1. Beginning July 1, 2000, the department of elementary and secondary education shall provide a four-year competitive matching grant program at the district and building level to defray the cost of reading assessment, teacher and administrator training in the use of reading assessment and in early grade reading intervention strategies, provided that such intervention strategies give the classroom teacher options for selecting the method most appropriate for an individual student’s needs. Grants may also be used to expand existing reading instruction improvement programs. Grants may also be used for explicit phonics instruction, in any district, consistent with the requirements for the pilot program established pursuant to section 168.430.

2. In its grant application the school district shall describe its current program, at the building level if applicable, of reading assessment and instruction, show a need for improved assessment and instructional methods, and explain which assessment and reading instruction improvement program or programs it will implement under the grant and how it proposes to judge student progress. Additional priority shall be given to programs that include a parental involvement component.

3. The grantee pursuant to this section shall show improvement of students in the reading instruction improvement program after the second year of the grant to receive funds for years three and four. As part of the mid-grant progress report, the grantee shall report the progress of students who are receiving reading improvement instruction as a result of their performance on the third-grade communication arts assessment. The grantee shall also report its third grade communication arts assessment results in the two-year period before the grant and its results during the first two years of the grant. Performance on the third grade communication arts assessment may be a factor in the granting or denial of funds for years three and four, but primary emphasis shall be given to the plan of reading improvement and the measurements selected by the grantee.

4. Upon the conclusion of the grant, the department of elementary and secondary education may, upon demonstration of significant levels of improvement, from funds appropriated for that purpose, reimburse the district for its match, with such funds to be returned to the district’s operating funds. The department shall develop rules to determine significant progress, allowing for flexibility in application to varying grant projects but supplying rigorous standards so that significant is understood to mean measurable and meaningful in the context of the individual grant project.

5. Grants are renewable for an additional four-year term, based in part upon the results of the first grant. Any reimbursement of a district’s match shall be a one-time payment.

6. Nothing in this act^* shall be construed to prohibit the inclusion of vision- or hearing-impaired students in reading improvement instruction grant programs appropriate for them. Nothing in this act^* shall be construed to prevent the consideration of a grant application that focuses on improving reading for vision- or hearing-impaired students.

7. Grants shall be distributed in equal amounts within geographic areas established proportionately based upon student population; provided that funds may be reallocated by the department if an area has insufficient applications or insufficient eligible applications to obligate all funds for the area.