HOUSE BILL NO. 678
INTRODUCED BY M. LANGE, BROWN, GLASER, LAKE, LEWIS, SALES, STAPLETON, STORY
A BILL FOR AN ACT ENTITLED: "AN ACT PROVIDING PROPERTY TAX RELIEF BY REVISING SCHOOL FINANCE LAWS; INCREASING DIRECT STATE AID TO SCHOOLS AND REDUCING THE STATE EQUALIZATION AID LEVY; REVISING THE DEFINITION OF "BASE AID"; ELIMINATING THE BASE BUDGET LEVY; ELIMINATING REVISING GUARANTEED TAX BASE AID FOR THE BASE BUDGET; REVISING THE FUNDING FOR THE OVER-BASE BUDGET; REVISING THE CALCULATION OF AVERAGE NUMBER BELONGING; PROVIDING TAX RELIEF FOR CERTAIN RESIDENTIAL PROPERTY BY ALLOWING A REFUNDABLE INDIVIDUAL INCOME TAX CREDIT; ELIMINATING REDUCING SCHOOL DISTRICT BLOCK GRANTS; AMENDING SECTIONS 20-3-106, 20-3-324, 20-6-702, 20-7-102, 20-9-104, 20-9-141, 20-9-306, 20-9-308, 20-9-311, 20-9-351, 20-9-360, 20-9-366, 20-9-367, 20-9-368, 20-9-369, 20-9-515, AND 20-10-144 AND 20-9-630, MCA; REPEALING SECTION 20-9-630, MCA; AND PROVIDING AN EFFECTIVE DATES AND APPLICABILITY DATES DATE AND AN APPLICABILITY DATE."
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:
NEW SECTION. Section 1. Tax credit -- residential property minimum property tax relief. (1) (a) As provided in this section, a taxpayer is allowed a credit against taxes imposed by 15-30-103 in an amount equal to the amount calculated in this section. The credit provided in this section is a refundable credit that may be claimed even if the taxpayer does not have tax liability.
(b) (i) Subject to subsection (1)(b)(ii), the THE amount of a tax credit FOR A TAXPAYER'S RESIDENTIAL PROPERTY is determined by multiplying the taxable value of the taxpayer's residential property for the income tax year times 0.038 and subtracting that THE amount DETERMINED UNDER SUBSECTION (1)(C) from $400 ($400 - (taxable value x 0.038)). The resulting sum is the amount of the tax credit.
(ii) If the mill levy in a school district decreases because of the increase in direct state aid from 44.7% to 80%, as provided for in 20-9-306, the amount of the tax credit calculated in subsection (1)(b)(i) must be reduced by the amount of the property tax reduction attributable to the mill levy decrease.
(c) The department shall calculate the amount of the mill levy reduction attributable to the increase in direct state aid described in subsection (1)(b)(ii) (1)(B) for each school district. The department shall publish the mill levy reduction for each school district and calculate the property tax decrease attributable to the increase in direct state aid for purposes of determining the amount of the credit available under this subsection (1). The department may adopt rules to implement this section.
(2) If the amount of the credit exceeds the taxpayer's liability under this chapter, the amount of the excess must be refunded to the taxpayer. The credit may be claimed even though the claimant has no income taxable under this chapter.
(3) Only one claim may be made with respect to any property.
(4) As used in this section, the following definitions apply:
(a) "Owned" includes purchasing under a contract for deed and being the grantor or grantors under a trust indenture.
(b) "Taxpayer's residential property" means property classified under 15-6-134 that is:
(i) a single-family dwelling unit, a unit of a multiple-unit dwelling, a trailer, a manufactured home, or a mobile home and as much of the surrounding land, not exceeding 1 acre, as is reasonably necessary for its use as a dwelling;
(ii) assessed in the tax year; and
(iii) the residence that the taxpayer owned and occupied as the taxpayer's principal residence for at least 7 months during a tax year.
Section 2. Section 20-3-106, MCA, is amended to read:
"20-3-106. Supervision of schools -- powers and duties. The superintendent of public instruction has the general supervision of the public schools and districts of the state and shall perform the following duties or acts in implementing and enforcing the provisions of this title:
(1) resolve any controversy resulting from the proration of costs by a joint board of trustees under the provisions of 20-3-362;
(2) issue, renew, or deny teacher certification and emergency authorizations of employment;
(3) negotiate reciprocal tuition agreements with other states in accordance with the provisions of 20-5-314;
(4) approve or disapprove the opening or reopening of a school in accordance with the provisions of 20-6-502, 20-6-503, 20-6-504, or 20-6-505;
(5) approve or disapprove school isolation within the limitations prescribed by 20-9-302;
(6) generally supervise the school budgeting procedures prescribed by law in accordance with the provisions of 20-9-102 and prescribe the school budget format in accordance with the provisions of 20-9-103 and 20-9-506;
(7) establish a system of communication for calculating joint district revenue in accordance with the provisions of 20-9-151;
(8) approve or disapprove the adoption of a district's budget amendment resolution under the conditions prescribed in 20-9-163 and adopt rules for an application for additional direct state aid for a budget amendment in accordance with the approval and disbursement provisions of 20-9-166;
(9) generally supervise the school financial administration provisions as prescribed by 20-9-201(2);
(10) prescribe and furnish the annual report forms to enable the districts to report to the county superintendent in accordance with the provisions of 20-9-213(6) and the annual report forms to enable the county superintendents to report to the superintendent of public instruction in accordance with the provisions of 20-3-209;
(11) approve, disapprove, or adjust an increase of the average number belonging (ANB) in accordance with the provisions of 20-9-313 and 20-9-314;
(12) distribute BASE aid and special education allowable cost payments in support of the BASE funding program in accordance with the provisions of 20-9-331, 20-9-333, 20-9-342, 20-9-346, and 20-9-347, and 20-9-366 through 20-9-369;
(13) provide for the uniform and equal provision of transportation by performing the duties prescribed by the provisions of 20-10-112;
(14) request, accept, deposit, and expend federal money in accordance with the provisions of 20-9-603;
(15) authorize the use of federal money for the support of an interlocal cooperative agreement in accordance with the provisions of 20-9-703 and 20-9-704;
(16) prescribe the form and contents of and approve or disapprove interstate contracts in accordance with the provisions of 20-9-705;
(17) recommend standards of accreditation for all schools to the board of public education and evaluate compliance with the standards and recommend accreditation status of every school to the board of public education in accordance with the provisions of 20-7-101 and 20-7-102;
(18) collect and maintain a file of curriculum guides and assist schools with instructional programs in accordance with the provisions of 20-7-113 and 20-7-114;
(19) establish and maintain a library of visual, aural, and other educational media in accordance with the provisions of 20-7-201;
(20) license textbook dealers and initiate prosecution of textbook dealers violating the law in accordance with the provisions of the textbooks part of this title;
(21) as the governing agent and executive officer of the state of Montana for K-12 career and vocational/technical education, adopt the policies prescribed by and in accordance with the provisions of 20-7-301;
(22) supervise and coordinate the conduct of special education in the state in accordance with the provisions of 20-7-403;
(23) administer the traffic education program in accordance with the provisions of 20-7-502;
(24) administer the school food services program in accordance with the provisions of 20-10-201 through 20-10-203;
(25) review school building plans and specifications in accordance with the provisions of 20-6-622;
(26) provide schools with information and technical assistance for compliance with the student assessment rules provided for in 20-2-121 and collect and summarize the results of the student assessment for the board of public education and the legislature;
(27) upon request and in compliance with confidentiality requirements of state and federal law, disclose to interested parties all school district student assessment data for a test required by the board of public education;
(28) administer the distribution of guaranteed tax base aid in accordance with 20-9-366 through 20-9-369; and
(29) perform any other duty prescribed from time to time by this title, any other act of the legislature, or the policies of the board of public education."
Section 3. Section 20-3-324, MCA, is amended to read:
"20-3-324. Powers and duties. As prescribed elsewhere in this title, the trustees of each district shall:
(1) employ or dismiss a teacher, principal, or other assistant upon the recommendation of the district superintendent, the county high school principal, or other principal as the board considers necessary, accepting or rejecting any recommendation as the trustees in their sole discretion determine, in accordance with the provisions of Title 20, chapter 4;
(2) employ and dismiss administrative personnel, clerks, secretaries, teacher aides, custodians, maintenance personnel, school bus drivers, food service personnel, nurses, and any other personnel considered necessary to carry out the various services of the district;
(3) administer the attendance and tuition provisions and govern the pupils of the district in accordance with the provisions of the pupils chapter of this title;
(4) call, conduct, and certify the elections of the district in accordance with the provisions of the school elections chapter of this title;
(5) participate in the teachers' retirement system of the state of Montana in accordance with the provisions of the teachers' retirement system chapter of Title 19;
(6) participate in district boundary change actions in accordance with the provisions of the districts chapter of this title;
(7) organize, open, close, or acquire isolation status for the schools of the district in accordance with the provisions of the school organization part of this title;
(8) adopt and administer the annual budget or a budget amendment of the district in accordance with the provisions of the school budget system part of this title;
(9) conduct the fiscal business of the district in accordance with the provisions of the school financial administration part of this title;
(10) subject to 15-10-420, establish the ANB, BASE budget levy, over-BASE budget levy, additional levy, operating reserve, and state impact aid amounts for the general fund of the district in accordance with the provisions of the general fund part of this title;
(11) establish, maintain, budget, and finance the transportation program of the district in accordance with the provisions of the transportation parts of this title;
(12) issue, refund, sell, budget, and redeem the bonds of the district in accordance with the provisions of the bonds parts of this title;
(13) when applicable, establish, financially administer, and budget for the tuition fund, retirement fund, building reserve fund, adult education fund, nonoperating fund, school food services fund, miscellaneous programs fund, building fund, lease or rental agreement fund, traffic education fund, impact aid fund, interlocal cooperative agreement fund, and other funds as authorized by the state superintendent of public instruction in accordance with the provisions of the other school funds parts of this title;
(14) when applicable, administer any interlocal cooperative agreement, gifts, legacies, or devises in accordance with the provisions of the miscellaneous financial parts of this title;
(15) hold in trust, acquire, and dispose of the real and personal property of the district in accordance with the provisions of the school sites and facilities part of this title;
(16) operate the schools of the district in accordance with the provisions of the school calendar part of this title;
(17) set the length of the school term, school day, and school week in accordance with 20-1-302;
(18) establish and maintain the instructional services of the schools of the district in accordance with the provisions of the instructional services, textbooks, K-12 career and vocational/technical education, and special education parts of this title;
(19) establish and maintain the school food services of the district in accordance with the provisions of the school food services parts of this title;
(20) make reports from time to time as the county superintendent, superintendent of public instruction, and board of public education may require;
(21) retain, when considered advisable, a physician or registered nurse to inspect the sanitary conditions of the school or the general health conditions of each pupil and, upon request, make available to any parent or guardian any medical reports or health records maintained by the district pertaining to the child;
(22) for each member of the trustees, visit each school of the district not less than once each school fiscal year to examine its management, conditions, and needs, except trustees from a first-class school district may share the responsibility for visiting each school in the district;
(23) procure and display outside daily in suitable weather on school days at each school of the district an American flag that measures not less than 4 feet by 6 feet;
(24) provide that an American flag that measures approximately 12 inches by 18 inches be prominently displayed in each classroom in each school of the district, except in a classroom in which the flag may get soiled. This requirement is waived if the flags are not provided by a local civic group.
(25) adopt and administer a district policy on assessment for placement of any child who enrolls in a school of the district from a nonpublic school that is not accredited, as required in 20-5-110;
(26) upon request and in compliance with confidentiality requirements of state and federal law, disclose to interested parties school district student assessment data for any test required by the board of public education;
(27) consider and may enter into an interlocal agreement with a postsecondary institution, as defined in 20-9-706, that authorizes 11th and 12th grade students to obtain credits through classes available only at a postsecondary institution;
(28) approve or disapprove the conduct of school on a Saturday in accordance with the provisions of 20-1-303;
(29) consider and, if advisable for a high school or K-12 district, establish a student financial institution, as defined in 32-1-115; and
(30) perform any other duty and enforce any other requirements for the government of the schools prescribed by this title, the policies of the board of public education, or the rules of the superintendent of public instruction."
Section 4. Section 20-6-702, MCA, is amended to read:
"20-6-702. Funding for K-12 school districts. (1) Notwithstanding the provisions of subsections (2) through (6), a K-12 school district formed under the provisions of 20-6-701 is subject to the provisions of law for high school districts.
(2) The number of elected trustees of the K-12 school district must be based on the classification of the attached elementary district under the provisions of 20-3-341 and 20-3-351.
(3) Calculations for the following must be made separately for the elementary school program and the high school program of a K-12 school district:
(a) the calculation of ANB for purposes of determining the total per-ANB entitlements must be in accordance with the provisions of 20-9-311; and
(b) the basic county tax for elementary equalization and revenue for the elementary BASE funding program for the district must be determined in accordance with the provisions of 20-9-331, and the basic county tax for high school equalization and revenue for the high school BASE funding program for the district must be determined in accordance with 20-9-333; and
(c) the guaranteed tax base aid for BASE funding program purposes for a K-12 school district must be calculated separately, using each district's guaranteed tax base ratio, as defined in 20-9-366. The BASE budget levy to be levied for the K-12 school district must be prorated based on the ratio of the BASE funding program amounts for elementary school programs to the BASE funding program amounts for high school programs.
(4) The retirement obligation and eligibility for retirement guaranteed tax base aid for a K-12 school district must be calculated and funded as a high school district retirement obligation under the provisions of 20-9-501.
(5) For the purposes of budgeting for a K-12 school district, the trustees shall adopt a single fund for any of the budgeted or nonbudgeted funds described in 20-9-201 for the costs of operating all grades and programs of the district.
(6) Tuition for attendance in the K-12 school district must be determined separately for high school pupils and for elementary pupils under the provisions of 20-5-320 through 20-5-324, except that the actual expenditures used for calculations in 20-5-323 must be based on an amount prorated between the elementary and high school programs in the appropriate funds of each district in the year prior to the attachment of the districts."
Section 5. Section 20-7-102, MCA, is amended to read:
"20-7-102. Accreditation of schools. (1) The conditions under which each elementary school, each middle school, each junior high school, 7th and 8th grades funded at high school rates, and each high school operates must be reviewed by the superintendent of public instruction to determine compliance with the standards of accreditation. The accreditation status of each school must then be established by the board of public education upon the recommendation of the superintendent of public instruction. Notification of the accreditation status for the applicable school year or years must be given to each district by the superintendent of public instruction.
(2) A school may be accredited for a period consisting of 1, 2, 3, 4, or 5 school years, except that multiyear accreditation may be granted only to schools that are in compliance with 20-4-101.
(3) A nonpublic school may, through its governing body, request that the board of public education accredit the school. Nonpublic schools may be accredited in the same manner as provided in subsection (1).
(4) As used in this section, "7th and 8th grades funded at high school rates" means an elementary school district or K-12 district elementary program whose 7th and 8th grades are funded as provided in 20-9-306(14)(c)(ii) 20-9-306(13)(c)(ii)."
Section 6. 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 designate the 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 as provided in subsection (5) may be appropriated to reduce the BASE budget levy, the over-BASE budget levy, or the additional levy provided by 20-9-353.
(4) Any portion of the general fund end-of-the-year fund balance that is not reserved under subsection (2) or reappropriated 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) received in settlement of tax payments protested in a prior school fiscal year;
(b) received in taxes from a prior school fiscal year as a result of a tax audit by the department of revenue or its agents; or
(c) received in delinquent taxes from a prior school fiscal year.
(6) The limitation of subsection (1) does not apply when the amount earmarked as operating reserve is $10,000 or less."
Section 1. Section 20-9-141, MCA, is amended to read:
"20-9-141. Computation of general fund net levy requirement by county superintendent. (1) The county superintendent shall compute the levy requirement for each district's general fund on the basis of the following procedure:
(a) Determine the funding required for the district's final general fund budget less the sum of direct state aid and the special education allowable cost payment for the district by totaling:
(i) the district's nonisolated school BASE budget requirement to be met by a district levy as provided in 20-9-303; and
(ii) determining TOTALING:
(I) THE DISTRICT'S NONISOLATED SCHOOL BASE BUDGET REQUIREMENT TO BE MET BY A DISTRICT LEVY AS PROVIDED IN 20-9-303; AND
(II) any general fund budget amount adopted by the trustees of the district under the provisions of 20-9-308 and 20-9-353, including any additional funding for a general fund budget that exceeds the maximum general fund budget.
(b) Determine the money available for the reduction of the property tax on the district for the general fund by totaling:
(i) the general fund balance reappropriated, as established under the provisions of 20-9-104;
(ii) amounts received in the last fiscal year for which revenue reporting was required for each of the following:
(A) interest earned by the investment of general fund cash in accordance with the provisions of 20-9-213(4); and
(B) any other revenue received during the school fiscal year that may be used to finance the general fund, excluding any guaranteed tax base aid, EXCLUDING ANY GUARANTEED TAX BASE AID;
(iii) anticipated oil and natural gas production taxes; and
(iv) pursuant to subsection (4) (3) (4), anticipated revenue from coal gross proceeds under 15-23-703; and
(v) school district block grants distributed under 20-9-630.
(c) Notwithstanding the provisions of subsection (2), subtract Subtract NOTWITHSTANDING THE PROVISIONS OF SUBSECTION (2), SUBTRACT the money available to reduce the property tax required to finance the general fund that has been determined in subsection (1)(b) from any general fund budget amount adopted by the trustees of the district, up to the BASE budget amount, to determine the general fund BASE budget levy requirement, UP TO THE BASE BUDGET AMOUNT, TO DETERMINE THE GENERAL FUND BASE BUDGET LEVY REQUIREMENT.
(d) Determine the sum of any amount remaining after the determination in subsection (1)(c) and any tuition payments for out-of-district pupils to be received under the provisions of 20-5-320 through 20-5-324, except the amount of tuition received for a pupil who is a child with a disability in excess of the amount received for a pupil without disabilities, as calculated under 20-5-323(2).
(e) Subtract the amount determined in subsection (1)(d) from any additional funding requirement to be met by an over-BASE budget amount, a district levy as provided in 20-9-303, and any additional financing as provided in 20-9-353 to determine any additional general fund levy requirements.
(2) The county superintendent shall calculate the number of mills to be levied on the taxable property in the district to finance the general fund levy requirement for any amount that does not exceed the BASE budget amount for the district by dividing the amount determined in subsection (1)(c) by the sum of:
(a) the amount of guaranteed tax base aid that the district will receive for each mill levied, as certified by the superintendent of public instruction; and
(b) the current total taxable valuation of the district, as certified by the department of revenue under 15-10-202, divided by 1,000.
(2) THE COUNTY SUPERINTENDENT SHALL CALCULATE THE NUMBER OF MILLS TO BE LEVIED ON THE TAXABLE PROPERTY IN THE DISTRICT TO FINANCE THE GENERAL FUND LEVY REQUIREMENT FOR ANY AMOUNT THAT DOES NOT EXCEED THE BASE BUDGET AMOUNT FOR THE DISTRICT BY DIVIDING THE AMOUNT DETERMINED IN SUBSECTION (1)(C) BY THE SUM OF:
(A) THE AMOUNT OF GUARANTEED TAX BASE AID THAT THE DISTRICT WILL RECEIVE FOR EACH MILL LEVIED, AS CERTIFIED BY THE SUPERINTENDENT OF PUBLIC INSTRUCTION; AND
(B) THE CURRENT TOTAL TAXABLE VALUATION OF THE DISTRICT, AS CERTIFIED BY THE DEPARTMENT OF REVENUE UNDER 15-10-202, DIVIDED BY 1,000.
(3)(2)(3) The net general fund levy requirement determined in subsections (1)(c) and (1)(d) must be reported to the county commissioners on the fourth Monday of August by the county superintendent as the general fund net levy requirement for the district, and a levy must be set by the county commissioners in accordance with 20-9-142.
(4)(3)(4) For each school district, the department of revenue shall calculate and report to the county superintendent the amount of revenue anticipated for the ensuing fiscal year from revenue from coal gross proceeds under 15-23-703."
Section 2. Section 20-9-306, MCA, is amended to read:
"20-9-306. Definitions. As used in this title, unless the context clearly indicates otherwise, the following definitions apply:
(1) "BASE" means base amount for school equity.
(2) "BASE aid" means:
(a) direct state aid for 44.7% 80% 40% of the basic entitlement and 44.7% 80% 40% of the total per-ANB entitlement for the general fund budget of a district;
(b) guaranteed tax base aid for an eligible district for any amount up to 35.3% of the basic entitlement, up to 35.3% of the total per-ANB entitlement budgeted in the general fund budget of a district, and 40% of the special education allowable cost payment;
(B) GUARANTEED TAX BASE AID FOR AN ELIGIBLE DISTRICT FOR ANY AMOUNT UP TO 40% OF THE BASIC ENTITLEMENT, UP TO 40% OF THE TOTAL PER-ANB ENTITLEMENT BUDGETED IN THE GENERAL FUND BUDGET OF A DISTRICT, AND 40% OF THE SPECIAL EDUCATION ALLOWABLE COST PAYMENT;
(c)(b)(C) the total quality educator payment;
(d)(c)(D) the total at-risk student payment;
(e)(d)(E) the total Indian education for all payment; and
(f)(e)(F) the total American Indian achievement gap payment.
(3) "BASE budget" means the minimum general fund budget of a district, which includes 80% of the basic entitlement, 80% of the total per-ANB entitlement, 100% of the total quality educator payment, 100% of the total at-risk student payment, 100% of the total Indian education for all payment, 100% of the total American Indian achievement gap payment, and 140% 100% 140% of the special education allowable cost payment.
(4) "BASE budget levy" means the district levy in support of the BASE budget of a district, which may be supplemented by guaranteed tax base aid if the district is eligible under the provisions of 20-9-366 through 20-9-369.
(4) "BASE BUDGET LEVY" MEANS THE DISTRICT LEVY IN SUPPORT OF THE BASE BUDGET OF A DISTRICT, WHICH MAY BE SUPPLEMENTED BY GUARANTEED TAX BASE AID IF THE DISTRICT IS ELIGIBLE UNDER THE PROVISIONS OF 20-9-366 THROUGH 20-9-369.
(5)(4)(5) "BASE funding program" means the state program for the equitable distribution of the state's share of the cost of Montana's basic system of public elementary schools and high schools, through county equalization aid as provided in 20-9-331 and 20-9-333 and state equalization aid as provided in 20-9-343, in support of the BASE budgets of districts and special education allowable cost payments as provided in 20-9-321.
(6)(5)(6) "Basic entitlement" means:
(a) $230,199 for each high school district;
(b) $20,718 for each elementary school district or K-12 district elementary program without an approved and accredited junior high school or middle school; and
(c) the prorated entitlement for each elementary school district or K-12 district elementary program with an approved and accredited junior high school or middle school, calculated as follows using either the current year ANB or the 3-year ANB provided for in 20-9-311:
(i) $20,718 times the ratio of the ANB for kindergarten through grade 6 to the total ANB of kindergarten through grade 8; plus
(ii) $230,199 times the ratio of the ANB for grades 7 and 8 to the total ANB of kindergarten through grade 8.
(7)(6)(7) "Budget unit" means the unit for which the ANB of a district is calculated separately pursuant to 20-9-311.
(8)(7)(8) "Direct state aid" means 44.7% 80% 40% of the basic entitlement and 44.7% 80% 40% of the total per-ANB entitlement for the general fund budget of a district and funded with state and county equalization aid.
(9)(8)(9) "Maximum general fund budget" means a district's general fund budget amount calculated from the basic entitlement for the district, the total per-ANB entitlement for the district, the total quality educator payment, the total at-risk student payment, the total Indian education for all payment, the total American Indian achievement gap payment, and the greater of:
(a) 175% of special education allowable cost payments; or
(b) the ratio, expressed as a percentage, of the district's special education allowable cost expenditures to the district's special education allowable cost payment for the fiscal year that is 2 years previous, with a maximum allowable ratio of 200%.
(10)(9)(10) "Over-BASE budget levy" means the district levy in support of any general fund amount budgeted that is above the BASE budget and below the maximum general fund budget for a district.
(11)(10)(11) "Total American Indian achievement gap payment" means the payment resulting from multiplying $200 times the number of American Indian students enrolled in the district as provided in 20-9-330.
(12)(11)(12) "Total at-risk student payment" means the payment resulting from the distribution of any funds appropriated for the purposes of 20-9-328.
(13)(12)(13) "Total Indian education for all payment" means the payment resulting from multiplying $20.40 times the ANB of the district or $100 for each district, whichever is greater, as provided for in 20-9-329.
(14)(13)(14) "Total per-ANB entitlement" means the district entitlement resulting from the following calculations and using either the current year ANB or the 3-year ANB provided for in 20-9-311:
(a) for a high school district or a K-12 district high school program, a maximum rate of $5,704 for the first ANB is decreased at the rate of 50 cents per ANB for each additional ANB of the district up through 800 ANB, with each ANB in excess of 800 receiving the same amount of entitlement as the 800th ANB;
(b) for an elementary school district or a K-12 district elementary program without an approved and accredited junior high school or middle school, a maximum rate of $4,456 for the first ANB is decreased at the rate of 20 cents per ANB for each additional ANB of the district up through 1,000 ANB, with each ANB in excess of 1,000 receiving the same amount of entitlement as the 1,000th ANB; and
(c) for an elementary school district or a K-12 district elementary program with an approved and accredited junior high school or middle school, the sum of:
(i) a maximum rate of $4,456 for the first ANB for kindergarten through grade 6 is decreased at the rate of 20 cents per ANB for each additional ANB up through 1,000 ANB, with each ANB in excess of 1,000 receiving the same amount of entitlement as the 1,000th ANB; and
(ii) a maximum rate of $5,704 for the first ANB for grades 7 and 8 is decreased at the rate of 50 cents per ANB for each additional ANB for grades 7 and 8 up through 800 ANB, with each ANB in excess of 800 receiving the same amount of entitlement as the 800th ANB.
(15)(14)(15) "Total quality educator payment" means the payment resulting from multiplying $2,000 times the number of full-time equivalent educators as provided in 20-9-327."
Section 9. Section 20-9-308, MCA, is amended to read:
"20-9-308. (Temporary) BASE budgets and maximum general fund budgets. (1) The trustees of a district shall adopt a general fund budget that is at least equal to the BASE budget established for the district and, except as provided in subsection (3), does not exceed the maximum general fund budget established for the district.
(2) Whenever the trustees of a district adopt a general fund budget that exceeds the BASE budget for the district but does not exceed the maximum general fund budget for the district, the trustees shall submit a proposition for any necessary levy to the electors of the district, as provided in 20-9-353.
(3) (a) (i) Except as provided in subsections (3)(a)(ii) and (3)(b), the trustees of a school district whose previous year's general fund budget exceeds the current year's maximum general fund budget amount may adopt a general fund budget up to the maximum general fund budget amount or the previous year's general fund budget, whichever is greater. Except as provided in subsection (3)(b), a school district may adopt a budget under the criteria of this subsection (3)(a)(i) for a maximum of 5 consecutive years, but the trustees shall adopt a plan to reach the maximum general fund budget by no later than the end of the 5-year period.
(ii) Except as provided in subsection (3)(b), the trustees of a district whose general fund budget was above the maximum general fund budget established by Chapter 38, Special Laws of November 1993, and whose general fund budget has continued to exceed the district's maximum general fund budget in each school fiscal year after school fiscal year 1993 may continue to adopt a general fund budget that exceeds the maximum general fund budget. However, the budget adopted for the current year may not exceed the lesser of:
(A) the adopted budget for the previous year; or
(B) the district's maximum general fund budget for the current year plus the over maximum budget amount adopted for the previous year.
(b) A school district that adopted a general fund budget over its maximum general fund budget under any provision of subsection (3)(a) at any time between fiscal year 2001 and fiscal year 2005 may, for fiscal year 2006 and fiscal year 2007, adopt the greater of its maximum general fund budget or the highest actual budget adopted between fiscal year 2001 and fiscal year 2005.
(c) Except as provided in 20-9-353(8), the trustees of the district shall submit a proposition to raise any general fund budget amount that is in excess of the maximum general fund budget for the district to the electors who are qualified under 20-20-301 to vote on the proposition, as provided in 20-9-353.
(4) The BASE budget for the district must be financed by the following sources of revenue:
(a) state equalization aid, as provided in 20-9-343, including any guaranteed tax base aid for which the district may be eligible, as provided in 20-9-366 through 20-9-369;
(b) county equalization aid, as provided in 20-9-331 and 20-9-333; and
(c) a district levy for support of a school not approved as an isolated school under the provisions of 20-9-302;
(d)(c) payments in support of special education programs under the provisions of 20-9-321;
(e) nonlevy revenue, as provided in 20-9-141; and
(f) a BASE budget levy on the taxable value of all property within the district.
(5) The over-BASE budget amount of a district must be financed by a levy on the taxable value of all property within the district or other revenue available to the district, as provided in 20-9-141. (Terminates June 30, 2007--sec. 3, Ch. 190, L. 2005; sec. 25(2), Ch. 462, L. 2005.)
20-9-308. (Effective July 1, 2007) BASE budgets and maximum general fund budgets. (1) The trustees of a district shall adopt a general fund budget that is at least equal to the BASE budget established for the district and, except as provided in subsection (3), does not exceed the maximum general fund budget established for the district.
(2) Whenever the trustees of a district adopt a general fund budget that exceeds the BASE budget for the district but does not exceed the maximum general fund budget for the district, the trustees shall submit a proposition for any necessary levy to the electors of the district, as provided in 20-9-353.
(3) (a) (i) Except as provided in subsection (3)(a)(ii), the trustees of a school district whose previous year's general fund budget exceeds the current year's maximum general fund budget amount may adopt a general fund budget up to the maximum general fund budget amount or the previous year's general fund budget, whichever is greater. A school district may adopt a budget under the criteria of this subsection (3)(a)(i) for a maximum of 5 consecutive years, but the trustees shall adopt a plan to reach the maximum general fund budget by no later than the end of the 5-year period. A school district whose adopted general fund budget for the previous year exceeds the maximum general fund budget for the current year and whose ANB for the previous year exceeds the ANB for the current year by 30% or more shall reduce its adopted budget by:
(A) in the first year, 20% of the range between the district's adopted general fund budget for the previous school fiscal year and the maximum general fund budget for the current school fiscal year;
(B) in the second year, 25% of the range between the district's adopted general fund budget for the previous school fiscal year and the maximum general fund budget for the current school fiscal year;
(C) in the third year, 33.3% of the range between the district's adopted general fund budget for the previous school fiscal year and the maximum general fund budget for the current school fiscal year;
(D) in the fourth year, 50% of the range between the district's adopted general fund budget for the previous school fiscal year and the maximum general fund budget for the current school fiscal year; and
(E) in the fifth year, the remainder of the range between the district's adopted general fund budget for the previous school fiscal year and the maximum general fund budget for the current school fiscal year.
(ii) The trustees of a district whose general fund budget was above the maximum general fund budget established by Chapter 38, Special Laws of November 1993, and whose general fund budget has continued to exceed the district's maximum general fund budget in each school fiscal year after school fiscal year 1993 may continue to adopt a general fund budget that exceeds the maximum general fund budget. However, the budget adopted for the current year may not exceed the lesser of:
(A) the adopted budget for the previous year; or
(B) the district's maximum general fund budget for the current year plus the over maximum budget amount adopted for the previous year.
(b) The trustees of the district shall submit a proposition to raise any general fund budget amount that is in excess of the maximum general fund budget for the district to the electors who are qualified under 20-20-301 to vote on the proposition, as provided in 20-9-353.
(4) The BASE budget for the district must be financed by the following sources of revenue:
(a) state equalization aid, as provided in 20-9-343, including any guaranteed tax base aid for which the district may be eligible, as provided in 20-9-366 through 20-9-369;
(b) county equalization aid, as provided in 20-9-331 and 20-9-333; and
(c) a district levy for support of a school not approved as an isolated school under the provisions of 20-9-302;
(d)(c) payments in support of special education programs under the provisions of 20-9-321;
(e) nonlevy revenue, as provided in 20-9-141; and
(f) a BASE budget levy on the taxable value of all property within the district.
(5) The over-BASE budget amount of a district must be financed by a levy on the taxable value of all property within the district or other revenue available to the district, as provided in 20-9-141."
Section 10. Section 20-9-311, MCA, is amended to read:
"20-9-311. (Temporary) Calculation of average number belonging (ANB) -- three-year averaging. (1) Average number belonging (ANB) must be computed for each budget unit as follows:
(a) compute an average enrollment by adding a count of regularly enrolled full-time pupils who were enrolled as of the first Monday in October of the prior school fiscal year to a count of regularly enrolled pupils on February 1 of the prior school fiscal year, or the next school day if those dates do not fall on a school day, and divide the sum by two; and
(b) multiply the average enrollment calculated in subsection (1)(a) by the sum of 180 and the approved pupil-instruction-related days for the current school fiscal year and divide by 180.
(2) For the purpose of calculating ANB under subsection (1), up to 7 approved pupil-instruction-related days may be included in the calculation.
(3) When a school district has approval to operate less than the minimum aggregate hours under 20-9-806, the total ANB must be calculated in accordance with the provisions of 20-9-805.
(4) (a) Except as provided in subsection (5), for the purpose of calculating ANB, enrollment in an education program:
(i) from 181 180 to 359 aggregate hours of pupil instruction per school year is counted as one-quarter-time enrollment;
(ii) from 360 to 539 aggregate hours of pupil instruction per school year is counted as half-time enrollment;
(iii) from 540 to 719 aggregate hours of pupil instruction per school year is counted as three-quarter-time enrollment; and
(iv) 720 or more aggregate hours of pupil instruction per school year is counted as full-time enrollment.
(b) Enrollment in a program intended to provide fewer than 180 aggregate hours of pupil instruction per school year may not be included for purposes of ANB.
(c) Enrollment in a self-paced program or course may be converted to an hourly equivalent based on the hours necessary and appropriate to provide the course within a regular classroom schedule.
(d) A pupil in grades 1 through 12 who is concurrently enrolled in more than one public school, program, or district may not be counted as more than one full-time pupil for ANB purposes.
(5) In calculating the ANB for pupils enrolled in a program established under 20-7-117(1), enrollment in a program that provides 360 or more aggregate hours of pupil instruction per school year must be counted as one-half pupil for ANB purposes.
(6) When a pupil has been absent, with or without excuse, for more than 10 consecutive school days, the pupil may not be included in the enrollment count used in the calculation of the ANB unless the pupil resumes attendance prior to the day of the enrollment count.
(7) The enrollment of prekindergarten pupils, as provided in 20-7-117, may not be included in the ANB calculations.
(8) The average number belonging of the regularly enrolled, full-time pupils for the public schools of a district must be based on the aggregate of all the regularly enrolled, full-time pupils attending the schools of the district, except that the ANB is calculated as a separate budget unit when:
(a) (i) a school of the district is located more than 20 miles beyond the incorporated limits of a city or town located in the district and at least 20 miles from any other school of the district, the number of regularly enrolled, full-time pupils of the school must be calculated as a separate budget unit for ANB purposes and the district must receive a basic entitlement for the school calculated separately from the other schools of the district;
(ii) a school of the district is located more than 20 miles from any other school of the district and incorporated territory is not involved in the district, the number of regularly enrolled, full-time pupils of the school must be calculated separately for ANB purposes and the district must receive a basic entitlement for the school calculated separately from the other schools of the district;
(iii) the superintendent of public instruction approves an application not to aggregate when conditions exist affecting transportation, such as poor roads, mountains, rivers, or other obstacles to travel, or when any other condition exists that would result in an unusual hardship to the pupils of the school if they were transported to another school, the number of regularly enrolled, full-time pupils of the school must be calculated separately for ANB purposes and the district must receive a basic entitlement for the school calculated separately from the other schools of the district; or
(iv) two or more districts consolidate or annex under the provisions of 20-6-422 or 20-6-423, the ANB and the basic entitlements of the component districts must be calculated separately for a period of 3 years following the consolidation or annexation. Each district shall retain a percentage of its basic entitlement for 3 additional years as follows:
(A) 75% of the basic entitlement for the fourth year;
(B) 50% of the basic entitlement for the fifth year; and
(C) 25% of the basic entitlement for the sixth year.
(b) a junior high school has been approved and accredited as a junior high school, all of the regularly enrolled, full-time pupils of the junior high school must be considered as high school district pupils for ANB purposes;
(c) a middle school has been approved and accredited, all pupils below the 7th grade must be considered elementary school pupils for ANB purposes and the 7th and 8th grade pupils must be considered high school pupils for ANB purposes; or
(d) a school has not been accredited by the board of public education, the regularly enrolled, full-time pupils attending the nonaccredited school are not eligible for average number belonging calculation purposes, nor will an average number belonging for the nonaccredited school be used in determining the BASE funding program for the district.
(9) The district shall provide the superintendent of public instruction with semiannual reports of school attendance, absence, and enrollment for regularly enrolled students, using a format determined by the superintendent.
(10) (a) Except as provided in subsections (10)(b) and (10)(c), enrollment in a basic education program provided by the district through any combination of onsite or offsite instruction may be included for ANB purposes only if the pupil is offered access to the complete range of educational services for the basic education program required by the accreditation standards adopted by the board of public education.
(b) Access to school programs and services for a student placed by the trustees in a private program for special education may be limited to the programs and services specified in an approved individual education plan supervised by the district.
(c) Access to school programs and services for a student who is incarcerated in a facility, other than a youth detention center, may be limited to the programs and services provided by the district at district expense under an agreement with the incarcerating facility.
(d) This subsection (10) may not be construed to require a school district to offer access to activities governed by an organization having jurisdiction over interscholastic activities, contests, and tournaments to a pupil who is not otherwise eligible under the rules of the organization.
(11) A district may include only, for ANB purposes, an enrolled pupil who is otherwise eligible under this title and who is:
(a) a resident of the district or a nonresident student admitted by trustees under a student attendance agreement and who is attending a school of the district;
(b) unable to attend school due to because of a medical reason certified by a medical doctor and receiving individualized educational services supervised by the district, at district expense, at a home or facility that does not offer an educational program;
(c) unable to attend school due to because of the student's incarceration in a facility, other than a youth detention center, and who is receiving individualized educational services supervised by the district, at district expense, at a home or facility that does not offer an educational program;
(d) receiving special education and related services, other than day treatment, under a placement by the trustees at a private nonsectarian school or private program if the pupil's services are provided at the district's expense under an approved individual education plan supervised by the district;
(e) participating in the running start program at district expense under 20-9-706;
(f) receiving educational services, provided by the district, using appropriately licensed district staff at a private residential program or private residential facility licensed by the department of public health and human services;
(g) enrolled in an educational program or course provided at district expense using electronic or offsite delivery methods, including but not limited to tutoring, distance learning programs, online programs, and technology delivered technology-delivered learning programs, while attending a school of the district or any other nonsectarian offsite instructional setting with the approval of the trustees of the district. The pupil shall:
(i) meet the residency requirements for that district as provided in 1-1-215;
(ii) live in the district and must be eligible for educational services under the Individuals With Disabilities Education Act or under 29 U.S.C. 794; or
(iii) attend school in the district under a mandatory attendance agreement as provided in 20-5-321.
(h) a resident of the district attending a Montana job corps program under an interlocal agreement with the district under 20-9-707.
(12) (a) For an elementary or high school district that has been in existence for 3 years or more, the district's maximum general fund budget and BASE budget for the ensuing school fiscal year must be calculated using the current year ANB for all budget units or the 3-year average ANB for all budget units, whichever generates the greatest maximum general fund budget.
(b) For a K-12 district that has been in existence for 3 years or more, the district's maximum general fund budget and BASE budget for the ensuing school fiscal year must be calculated separately for the elementary and high school programs pursuant to subsection (12)(a) and then combined.
(13) The term "3-year ANB" means an average ANB over the most recent 3-year period, calculated by:
(a) adding the ANB for the budget unit for the ensuing school fiscal year to the ANB for each of the previous 2 school fiscal years; and
(b) dividing the sum calculated under subsection (13)(a) by three. (Terminates June 30, 2007--sec. 25(2), Ch. 462, L. 2005.)
20-9-311. (Effective July 1, 2007) Calculation of average number belonging (ANB) -- three-year averaging. (1) Average number belonging (ANB) must be computed as follows:
(a) compute an average enrollment by adding a count of regularly enrolled full-time pupils who were enrolled as of the first Monday in October of the prior school fiscal year to a count of regularly enrolled pupils on February 1 of the prior school fiscal year, or the next school day if those dates do not fall on a school day, and divide the sum by two; and
(b) multiply the average enrollment calculated in subsection (1)(a) by the sum of 180 and the approved pupil-instruction-related days for the current school fiscal year and divide by 180.
(2) For the purpose of calculating ANB under subsection (1), up to 7 approved pupil-instruction-related days may be included in the calculation.
(3) When a school district has approval to operate less than the minimum aggregate hours under 20-9-806, the total ANB must be calculated in accordance with the provisions of 20-9-805.
(4) (a) Except as provided in subsection (5), for the purpose of calculating ANB, enrollment in an education program:
(i) from 181 180 to 359 aggregate hours of pupil instruction per school year is counted as one-quarter-time enrollment;
(ii) from 360 to 539 aggregate hours of pupil instruction per school year is counted as half-time enrollment;
(iii) from 540 to 719 aggregate hours of pupil instruction per school year is counted as three-quarter-time enrollment; and
(iv) 720 or more aggregate hours of pupil instruction per school year is counted as full-time enrollment.
(b) Enrollment in a program intended to provide fewer than 180 aggregate hours of pupil instruction per school year may not be included for purposes of ANB.
(c) Enrollment in a self-paced program or course may be converted to an hourly equivalent based on the hours necessary and appropriate to provide the course within a regular classroom schedule.
(d) A pupil in grades 1 through 12 who is concurrently enrolled in more than one public school, program, or district may not be counted as more than one full-time pupil for ANB purposes.
(5) In calculating the ANB for pupils enrolled in a program established under 20-7-117(1), enrollment in a program that provides 360 or more aggregate hours of pupil instruction per school year must be counted as one-half pupil for ANB purposes.
(6) When a pupil has been absent, with or without excuse, for more than 10 consecutive school days, the pupil may not be included in the enrollment count used in the calculation of the ANB unless the pupil resumes attendance prior to the day of the enrollment count.
(7) The enrollment of prekindergarten pupils, as provided in 20-7-117, may not be included in the ANB calculations.
(8) The average number belonging of the regularly enrolled, full-time pupils for the public schools of a district must be based on the aggregate of all the regularly enrolled, full-time pupils attending the schools of the district, except that when:
(a) (i) a school of the district is located more than 20 miles beyond the incorporated limits of a city or town located in the district and at least 20 miles from any other school of the district, the number of regularly enrolled, full-time pupils of the school must be calculated separately for ANB purposes and the district must receive a basic entitlement for the school calculated separately from the other schools of the district;
(ii) a school of the district is located more than 20 miles from any other school of the district and incorporated territory is not involved in the district, the number of regularly enrolled, full-time pupils of the school must be calculated separately for ANB purposes and the district must receive a basic entitlement for the school calculated separately from the other schools of the district;
(iii) the superintendent of public instruction approves an application not to aggregate when conditions exist affecting transportation, such as poor roads, mountains, rivers, or other obstacles to travel, or when any other condition exists that would result in an unusual hardship to the pupils of the school if they were transported to another school, the number of regularly enrolled, full-time pupils of the school must be calculated separately for ANB purposes and the district must receive a basic entitlement for the school calculated separately from the other schools of the district; or
(iv) two or more districts consolidate or annex under the provisions of 20-6-422 or 20-6-423, the ANB and the basic entitlements of the component districts must be calculated separately for a period of 3 years following the consolidation or annexation. Each district shall retain a percentage of its basic entitlement for 3 additional years as follows:
(A) 75% of the basic entitlement for the fourth year;
(B) 50% of the basic entitlement for the fifth year; and
(C) 25% of the basic entitlement for the sixth year.
(b) a junior high school has been approved and accredited as a junior high school, all of the regularly enrolled, full-time pupils of the junior high school must be considered as high school district pupils for ANB purposes;
(c) a middle school has been approved and accredited, all pupils below the 7th grade must be considered elementary school pupils for ANB purposes and the 7th and 8th grade pupils must be considered high school pupils for ANB purposes; or
(d) a school has not been accredited by the board of public education, the regularly enrolled, full-time pupils attending the nonaccredited school are not eligible for average number belonging calculation purposes, nor will an average number belonging for the nonaccredited school be used in determining the BASE funding program for the district.
(9) The district shall provide the superintendent of public instruction with semiannual reports of school attendance, absence, and enrollment for regularly enrolled students, using a format determined by the superintendent.
(10) (a) Except as provided in subsections (10)(b) and (10)(c), enrollment in a basic education program provided by the district through any combination of onsite or offsite instruction may be included for ANB purposes only if the pupil is offered access to the complete range of educational services for the basic education program required by the accreditation standards adopted by the board of public education.
(b) Access to school programs and services for a student placed by the trustees in a private program for special education may be limited to the programs and services specified in an approved individual education plan supervised by the district.
(c) Access to school programs and services for a student who is incarcerated in a facility, other than a youth detention center, may be limited to the programs and services provided by the district at district expense under an agreement with the incarcerating facility.
(d) This subsection (10) may not be construed to require a school district to offer access to activities governed by an organization having jurisdiction over interscholastic activities, contests, and tournaments to a pupil who is not otherwise eligible under the rules of the organization.
(11) A district may include only, for ANB purposes, an enrolled pupil who is otherwise eligible under this title and who is:
(a) a resident of the district or a nonresident student admitted by trustees under a student attendance agreement and who is attending a school of the district;
(b) unable to attend school due to because of a medical reason certified by a medical doctor and receiving individualized educational services supervised by the district, at district expense, at a home or facility that does not offer an educational program;
(c) unable to attend school due to because of the student's incarceration in a facility, other than a youth detention center, and who is receiving individualized educational services supervised by the district, at district expense, at a home or facility that does not offer an educational program;
(d) receiving special education and related services, other than day treatment, under a placement by the trustees at a private nonsectarian school or private program if the pupil's services are provided at the district's expense under an approved individual education plan supervised by the district;
(e) participating in the running start program at district expense under 20-9-706;
(f) receiving educational services, provided by the district, using appropriately licensed district staff at a private residential program or private residential facility licensed by the department of public health and human services;
(g) enrolled in an educational program or course provided at district expense using electronic or offsite delivery methods, including but not limited to tutoring, distance learning programs, online programs, and technology delivered technology-delivered learning programs, while attending a school of the district or any other nonsectarian offsite instructional setting with the approval of the trustees of the district. The pupil shall:
(i) meet the residency requirements for that district as provided in 1-1-215;
(ii) live in the district and must be eligible for educational services under the Individuals With Disabilities Education Act or under 29 U.S.C. 794; or
(iii) attend school in the district under a mandatory attendance agreement as provided in 20-5-321.
(h) a resident of the district attending a Montana job corps program under an interlocal agreement with the district under 20-9-707.
(12) (a) For an elementary or high school district that has been in existence for 3 years or more, the district's maximum general fund budget and BASE budget for the ensuing school fiscal year must be calculated using the current year ANB for all budget units or the 3-year average ANB for all budget units, whichever generates the greatest maximum general fund budget.
(b) For a K-12 district that has been in existence for 3 years or more, the district's maximum general fund budget and BASE budget for the ensuing school fiscal year must be calculated separately for the elementary and high school programs pursuant to subsection (12)(a) and then combined.
(13) The term "3-year ANB" means an average ANB over the most recent 3-year period, calculated by:
(a) adding the ANB for the budget unit for the ensuing school fiscal year to the ANB for each of the previous 2 school fiscal years; and
(b) dividing the sum calculated under subsection (13)(a) by three."
Section 11. Section 20-9-351, MCA, is amended to read:
"20-9-351. Funding of deficiency in BASE aid. If the money available for BASE aid is not the result of a reduction in spending under 17-7-140 and is not sufficient to provide the guaranteed tax base aid required under 20-9-366 through 20-9-369 and BASE aid support determined under 20-9-347, the superintendent of public instruction shall request the budget director to submit a request for a supplemental appropriation in the second year of the biennium that is sufficient to complete the funding of BASE aid for the elementary and high school districts for the current biennium."
Section 12. Section 20-9-360, MCA, is amended to read:
"20-9-360. State equalization aid levy. Subject to 15-10-420, there is a levy of 40 15 mills imposed by the county commissioners of each county on all taxable property within the state, except property for which a tax or fee is required under 61-3-321(2) or (3), 61-3-529, 61-3-537, 61-3-562, 61-3-570, and 67-3-204. Proceeds of the levy must be remitted to the department of revenue, as provided in 15-1-504, and must be deposited to the credit of the state general fund for state equalization aid to the public schools of Montana."
Section 3. Section 20-9-366, MCA, is amended to read:
"20-9-366. Definitions. As used in 20-9-366 through 20-9-371, the following definitions apply:
(1) "County retirement mill value per elementary ANB" or "county retirement mill value per high school ANB" means the sum of the taxable valuation in the previous year of all property in the county divided by 1,000, with the quotient divided by the total county elementary ANB count or the total county high school ANB count used to calculate the elementary school districts' and high school districts' current year total per-ANB entitlement amounts.
(2) (a) "District guaranteed tax base ratio" for guaranteed tax base funding for the BASE budget of an eligible district means the taxable valuation in the previous year of all property in the district divided by the sum of the district's current year BASE budget amount less direct state aid and the state special education allowable cost payment.
(b)(A) "DISTRICT GUARANTEED TAX BASE RATIO" FOR GUARANTEED TAX BASE FUNDING FOR THE BASE BUDGET OF AN ELIGIBLE DISTRICT MEANS THE TAXABLE VALUATION IN THE PREVIOUS YEAR OF ALL PROPERTY IN THE DISTRICT DIVIDED BY THE SUM OF THE DISTRICT'S CURRENT YEAR BASE BUDGET AMOUNT LESS DIRECT STATE AID AND THE STATE SPECIAL EDUCATION ALLOWABLE COST PAYMENT.
(B) "District mill value per ANB", for school facility entitlement purposes, means the taxable valuation in the previous year of all property in the district divided by 1,000, with the quotient divided by the ANB count of the district used to calculate the district's current year total per-ANB entitlement amount.
(3) "Facility guaranteed mill value per ANB", for school facility entitlement guaranteed tax base purposes, means the sum of the taxable valuation in the previous year of all property in the state, multiplied by 140% and divided by 1,000, with the quotient divided by the total state elementary ANB count or the total state high school ANB count used to calculate the elementary school districts' and high school districts' current year total per-ANB entitlement amounts.
(4) (a) "Statewide elementary guaranteed tax base ratio" or "statewide high school guaranteed tax base ratio", for guaranteed tax base funding for the BASE budget of an eligible district, means the sum of the taxable valuation in the previous year of all property in the state, multiplied by 175% and divided by the total sum of either the state elementary school districts' or the high school districts' current year BASE budget amounts less total direct state aid.
(b)(A) "STATEWIDE ELEMENTARY GUARANTEED TAX BASE RATIO" OR "STATEWIDE HIGH SCHOOL GUARANTEED TAX BASE RATIO", FOR GUARANTEED TAX BASE FUNDING FOR THE BASE BUDGET OF AN ELIGIBLE DISTRICT, MEANS THE SUM OF THE TAXABLE VALUATION IN THE PREVIOUS YEAR OF ALL PROPERTY IN THE STATE, MULTIPLIED BY 250% AND DIVIDED BY THE TOTAL SUM OF EITHER THE STATE ELEMENTARY SCHOOL DISTRICTS' OR THE HIGH SCHOOL DISTRICTS' CURRENT YEAR BASE BUDGET AMOUNTS LESS TOTAL DIRECT STATE AID.
(B) "Statewide mill value per elementary ANB" or "statewide mill value per high school ANB", for school retirement guaranteed tax base purposes, means the sum of the taxable valuation in the previous year of all property in the state, multiplied by 121% and divided by 1,000, with the quotient divided by the total state elementary ANB count or the total state high school ANB amount used to calculate the elementary school districts' and high school districts' current year total per-ANB entitlement amounts."
Section 4. Section 20-9-367, MCA, is amended to read:
"20-9-367. Eligibility to receive guaranteed tax base aid or state advance or GUARANTEED TAX BASE AID OR STATE ADVANCE OR reimbursement for school facilities. (1) If the district guaranteed tax base ratio of any elementary or high school district is less than the corresponding statewide elementary or high school guaranteed tax base ratio, the district may receive guaranteed tax base aid based on the number of mills levied in the district in support of up to 35.3% of the basic entitlement, up to 35.3% of the total per-ANB entitlement, and up to 40% of the special education allowable cost payment budgeted within the general fund budget. (1) IF THE DISTRICT GUARANTEED TAX BASE RATIO OF ANY ELEMENTARY OR HIGH SCHOOL DISTRICT IS LESS THAN THE CORRESPONDING STATEWIDE ELEMENTARY OR HIGH SCHOOL GUARANTEED TAX BASE RATIO, THE DISTRICT MAY RECEIVE GUARANTEED TAX BASE AID BASED ON THE NUMBER OF MILLS LEVIED IN THE DISTRICT IN SUPPORT OF UP TO 40% OF THE BASIC ENTITLEMENT, UP TO 40% OF THE TOTAL PER-ANB ENTITLEMENT, AND UP TO 40% OF THE SPECIAL EDUCATION ALLOWABLE COST PAYMENT BUDGETED WITHIN THE GENERAL FUND BUDGET.
(2)(1)(2) If the county retirement mill value per elementary ANB or the county retirement mill value per high school ANB is less than the corresponding statewide mill value per elementary ANB or high school ANB, the county may receive guaranteed tax base aid based on the number of mills levied in the county in support of the retirement fund budgets of the respective elementary or high school districts in the county.
(3)(2)(3) For the purposes of 20-9-370 and 20-9-371, if the district mill value per elementary ANB or the district mill value per high school ANB is less than the corresponding statewide mill value per elementary ANB or statewide mill value per high school ANB, the district may receive a state advance or reimbursement for school facilities in support of the debt service fund."
Section 5. Section 20-9-368, MCA, is amended to read:
"20-9-368. Amount of guaranteed tax base aid. (1) The amount of guaranteed tax base aid per ANB that a county may receive in support of the retirement fund budgets of the elementary school districts in the county is the difference between the county mill value per elementary ANB and the statewide mill value per elementary ANB, multiplied by the number of mills levied in support of the retirement fund budgets for the elementary districts in the county.
(2) The amount of guaranteed tax base aid per ANB that a county may receive in support of the retirement fund budgets of the high school districts in the county is the difference between the county mill value per high school ANB and the statewide mill value per high school ANB, multiplied by the number of mills levied in support of the retirement fund budgets for the high school districts in the county.
(3) The amount of guaranteed tax base aid that a district may receive in support of up to 35.3% of the basic entitlement, up to 35.3% of the total per-ANB entitlement budgeted within the general fund budget, and up to 40% of the special education payment is calculated in the following manner:
(a) multiply the sum of the district's BASE budget amount less direct state aid by the corresponding statewide guaranteed tax base ratio;
(b) subtract the taxable valuation of the district from the product obtained in subsection (3)(a); and
(c) divide the remainder by 1,000 to determine the equivalent to the dollar amount of guaranteed tax base aid for each mill levied.
(3) THE AMOUNT OF GUARANTEED TAX BASE AID THAT A DISTRICT MAY RECEIVE IN SUPPORT OF UP TO 40% OF THE BASIC ENTITLEMENT, UP TO 40% OF THE TOTAL PER-ANB ENTITLEMENT BUDGETED WITHIN THE GENERAL FUND BUDGET, AND UP TO 40% OF THE SPECIAL EDUCATION PAYMENT IS CALCULATED IN THE FOLLOWING MANNER:
(A) MULTIPLY THE SUM OF THE DISTRICT'S BASE BUDGET AMOUNT LESS DIRECT STATE AID BY THE CORRESPONDING STATEWIDE GUARANTEED TAX BASE RATIO;
(B) SUBTRACT THE TAXABLE VALUATION OF THE DISTRICT FROM THE PRODUCT OBTAINED IN SUBSECTION (3)(A); AND
(C) DIVIDE THE REMAINDER BY 1,000 TO DETERMINE THE EQUIVALENT TO THE DOLLAR AMOUNT OF GUARANTEED TAX BASE AID FOR EACH MILL LEVIED.
(4)(3)(4) Guaranteed tax base aid provided to any county or district under this section is earmarked to finance the fund or portion of the fund for which it is provided. If a county or district receives more guaranteed tax base aid than it is entitled to, the excess must be returned to the state as required by 20-9-344."
Section 15. Section 20-9-369, MCA, is amended to read:
"20-9-369. Duties of superintendent of public instruction and department of revenue. (1) The superintendent of public instruction shall administer the distribution of guaranteed tax base aid by:
(a) providing each school district and county superintendent, by March 1 of each year, with the preliminary statewide and district guaranteed tax base ratios and, by May 1 of each year, with the final statewide and district guaranteed tax base ratios, for use in calculating the guaranteed tax base aid available for the ensuing school fiscal year;
(b)(a) providing each school district and county superintendent, by March 1 of each year, with the preliminary statewide, county, and district mill values per ANB and, by May 1 of each year, with the final statewide, county, and district mill values per ANB, for use in calculating the guaranteed tax base aid and state advance and reimbursement for school facilities available to counties and districts for the ensuing school fiscal year;
(c)(b) requiring each county and district that qualifies and applies for guaranteed tax base aid to report to the county superintendent all budget and accounting information required to administer the guaranteed tax base aid;
(d)(c) keeping a record of the complete data concerning appropriations available for guaranteed tax base aid and the entitlements for the aid of the counties and districts that qualify;
(e)(d) distributing the guaranteed tax base aid entitlement to each qualified county or district from the appropriations for that purpose.
(2) The superintendent shall adopt rules necessary to implement 20-9-366 through 20-9-369.
(3) The department of revenue shall provide the superintendent of public instruction by December 1 of each year a final determination of the taxable value of property within each school district and county of the state reported to the department of revenue based on information delivered to the county clerk and recorder as required in 15-10-305.
(4) The superintendent of public instruction shall calculate the district and statewide guaranteed tax base ratios by applying the prior year's direct state aid payment mill values for guaranteed tax base purposes."
Section 16. Section 20-9-515, MCA, is amended to read:
"20-9-515. Litigation reserve fund. (1) The trustees of a school district may establish a litigation reserve fund only when litigation that is pending against the district could result in an award against the district.
(2) At the end of each school fiscal year, the trustees of a district may transfer money from the general fund, within the adopted budget, to establish the fund.
(3) Upon conclusion of litigation, the balance of the money in the fund reverts to the general fund and must be used to reduce the district's general fund BASE over-BASE budget levy requirement computed pursuant to 20-9-141."
Section 17. Section 20-10-144, MCA, is amended to read:
"20-10-144. Computation of revenue and net tax levy requirements for district transportation fund budget. Before the second Monday of August, the county superintendent shall compute the revenue available to finance the transportation fund budget of each district. The county superintendent shall compute the revenue for each district on the following basis:
(1) The "schedule amount" of the budget expenditures that is derived from the rate schedules in 20-10-141 and 20-10-142 must be determined by adding the following amounts:
(a) the sum of the maximum reimbursable expenditures for all approved school bus routes maintained by the district (to determine the maximum reimbursable expenditure, multiply the applicable rate for each bus mile by the total number of miles to be traveled during the ensuing school fiscal year on each bus route approved by the county transportation committee and maintained by the district); plus
(b) the total of all individual transportation per diem reimbursement rates for the district as determined from the contracts submitted by the district multiplied by the number of pupil-instruction days scheduled for the ensuing school attendance year; plus
(c) any estimated costs for supervised home study or supervised correspondence study for the ensuing school fiscal year; plus
(d) the amount budgeted in the budget for the contingency amount permitted in 20-10-143, except if the amount exceeds 10% of the total of subsections (1)(a), (1)(b), and (1)(c) or $100, whichever is larger, the contingency amount on the budget must be reduced to the limitation amount and used in this determination of the schedule amount; plus
(e) any estimated costs for transporting a child out of district when the child has mandatory approval to attend school in a district outside the district of residence.
(2) (a) The schedule amount determined in subsection (1) or the total transportation fund budget, whichever is smaller, is divided by 2 and is used to determine the available state and county revenue to be budgeted on the following basis:
(i) one-half is the budgeted state transportation reimbursement; and
(ii) one-half is the budgeted county transportation fund reimbursement and must be financed in the manner provided in 20-10-146.
(b) When the district has a sufficient amount of fund balance for reappropriation and other sources of district revenue, as determined in subsection (3), to reduce the total district obligation for financing to zero, any remaining amount of district revenue and fund balance reappropriated must be used to reduce the county financing obligation in subsection (2)(a)(ii) and, if the county financing obligations are reduced to zero, to reduce the state financial obligation in subsection (2)(a)(i).
(c) The county revenue requirement for a joint district, after the application of any district money under subsection (2)(b), must be prorated to each county incorporated by the joint district in the same proportion as the ANB of the joint district is distributed by pupil residence in each county.
(3) The total of the money available for the reduction of property tax on the district for the transportation fund must be determined by totaling:
(a) anticipated federal money received under the provisions of 20 U.S.C. 7701, et seq., or other anticipated federal money received in lieu of that federal act;
(b) anticipated payments from other districts for providing school bus transportation services for the district;
(c) anticipated payments from a parent or guardian for providing school bus transportation services for a child;
(d) anticipated or reappropriated interest to be earned by the investment of transportation fund cash in accordance with the provisions of 20-9-213(4);
(e) anticipated revenue from coal gross proceeds under 15-23-703;
(f) anticipated oil and natural gas production taxes;
(g) anticipated local government severance tax payments for calendar year 1995 production;
(h) anticipated transportation payments for out-of-district pupils under the provisions of 20-5-320 through 20-5-324;
(i) school district block grants distributed under 20-9-630;
(j)(i) any other revenue anticipated by the trustees to be earned during the ensuing school fiscal year that may be used to finance the transportation fund; and
(k)(j) any fund balance available for reappropriation as determined by subtracting the amount of the end-of-the-year fund balance earmarked as the transportation fund operating reserve for the ensuing school fiscal year by the trustees from the end-of-the-year fund balance in the transportation fund. The operating reserve may not be more than 20% of the final transportation fund budget for the ensuing school fiscal year and is for the purpose of paying transportation fund warrants issued by the district under the final transportation fund budget.
(4) The district levy requirement for each district's transportation fund must be computed by:
(a) subtracting the schedule amount calculated in subsection (1) from the total preliminary transportation budget amount; and
(b) subtracting the amount of money available to reduce the property tax on the district, as determined in subsection (3), from the amount determined in subsection (4)(a).
(5) The transportation fund levy requirements determined in subsection (4) for each district must be reported to the county commissioners on the fourth Monday of August by the county superintendent as the transportation fund levy requirements for the district, and the levy must be made by the county commissioners in accordance with 20-9-142."
NEW SECTION. Section 18. Repealer. Section 20-9-630, MCA, is repealed.
NEW SECTION. Section 19. Codification instruction. [Section 1] is intended to be codified as an integral part of Title 15, chapter 30, part 1, and the provisions of Title 15, chapter 30, part 1, apply to [section 1].
NEW SECTION. Section 20. Effective dates. (1) [Sections 1 and 12 and this section] [SECTION 1 AND THIS SECTION] are effective on passage and approval.
(2) Except as provided in subsection (1), [this act] is effective July 1, 2007.
NEW SECTION. Section 21. Retroactive applicability -- applicability. (1) [Section 1] applies retroactively, within the meaning of 1-2-109, to tax years beginning after December 31, 2006.
(2) [Section 12] applies retroactively, within the meaning of 1-2-109, to property taxes imposed after December 31, 2006.
(3)(2) [Sections 2 through 11 and 13 through 18] apply to school district budgets adopted after June 30, 2007.
SECTION 6. SECTION 20-9-630, MCA, IS AMENDED TO READ:
"20-9-630. School district block grants. (1) (a) The office of public instruction shall provide a block grant to each school district based on the revenue received by each district in fiscal year 2001 from vehicle taxes and fees, corporate license taxes paid by financial institutions, aeronautics fees, state land payments in lieu of taxes, and property tax reimbursements pursuant to sections 167(1) through (5) and 169(6), Chapter 584, Laws of 1999.
(b) Block grants must be calculated using the electronic reporting system that is used by the office of public instruction and school districts. The electronic reporting system must be used to allocate the block grant amount into each district's budget as an anticipated revenue source by fund.
(c) With the exception of vehicle taxes and fees, the office of public instruction shall use the amount actually received from the sources listed in subsection (1)(a) in fiscal year 2001 in its calculation of the block grant for fiscal year 2002 budgeting purposes. For vehicle taxes and fees, the office of public instruction shall use 93.4% of the amount actually received in fiscal year 2001 in calculating the block grant for fiscal year 2002.
(2) If the fiscal year 2003 appropriation provided in section 248(1), Chapter 574, Laws of 2001, is insufficient to fund the school district block grants in fiscal year 2003 at the fiscal year 2002 level, the office of public instruction shall prorate the block grants to meet the remaining appropriation. School districts shall anticipate the prorated block grant amounts provided by the office of public instruction in their budgets for fiscal year 2003.
(3)(2) Each year, 70% of each district's block grant must be distributed in November and 30% of each district's block grant must be distributed in May at the same time that guaranteed tax base aid is distributed.
(4) (a) The block grant for the district general fund is equal to the average amount received in fiscal years 2002 and 2003 by the district general fund from the block grants provided for in subsection (1). The block grant must be increased by 0.76% in fiscal year 2004 and in each succeeding fiscal year.
(b)(a) The block grant for the district transportation fund is equal to one-half of the average the amount received in fiscal years 2002 and 2003 year 2007 by the district transportation fund from the block grants provided for in subsection (1). The block grant must be increased by 0.76% in fiscal year 2004 2008 and in each succeeding fiscal year.
(c)(b) (i) The combined fund block grant is equal to the average amount received in fiscal years 2002 and 2003 year 2007 by the district tuition, bus depreciation reserve, building reserve, nonoperating, and adult education funds from the block grants provided for in subsection (1). The block grant must be increased by 0.76% in fiscal year 2004 2008 and in each succeeding fiscal year.
(ii) The school district may deposit the combined fund block grant into any budgeted fund of the district."
NEW SECTION. SECTION 7. EFFECTIVE DATE -- APPLICABILITY. [THIS ACT] IS EFFECTIVE JULY 1, 2007, AND APPLIES TO SCHOOL DISTRICT BUDGETS FOR SCHOOL FISCAL YEARS BEGINNING ON OR AFTER JULY 1, 2007.
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Latest Version of HB 678 (HB0678.03)
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