_________ Bill No. _______

Introduced By _______________________________________________________________________________



A Bill for an Act entitled: "An Act allowing for the transfer of unexpended general fund money to pay for the replacement and reconditioning of school district technology, equipment, furniture, and services; amending section

20-9-104, MCA; and providing an effective date."



Be it enacted by the Legislature of the State of Montana:



Section 1.  Section 20-9-104, MCA, is amended to read:

"20-9-104.   General fund operating reserve. (1) At the end of each school fiscal year, the trustees of each district shall may designate the a portion of the general fund end-of-the-year fund balance that is to be earmarked as operating reserve for the purpose of paying general fund warrants issued by the district from July 1 to November 30 of the ensuing school fiscal year. Except as provided in subsections (5) and (6), the amount of the general fund balance that is earmarked as operating reserve may not exceed 10% of the final general fund budget for the ensuing school fiscal year.

(2)  The amount held as operating reserve may not be used for property tax reduction in the manner permitted by 20-9-141(1)(b) for other receipts.

(3)  Excess reserves Reserves not earmarked as operating reserve, as provided in subsection (5) (1), may be appropriated to reduce the BASE budget levy, the over-BASE budget levy, or the additional levy provided by 20-9-353 transferred to either the miscellaneous programs fund or the technology acquisitions fund, at the discretion of the trustees of the district, and may be spent by the district to pay for the purchase, replacement, updating, or reconditioning of the district's technology, furniture, or other services or equipment.

(4)  Any portion of the general fund end-of-the-year fund balance that is not reserved earmarked under subsection (2) (1) or reappropriated transferred under subsection (3) is fund balance reappropriated and must be used for property tax reduction as provided in 20-9-141(1)(b).

(5)  The limitation of subsection (1) does not apply when the amount in excess of the limitation is equal to or less than the unused balance of any amount:

(a)  (i) received in settlement of tax payments protested in a prior school fiscal year;

(ii)  received in taxes from a prior school fiscal year as a result of a tax audit by the department of revenue or its agents;

(iii)  received in delinquent taxes from a prior school fiscal year; and

(iv)  received as a local government severance tax payment for calendar year 1995 production as provided in 15-36-325; or

(b)  a district was entitled to as a general bonus payment prior to July 1, 1994.

(6)  The limitation of subsection (1) does not apply when the amount earmarked as operating reserve is $10,000 or less."



NEW SECTION. Section 2.  Effective date. [This act] is effective July 1, 1997.

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