House Bill No. 119

Introduced By grady

By Request of the Office of Public Instruction

A Bill for an Act entitled: "An Act Increasing by 4.71 Percent the Basic and the Per-ANB Entitlements For School District Funding; clarifying that a school district whose current year's funding is increased as a result of an increase in the basic and per-anb entitlements is authorized to increase its previous year's budget by the same percentage increase as the basic and per-anb entitlements without submitting a proposition to the electors of the district; amending sections 20-9-306, 20-9-308, and 20-9-353, MCA; and providing an immediate effective date and an applicability date."

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

Section 1.  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 40% of the basic entitlement and 40% of the total per-ANB entitlement for the general fund budget of a district; and

(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 up to 40% of the special education allowable cost 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, and up to 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.

(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)  "Basic entitlement" means:

(a)  $191,000 $200,000 for each high school district;

(b)  $17,190 $18,000 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:

(i)  $17,190 $18,000 times the ratio of the ANB for kindergarten through grade 6 to the total ANB of kindergarten through grade 8; plus

(ii) $191,000 $200,000 times the ratio of the ANB for grades 7 and 8 to the total ANB of kindergarten through grade 8.

(7)  "Direct state aid" means 40% of the basic entitlement and 40% of the total per-ANB entitlement for the general fund budget of a district and funded with state and county equalization aid.

(8)  "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, and up to 153% of special education allowable cost payments.

(9)  "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.

(10) "Total per-ANB entitlement" means the district entitlement resulting from the following calculations:

(a)  for a high school district or a K-12 district high school program, a maximum rate of $4,680 $4,900 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 $3,343 $3,500 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 $3,343 $3,500 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 $4,680 $4,900 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."

Section 2.  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:

(a)  except as provided in subsection (2), is at least equal to the BASE budget established for the district; or

(b)  except as provided in section 3, Chapter 38, Special Laws of November 1993, and subsection (4) of this section, does not exceed the maximum general fund budget established for the district.

(2)  (a) If the BASE budget for a district for the school fiscal year is greater than the general fund budget of the district for the prior school fiscal year, the trustees of the district:

(i)  shall increase the general fund budget by at least:

(A)  25% of the range between the district general fund budget for the school fiscal year ending June 30, 1994, and the BASE budget for the district for the school fiscal year beginning July 1, 1994;

(B)  33.3% of the range between the district general fund budget for the school fiscal year ending June 30, 1995, and the BASE budget for the district for the school fiscal year beginning July 1, 1995;

(C)  50% of the range between the district general fund budget for the school fiscal year ending June 30, 1996, and the BASE budget for the district for the school fiscal year beginning July 1, 1996; or

(D)  the remainder of the range between the district general fund budget for the school fiscal year ending June 30, 1997, and the BASE budget for the district for the school fiscal year beginning July 1, 1997;

(ii) may increase the general fund budget beyond the amount in subsection (2)(a)(i) but not by more than 4% of the previous year's general fund budget or by more than 4% of the previous year's general fund per-ANB multiplied by the current year's ANB for budgeting purposes pursuant to subsection (2)(b).

(b)  The trustees shall submit a proposition on any amount exceeding the limitations in subsection (2)(a)(i) to the electors of the district, as provided in 20-9-353.

(3)(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, for any budget amount that exceeds the previous year's general fund budget amount or the previous year's general fund budget per-ANB multiplied by the current year's ANB for budgeting purposes.

(b)  A general fund budget adopted under this subsection (3) (2) may not exceed the greater of:

(i)  104% of the previous year's general fund budget as adjusted by the provisions of section 3, Chapter 38, Special Laws of November 1993; or

(ii) 104% of the previous year's general fund budget per-ANB multiplied by the current year's ANB for budgeting purposes as adjusted by the provisions of section 3, Chapter 38, Special Laws of November 1993.

(4)(3)  (a) If the maximum general fund budget for a district for an ensuing the current school fiscal year is less than the general fund budget for the district for the current previous school fiscal year, as adjusted by the provisions of section 3, Chapter 38, Special Laws of November 1993, the trustees of the district may not adopt a general fund budget for the ensuing current school fiscal year that is greater than the district's general fund budget for the current previous school fiscal year.

(b)  Except for the school fiscal year beginning July 1, 1994, the 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.

(5)(4)  Whenever the trustees of a district adopt a general fund budget that does not exceed the BASE budget for the district, the The trustees shall finance this amount the BASE budget for the district with 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.

(6)(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.

(6) For the purpose of calculating general fund budget limits and voting requirements under subsection (2), "previous year's general fund budget" is the adopted budget for the previous year multiplied by the sum of 1 plus the percentage increase in the basic and per-ANB entitlement amounts, as defined in 20-9-306, that is approved by the legislature for the current school fiscal year."

Section 3.  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)  a budget amount up to the BASE budget amount for the district general fund that is within the limitations and required budget increases provided in 20-9-308(2)(1);

(b)  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(3)(2); or

(c)  a general fund budget amount in excess of the maximum general fund budget amount for the district, as provided in 20-9-308(4)(3).

(2)  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 additional amount of general fund financing 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 money to be financed, the approximate number of mills required to raise all or a portion of the money, 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 any levy.

(3)  If the election on any additional financing 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 preliminary 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, to raise the amount of the additional levy.

(4)  Authorization to levy an additional tax to support a budget amount adopted as allowed by 20-9-308(4)(3) is effective for only 1 school fiscal year.

(5)  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.

(6)  If the trustees of a district are required to submit a proposition to finance an increased amount up to the BASE budget amount, as provided in 20-9-308(2)(b)(1), an increased over-BASE budget amount, as provided in 20-9-308(3)(a)(2)(a), or an amount in excess of the maximum general fund budget amount for the district as allowed by 20-9-308(4)(3) to the electors of the district, the trustees shall comply with the provisions of subsections (2) (1) through (4) (3)."

NEW SECTION. Section 4.  Effective date -- applicability. [This act] is effective on passage and approval and applies to budgets for school fiscal years beginning on or after July 1, 1997.

-END-