LOL! No wonder our kids are failing - this dizzy bitch doesn't know what she's talking about. Nothing wrong with any of that letter except her capitalizing "style!" disagreement. Note to ditzy teacher: 'Federal and State levels' is a perfectly acceptable informal shortening of 'Federal Government and State Government levels' - see proper nouns capitalization in your "stylebook".
And her "corrections" - explain rule? Really?- are a pathetic incoherent mess. Not surprising, though - just look at her!