When Mr. Moore gets a job in a touring company, he leaves the school and the IHP gets a new teacher, Billy MacGregor. Dennis chooses not to welcome him. While Arvid thinks he's the man.
The IHP get lost driving back from an academic bowl and stop at a truck stop. After the students insult everything from a festival to the character and intelligence of the locals, Billy pits the two sides in game show-style competition.
Jasper's parents thinking of him as a child won't let him alone so they get a babysitter. And the person who shows up is Sarah. And he pretends that he has a sibling. And that's when they get close.
When Arvid "rescues" a chimp from a pet store, the IHP stages a mock court room hearing to aggressively plead with the store owner not to sell the chimp. The only problem is they confuse the store owner with an evaluator from the Board of Education.
Simone tries to get the right caption for Eric in the yearbook. Billy is concerned that Eric would rather be forgotten when Dr. Samuels leaves out Eric's name on the trophy.
Billy is put in charge of the school musical. Monica quits when Billy allows everybody to sing. An operatic voice comes out of the air duct. Billy proclaims it to be the Phantom of Fillmore High and later discovers that it's T.J.
Dr. Samuels is facing early retirement. Fillmore High is closing. The classmates have to deal with their impending departures. Billy plans to propose to Miss Meara. Sarah makes T.J. the valedictorian.
As graduation approaches, Eric proposes to Simone and a typo sends a demolition crew to the school. An angry T.J. plans to tank the valedictorian speech. Janice returns to join the graduating class.