SECTION 1. Chapter 29 of the General Laws is amended by inserting after section 5B the following section:-

Section 5B½. (a) As used in this section, the following words shall have the following meanings unless the context clearly requires otherwise:-

“Assumed in-school special education enrollment”, 4 per cent of the total foundation enrollment in a district, not including vocational or preschool enrollment, plus 5 per cent of vocational enrollment.

“Department”, the department of elementary and secondary education.

“Employee health insurance rate”, the employer share of the average active employee premium for all group insurance commission plans for the 3 previous fiscal years; provided, however, that the group insurance commission shall annually, not later than June 30, provide the department with data necessary for the determination of the rate or an increase of it.

“English learner enrollment”, the number of students identified as English learners pursuant to chapter 71A, including students enrolled in vocational and technical schools.

“English learner increment”, the additional amount allotted within a district’s foundation budget for additional services for students identified as English learners pursuant to chapter 71A, including those enrolled in vocational and technical schools; provided, however, that the value of the increment for fiscal year 2019 shall be $2,444.60 multiplied by the number of English learners in the district and shall be adjusted annually thereafter by the foundation inflation index; provided further, that the portion of the increment supporting employee benefits and fixed charges shall be adjusted annually consistent with adjustments made to foundation benefit rates.

“Foundation benefits”, the amount allotted within a district's foundation budget for employee benefits and fixed charges; provided, however, that the allotment shall be equal to 1.29 times the sum of: (i) the employee health insurance rate multiplied by the number of active employees for whom the district provides health insurance; and (ii) the retired employee health insurance rate multiplied by the number of the district’s retired employees receiving health insurance through the district or any of its member municipalities; and provided further, that each district shall annually, not later than June 30, provide the department with data necessary to determine the number of retired employees.

“Low-income enrollment”, the number of low-income students attending school in a district regardless of residence or tuition-paying status; provided, however, that in determining the number of low-income students, the department shall use the preceding year's actual number of low-income full-day kindergarten, elementary, junior high or middle school, high school and vocational students and ½ of the preceding year's actual number of low-income half-day kindergarten and preschool students.

“Low-income increment”, the additional amount allotted within a district’s foundation budget for each low-income student; provided, however, that the department shall rank each district and divide the districts into deciles; provided further, that each district shall be assigned a low-income decile based on its low-income percentage that shall be calculated as its number of low-income students divided by the total foundation enrollment; provided further, that each decile shall be assigned a low-income increment where the increment for the lowest percentage decile shall be 50 per cent of the statewide per pupil amount for students with a family income of more than 185 per cent of the federal poverty level and the increment for the highest percentage decile shall be 100 per cent of the statewide per pupil amount for students with a family income of more than 185 per cent of the federal poverty level; and provided further, that when determining the statewide per pupil amount, the department shall use the average of the base rates in the enrollment categories of prekindergarten, kindergarten, elementary, middle school and high school, weighted by the number of students in each category.

“Low-income student”, a student who has a family income that is not more than 185 per cent of the federal poverty level.

“Retired employee health insurance rate”, the weighted average of the group insurance commission  premium for all retiree plans for the 3 previous fiscal years; provided, however, that the group insurance commission shall annually, not later than June 30, provide the department with data necessary for the determination of such rate.

“Tuitioned-out special education rate”, 3 times the statewide foundation budget per pupil amount.

(b) Annually, not later than January 15, the secretary of administration and finance shall meet with the senate and house committees on ways and means to jointly determine an implementation schedule to fulfill the recommendations filed on November 2, 2015 by the foundation budget review commission established in section 4 of chapter 70. The implementation schedule shall establish a foundation budget as defined in section 2 of said chapter 70 that incorporates the categories of tuitioned-out special education rate, assumed in-school special education enrollment, low-income increment, low-income enrollment, foundation benefits, employee health insurance rate, retired employee health insurance rate and English learner increment; provided, however, that in the first year of the term of office of a governor who has not served in the preceding year, the parties shall determine an implementation schedule not later than January 31 of that year.

In determining the implementation schedule, the secretary of administration and finance and the senate and house committees on ways and means shall hold a public hearing and receive testimony from the commissioner of elementary and secondary education and other interested parties. The schedule may be amended by agreement of the chairs of the senate and house committees on ways and means in any fiscal year to reflect changes in enrollment, inflation, student populations or other factors that may affect the remaining costs in the schedule. The implementation schedule shall be included in a joint resolution and placed before the members of the general court for their consideration annually, along with any proposed legislation necessary to execute and implement the schedule, not later than February 15. The implementation schedule shall be subject to appropriation. Upon completion of the implementation schedule, a joint resolution shall be placed before the members of the general court affirming that the recommendations of the commission have been fulfilled; provided, however, that the determination of an annual implementation schedule shall not be required upon the adoption of the resolution affirming that the recommendations of the commission have been fulfilled.

SECTION 2. Chapter 70 of the General Laws, as appearing in the 2016 Official Edition, is hereby amended by striking out section 4 and inserting in place thereof the following section:-

Section 4. There shall be a foundation budget review commission to review, every 5 years, the way foundation budgets are calculated and to make recommendations for potential changes in those calculations, as the commission deems appropriate. In conducting the review, the commission shall seek to determine the educational programs and services that are necessary to achieve the commonwealth’s educational goals and to prepare students to achieve passing scores on the Massachusetts Comprehensive Assessment System examination or any successor assessment as determined by the board. The review shall include, but not be limited to, the components of the foundation budget established under section 3 and subsequent changes made to the foundation budget by law. In addition, the commission shall seek to determine and recommend measures to promote the adoption of ways in which resources can be most effectively utilized and consider various models of efficient and effective resource allocation. In carrying out the review, the commissioner of elementary and secondary education shall provide to the commission any data or information that the commissioner considers relevant to the commission’s charge.

The commission shall include: the house and senate chairs of the joint committee on education, who shall serve as co-chairs; the secretary of education; the commissioner of elementary and secondary education; the commissioner of early education and care; the speaker of the house of representatives or a designee; the president of the senate or a designee; the minority leader of the house of representatives or a designee; the minority leader of the senate or a designee; the governor or a designee; the chair of the house committee on ways and means or a designee; the chair of the senate committee on ways and means or a designee; and 1 member to be appointed by each of the following organizations: the Massachusetts Municipal Association, Inc.; the Massachusetts Business Alliance for Education, Inc.; the Massachusetts Association of School Committees, Inc.; the Massachusetts Association of School Superintendents, Inc.; the Massachusetts Teachers Association; the American Federation of Teachers Massachusetts; the Massachusetts Association of Vocational Administrators, Inc.; the Massachusetts Association of Regional Schools, Inc.; and the Massachusetts Association of School Business Officials. Members shall not receive compensation for their services but may receive reimbursement for the reasonable expenses incurred in carrying out their responsibilities as members of the commission. The commissioner of elementary and secondary education shall furnish reasonable staff and other support for the work of the commission. Prior to issuing its recommendations, the commission shall conduct not less than 4 public hearings across regions of the commonwealth.

It shall not constitute a violation of chapter 268A for a state employee or a person employed by a school district to serve on the commission or to participate in commission deliberations that may have a financial impact on the district employing that person, the commonwealth or the rate at which that person may be compensated; provided, however, that the commission may establish procedures to ensure that such a person shall not participate in commission deliberations that may directly affect the school districts employing such a person or that may directly affect the rate at which such a person is compensated.

SECTION 3. Chapter 70 of the General Laws is hereby amended by inserting after section 4 the following section:-

Section 4A. (a) The department, in consultation with the executive office of education, shall convene a data advisory committee to promote the improved use of school-level data to inform effective resource allocation decisions at the local level.

The data advisory committee shall include, but not be limited to, a representative from: the department; the executive office of education; the Massachusetts Association of School Committees, Inc.; the Massachusetts Association of School Superintendents, Inc.; the Massachusetts School Administrators Association, Incorporated; the Massachusetts Association of School Business Officials, Inc.; the Massachusetts Association of Vocational Administrators, Inc.; and the Massachusetts Association of Regional Schools, Inc. The data advisory committee may add additional members upon a majority vote of the committee members. The representative from the department and 1 member determined by a vote of the full committee every 2 years shall serve as co-chairs.

The data advisory committee shall assist the department in identifying, advising on and analyzing cost-effective ways to achieve goals including, but not limited to:

(i) streamlining financial reporting, eliminating duplicative reporting requirements and improving data quality;

(ii) strengthening the department’s capacity to analyze and report staffing, scheduling and financial data in ways that support strategic resource allocation decisions at the district and school levels;

(iii) strengthening district capacity to use data to make strategic resource allocation decisions; and

(iv) establishing a data collection and reporting system that: (A) tracks funding allocated for  low-income students and students identified as English learners pursuant to chapter 71A to ensure that spending is targeted to the intended populations and to provide a data source for the foundation budget review commission about the accuracy and adequacy of the low-income and English learner increments as defined in section 5B½ of chapter 29; and (B) allows for access to school-level expenditures and data across all districts to inform the public and policy-makers about effective school-level interventions and investments.

(b) The data advisory committee shall report on its progress to the board of elementary and secondary education, the clerks of the senate and the house of representatives, the senate and house chairs of the joint committee on education and the chairs of the senate and house committees on ways and means not less than annually, by December 1. The report shall include recommendations for the department to achieve the goals of this section. The department may, in consultation with the data advisory committee, develop or procure the data collection and reporting system described in subsection (a).

SECTION 4. Section 2 shall take effect upon the adoption of the joint resolution affirming that the recommendations of the commission have been fulfilled, as provided in subsection (b) of section 5B½ of chapter 29 of the General Laws.