Unfortunately, the district�s GT coordinator indicated that Texas policy does not allow such arrangement for elementary school students and is not an option until DD is in the middle school.
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I just did not have the nerve to ask the district GT coordinator for the specific legislation/law/policy that we have so desperately searched for on the internet. But even if I do find the policy, will it really change anything?!)
No - but if the GT coordinator were to admit that it doesn't exist, that might change a lot, not only for your DD but for others. However, "policy"'s different from "law" - on the minus side, a policy might not even be written down but could still exist, on the plus side a policy might be easier to get round! I really would push on this if I were you. Would it maybe work to mention to the principal that you're confused by this comment but didn't liked to bring it up for fear of sounding argumentative? Maybe the principal would be in a better position to ask the GT coordinator about it as a professional query, which might bring to light that the policy/law is fictitious, if it is...
Re the "it's still kindergarten level" comment, is there any reason not to take it at face value? i.e. that achieving perfection on a grade-level test is different from achieving well on an above-level test. (Both ways: GT kids who can do well on above-level tests but still not achieve perfection on grade-level tests are common; you've got the other way round, that perfection on the grade-level tests doesn't tell you how she'd do on an above-level test, although probably you personally could have a good guess.) This matters for acceleration particularly if it's by several years - but if you're just asking for acceleration out of K you'd think perfection on a K level test should do it!