(1) On or before October 1, 2009, and periodically thereafter, the state board shall review the rules for implementing the federal "Family Educational Rights and Privacy Act of 1974", 20 U.S.C. sec. 1232g, and shall adopt an interpretation of said act that will facilitate the exchange and sharing of student information to the greatest extent possible in compliance with the federal regulations for implementing said act. The state board shall consult with the EDAC in determining its interpretation of said act.

(2) The department shall periodically review its interpretation of federal regulations pertaining to education data collection and reporting and shall ensure that it takes into consideration the interpretations adopted by the departments of education in neighboring states.

(3) (a) Notwithstanding any provision of law to the contrary, in any year in which the general assembly does not appropriate moneys to implement a state program in which the department, a school district, the state charter school institute, or a public school was participating, any reporting requirements that are required under the provisions of the state program are suspended, and the department, school districts, the state charter school institute, and public schools need not comply with said reporting requirements; except that a participating school district, the state charter school institute if it is participating, or a participating public school shall comply with requirements to report information concerning the entity's participation in the state program during the period in which it was funded.

(b) For purposes of this subsection (3), "state program" means a program specifically created in state statute and for which the statute creating the program specifically provides funding to a participating school district, the state charter school institute, or a public school.