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H0349.....................................................by APPROPRIATIONS
BOND LEVY EQUALIZATION PROGRAM - Amends existing law relating to school
funds to provide a date by which bonds must be passed for purposes of
receiving the minimum of the interest cost portion in the Bond Levy
Equalization Support Program; and to provide a reference to each qualifying
school district.
03/15 House intro - 1st rdg - to printing
03/16 Rpt prt - to 2nd rdg
03/17 2nd rdg - to 3rd rdg
03/18 Ref'd to Educ
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-eighth Legislature First Regular Session - 2005
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 349
BY APPROPRIATIONS COMMITTEE
1 AN ACT
2 RELATING TO SCHOOL FUNDS; AMENDING SECTION 33-906, IDAHO CODE, TO PROVIDE A
3 DATE BY WHICH BONDS MUST BE PASSED FOR PURPOSES OF RECEIVING THE MINIMUM
4 OF THE INTEREST COST PORTION IN THE BOND LEVY EQUALIZATION SUPPORT PROGRAM
5 AND TO PROVIDE A REFERENCE TO EACH QUALIFYING SCHOOL DISTRICT; AND DECLAR-
6 ING AN EMERGENCY.
7 Be It Enacted by the Legislature of the State of Idaho:
8 SECTION 1. That Section 33-906, Idaho Code, be, and the same is hereby
9 amended to read as follows:
10 33-906. BOND LEVY EQUALIZATION SUPPORT PROGRAM. (1) Pursuant to section
11 33-906B, Idaho Code, school districts with a value index below one (1) shall
12 be eligible to receive additional state financial assistance for the cost of
13 annual bond interest and redemption payments made on bonds passed on or after
14 September 15, 2002. However, any school district shall receive no less than
15 ten percent (10%) of the interest cost portion of the annual bond interest and
16 redemption payment for bonds passed on or after September 15, 2002 and prior
17 to July 1, 2005. The state department of education shall disburse such funds
18 to school districts from moneys appropriated from the bond levy equalization
19 fund. The department shall disburse the funds by no later than September 1 of
20 each year for school districts in which voters have approved the issuance of
21 qualifying bonds by no later than January 1 of that calendar year, and which
22 are certifying a qualifying bond interest and redemption payment for the fis-
23 cal year in which the disbursement is made. For districts with a value index
24 below one (1), the percentage of each annual bond interest and redemption pay-
25 ment that is paid by the state shall be determined by dividing the difference
26 between one (1) and the school district's value index by one (1) provided that
27 the state shall pay for no more than the interest cost portion of the annual
28 bond interest and redemption payment, and each qualifying school district
29 shall receive no less than ten percent (10%) of the interest cost portion of
30 the qualifying bond interest and redemption payment.
31 (2) For the purposes of this section, the annual bond interest and
32 redemption payment shall be determined by dividing the total payment amounts
33 by the number of fiscal years in which payments are to be made. The interest
34 cost portion of the annual bond interest and redemption payment shall be
35 determined by dividing the total interest paid by the number of fiscal years
36 in which payments are to be made. For school districts not qualifying for a
37 state payment in the first year of the bond interest and redemption payment
38 schedule, due solely to the January 1 eligibility deadline, the state depart-
39 ment of education shall distribute an additional payment in the next fiscal
40 year, in the amount of such funds that the school district would have other-
41 wise qualified for in the current fiscal year.
42 (3) The provisions of this section may not be utilized to refinance
43 existing debt or subsidize projects previously subsidized by state grants;
2
1 provided however, that any school district that has issued qualifying bonds
2 prior to June 30, 2004, in conformance with this section shall not be deemed
3 to be refinancing existing debt when the qualifying bonds are utilized to
4 finance the acquisition of public school facilities previously leased or
5 financed through means other than the issuance of general obligation bonds
6 approved by a two-thirds (2/3) vote at an election called for that purpose
7 subject to subsection (5) of this section.
8 (4) School districts shall annually report the status of all qualifying
9 bonds to the state department of education by January 1 of each year, includ-
10 ing bonds approved by the voters, but not yet issued. Information submitted
11 shall include the following:
12 (a) The actual or estimated bond interest and redemption payment sched-
13 ule;
14 (b) Any qualifying bond that has been paid off;
15 (c) Other information as may be required by the state department of edu-
16 cation.
17 (5) No school district eligible for participation in the bond levy equal-
18 ization support program shall be deemed ineligible for participation due to
19 that school district's eligibility and prior participation in the safe school
20 facilities loan and grant program or the Idaho safe schools facilities program
21 under section 33-804A, 33-1017 or 33-1613, Idaho Code, provided that:
22 (a) Such school district notifies the state department of education of
23 its desire and eligibility to participate in the bond levy equalization
24 support program; and
25 (b) Such school district shall receive no state financial assistance
26 under the bond levy equalization support program until the amount to which
27 it would otherwise have been entitled to receive shall equal the amounts
28 received by the school district under the safe school facilities loan and
29 grant program or the Idaho safe schools facilities program under section
30 33-804A, 33-1017 or 33-1613, Idaho Code.
31 SECTION 2. An emergency existing therefor, which emergency is hereby
32 declared to exist, this act shall be in full force and effect on and after its
33 passage and approval.
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STATEMENT OF PURPOSE
RS 15140C1
The purpose of this legislation is to remove the requirement
that the state’s Bond Levy Equalization program must provide a
minimum 10% interest subsidy on school bonds passed by the
school districts ranked as most prosperous on a “value index”
that takes into account property values, personal income, and
unemployment rates. It will not impact current or future
subsidies for prosperous school districts that have already
passed bonds, or pass bonds prior to July 1, 2005, nor will it
impact the over two-thirds of school districts whose low value
indices cause them to qualify for larger interest subsidies.
FISCAL IMPACT
Future state costs avoids, under the Bond Levy Equalization
program, will be approximately $25 million over the period from
FY07 to FY26, with annual cost avoidance rising to approximately
$2.4 million by FY26.
Contact
Name: Representatives Bedke, Bell, Field, Bolz, Eskridge,
Harwood, Skippen, Bayer
Phone: (208) 332-1000
STATEMENT OF PURPOSE/FISCAL NOTE H 349