AN ACT AUTHORIZING A SCHOOL DISTRICT WHOSE CURRENT YEAR GENERAL FUND BUDGET EXCEEDS THE ENSUING YEAR'S MAXIMUM GENERAL FUND BUDGET AMOUNT TO ADOPT A GENERAL FUND BUDGET FOR THE ENSUING YEAR UP TO THE ENSUING YEAR'S MAXIMUM GENERAL FUND AMOUNT OR UP TO 94 PERCENT OF THE CURRENT YEAR'S GENERAL FUND BUDGET, WHICHEVER IS GREATER; ALLOWING ADOPTION OF A GENERAL FUND BUDGET THAT EXCEEDS THE MAXIMUM GENERAL FUND BUDGET FOR A MAXIMUM OF 5 CONSECUTIVE YEARS; PROVIDING AN EXCEPTION REQUIRING A SCHOOL DISTRICT WHOSE BUDGET EXCEEDS THE MAXIMUM GENERAL FUND BUDGET BECAUSE THE AVERAGE NUMBER BELONGING DECLINES 30 PERCENT OR MORE TO REDUCE ITS GENERAL FUND BUDGET PROPORTIONATELY OVER 5 CONSECUTIVE YEARS; ELIMINATING THE PROVISION FOR TRUSTEES TO ADOPT A BUDGET BASED ON THE PREVIOUS YEAR'S GENERAL FUND BUDGET PER-ANB; PROVIDING THAT A VOTE IS REQUIRED FOR ANY INCREASE IN LOCAL PROPERTY TAXES; AMENDING SECTIONS 20-9-308 AND 20-9-353, MCA; AND PROVIDING AN EFFECTIVE DATE AND AN APPLICABILITY DATE.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:

Section 1. Section 20-9-308, MCA, is amended to read:

"20-9-308. 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) of this section, does not exceed the maximum general fund budget established for the district.

(2) (a) 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 to the electors of the district, as provided in 20-9-353 .

(b) A general fund budget adopted under this subsection (2) may not exceed the greater of:

(i) 104% of the previous year's general fund budget ; or

(ii) 104% of the previous year's general fund budget per-ANB multiplied by the current year's ANB for budgeting purposes .

(3) (a) (i) Except as provided in subsections (3)(a)(ii) and (3)(a)(iii), the trustees of a district whose current year general fund budget exceeds the ensuing year's maximum budget amount may adopt a general fund budget for the ensuing year up to the ensuing year's maximum general fund budget amount or up to 94% of the current year's general fund budget, whichever is greater. A school district may adopt a budget under the criteria of this subsection (3) for a maximum of 5 consecutive years.

(ii) The trustees of a district whose general fund budget was above the maximum general fund budget established by Chapter 30, Special Laws of November 1993, may continue to adopt a general fund budget in each ensuing school fiscal year that exceeds the district's maximum general fund budget but does not exceed the district's general fund budget for the current school fiscal year.

(iii) A school district whose current budget exceeds the ensuing year's maximum budget and whose current year ANB exceeds the ensuing year's ANB 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 current fiscal year and the maximum general fund for the ensuing school fiscal year;

(B) in the second year, 25% of the range between the district's adopted general fund budget for the current school fiscal year and the maximum general fund budget for the ensuing school fiscal year;

(C) in the third year, 33.3% of the range between the district's adopted general fund budget for the current fiscal year and the maximum general fund budget for the ensuing school fiscal year;

(D) in the fourth year, 50% of the range between the district's adopted general fund budget for the current fiscal year and the maximum general fund budget for the ensuing school fiscal year; and

(E) in the fifth year, the remainder of the range between the district's adopted general fund budget for the current fiscal year and the maximum general fund budget for the ensuing school fiscal 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;

(c) a district levy for support of a school not approved as an isolated school under the provisions of 20-9-302;

(d) 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 2. Section 20-9-353, MCA, is amended to read:

"20-9-353. Additional financing for general fund -- election for authorization to impose. (1) The trustees of a district may propose to adopt:

(a) an over-BASE budget amount for the district general fund that does not exceed the maximum general fund budget for the district or other limitations, as provided in 20-9-308(2); or

(b) a general fund budget amount in excess of the maximum general fund budget amount for the district, as provided in 20-9-308(3)(a)(ii).

(2) When the trustees of the district propose to adopt an over-BASE budget under subsection (1)(a), any increase in local property taxes authorized by 20-9-308(5) must be submitted to a vote of the qualified electors of the district. The trustees are not required to submit to the qualified electors any increase in state funding of the basic or per-ANB entitlements approved by the legislature. When the trustees of a district determine that a voted amount of financing is required for the general fund budget, the trustees shall submit the proposition to finance the voted amount to the electors who are qualified under 20-20-301 to vote upon the proposition. The special election must be called and conducted in the manner prescribed by this title for school elections. The ballot for the election must state the amount of the estimated increase in local property taxes and the estimated impact on the over-BASE mills needed to fund the general fund budget. The ballot must be in the following format:

PROPOSITION

The district levied (state the total amount of local property taxes levied in support of the district's prior year's over-BASE general fund budget) dollars and (state the total number of mills levied in support of the district's prior year's over-BASE general fund budget) mills to support the previous year's over-BASE general fund budget. If this proposition is approved, the local property taxes to support the district's proposed over-BASE general fund budget will increase by (state the additional local property taxes) dollars. The mills will (increase or decrease as applicable) by (insert the number of mills) mills.

Shall the district be authorized to increase the local property taxes by (insert the amount), which will (increase or decrease as applicable) the local mills by (insert the number of mills) mills?

[]	FOR the additional levy.

[]	AGAINST the additional levy.

(3) When the trustees of a district propose to adopt a general fund budget amount in excess of the maximum general fund budget under subsection (1)(b), the trustees shall submit the proposition to finance the additional amount of general fund budget authority to the electors who are qualified under 20-20-301 to vote upon the proposition. The special election must be called and conducted in the manner prescribed by this title for school elections. The ballot for the election must state the amount of the budget to be financed, the approximate number of mills required to fund all or a portion of the budget amount, and the purpose for which the money will be expended. The ballot must be in the following format:

PROPOSITION

Shall the district be authorized to expend the sum of (state the additional amount to be expended) and being approximately (give number) mills for the purpose of (insert the purpose for which the additional financing is made)?

[]	FOR budget authority and any levy.

[]	AGAINST budget authority and levy.

(4) If the election on any additional financing or budget authority for the general fund is approved by a majority vote of the electors voting at the election, the proposition carries and the trustees may use any portion or all of the authorized amount in adopting the final general fund budget. The trustees shall certify any additional levy amount authorized by the special election on the budget form that is submitted to the county superintendent, and the county commissioners shall levy the authorized number of mills on the taxable value of all taxable property within the district, as prescribed in 20-9-141 .

(5) Authorization to levy an additional tax to support a budget amount adopted as allowed by 20-9-308(3)(a)(ii) is effective for only 1 school fiscal year.

(6) All levies adopted under this section must be authorized by a special election conducted before August 1 of the school fiscal year for which it is effective.

(7) If the trustees of a district are required to submit a proposition to finance an over-BASE budget amount or an amount in excess of the maximum general fund budget amount for the district as allowed by 20-9-308(3)(a)(ii) to the electors of the district, the trustees shall comply with the provisions of subsections (2) through (6) of this section."

Section 3. Effective date -- applicability. [This act] is effective July 1, 1999, and applies to school budgets for the school fiscal years beginning on or after July 1, 2000.

- END -

I hereby certify that the within bill,

HB 0071, originated in the House.

Chief Clerk of the House

Speaker of the House

Signed this	day

of	, .

President of the Senate

Signed this	day

of	, .

HOUSE BILL NO. 71

INTRODUCED BY S. ROSE, J. ANDERSEN, T. FACEY, S. KITZENBERG, L. MCCULLOCH

AN ACT AUTHORIZING A SCHOOL DISTRICT WHOSE CURRENT YEAR GENERAL FUND BUDGET EXCEEDS THE ENSUING YEAR'S MAXIMUM GENERAL FUND BUDGET AMOUNT TO ADOPT A GENERAL FUND BUDGET FOR THE ENSUING YEAR UP TO THE ENSUING YEAR'S MAXIMUM GENERAL FUND AMOUNT OR UP TO 94 PERCENT OF THE CURRENT YEAR'S GENERAL FUND BUDGET, WHICHEVER IS GREATER; ALLOWING ADOPTION OF A GENERAL FUND BUDGET THAT EXCEEDS THE MAXIMUM GENERAL FUND BUDGET FOR A MAXIMUM OF 5 CONSECUTIVE YEARS; PROVIDING AN EXCEPTION REQUIRING A SCHOOL DISTRICT WHOSE BUDGET EXCEEDS THE MAXIMUM GENERAL FUND BUDGET BECAUSE THE AVERAGE NUMBER BELONGING DECLINES 30 PERCENT OR MORE TO REDUCE ITS GENERAL FUND BUDGET PROPORTIONATELY OVER 5 CONSECUTIVE YEARS; ELIMINATING THE PROVISION FOR TRUSTEES TO ADOPT A BUDGET BASED ON THE PREVIOUS YEAR'S GENERAL FUND BUDGET PER-ANB; PROVIDING THAT A VOTE IS REQUIRED FOR ANY INCREASE IN LOCAL PROPERTY TAXES; AMENDING SECTIONS 20-9-308 AND 20-9-353, MCA; AND PROVIDING AN EFFECTIVE DATE AND AN APPLICABILITY DATE.