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H0311.............................................................by EDUCATION
SCHOOL DISTRICTS - Amends and adds to existing law to provide an alternative
as to how a school district's value index is calculated based on the school
district's free and reduced lunch rate; and to allow the board of trustees of
the school district the option of utilizing the value index calculation that
is most advantageous to that district.
02/27 House intro - 1st rdg - to printing
02/28 Rpt prt - to Educ
|||| LEGISLATURE OF THE STATE OF IDAHO ||||
Fifty-seventh Legislature First Regular Session - 2003
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 311
BY EDUCATION COMMITTEE
1 AN ACT
2 RELATING TO THE VALUE INDEX CALCULATION FOR SCHOOL DISTRICTS; AMENDING SECTION
3 33-906, IDAHO CODE, TO PROVIDE A SCHOOL WITH AN ALTERNATIVE AS TO HOW ITS
4 VALUE INDEX IS CALCULATED; AMENDING CHAPTER 9, TITLE 33, IDAHO CODE, BY
5 THE ADDITION OF A NEW SECTION 33-906C, IDAHO CODE, TO PROVIDE AN ALTERNA-
6 TIVE AS TO HOW A SCHOOL DISTRICT'S VALUE INDEX IS CALCULATED BASED ON THE
7 SCHOOL DISTRICT'S FREE AND REDUCED LUNCH RATE AND TO ALLOW THE BOARD OF
8 TRUSTEES THE OPTION OF UTILIZING THE VALUE INDEX CALCULATION THAT IS MOST
9 ADVANTAGEOUS TO THAT DISTRICT; AND PROVIDING AN EFFECTIVE DATE.
10 Be It Enacted by the Legislature of the State of Idaho:
11 SECTION 1. That Section 33-906, Idaho Code, be, and the same is hereby
12 amended to read as follows:
13 33-906. BOND LEVY EQUALIZATION SUPPORT PROGRAM. Pursuant to section
14 33-906B or 33-906C, Idaho Code, school districts with a value index below one
15 (1) shall be eligible to receive additional state financial assistance for the
16 cost of annual bond interest and redemption payments made on bonds passed on
17 or after September 15, 2002, pursuant to either section 33-906B or 33-906C,
18 Idaho Code, as determined by the board of trustees of the school district.
19 However, any school district shall receive no less than ten percent (10%) of
20 the interest cost portion of the annual bond interest and redemption payment
21 for bonds passed on or after September 15, 2002. The state department of edu-
22 cation shall disburse such funds to school districts from moneys appropriated
23 from the bond levy equalization fund. The department shall disburse the funds
24 by no later than September 1 of each year for school districts certifying a
25 qualifying bond interest and redemption payment for the fiscal year in which
26 the disbursement is made. For districts with a value index below one (1), the
27 percentage of each annual bond interest and redemption payment that is paid by
28 the state shall be determined by dividing the difference between one (1) and
29 the school district's value index by one (1) provided that the state shall pay
30 for no more than the interest cost portion of the annual bond interest and
31 redemption payment, and each school district shall receive no less than ten
32 percent (10%) of the interest cost portion of the qualifying bond interest and
33 redemption payment.
34 For the purposes of this section, the annual bond interest and redemption
35 payment shall be determined by dividing the total payment amounts by the num-
36 ber of fiscal years in which payments are to be made. The interest cost por-
37 tion of the annual bond interest and redemption payment shall be determined
38 by dividing the total interest paid by the number of fiscal years in which
39 payments are to be made.
40 The provisions of this section may not be utilized to refinance existing
41 debt.
42 SECTION 2. That Chapter 9, Title 33, Idaho Code, be, and the same is
2
1 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
2 ignated as Section 33-906C, Idaho Code, and to read as follows:
3 33-906C. ALTERNATIVE VALUE INDEX CALCULATION. As an alternative to sec-
4 tion 33-906B, Idaho Code, the state department of education shall establish a
5 value index for each school district, based on each school district's market
6 value per support unit for equalization purposes, the free and reduced lunch
7 rate in the school district and the state average of free and reduced lunch
8 rates. The value index for each school district shall be calculated as the sum
9 of the following two (2) components:
10 (1) The state department of education shall annually calculate the market
11 value per support unit that is used to equalize school funding for each school
12 district in the state, and the statewide average. The first portion of the
13 value index shall be calculated by dividing the school district's market value
14 for equalization purposes per support unit by the statewide average market
15 value for equalization per support unit and dividing the result of this calcu-
16 lation by two (2).
17 (2) The second portion of the value index shall be calculated by dividing
18 the statewide free and reduced lunch rate average rate by the school
19 district's free and reduced lunch rate, and dividing the result of this calcu-
20 lation by four (4). For the purposes of this subsection, the statewide free
21 and reduced lunch rate and school district free and reduced lunch rates shall
22 be calculated annually by the state department of education when such figures
23 are available.
24 (3) The board of trustees of a school district shall have the option of
25 utilizing the value index calculation, in this section or in section 33-906B,
26 Idaho Code, that is most advantageous to that district via adopted motion by
27 the board of trustees.
28 SECTION 3. This act shall be in full force and effect on and after Janu-
29 ary 1, 2005.
STATEMENT OF PURPOSE
RS 13060C1
The purpose of this legislation is to amend the value index
calculation in Section 33-906B, Idaho Code, providing a subsidy to
school districts passing bond issues after September 15, 2002. Each
school district's free and reduced lunch rates will replace the
county unemployment rate data reported by the U.S. Department of
Labor and the county per capita income as determined by the U.S.
Department of Commerce in determining the value index calculation.
The second component in the market value per support unit
determined by the State Department of Education is used to equalize
school funding for each school district in the state, and the
statewide average. This change ensures that all data used in
calculating the value index is school district specific. This
second option will not be available to school board trustees until
July 1, 2005.
FISCAL IMPACT
The original legislation, SB1474, estimated that in FY '04 the impact
will be approximately $1,000,000, in FY '05 $1,500,000, and escalating
each year for 20 years reaching a maximum plateau in 20 years. It is
estimated that the option with the change in the value index will yield
an economic impact about 20 percent higher. It is very hard to make a
prediction of how many bond issues will be passed in the future.
Contact
Name: Representative Tom Trail
Phone: 208-332-1000
STATEMENT OF PURPOSE/FISCAL NOTE H 311