(a) The General Assembly finds that there is a need for an incentive program for outstanding schools. The General Assembly further finds that performance-based incentives are commonplace in the private sector and should be infused into the public sector as a reward for productivity.

(b) The Arkansas School Recognition Program is created to provide financial awards to public schools that experience high student performance and those with high student academic growth, which includes high school graduation rate comparisons for secondary schools.

(c) (1) (A) If funds are available, a public school or public charter school shall receive performance-based funding of:

(i) One hundred dollars ($100) per student who attends the public school or public charter school if:

(a) The public school or public charter school is in the top five percent (5%) of all public schools in Arkansas in student performance under the criteria set forth by rule of the State Board of Education;

(b) The public school or public charter school is in the top five percent (5%) of all public schools in Arkansas in student academic growth under the criteria set forth by rule of the state board; or

(c) The public school or public charter school meets the criteria established by the state board to be used in lieu of the criteria set forth in subdivisions (c)(1)(A)(i)(a) and (b) of this section to reward top-performing public schools; or

(ii) Fifty dollars ($50) per student who attends the public school or public charter school if:

(a) The public school or public charter school is in the top ten percent (10%) but below the top five percent (5%) of all public schools in Arkansas in student performance under the criteria set forth by rule of the state board;

(b) The public school or public charter school is in the top ten percent (10%) but below the top five percent (5%) of all public schools in Arkansas in student academic growth under the criteria set forth by rule of the state board; or

(c) The public school or public charter school meets the criteria established by the state board to be used in lieu of the criteria set forth in subdivisions (c)(1)(A)(ii)(a) and (b) of this section to reward high-performing public schools that do not meet the eligibility criteria set forth in subdivision (c)(1)(A)(i) of this section.

(B) The rewards listed in subdivision (c)(1)(A) of this section:

(i) Shall begin after the 2012-2013 state-mandated assessments; and

(ii) Shall be based upon the results of state-mandated assessments.

(2) The Department of Education may disburse available performance-based funding appropriated by the General Assembly on a pro rata basis.

(d)

(1) All eligible schools shall receive performance-based funding.

(2) (A) Funds shall be distributed to the school's fiscal agent and placed in the school's account and shall be used for purposes listed in subsection (e) of this section as determined by a committee which shall include:

(i) The principal;

(ii) A teacher elected by the faculty; and

(iii) A parent representative selected by the local Parent Teacher Association or some other local parental involvement group.

(B) The committee shall make its determination by December 15 of each applicable year.

(e) School recognition awards shall be used for the following:

(1) Nonrecurring bonuses to the faculty and staff;

(2) Nonrecurring expenditures for educational equipment or materials to assist in maintaining and improving student performance; or

(3) Temporary personnel for the school to assist in maintaining and improving student performance.

(f) School recognition awards are exempt from §§ 6-17-119 and 6-20-412.

(g) The General Assembly shall appropriate and fund sufficient funds to implement this section.