Senate Bill No. 240
Introduced By _______________________________________________________________________________
A Bill for an Act entitled: "An Act creating the voluntary consolidation and annexation incentive plan for school districts; providing for state financial assistance through general bonus payments and transportation bonus payments to school districts that consolidate or annex; statutorily appropriating the payments; amending sections 17-7-502, 20-6-703, and 20-9-104, MCA; and providing an effective date."
Be it enacted by the Legislature of the State of Montana:
NEW SECTION. Section 1. Definitions. As used in [sections 1 through 8], unless the context clearly indicates otherwise, the following definitions apply:
(1) "Component district" means the elementary, high school, or K-12 district incorporated into the enlarged district.
(2) "Eligible pupils" means the average number belonging (ANB) in the operating schools of the component districts and the tuition pupils residing in the component districts and attending another district's school under the tuition provisions of the school laws except that the pupils residing in the component district having the largest total number of pupils are ineligible for bonus payment consideration.
(3) "Enlarged district" means the elementary, high school, or K-12 district resulting from the consolidation or annexation of two or more component districts.
(4) The "general bonus payment" for first- and second-class school districts must be $450 per eligible pupil a year for a period of 3 years and must be deposited in the enlarged district's general fund. The general bonus payment for third-class school districts must be $750 per eligible pupil a year for a period of 3 years and must be deposited in the enlarged district's general fund. The general bonus payment must be made from the state school equalization aid account.
(5) "Transportation bonus payment" is the provision of 66 2/3% state financing of the on-schedule transportation amount as provided by the transportation provisions of the school laws. When an eligible pupil is entitled to transportation, the enlarged district is entitled to the transportation bonus payment for the eligible pupil for a period of 3 years. The payment must be made from the state transportation aid account. When the eligible pupil rides a bus providing transportation for ineligible pupils, the 66 2/3% state financing of the on-schedule amount for this payment must be prorated to provide financing for the eligible pupil.
NEW SECTION. Section 2. Voluntary consolidation and annexation incentive plan. [Sections 1 through 8] shall be known as the voluntary consolidation and annexation incentive plan. The purpose of this plan is to provide additional financial assistance to school districts that consolidate or annex under the provisions of 20-6-203, 20-6-205, or 20-6-208 for elementary school districts, 20-6-315 or 20-6-317 for high school districts, or Title 20, chapter 6, part 4, for K-12 districts.
NEW SECTION. Section 3. Application for bonus payments. Whenever two or more elementary school districts consolidate or annex under the provisions of 20-6-203, 20-6-205, or 20-6-208; two or more high school districts consolidate or annex under the provisions of 20-6-315 or 20-6-317; or two or more K-12 districts consolidate or annex under Title 20, chapter 6, part 4, the enlarged district may apply for the bonus payments as provided in this section if the consolidation or annexation results in the dissolution of at least one elementary, high school, or K-12 district. Application for the bonus payments must be made during the school year of the order creating the enlarged school district.
NEW SECTION. Section 4. Application to superintendent of public instruction. Application for the bonus payments must be made to the superintendent of public instruction and must include a copy of the order issued by the proper officials creating the enlarged school district, the number of eligible pupils as defined in this section, and any other information the superintendent of public instruction considers necessary.
NEW SECTION. Section 5. Approval or disapproval of application. The superintendent of public instruction shall approve only those applications that demonstrate compliance with the requirements of this plan. When an application is approved, the superintendent of public instruction shall determine the number of eligible pupils for the bonus payment. The superintendent shall notify the enlarged district's board of trustees and the county superintendent of the disapproval of the application or of the approval of the application establishing the number of eligible pupils.
NEW SECTION. Section 6. Disbursal and deposit of bonus payments. On or before June 30 of the next 3 consecutive years following the year of application, the superintendent of public instruction shall disburse the bonus payments for approved applications to the enlarged school district, and that disbursement is statutorily appropriated as provided in 17-7-502. The general bonus payment must be deposited by the county treasurer in the enlarged district's general fund, and the transportation bonus payment must be deposited by the county treasurer in the transportation fund. These bonus payments may not be considered as a part of the regular state equalization aid or state transportation aid received by the enlarged district.
NEW SECTION. Section 7. Effect on plan of reduction in territory. Any reduction in the amount of territory encompassed in the enlarged school district's territory during the 3-year period of bonus payments will cause the enlarged district to be ineligible to receive any remaining bonus payments under this plan.
NEW SECTION. Section 8. Effect of addition of component districts. The subsequent addition of other component districts to the enlarged district entitles the enlarged district to additional bonus payments under the provisions of this plan.
Section 9. Section 17-7-502, MCA, is amended to read:
"17-7-502. Statutory appropriations -- definition -- requisites for validity. (1) A statutory appropriation is an appropriation made by permanent law that authorizes spending by a state agency without the need for a biennial legislative appropriation or budget amendment.
(2) Except as provided in subsection (4), to be effective, a statutory appropriation must comply with both of the following provisions:
(a) The law containing the statutory authority must be listed in subsection (3).
(b) The law or portion of the law making a statutory appropriation must specifically state that a statutory appropriation is made as provided in this section.
(3) The following laws are the only laws containing statutory appropriations: 2-9-202; 2-17-105; 2-18-812; 3-5-901; 5-13-403; 10-3-203; 10-3-310; 10-3-312; 10-3-314; 10-4-301; 15-1-111; 15-23-706; 15-30-195; 15-31-702; 15-37-117; 15-38-202; 15-65-121; 15-70-101; 16-1-404; 16-1-410; 16-1-411; 16-11-308; 17-3-106; 17-3-212; 17-5-404; 17-5-424; 17-5-804; 17-6-101; 17-6-201; 17-7-304; 18-11-112; 19-2-502; 19-6-709; 19-9-1007; 19-17-301; 19-18-512; 19-18-513; 19-18-606; 19-19-205; 19-19-305; 19-19-506; [section 6]; 20-8-107; 20-8-111; 20-9-361; 20-26-1503; 23-5-136; 23-5-306; 23-5-409; 23-5-610; 23-5-612; 23-5-631; 23-7-301; 23-7-402; 32-1-537; 37-43-204; 37-51-501; 39-71-503; 39-71-907; 39-71-2321; 39-71-2504; 44-12-206; 44-13-102; 50-4-623; 50-5-232; 50-40-206; 53-6-150; 53-6-703; 53-24-206; 60-2-220; 67-3-205; 75-1-1101; 75-5-1108; 75-6-214; 75-11-313; 76-12-123; 80-2-103; 80-2-222; 80-4-416; 81-5-111; 82-11-136; 82-11-161; 85-1-220; 85-20-402; 90-3-301; 90-4-215; 90-6-331; 90-7-220; 90-7-221; and 90-9-306.
(4) There is a statutory appropriation to pay the principal, interest, premiums, and costs of issuing, paying, and securing all bonds, notes, or other obligations, as due, that have been authorized and issued pursuant to the laws of Montana. Agencies that have entered into agreements authorized by the laws of Montana to pay the state treasurer, for deposit in accordance with 17-2-101 through 17-2-107, as determined by the state treasurer, an amount sufficient to pay the principal and interest as due on the bonds or notes have statutory appropriation authority for the payments. (In subsection (3): pursuant to sec. 7, Ch. 567, L. 1991, the inclusion of 19-6-709 terminates upon death of last recipient eligible for supplemental benefit; and pursuant to sec. 7(2), Ch. 29, L. 1995, the inclusion of 15-30-195 terminates July 1, 2001.)"
Section 10. Section 20-6-703, MCA, is amended to read:
"20-6-703. Transitions after formation of K-12 school district. (1) When an attachment order for a K-12 school district becomes effective on July 1 under the provisions of 20-6-701:
(a) the board of county commissioners shall execute all necessary and appropriate deeds, bills of sale, or other instruments for the conveyance of title to all real and personal property of the elementary district to the high school district;
(b) the trustees of the elementary district shall entrust the minutes of the board of trustees, the elementary district documents, and other records to the high school district to which it is attached; and
(c) the county treasurer shall transfer all end-of-the-year warrants and fund balances of the attached elementary district to the similar funds established for the K-12 school district in the high school district.
(2) All taxes levied by and revenue due from a previous school fiscal year to an elementary district attached to a high school district must be payable to the appropriate fund of the high school district.
(3) The previous year's general fund budget amounts for the elementary district and the high school district that form a K-12 school district must be combined to determine the budget limitation for the ensuing school fiscal year pursuant to 20-9-308.
(4) An elementary district and a high school district that form a K-12 school district under the provisions of 20-6-701 may not be considered an enlarged district for the purposes of bonus payments under [sections 1 through 8]."
Section 11. 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) (i) received in settlement of tax payments protested in a prior school fiscal year;
(ii) received in taxes from a prior school fiscal year as a result of a tax audit by the department of revenue or its agents;
(iii) received in delinquent taxes from a prior school fiscal year; and
(iv) received as a local government severance tax payment for calendar year 1995 production as provided in 15-36-325; or
(b) a district was entitled to as a general bonus payment
prior to July 1, 1994 under the provisions of [sections 1 through
(6) The limitation of subsection (1) does not apply when the amount earmarked as operating reserve is $10,000 or less."
NEW SECTION. Section 12. Codification instruction. [Sections 1 through 8] are intended to be codified as an integral part of Title 20, chapter 6, part 4, and the provisions of Title 20, chapter 6, part 4, apply to [sections 1 through 8].
NEW SECTION. Section 13. Saving clause. [This act] does not affect rights and duties that matured, penalties that were incurred, or proceedings that were begun before [the effective date of this act].
NEW SECTION. Section 14. Effective date. [This act] is effective July 1, 1997.