pay for success initiative
(38) Pay for success initiative (A) In general Subject to subparagraph (B), the term “pay for success initiative” means a performance-based grant, contract, or cooperative agreement awarded by a State or local public entity (such as a local educational agency) to a public or private nonprofit entity— (i) in which a commitment is made to pay for improved outcomes that result in increased public value and social benefit to students and the public sector, such as improved student outcomes as evidenced by the indicators of performance described in section 2323(b)(2) of this title and direct cost savings or cost avoidance to the public sector; and (ii) that includes— (I) a feasibility study on the initiative describing how the proposed intervention is based on evidence of effectiveness; (II) a rigorous, third-party evaluation that uses experimental or quasi-experimental design or other research methodologies that allow for the strongest possible causal inferences to determine whether the initiative has met its proposed outcomes; (III) an annual, publicly available report on the progress of the initiative; and (IV) a requirement that payments are made to the recipient of a grant, contract, or cooperative agreement only when agreed upon outcomes are achieved, except that the entity may make payments to the third party conducting the evaluation described in subclause (II). (B) Exclusion The term “pay for success initiative” does not include any initiative that— (i) reduces the special education or related services that a student would otherwise receive under the Individuals with Disabilities Education Act [ 20 U.S.C. 1400 et seq.]; or (ii) otherwise reduces the rights of a student or the obligations of an entity under the Individuals with Disabilities Education Act, the Rehabilitation Act of 1973 ( 29 U.S.C. 701 et seq.), the Americans with Disabilities Act of 1990 ( 42 U.S.C. 12101 et seq.), or any other law.