(1) Except as otherwise provided in this section or section 1278b, beginning with pupils entering grade 8 in 2006, the board of a school district or board of directors of a public school academy shall not award a high school diploma to a pupil unless the pupil meets all of the following:

• (iii) At least 1 credit in subject matter that includes both health and physical education aligned with guidelines developed by the department and approved by the state board under section 1278b, or at least 1/2 credit in health aligned with guidelines developed by the department and approved by the state board under section 1278b and at least 1/2 credit awarded by the school district or public school academy for approved participation in extracurricular athletics or other extracurricular activities involving physical activity.

(2) A school district may credit a pupil’s participation in extracurricular athletics or other extracurricular activities involving physical activity as meeting the physical education requirement for the pupil under subsection (1).

Model policy does not allow for PE substitutions.