Local Education Agencies - As enacted, authorizes an LEA to adopt and implement a merit-based pay structure for educators to award additional compensation to high-performing educators and to incentivize educators to meet, the official text

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                             PUBLIC CHAPTER NO. 256

                                                     SENATE BILL NO. 729

                                                   By Lowe, Hatcher, Taylor

                                             Substituted for: House Bill No. 759

                                                              By Marsh

AN ACT to amend Tennessee Code Annotated, Title 49, relative to compensation for licensed
          personnel.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:

          SECTION 1. Tennessee Code Annotated, Section 49-3-306, is amended by adding the
following as a new subsection:

                    (i) An LEA may adopt and implement a merit-based pay structure for educators to
          award additional compensation to high-performing educators and to incentivize educators to
          meet and exceed expectations. A merit-based pay structure adopted pursuant to this
          subsection (i) may only result in an increase to the compensation of an educator, whether in
          the form of a one-time bonus or an increase to the salary payable to the educator in accordance
          with the salary schedule approved by the commissioner for the LEA for the respective school
          year. An LEA may decline to award merit pay in any school year for which the LEA does not
          receive increased or additional state funds, as compared to a prior year, in an amount sufficient
          to award merit pay. An LEA is not required to supplement its local expenditures for salaries
          and wages in any school year in order to continue any merit pay an educator received in a
          prior school year.

          SECTION 2. This act takes effect upon becoming a law, the public welfare requiring it, and
applies to the 2025-2026 school year and each school year thereafter.
         SENATE BILL NO. 729

PASSED:  April 14, 2025

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                         '           RANDY}fcNALLY

                                     SPEAKER OF THE SENATE

                         CAMERON'91!XTON,SPEAKER

                         HOUSE OF REPRESENTATIVES

Arpr, \ APPROVED this aY(t,. day of  2025

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         BILL LEE, GOVERNOR