State governments wield significant authority in the management of public schools. As a nexus for federal funding, state funding, and regulatory authority, states have both the legal and financial power to help drive school change. The "No Child Left Behind Act" has required each state to create a system of standards-based assessment and has empowered states with the ability to restructure and reconstitute those schools not meeting Adequate Yearly Progress (AYP). In addition to serving as the main agent of accountability, state legislatures pass laws regulating the instructional, operational, financial, and personnel-related functions of schools. To support dramatic school turnaround, state governments have the opportunity to create more flexible operating conditions for schools participating in a Partnership Zones. Finally, state governments provide the majority of funding for public schools. Often federal grants are distributed by state departments of education. Therefore, states are well-positioned to provide financial incentives and increased investment to support school turnaround. This memo outlines five important methods that state governments can use to help support school turnaround in a Partnership Zone. They include: (1) Developing Systems of Accountability and Performance Management; (2) Providing Increased Flexibility; (3) Creating Incentives; (4) Supporting Lead Partners and Building Coalitions; and (5) Increasing Investment.