The passage of House Bill 1205 comes as a direct response to a Call 6 Investigation that exposed a $1 million retirement payout for former Wayne Township Schools Superintendent Terry Thompson.

The legislation is awaiting the governor's signature and will go into effect July 1.

It will require school districts to alert the public when negotiating a superintendent's contract and the contract must disclose the monetary value of the contract, including benefits and perks.

In the case of Thompson, school board members said they did not understand the financial implications of the contract they were signing.

In January 2011, the Call 6 Investigators placed dozens of inquiries and public records requests to eventually determine the financial implications of Thompson's contract.

"I'm glad we were able to get this done," said Rep. Robert Behning, R-Indianapolis, the author of the legislation. "It's not as exciting as some of the education reforms from last year, but it is something the public has a right to know."

Behning said he drafted the legislation to prevent another debacle similar to what happened with Thompson.

"Hopefully, situations like what happened in Wayne Township will not happen again, because they're now required to have the annual dollar value of the contract," he said.

The legislation also requires the school district to hold a public meeting and allow community input at least seven days before signing the superintendent contract.

Once signed, the school district must post the contract on its website.

Under the new rules, school districts will also have to post existing contracts not just for superintendents, but all certificated employees, including principals and teachers.

"It's common sense," Behning said. "We're all about transparency in government, and this really just takes another step."

The Indiana Association of Public School Superintendents is busy educating school districts about the changes, but not everyone's happy.

"Superintendents don't like the fact that they feel this came from one isolated event," said the organization's director, John Ellis. "This appears to be a sledgehammer to fix an issue that could have been dealt with by pushing a little harder."

Ellis pointed to a recent survey that showed the majority of superintendents earn the same benefits as other school employees.

Ellis said he hopes school boards and the public will take into account what other school employees earn.

"Eighty-seven percent of superintendents receive the same benefits as all the rest of their administrators," Ellis said.

Ellis said the association supports the move toward more transparency.

"The information has always been out there," he said. "Sometimes it wasn't very easy to get to it, and in other cases it was very transparent. This makes the transparency apply to everyone regardless."

The law also requires charter school organizers to publish the names of the governing body members on the school's website.

Gov. Mitch Daniels had not yet received the legislation Monday, but once it hits his desk, he has seven days to make a decision.