The administration also calls for the elimination of former President George W. Bush's 2014 deadline for making every U.S. child academically proficient, The New York Times reported in its Monday edition.
Educators who have been briefed on the changes said they would reshape or eliminate many provisions of the act that school boards, teachers unions, associations of principals and other groups have criticized.
"They were very clear with us that they would change the metric, dropping adequate yearly progress and basing a new system on another picture of performance based on judging schools in a more nuanced way," said Bruce Hunter, director of public policy for the American Association of School Administrators.
The administration also wants to change federal school financing so money is awarded based on academic progress, rather than by longstanding formulas based on the number of students and other factors, including the proportion of low-income students.
Since the No Child law was signed eight years ago, many educators have taken issue with branding tens of thousands of schools as failing without forcing them to change, the Times said.
Under the current system, every year, each school receives a type of pass-fail report card. Administration officials say this fails to differentiate between schools in perpetual failure mode, schools where low-scoring students are improving with help and high-performing suburban schools still appearing to neglect some low-scoring pupils.
Some of the president's proposals include a system that would divide schools into more divisions and offer recognition to those succeeding and large amounts of money to failing schools to help them improve.
Notable deaths of 2014 [PHOTOS]