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Kentucky lawmakers approved a budget this summer that will provide slight increases in school funding and continue the implementation of the state's 1990 school-reform law.

The legislature convened in special session last month to hammer out a biennial budget after a bitter disagreement with Gov. Brereton C. Jones produced a stalemate over the lawmakers' original spending plan.

Under the new two-year spending plan, aid to school districts will rise by 4.5 percent next year and 3 percent in fiscal 1996. State officials said that the budget would not hamper implementation of the Kentucky Education Reform Act.

"We're going to be able to maintain our momentum even though it may be a little slower than we would like,'' said Jim Parks, an education department spokesman.

The final budget agreement does not include a provision, supported by the Kentucky Education Association, that would have required districts to devote a set portion of their general-aid increase to teacher raises.

But lawmakers apparently intended to give teachers a fair share of the funds. They reduced the amount of categorical funding that Governor Jones had requested for specific reform initiatives and channeled more money into the general-aid portion of the budget to give local officials the chance to decide how to spend the money.

The legislature also overrode the Governor's veto of a $4 million appropriation that will pay transportation costs of private school students, which had been borne by county governments.

N.J. Budget: Gov. Christine Todd Whitman of New Jersey has signed a $15.2 billion budget that includes level funding for education but requires teachers and other public employees to make a larger contribution to their pensions.

The budget, which she signed at the beginning of this month, also cuts income taxes by as much as 10 percent for some taxpayers.

Under the spending plan, which took effect July 1, many districts will receive less state aid than they did in the previous fiscal year, but the total amount of money appropriated for elementary and secondary education is about the same.

The 1995 budget--the first since Mrs. Whitman won office pledging a 30 percent cut in income taxes--also eliminates the state department of higher education.

Expulsion Bill: Gov. William F. Weld of Massachusetts has signed a bill that requires school principals to provide written reasons for expelling students for possessing weapons or drugs in school, or for assaulting school employees.

The bill modifies a school-reform measure passed last year, which for the first time gave principals the authority to expel students. It required them to explain in writing any decision to suspend a student rather than taking the more drastic action of expulsion. Critics said this made it easier to expel students than to suspend them.

The new law requires principals to explain in writing the reasons for expulsions but for not suspensions.

Meanwhile, principals' authority to expel students is being challenged in a lawsuit brought by a 15-year-old Worcester girl who was expelled for one year for possession of a small novelty knife. She argues that the law is too vague and gives school officials too much latitude to decide what constitutes a weapon.

School-to-Work: Gov. Carroll A. Campbell Jr. of South Carolina has signed the School-to-Work Transition Act, which will place students interested in vocational courses on a special technical track.

These students will receive a new curriculum stressing mathematics, science, and "applied academics,'' said Karen Horne, the Governor's education director. They will also receive career counseling starting in the 6th grade, and business leaders will visit classrooms as part of an apprenticeship program.

Critics say this system will discourage some students from attending college. But Governor Campbell said in a statement that students would be able to alternate between the college-preparatory and technical tracks.

Appeal Filed: More than 80 school districts in Maine are appealing a state court's recent decision upholding the way education aid is distributed to public schools.

Lawyers for the districts filed an appeal in the state's highest court last month, claiming that the superior court judge who heard the case had failed to rule on the districts' contention that education is a fundamental right under the state constitution.

The local officials argue that the Maine school-finance formula and recent cuts in state subsidies have had a devastating effect on districts with low property values.

Appeal Denied: The Missouri Supreme Court has dismissed the state's appeal of a lower-court decision in a school-finance lawsuit.

Last year, Cole County Judge Byron Kinder ruled that the state's school-finance formula was unconstitutional. The legislature later rewrote the formula and raised taxes some $310 million.

The supreme court found last month that Judge Kinder's ruling was not a final judgment, and consequently it did not have jurisdiction to review it or the legislative action.

Veto Upheld: The New Hampshire House has failed to override Gov. Stephen Merrill's veto of a bill that would have fully funded the state's nine-year-old school-aid formula for the first time.

The override attempt, which had to be approved by a two-thirds majority, did not receive even a simple majority in the Republican-dominated House, with 163 voting in favor and 192 against. Previously, the funding bill had passed by a vote of 184 to 170.

Had the veto been overridden, the bill would have raised school spending by about $60 million in the 1994-95 school year, more than doubling the amount of money the state sends to districts.

New Hampshire ranks last among the 50 states in the percentage of school funding provided by the state government. Districts derive about 90 percent of their budgets from local property taxes.

Mr. Merrill argued that in order to fund the education measure, the state would have to cut other aid to cities and towns, which could force them to raise local property taxes to maintain existing services.

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