Indiana will take advantage of a federal waiver on provisions of the No Child Left Behind act to create better education for students, State School Superintendent Tony Bennett said.

In a statement, he said the original act was a "giant step forward" for schools, but it's since become out-of-date with how the state measures student success.

The Indiana State Teachers Association says they are cautiously supportive of the state's new plan, so long as it is used to improve schools.

"ISTA hopes that Indiana officials do not use this waiver to mandate further education 'reforms' without input from teachers, parents and other public stakeholders," ISTA President Nate Schnellenberger said in a statement. Schnellenberger attended President Barack Obama's announcement of the waivers in Washington on Thursday.

Gov. Mitch Daniels said in a live broadcast of an interview with the Louisville Courier-Journal's editorial board that Secretary of Education Arne Duncan called him Wednesday to announce Indiana's waiver. Daniels said in the interview he appreciated the Obama administration's willingness to compromise on the bill's tough requirement for all students to be proficient in reading and math by 2014.

"The waiver will make for a fairer system and one that focuses on what matters most: getting the whole system to perform better in terms of student learning," Daniels said in a statement.

Instead of a national passing-rate mandate, Indiana will use a ramped-up version of its A to F school-grading system, which was adopted last summer. But the state department of education will use new methods to calculate a school's letter grades.

Schools will receive a yearly report card that analyzes their students' progress in key testing areas, such as math and reading. It will break down how many students passed standardized tests and provide a letter grade for each subject. Those will be averaged into one overall letter grade for the school. In addition, the state will analyze progress by achievement groups — students who score similarly on tests will be grouped together and their yearly improvement rate will be monitored.

The first batch of newly calculated letter grades will be released at the end of this school year.

Department of Education spokeswoman Stephanie Sample says this is a more accurate way to look at student growth and places emphasis on struggling students. Since low-achieving students may not start in the same place as higher-achieving peers each year, Sample said the state's plan makes it a priority to have each student learn a year's worth of material at any level and improve from there.

"There is a bottom 25 percent of students in every school, whether it's Carmel or Indianapolis Public Schools," Sample said. "Every school should be looking to get those students."