School Accountability Improvement Act of 2010

School Accountability Improvement Act of 2010 - Amends the Elementary and Secondary Education Act of 1965 (ESEA) to alter requirements for adequate yearly progress (AYP) assessments of student groups by: (1) allowing states to vary the number of students sufficient for such an assessment from local educational agency (LEA) to LEA and from school to school; (2) lowering the percentage of students in a failing group who must show improvement from the preceding year for a school to avoid corrective action; (3) changing the method of counting students in more than one group; (4) allowing states to use alternative methods of defining AYP; (5) allowing states to use a combination of AYP assessments; (6) exempting a higher percentage of students from such assessments; (7) giving states greater flexibility in the use of alternative assessments for disabled students and those not proficient in English; (8) allowing states to continue to include students in the disabled and limited English proficient student groups for three years after their status as disabled or limited English proficient ends; and (9) allowing multiple assessments of the same student prior to the following school year and measurement of the achievement of students as if they were in their prior grade.

Provides that a state's intermediate academic achievement goals need not increase in equal increments for all groups.

Permits states to adopt alternative calculations of graduation and dropout rates to account for students who do not graduate on time, but are still enrolled in school or are receiving a postsecondary education.

Authorizes the Secretary of Education to conduct research regarding, and make grants to states to develop and implement, AYP standards that: (1) meet the expectation that students be prepared for postsecondary education or the workplace; and (2) are consistent with high caliber standards in other countries. Gives states certain incentives to adopt such standards.

Requires that states be given maximum flexibility in devising academic improvement plans.

Limits the implementation of sanctions to schools and LEAs that fail AYP standards in the same subject for the same group for two consecutive school years, and the provision of school transfers and supplemental services to students in the group who failed AYP standards. Provides further exceptions to and conditions on the application of corrective actions.

Involves LEAs in the choice and critique of supplemental service providers as well as the provision of such services.

Authorizes states, LEAs, and schools to defer implementation of certain corrective actions in any fiscal year when the amount appropriated under ESEA and the Individuals with Disabilities Act does not equal or exceed a specified authorized amount.

Applies AYP assessments to private schools receiving benefits under ESEA. Allows states to deny such benefits to private schools that fail state AYP standards for three consecutive years and underperform local public schools.