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H0375..........................................................by EDUCATION
SCHOOLS - BOND LEVY EQUALIZATION - 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; to provide a reference to each qualifying
school district; and to revise provisions applicable to the Bond Levy
Equalization Fund.
03/23 House intro - 1st rdg - to printing
03/24 Rpt prt - to 2nd rdg
Rls susp - PASSED - 63-3-4
AYES -- Anderson, Andrus, Barraclough, Bastian, Bayer, Bedke, Bell,
Bilbao, Black, Block, Boe, Bolz, Bradford, Cannon, Chadderdon, Clark,
Collins, Crow, Deal, Denney, Edmunson(Barker), Eskridge, Field(18),
Field(23), Garrett, Hart, Harwood, Henbest, Henderson, Jaquet, Jones,
Kemp, Lake, Loertscher, Martinez, Mathews, McGeachin, McKague,
Miller, Mitchell, Moyle, Nielsen, Nonini, Pasley-Stuart, Pence,
Raybould, Ring, Rusche, Rydalch, Sali, Sayler, Schaefer, Shepherd(2),
Shepherd(8), Shirley, Skippen, Smith(30), Smith(24)(Frost), Smylie,
Snodgrass, Stevenson, Wood, Mr. Speaker
NAYS -- LeFavour, Ringo, Trail
Absent and excused -- Barrett, Ellsworth, Roberts, Wills
Floor Sponsor - Bedke
Title apvd - to Senate
03/25 Senate intro - 1st rdg - to St Aff
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-eighth Legislature First Regular Session - 2005
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 375
BY EDUCATION 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; AMENDING
6 SECTION 33-906A, IDAHO CODE, TO REVISE PROVISIONS APPLICABLE TO THE BOND
7 LEVY EQUALIZATION FUND; AND PROVIDING EFFECTIVE DATES.
8 Be It Enacted by the Legislature of the State of Idaho:
9 SECTION 1. That Section 33-906, Idaho Code, be, and the same is hereby
10 amended to read as follows:
11 33-906. BOND LEVY EQUALIZATION SUPPORT PROGRAM. (1) Pursuant to section
12 33-906B, Idaho Code, school districts with a value index below one (1) shall
13 be eligible to receive additional state financial assistance for the cost of
14 annual bond interest and redemption payments made on bonds passed on or after
15 September 15, 2002. However, any school district shall receive no less than
16 ten percent (10%) of the interest cost portion of the annual bond interest and
17 redemption payment for bonds passed on or after September 15, 2002, and prior
18 to January 1, 2006. The state department of education shall disburse such
19 funds to school districts from moneys appropriated from the bond levy equal-
20 ization fund. The department shall disburse the funds by no later than Septem-
21 ber 1 of each year for school districts in which voters have approved the
22 issuance of qualifying bonds by no later than January 1 of that calendar year,
23 and which are certifying a qualifying bond interest and redemption payment for
24 the fiscal year in which the disbursement is made. For districts with a value
25 index below one (1), the percentage of each annual bond interest and redemp-
26 tion payment that is paid by the state shall be determined by dividing the
27 difference between one (1) and the school district's value index by one (1)
28 provided that the state shall pay for no more than the interest cost portion
29 of the annual bond interest and redemption payment, and each qualifying school
30 district shall receive no less than ten percent (10%) of the interest cost
31 portion of the qualifying bond interest and redemption payment.
32 (2) For the purposes of this section, the annual bond interest and
33 redemption payment shall be determined by dividing the total payment amounts
34 by the number of fiscal years in which payments are to be made. The interest
35 cost portion of the annual bond interest and redemption payment shall be
36 determined by dividing the total interest paid by the number of fiscal years
37 in which payments are to be made. For school districts not qualifying for a
38 state payment in the first year of the bond interest and redemption payment
39 schedule, due solely to the January 1 eligibility deadline, the state depart-
40 ment of education shall distribute an additional payment in the next fiscal
41 year, in the amount of such funds that the school district would have other-
42 wise qualified for in the current fiscal year.
43 (3) The provisions of this section may not be utilized to refinance
2
1 existing debt or subsidize projects previously subsidized by state grants;
2 provided however, that any school district that has issued qualifying bonds
3 prior to June 30, 2004, in conformance with this section shall not be deemed
4 to be refinancing existing debt when the qualifying bonds are utilized to
5 finance the acquisition of public school facilities previously leased or
6 financed through means other than the issuance of general obligation bonds
7 approved by a two-thirds (2/3) vote at an election called for that purpose
8 subject to subsection (5) of this section.
9 (4) School districts shall annually report the status of all qualifying
10 bonds to the state department of education by January 1 of each year, includ-
11 ing bonds approved by the voters, but not yet issued. Information submitted
12 shall include the following:
13 (a) The actual or estimated bond interest and redemption payment sched-
14 ule;
15 (b) Any qualifying bond that has been paid off;
16 (c) Other information as may be required by the state department of edu-
17 cation.
18 (5) No school district eligible for participation in the bond levy equal-
19 ization support program shall be deemed ineligible for participation due to
20 that school district's eligibility and prior participation in the safe school
21 facilities loan and grant program or the Idaho safe schools facilities program
22 under section 33-804A, 33-1017 or 33-1613, Idaho Code, provided that:
23 (a) Such school district notifies the state department of education of
24 its desire and eligibility to participate in the bond levy equalization
25 support program; and
26 (b) Such school district shall receive no state financial assistance
27 under the bond levy equalization support program until the amount to which
28 it would otherwise have been entitled to receive shall equal the amounts
29 received by the school district under the safe school facilities loan and
30 grant program or the Idaho safe schools facilities program under section
31 33-804A, 33-1017 or 33-1613, Idaho Code.
32 SECTION 2. That Section 33-906A, Idaho Code, be, and the same is hereby
33 amended to read as follows:
34 33-906A. BOND LEVY EQUALIZATION FUND. There is hereby created in the
35 state treasury a bond levy equalization fund. This fund shall contain such
36 moneys as may be directed pursuant to appropriation The state controller shall
37 annually transfer such moneys as are required to make the payments authorized
38 by the bond levy equalization support program created in section 33-906, Idaho
39 Code, from the permanent building fund to the bond levy equalization fund.
40 Moneys in the fund shall be used exclusively are hereby continuously appropri-
41 ated to make the payments authorized by the bond levy equalization support
42 program created in section 33-906, Idaho Code.
43 SECTION 3. Section 1 of this act shall be in full force and effect on and
44 after July 1, 2005; Section 2 of this act shall be in full force and effect on
45 and after July 1, 2006.
STATEMENT OF PURPOSE
RS 15197C1
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 January 1, 2006, nor will
it impact the over two-thirds of school districts whose low value
indices cause them to qualify for larger interest subsidies. This
legislation also shifts the future costs of the Bond Levy Equalization
program from Lottery funds to the Permanent Building Fund, beginning
in FY2007.
FISCAL NOTE
Future state costs avoided, 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. Costs to the Permanent Building Fund are projected to be $5.6
million in FY2007.
Contact
Name: Rep. Scott Bedke, Rep. Ann Rydalch, Rep. Donna Boe
Phone: 332-1000
STATEMENT OF PURPOSE/FISCAL NOTE H 375