCS be sustained?
    Discussion: Applicants have flexibility regarding the length of 
their sustainability plans. As a practical matter, we understand that 
the difficulty of making long-term predictions of economic conditions, 
State and local funding, and political factors may limit the required 
fiscal sustainability plans to no more than three to five years.
    Changes: None.

Priority 3

    Comment: Several commenters expressed support for priority 3 
regarding programmatic sustainability of the PBCS. One commenter also 
urged that the priority include a focus on strategies for supporting 
educators, such as professional development, mentoring, and induction 
programs. Similarly, another commenter cautioned against too much 
emphasis on the PBCS when other approaches related to recruiting, 
inducting, mentoring, evaluating, and retaining teachers may be more 
effective in improving student achievement. Another commenter 
encouraged the Department to require, as part of priority 3, 
professional development strategies designed to improve the 
identification and instruction of students with disabilities and gifted 
and talented students. In addition, this commenter recommended that the 
Department promote mentoring and induction programs supporting 
collaboration between general and special education.
    Discussion: Priority 3 is based on the idea that a PBCS works best 
in conjunction with a coherent and integrated approach to strengthening 
the educator workforce that specifically includes many of the 
strategies suggested by the commenters, such as teacher and principal 
recruitment, induction, professional development, evaluation, 
retention, and advancement into instructional leadership roles (as 
defined in this notice). Contrary to the second commenter's warning 
about ``too much emphasis'' on the PBCS, we believe the opportunity to 
receive incentive payments and other rewards from the PBCS will 
encourage educators to take full advantage of the various strategies 
and supports made available through the applicant's coherent and 
integrated approach to strengthening the educator workforce.
    Moreover, the Department also expects that, particularly as part of 
an overall strategy to improve instruction for high-need students, TIF 
grantees will provide professional development related to meeting the 
needs of students with disabilities and gifted and talented students, 
including induction and mentoring programs aimed at supporting 
collaboration between general and special education. However, the 
Department declines to add specific requirements in this area as we 
believe that TIF grantees should implement site-specific professional 
development opportunities for teachers and principals designed based on 
their specific needs, which may include professional development 
related to serving students with disabilities and gifted and talented 
students.
    Changes: None.

Priority 4

    Comment: Three commenters expressed strong support for priority 4, 
a competitive priority on the use of value-added measures of student 
achievement for purposes of determining differentiated levels of 
compensation in a PBCS. Two of these commenters recommended making this 
priority an absolute priority, ``since improving student achievement is 
the underlying purpose for all these incentives.'' Another commenter 
stated that the use of value-added models will address the problem of 
non-random assignment of students to individual teachers by helping to 
ensure that teachers with the highest-achieving students do not benefit 
disproportionately from a PBCS.
    However, several other commenters raised strong objections to the 
use of value-added models as part of a PBCS, citing research that shows 
significant variability in the results of such models, particularly for 
individual teachers, the limited availability of data to support such 
models for most teachers, the limited number of vendors experienced in 
developing and implementing value-added models, and the lack of 
evidence that such models are fair, reliable, and valid when used to 
evaluate teacher effectiveness or determine compensation levels. One 
commenter, for example, stated that value-added systems are not 
appropriate for ``high-stakes decisions regarding employee evaluation 
and compensation.'' Another commenter stated that the use of value-
added models in PBCSs generally would exclude both educators of 
students with disabilities and the impact of regular instructors on 
students with disabilities, leading to ``two separate systems for 
judging teacher performance.'' As a result of these various concerns, 
three commenters recommended eliminating priority 4 altogether. Other 
commenters suggested replacing the priority with a competitive 
preference for programs that enhance teaching and leadership skills 
through professional development or the pursuit of advanced 
certification or degrees, as well as the addition of multiple measures 
to value-added models. Finally, one commenter asked whether TIF funds 
could be used to refine a value-added model.
    Discussion: We appreciate the expressions of support for 
encouraging applicants to incorporate value-added measures into their 
PBCSs, in particular due to the potential for such measures to isolate 
the improved achievement that may be attributed to individual teachers 
regardless of the starting point of their students. The Department 
understands and, to some extent, shares the concerns of some commenters 
regarding the need to be judicious about the use of value-added models 
due to the public's limited experience with them. We also recognize 
that many researchers have expressed concern about the use of value-
added models to evaluate teacher performance. However, one purpose of a 
competitive grant program like the TIF program is to encourage 
innovation and the Department believes that a competitive preference on 
the use of value-added models as part of a PBCS is consistent with this 
purpose.
    We also note that many of the research-based concerns expressed by 
commenters focus on the potential use of value-added models as the sole 
or predominant indicator of teacher performance, an approach that is 
not required under either the statutory

[[Page 28721]]

authority for the TIF program or this final notice, which states that, 
in determining teacher effectiveness, the LEA must give significant 
weight to student growth (as defined in this notice) and must include 
observation-based assessments of performance. Moreover, we believe that 
priority 4 is fully consistent with the observation of one study cited 
by a commenter that value-added approaches ``may be appropriate for 
wider use as student assessment systems and value-added models 
evolve.'' One purpose of priority 4 is to promote such evolution by 
encouraging grantees to adapt value-added models to their PBCSs 
consistent with the safeguards for all PBCSs required by this final 
notice (i.e., the use of multiple measures in teacher evaluation 
systems, teacher involvement in developing such systems, and robust 
data systems).
    In addition, value-added models have the potential to improve the 
measurement of academic growth (as defined in this notice) for many 
students with learning disabilities, and thus should not be dismissed 
simply because they may not be appropriate for all students with 
disabilities. TIF funds also may be used to improve tools to measure 
growth (as defined in this notice) in student achievement (as defined 
in this notice), such as value-added models, and thus could be used to 
refine a value-added model, addressing some of the concerns raised by 
commenters. For this reason the Department does not agree with the 
commenters who suggested that we eliminate priority 4. Similarly, the 
Department does not agree that a competitive preference for programs 
that enhance teaching and leadership skills through professional 
development or attainment of professional credentials holds the same 
promise of improving our ability to measure teacher effectiveness as 
value-added measures of student achievement (as defined in this 
notice). We say this largely because such programs are not designed or 
intended to measure teacher effectiveness, as is statutorily required 
for the TIF program.
    Changes: None.
    Comment: One commenter requested clarification as to whether 
applicants could meet priority 4 by using value-added models only to 
evaluate teacher performance or whether they also must provide to 
teachers feedback aimed at improving instruction.
    Discussion: In the NPP, the background section for proposed 
priority 4 clearly stated that one goal of this competitive preference 
priority is to ensure that applicants have a plan to enable teachers 
``to use the data generated through the models to improve classroom 
practices.'' However, the language of the proposed priority 
inadvertently omitted any reference to improving classroom practice. 
The Department has revised priority 4 to require TIF applicants seeking 
to meet this priority to ensure that they will use value-added data to 
improve classroom instruction as well as to evaluate teacher 
performance. As these activities are directly related to providing 
feedback educators need to improve their performance, and thus are part 
of a coherent and integrated approach to strengthening the educator 
workforce (see priority 2), TIF funds may be used to pay for activities 
needed to help educators use the value-added data to improve classroom 
practices, including the development or enhancement of systems and 
tools used to generate feedback to teachers for the purpose of 
improving instruction.
    Changes: The Department has revised clause (2) of priority 4 to 
clarify that an applicant must demonstrate in its application that, as 
part of its PBCS, it has the capacity to clearly explain the chosen 
value-added model to teachers to enable them to use the data generated 
through the model to improve classroom practices.
    Comment: One commenter recommended that priority 4 be revised to 
require LEAs to have a plan for including career and technical 
education (CTE) teachers in value-added systems, although the commenter 
acknowledged that value-added measures are problematic in CTE due to 
the lack of comparative data for the end-of-course assessments 
typically used in CTE courses.
    Discussion: The Department declines, for the reason cited by the 
commenter, to require applicants to have a plan for including CTE 
courses in their value-added systems. However, applicants that have the 
capability to use such measures for CTE programs certainly may include 
them to meet the requirements of priority 4.
    Changes: None.

Priority 5

    Comment: One commenter recommended changing priority 5, the 
competitive preference priority on increased recruitment and retention 
of teachers in hard-to-staff subjects and specialty areas in high-need 
schools, to an absolute priority. Another commenter called for giving 
priority to applications that propose to increase recruitment or 
retention of teachers in hard-to-staff subjects in high-need schools. A 
third commenter sought clarification that an applicant could receive 
points for priority 5 by including an emphasis on recruiting and 
retaining teachers in hard-to-staff subjects and specialty areas as 
part of an overall PBCS for all teachers, rather than a PBCS focused 
solely on the goals of priority 5.
    Discussion: We agree with the first commenter that increased 
recruitment and retention of teachers in hard-to-staff subjects and 
specialty areas in high-need schools is an important goal; however, we 
also believe that designing and implementing a good PBCS is difficult, 
and that some LEAs may be reluctant to add to the challenge by making 
recruitment and retention bonuses a required component of the system. 
Consistent with our overall policy of establishing mandatory 
requirements only when necessary, we believe that retaining priority 5 
as a competitive preference priority is the appropriate way to 
encourage applicants to consider ways to use the PBCS to promote 
increased recruitment and retention of teachers in hard-to-staff 
subjects and specialty areas in high-need schools. The Department 
declines to give a competitive preference to an applicant that proposes 
to increase recruitment or retention, because we believe that it is the 
combination of the two strategies that is likely to be both most needed 
and most effective in serving high-need students in high-need schools. 
Finally, we agree that the components and activities required to meet 
priority 5 may be part of a broader TIF proposal for developing and 
implementing a PBCS that fulfills the full range of an applicant's 
recruitment and retention needs, not just those related to teachers in 
hard-to-staff subjects and specialty areas.
    Changes: None.
    Comment: Two commenters objected to what they described as the 
premise of priority 5--that an effective teacher will be effective in 
any school without regard to the school's conditions and climate. These 
commenters recommended that we address factors such as poor leadership 
and support, inadequate professional development, discipline and safety 
concerns, and planning time. The commenters argued that addressing 
these factors could help remove the ``hard-to-staff'' label from the 
school. A third commenter stated that any effort to attract and retain 
teachers should invest in teacher support and development.
    Discussion: Priority 5 is not premised on the assumption that an 
effective teacher will be effective in any school; rather, it is based 
on the premise that a teacher who has demonstrated the

[[Page 28722]]

ability to raise student achievement (as defined in this notice) in one 
school is more likely to be effective in another school than a teacher 
who has not demonstrated such effectiveness in any school setting. In 
addition, an applicant seeking to meet priority 5 will be expected to 
incorporate the strategies for doing so into its coherent and 
integrated strategy for strengthening the educator workforce, which 
may, and whenever necessary should, include efforts to address the 
other conditions described by the commenters.
    Changes: None.
    Comment: One commenter objected to the use of the terms 
``effective'' or ``likely to be effective'' in the context of priority 
5 because of concerns about the use of growth measures to determine 
``effectiveness.'' Another commenter recommended that the priority be 
revised to include NBPTS certification as one measure that could 
demonstrate whether a teacher who is filling a hard-to-staff vacancy is 
effective or likely to be effective.
    Discussion: We have addressed concerns about the use of student 
growth (as defined in this notice) measures to determine teacher and 
principal effectiveness under the General Comments section of this 
preamble. In addition, priority 5 requires applicants to provide an 
explanation for how they will determine that a teacher filling a 
vacancy is effective or likely to be effective. We believe that this 
language provides flexibility for an applicant to propose appropriate 
measures of effectiveness or likely effectiveness, including NBPTS 
certification, under priority 5.
    Changes: None.
    Comment: Three commenters provided suggestions about how to define 
``hard-to-staff'' subjects under priority 5. One commenter recommended 
that we add CTE to the list of hard-to-staff subjects and specialty 
areas. Another commenter requested that the priority provide 
flexibility to allow LEAs to change their lists of hard-to-staff 
subjects and specialty areas over the 5-year grant period. The last 
commenter asked the Department to clarify that LEAs have the authority 
to determine which subjects are hard-to-staff and which areas 
constitute ``specialty areas,'' and that specialty areas could include 
extended day, pre-K, or other areas in high-need schools that are 
difficult to staff.
    Discussion: Priority 5 requires applicants to demonstrate, in their 
applications, the extent to which the subjects or specialty areas they 
propose to target are hard-to-staff. The language of the priority 
leaves the determination of hard-to-staff subjects and specialty areas 
up to applicants and the LEAs that administer the affected high-need 
schools. The Department, therefore, believes that, under priority 5, 
applicants have the flexibility to define ``hard-to-staff'' subjects 
consistent with the suggestions made by the commenters, including 
flexibility to change their definitions over the 5-year grant period. 
Also, because of this flexibility, we do not believe that any of the 
specific suggestions for additions to the list of hard-to-staff 
subjects and specialty areas are necessary, and therefore decline to 
make any changes to the priority.
    Changes: None.
    Comment: One commenter stated that paying the teachers of some 
subjects more than teachers of other subjects undermines the basic 
equity of existing compensation systems. Instead, this commenter 
recommended that we address gaps in subject and specialty areas through 
scholarships, tuition assistance, and loan forgiveness programs.
    Discussion: The TIF program is premised on the belief that existing 
compensation systems do not serve the goal of increasing the number and 
proportion of effective teachers serving low-income, minority, and low-
achieving students, and the belief that providing financial rewards for 
both effectiveness and willingness to work in challenging schools is a 
promising education reform. Many high-need schools have particular need 
for teachers of certain subjects and specialty areas (e.g., 
mathematics, science, and special education), and we believe that 
higher pay for effective teachers in these areas who agree to work in 
high-need schools could help to alleviate this problem. We are 
confident that performance-based compensation available through TIF can 
be one means of addressing this problem. The Department agrees that 
other kinds of rewards and incentives described by the commenter also 
may be effective, but they fall ou