2006 Legislation
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SENATE BILL NO. 1501 – Propety tax, reduce, advisory vote

SENATE BILL NO. 1501

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Bill Status



S1501aaH...................................................by STATE AFFAIRS
SCHOOL DISTRICTS - MAINTENANCE AND OPERATION LEVIES - Adds to existing law
to submit an advisory vote to the electors at the 2006 general election
regarding deleting the property tax and replacing it with an increase in
the sales tax; to revise how maximum school maintenance and operation
levies are calculated for tax year 2006 and each year thereafter; to revise
local districts' contribution calculation; to provide a property tax
computation ratio for school districts; and to define a term.
                                                                        
04/05    Senate intro - 1st rdg - to printing
    Rpt prt - to Loc Gov
    Rpt out - w/o rec - to 2nd rdg
04/06    Rls susp - PASSED - 32-2-1
      AYES -- Andreason, Brandt, Broadsword, Bunderson, Burkett, Cameron,
      Coiner, Compton, Corder, Darrington, Davis, Fulcher, Gannon, Geddes,
      Goedde, Hill, Kelly, Keough, Langhorst, Little, Lodge, Malepeai,
      Marley, McGee, McKenzie, Pearce, Richardson, Schroeder, Stegner,
      Stennett, Sweet, Werk
      NAYS -- Burtenshaw, Jorgenson
      Absent and excused -- Williams
    Floor Sponsor - Little
    Title apvd - to House
04/07    House intro - 1st rdg - Held at Desk
04/11    Ref'd to Gen Ord
    Rpt out amen - to 1st rdg as amen
    1st rdg - to 2nd rdg as amen
    Rls susp - PASSED - 54-16-0
      AYES -- Anderson, Andrus, Barraclough, Barrett, Bastian, Bayer,
      Bedke, Bell, Bilbao, Black, Block, Bolz, Brackett, Bradford,
      Chadderdon, Collins, Crow, Deal, Denney, Edmunson, Ellsworth,
      Eskridge, Field(18), Field(23), Garrett, Henderson, Kemp, Lake,
      Loertscher, Mathews, McGeachin, McKague, Miller, Moyle, Nielsen,
      Nonini, Raybould, Ring, Roberts, Rusche, Rydalch, Sali, Sayler,
      Schaefer, Shepherd(2), Shepherd(8), Shirley, Skippen, Smylie,
      Snodgrass, Stevenson, Wills, Wood, Mr. Speaker
      NAYS -- Boe, Cannon, Clark, Hart, Harwood, Henbest, Jaquet, LeFavour,
      Martinez, Mitchell, Pasley-Stuart, Pence, Ringo, Smith(30),
      Smith(24), Trail
      Absent and excused -- None
    Floor Sponsor - Roberts
    Title apvd - to Senate
04/11    Senate concurred in House amens - to engros
    Rpt engros - 1st rdg - to 2nd rdg as amen
    Rls susp - FAILED - 5-30-0
      AYES -- Brandt, Burtenshaw, Little, Pearce, Williams
      NAYS -- Andreason, Broadsword, Bunderson, Burkett, Cameron, Coiner,
      Compton, Corder, Darrington, Davis, Fulcher(Fulcher), Gannon, Geddes,
      Goedde, Hill(Moeller), Jorgenson, Kelly, Keough, Langhorst, Lodge,
      Malepeai, Marley, McGee, McKenzie, Richardson, Schroeder, Stegner,
      Stennett, Sweet, Werk
      Absent and excused -- None
    Floor Sponsor - Little
    Filed in Office of the Secretary of Senate

Bill Text


                                                                        
                                                                        
  ]]]]              LEGISLATURE OF THE STATE OF IDAHO             ]]]]
 Fifty-eighth Legislature                   Second Regular Session - 2006
                                                                        
                                                                        
                                       IN THE SENATE
                                                                        
                                    SENATE BILL NO. 1501
                                                                        
                                 BY STATE AFFAIRS COMMITTEE
                                                                        
  1                                        AN ACT
  2    RELATING TO PROPERTY TAX FUNDING MAINTENANCE AND OPERATIONS OF PUBLIC  SCHOOLS
  3        AND  REPLACEMENT  FUNDS; STATING LEGISLATIVE FINDINGS, SUBMITTING AN ADVI-
  4        SORY VOTE TO THE ELECTORS, DIRECTING THE SECRETARY OF STATE  AND  ATTORNEY
  5        GENERAL TO PERFORM SPECIFIED DUTIES, STATING THE QUESTION TO BE SUBMITTED,
  6        DECLARING  THE  ADVISORY QUESTION A MEASURE, AND MAKING APPLICABLE CERTAIN
  7        PROVISIONS GOVERNING ELECTION CAMPAIGN CONTRIBUTIONS AND EXPENDITURES.
                                                                        
  8    Be It Enacted by the Legislature of the State of Idaho:
                                                                        
  9        SECTION 1.  The Legislature finds and  declares  that  the  issue  of  the
 10    property tax funding maintenance and operations of public schools is of impor-
 11    tance to the citizens of the state of Idaho. As a representative body, members
 12    of  the Legislature desire to be responsive and responsible to these citizens.
 13    For this reason, the Legislature herewith submits an advisory  ballot  to  the
 14    electors  of the state of Idaho, and the results will guide the Legislature as
 15    to whether the three-tenths of one percent property tax contained  in  Section
 16    33-802,  Idaho  Code,  and levied against the market value of taxable property
 17    in the school district for maintenance and operation purposes of  school  dis-
 18    tricts  be  removed  and the funds be replaced by a sufficient increase in the
 19    state sales tax.
 20        At the election to be held on November  7,  2006,  the  question  provided
 21    herein  shall  be  placed  on the ballot as an advisory vote. The Secretary of
 22    State and the Attorney General shall perform the duties as prescribed  for  an
 23    initiative  in Chapter 18, Title 34, Idaho Code. The question shall be as fol-
 24    lows:
 25             "Shall the three-tenths of one percent property tax contained in
 26        Section 33-802, Idaho Code, and levied  against the market  value  of
 27        taxable  property   in the school district for maintenance and opera-
 28        tion purposes of  school  districts  be  removed  and  the  funds  be
 29        replaced by a sufficient increase in the state sales tax?".
 30        The  advisory question provided for in this act is hereby declared to be a
 31    "measure" for purposes of Chapter 66, Title 67, Idaho Code, and the provisions
 32    of Chapter 66, Title 67, Idaho Code, shall apply thereto.

Amendment


                                                                        
                                                                        
  ]]]]              LEGISLATURE OF THE STATE OF IDAHO             ]]]]
 Fifty-eighth Legislature                   Second Regular Session - 2006
                                                                        
                                                                        
                                                     Moved by    Roberts             
                                                                        
                                                     Seconded by Crow                
                                                                        
                                                                        
                              IN THE HOUSE OF REPRESENTATIVES
                             HOUSE AMENDMENTS TO S.B. NO. 1501
                                                                        
                                                                        
  1                               AMENDMENTS TO SECTION 1
  2        On page 1 of the printed bill, delete lines 9 and 10 and insert:
  3        "SECTION 1.  The Legislature finds that the issue of property taxes is  of
  4    impor-";  delete  lines  15 through 19 and insert: "to reducing property taxes
  5    and replacing the funds with an increase in  the  state  sales  tax.";  delete
  6    lines 25 through 29 and insert:
  7             ""Shall  property  taxes be reduced and the funds be replaced by
  8        an increase in the state sales tax?".".
                                                                        
  9                                AMENDMENT TO THE BILL
 10        On page 1, following line 32 insert:
 11        "SECTION 2.  That Section 33-802, Idaho Code, be, and the same  is  hereby
 12    amended to read as follows:
                                                                        
 13        33-802.  SCHOOL LEVIES. Any tax levied for school purposes shall be a lien
 14    on  the  property against which the tax is levied. The board of trustees shall
 15    determine the levies upon each dollar of taxable property in the district  for
 16    the ensuing fiscal year as follows:
 17        1.  Bond, Interest and Judgment Obligation Levies. Such levies as shall be
 18    required  to  satisfy  all  maturing bond, bond interest, and judgment obliga-
 19    tions.
 20        2.  Maximum School Maintenance and Operation Levies. Such levies for main-
 21    taining and operating the schools of the  district  and  for  the  payment  of
 22    tuition  and transportation, that do not exceed an amount equal to four-tenths
 23    of one percent (.4%) during tax year 1994, and do not exceed an  amount  equal
 24    to  three-tenths  of  one  percent  (.3%)  during tax year 1995 and thereafter
 25    through tax year 2005, applied to the actual  or  adjusted  market  value  for
 26    assessment  purposes  of the district as such valuation existed on December 31
 27    of the previous year, but allowances necessary as a credit for prepaid  taxes,
 28    as provided in section 63-1607, Idaho Code, shall not be included in such max-
 29    imum  levies. Provided however, that in the event property within a district's
 30    boundaries is contained in a revenue allocation area established under chapter
 31    29, title 50, Idaho Code, and such revenue allocation area has given notice of
 32    termination thereunder, then, only for the purpose  of  determining  the  levy
 33    described  in  this  subsection,  the district may add the increment value, as
 34    defined in section 50-2903, Idaho Code, to the actual or adjusted market value
 35    for assessment purposes of the district as such value existed on  December  31
 36    of the previous year. For tax year 2006, and each year thereafter, the maximum
 37    levy   of this subsection 2. shall not exceed an amount equal to the following
 38    percentage as applied pursuant to this section:
 39        (a)  Multiply the amount of money raised statewide in the prior year, pur-
 40        suant to this section, by 1.03;
 41        (b)  Subtract the value of any increase  in  statewide  market  value  for
                                                                        
                                          2
                                                                        
  1        assessment  purposes resulting from new construction or change of land use
  2        classification as evidenced by the value shown on  the  prior  year's  new
  3        construction  roll  compiled pursuant to section 63-301A, Idaho Code, from
  4        the actual or adjusted statewide market value as such valuation existed on
  5        December 31 of the previous year;
  6        (c)  Divide the amount in subsection 2.(a) of this section by  the  amount
  7        in subsection 2.(b) of this section.
  8        3.  Authorized  School  Maintenance  and Operation Levies. Such levies for
  9    maintaining and operating the schools of the district and for the  payment  of
 10    tuition  and  transportation  that  do  not  exceed one hundred eleven percent
 11    (111%) of the local district's contribution authorized  in  subsection  2.  of
 12    section  33-1002, Idaho Code. Implementation of the provisions of this subsec-
 13    tion shall be authorized only after approval by a majority of  the  district's
 14    electors  voting on the question. Levies otherwise authorized by law shall not
 15    require an election.
 16        4.  Supplemental Maintenance and Operation Levies. No levy  in  excess  of
 17    the  levy  permitted by subsection 2. or 3. of this section shall be made by a
 18    noncharter school district unless such a  supplemental  levy  in  a  specified
 19    amount  and  for  a specified time not to exceed two (2) years be first autho-
 20    rized through an election held pursuant to chapter 4, title  33,  Idaho  Code,
 21    and approved by a majority of the district electors voting in such election. A
 22    levy approved pursuant to this subsection may be reduced by a majority vote of
 23    the board of trustees in the second year.
 24        5.  Charter District Supplemental Maintenance and Operation. Levies pursu-
 25    ant  to  the  respective  charter  of any such charter district shall be first
 26    authorized through an election held pursuant to chapter  4,  title  33,  Idaho
 27    Code, and approved by a majority of the district electors voting in such elec-
 28    tion.
 29        6.  The  Local  District Contribution. The local school district contribu-
 30    tion levy is the amount utilized for calculating local district  participation
 31    in the educational foundation program, which is applied to the adjusted market
 32    value for assessment purposes, as such valuation existed on December 31 of the
 33    previous  year,  together  with  the  increment  value,  as defined in section
 34    50-2903, Idaho Code, if applicable under the circumstance described in subsec-
 35    tion 2. of this section, relating to termination of a revenue allocation area.
 36        7.  The board of trustees of any school district that has,  for  at  least
 37    seven (7) consecutive years, been authorized through an election held pursuant
 38    to  chapter  4,  title 33, Idaho Code, to certify a supplemental levy that has
 39    annually been equal to or greater than twenty percent (20%) of the total  gen-
 40    eral  maintenance and operation fund, may submit the question of an indefinite
 41    term supplemental levy to the electors of the school district.  Such  question
 42    shall clearly state the dollar amount that will be certified annually and that
 43    the  levy  will  be  for  an  indefinite number of years. The question must be
 44    approved by a majority of the district electors voting on the question  in  an
 45    election  held  pursuant to chapter 4, title 33, Idaho Code. The levy approved
 46    pursuant to this subsection may be reduced by a majority vote of the board  of
 47    trustees during any fiscal year.
                                                                        
 48        SECTION  3.  That  Section 33-1002, Idaho Code, be, and the same is hereby
 49    amended to read as follows:
                                                                        
 50        33-1002.  EDUCATIONAL SUPPORT PROGRAM. The educational support program  is
 51    calculated as follows:
 52        1.  State  Educational Support Funds. Add the state appropriation, includ-
 53    ing the moneys available in the public school income fund, together  with  all
                                                                        
                                          3
                                                                        
  1    miscellaneous revenues to determine the total state funds.
  2        2.  From  the  total state funds subtract the following amounts needed for
  3    state support of special programs provided by a school district:
  4        a.  Pupil tuition-equivalency allowances as provided in section  33-1002B,
  5        Idaho Code;
  6        b.  Transportation  support  program as provided in section 33-1006, Idaho
  7        Code;
  8        c.  Feasibility studies allowance as provided in section  33-1007A,  Idaho
  9        Code;
 10        d.  The approved costs for border district allowance, provided in section
 11        33-1403,  Idaho  Code, as determined by the state superintendent of public
 12        instruction;
 13        e.  The approved costs for exceptional child approved contract  allowance,
 14        provided in subsection 2. of section 33-2004, Idaho Code, as determined by
 15        the state superintendent of public instruction;
 16        f.  Certain  expectant and delivered mothers allowance as provided in sec-
 17        tion 33-2006, Idaho Code;
 18        g.  Salary-based apportionment calculated as provided in sections  33-1004
 19        through 33-1004F, Idaho Code;
 20        h.  Unemployment insurance benefit payments according to the provisions of
 21        section 72-1349A, Idaho Code;
 22        i.  For expenditure as provided by the public school technology program;
 23        j.  For  the  support of provisions that provide a safe environment condu-
 24        cive to student learning and maintain classroom discipline, an  allocation
 25        of $300 per support unit; and
 26        k.  Any additional amounts as required by statute to effect administrative
 27        adjustments  or  as specifically required by the provisions of any bill of
 28        appropriation;
 29    to secure the state educational support funds.
 30        3.  Local  Districts'  Contribution  Calculation.  Without  including  any
 31    allowance as a credit for prepaid taxes as provided by section 63-1607,  Idaho
 32    Code,  the local districts' contribution shall be the amount appropriated pur-
 33    suant to section 33-1002D, Idaho Code, plus three-tenths percent (.3%)  during
 34    fiscal  year 2003-04 and each year thereafter, a percentage of the total state
 35    adjusted market value for assessment purposes for the previous year, with such
 36    percentage being determined pursuant to section 33-802, Idaho Code,  and  with
 37    such  value  being determined by the provisions of section 63-315, Idaho Code,
 38    and four-tenths percent (.4%) during fiscal year 1994-95 and each year  there-
 39    after,  of  the cooperative electrical associations' property values that have
 40    been derived from the taxes paid in lieu of ad valorem taxes for the  previous
 41    year as provided in section 63-3502, Idaho Code.
 42        4.  Educational  Support  Program  Distribution  Funds. Add the local dis-
 43    tricts' contribution, subsection 3. of this section, and the state educational
 44    support program funds, subsection 1. of this section, together to  secure  the
 45    total educational support program distribution funds.
 46        5.  Average  Daily  Attendance.  The  total state average daily attendance
 47    shall be the sum of the average daily attendance of all  of  the  school  dis-
 48    tricts  of  the state. The state board of education shall establish rules set-
 49    ting forth the procedure to determine average daily attendance  and  the  time
 50    for, and method of, submission of such report. Average daily attendance calcu-
 51    lation  shall  be carried out to the nearest hundredth. Computation of average
 52    daily attendance shall also be governed by the provisions of section 33-1003A,
 53    Idaho Code.
 54        6.  Support Units. The total state support units shall  be  determined  by
 55    using  the tables set out hereafter called computation of kindergarten support
                                                                        
                                          4
                                                                        
  1    units, computation of elementary support units, computation of secondary  sup-
  2    port  units,  computation of exceptional education support units, and computa-
  3    tion of alternative school secondary support units. The  sum  of  all  of  the
  4    total  support  units  of all school districts of the state shall be the total
  5    state support units.
  6                      COMPUTATION OF KINDERGARTEN SUPPORT UNITS
  7    Average Daily
  8    Attendance            Attendance Divisor         Units Allowed
  9    41 or more     ....   40.......................  1 or more as computed
 10    31 -  40.99 ADA....    -.......................  1
 11    26 -  30.99 ADA....    -.......................   .85
 12    21 -  25.99 ADA....    -.......................   .75
 13    16 -  20.99 ADA....    -.......................   .6
 14     8 -  15.99 ADA....    -.......................   .5
 15     1 -   7.99 ADA....    -.......................  count as elementary
                                                                        
 16                       COMPUTATION OF ELEMENTARY SUPPORT UNITS
 17    Average Daily
 18    Attendance            Attendance Divisor         Minimum Units Allowed
 19    300 or more ADA........................................  15
 20                        ..23...grades 4,5 & 6....
 21                        ..22...grades 1,2 & 3....1994-95
 22                        ..21...grades 1,2 & 3....1995-96
 23                        ..20...grades 1,2 & 3....1996-97
 24                              and each year thereafter.
 25    160   to  299.99 ADA... 20.....................         8.4
 26    110   to  159.99 ADA... 19.....................         6.8
 27     71.1 to  109.99 ADA... 16.....................         4.7
 28     51.7 to   71.0  ADA... 15.....................         4.0
 29     33.6 to   51.6  ADA... 13.....................         2.8
 30     16.6 to   33.5  ADA... 12.....................         1.4
 31      1.0 to   16.5  ADA... n/a....................         1.0
                                                                        
 32                        COMPUTATION OF SECONDARY SUPPORT UNITS
 33    Average Daily
 34    Attendance            Attendance Divisor         Minimum Units Allowed
 35    750 or more      .... 18.5.....................        47
 36    400 -  749.99 ADA.... 16.......................        28
 37    300 -  399.99 ADA.... 14.5.....................        22
 38    200 -  299.99 ADA.... 13.5.....................        17
 39    100 -  199.99 ADA.... 12.......................         9
 40     99.99 or fewer       Units allowed as follows:
 41             Grades 7-12  .........................         8
 42             Grades 9-12  .........................         6
 43             Grades 7- 9  .........................         1 per 14 ADA
 44             Grades 7- 8  .........................         1 per 16 ADA
                                                                        
 45                  COMPUTATION OF EXCEPTIONAL EDUCATION SUPPORT UNITS
 46    Average Daily
 47    Attendance            Attendance Divisor         Minimum Units Allowed
 48    14 or more ....       14.5.....................  1 or more as computed
 49    12 -  13.99....        -.......................  1
 50     8 -  11.99....        -.......................   .75
 51     4 -   7.99....        -.......................   .5
 52     1 -   3.99....        -.......................   .25
                                                                        
                                          5
                                                                        
  1              COMPUTATION OF ALTERNATIVE SCHOOL SECONDARY SUPPORT UNITS
  2    Pupils in Attendance  Attendance Divisor         Minimum Units Allowed
  3    12 or more..........  12......................   1 or more as computed
                                                                        
  4        In applying these tables to any given separate attendance unit, no  school
  5    district  shall  receive  less  total  money than it would receive if it had a
  6    lesser average daily attendance in such separate attendance unit. In  applying
  7    the  kindergarten  table  to  a  kindergarten program of less days than a full
  8    school year, the support unit allowance shall be in ratio  to  the  number  of
  9    days  of a full school year. The tables for exceptional education and alterna-
 10    tive school secondary support units shall  be  applicable  only  for  programs
 11    approved  by  the state department of education following rules established by
 12    the state board of education. Moneys generated  from  computation  of  support
 13    units  for  alternative  schools shall be utilized for alternative school pro-
 14    grams. School district administrative and facility costs may  be  included  as
 15    part of the alternative school expenditures.
 16        7.  State Distribution Factor per Support Unit. Divide educational support
 17    program distribution funds, after subtracting the amounts necessary to pay the
 18    obligations  specified  in  subsection  2. of this section, by the total state
 19    support units to secure the state distribution factor per support unit.
 20        8.  District Share of State Funds for Educational Support Program.  Ascer-
 21    tain  a district's share of state funds for the educational support program as
 22    follows:
 23        a.  District Contribution Calculation. Without including any allowance  as
 24        a  credit  for  prepaid taxes, as provided in section 63-1607, Idaho Code,
 25        the district contribution calculation shall be the rate  determined  under
 26        subsection 3. of this section.
 27        b.  District  Support  Units.  The number of support units for each school
 28        district in the state shall be determined as follows:
 29             (1)  Divide the actual average daily attendance,  excluding  students
 30             approved  for inclusion in the exceptional child educational program,
 31             for the administrative schools and each of the separate  schools  and
 32             attendance  units  by the appropriate divisor from the tables of sup-
 33             port units in this section, then add  the  quotients  to  obtain  the
 34             district's support units allowance for regular students, kindergarten
 35             through  grade  12  including  alternative school secondary students.
 36             Calculations in application of this subsection shall be  carried  out
 37             to the nearest tenth.
 38             (2)  Divide  the  combined  totals of the average daily attendance of
 39             all preschool, handicapped, kindergarten, elementary,  secondary  and
 40             juvenile  detention  center  students  approved  for inclusion in the
 41             exceptional child program of the district by the appropriate  divisor
 42             from the table for computation of exceptional education support units
 43             to  obtain  the  number  of  support units allowed for the district's
 44             approved exceptional child program. Calculations for this  subsection
 45             shall be carried out to the nearest tenth when more than one (1) unit
 46             is allowed.
 47             (3)  The  total  number of support units of the district shall be the
 48             sum of the total  support  units  for  regular  students,  subsection
 49             8.b.(1)  of  this  section,  and  the support units allowance for the
 50             approved exceptional child program, subsection 8.b.(2) of  this  sec-
 51             tion.
 52        c.  Total  District Allowance Educational Program. Multiply the district's
 53        total number of support units, carried out to the nearest  tenth,  by  the
 54        state  distribution  factor  per  support unit and to this product add the
                                                                        
                                          6
                                                                        
  1        approved amount of programs of the district provided in subsection  2.  of
  2        this  section to secure the district's total allowance for the educational
  3        support program.
  4        d.  District Share. To secure the district's share of state apportionment,
  5        subtract the amount of the local district contribution  calculation,  sub-
  6        section  3.  of this section, from the amount of the total district allow-
  7        ance, subsection 8.c. of this section.
  8        e.  Adjustment of District Share. The contract salary of every noncertifi-
  9        cated teacher shall be subtracted from the district's share as  calculated
 10        from the provisions of subsection 8.d. of this section.
 11        9.  Property Tax Computation Ratio. In order to receive state funds pursu-
 12    ant  to this section a charter district shall utilize a school maintenance and
 13    operation property tax computation ratio for the purpose  of  calculating  its
 14    maintenance  and  operation   levy, that is no greater than that which it uti-
 15    lized in tax year 1994, less the difference between the maximum levy rate per-
 16    mitted by section 33-802 2., Idaho Code, and four-tenths of one percent (.4%).
 17    As used herein, the term "property tax computation ratio" shall mean  a  ratio
 18    determined  by  dividing the district's certified property tax maintenance and
 19    operation budget by the actual or adjusted market value  for  assessment  pur-
 20    poses as such values existed on December 31, 1993. Such maintenance and opera-
 21    tion  levy  shall be based on the property tax computation ratio multiplied by
 22    the actual or adjusted market value for assessment  purposes  as  such  values
 23    existed on December 31 of the prior calendar year.
                                                                        
 24        SECTION  4.  SEVERABILITY.  The provisions of this act are hereby declared
 25    to be severable and if any provision of this act or the  application  of  such
 26    provision  to  any  person or circumstance is declared invalid for any reason,
 27    such declaration shall not affect the validity of the  remaining  portions  of
 28    this act.
                                                                        
 29        SECTION  5.  An  emergency  existing  therefor,  which emergency is hereby
 30    declared to exist, this act shall be in full force and effect on and after its
 31    passage and approval, and retroactively to January 1, 2006.".
                                                                        
 32                                 CORRECTION TO TITLE
 33        On page 1, delete lines 2 and 3 and insert:
 34    "RELATING TO PROPERTY  TAXES;  STATING  LEGISLATIVE  FINDINGS,  SUBMITTING  AN
 35        ADVI-";  and  in line 7, following "EXPENDITURES" insert: "; AMENDING SEC-
 36        TION 33-802, IDAHO CODE, TO REVISE  HOW  MAXIMUM  SCHOOL  MAINTENANCE  AND
 37        OPERATION  LEVIES ARE CALCULATED FOR TAX YEAR 2006, AND EACH YEAR THEREAF-
 38        TER; AMENDING SECTION 33-1002, IDAHO CODE, TO REVISE THE LOCAL  DISTRICTS'
 39        CONTRIBUTION  CALCULATION, TO PROVIDE A PROPERTY TAX COMPUTATION RATIO FOR
 40        CHARTER SCHOOL DISTRICTS THAT MUST BE UTILIZED FOR THE CHARTER DISTRICT TO
 41        BE ELIGIBLE TO RECEIVE STATE FUNDS AND TO DEFINE "PROPERTY TAX COMPUTATION
 42        RATIO"; PROVIDING SEVERABILITY; DECLARING AN EMERGENCY AND PROVIDING  RET-
 43        ROACTIVE APPLICATION".

Engrossed Bill (Original Bill with Amendment(s) Incorporated)


                                                                        
                                                                        
  ]]]]              LEGISLATURE OF THE STATE OF IDAHO             ]]]]
 Fifty-eighth Legislature                   Second Regular Session - 2006
                                                                        
                                                                        
                                       IN THE SENATE
                                                                        
                       SENATE BILL NO. 1501, As Amended in the House
                                                                        
                                 BY STATE AFFAIRS COMMITTEE
                                                                        
  1                                        AN ACT
  2    RELATING TO PROPERTY TAXES; STATING LEGISLATIVE FINDINGS, SUBMITTING AN  ADVI-
  3        SORY  VOTE  TO THE ELECTORS, DIRECTING THE SECRETARY OF STATE AND ATTORNEY
  4        GENERAL TO PERFORM SPECIFIED DUTIES, STATING THE QUESTION TO BE SUBMITTED,
  5        DECLARING THE ADVISORY QUESTION A MEASURE, AND MAKING  APPLICABLE  CERTAIN
  6        PROVISIONS  GOVERNING  ELECTION  CAMPAIGN  CONTRIBUTIONS AND EXPENDITURES;
  7        AMENDING SECTION 33-802, IDAHO CODE, TO REVISE HOW MAXIMUM SCHOOL  MAINTE-
  8        NANCE AND OPERATION LEVIES ARE CALCULATED FOR TAX YEAR 2006, AND EACH YEAR
  9        THEREAFTER; AMENDING SECTION 33-1002, IDAHO CODE, TO REVISE THE LOCAL DIS-
 10        TRICTS'  CONTRIBUTION  CALCULATION,  TO PROVIDE A PROPERTY TAX COMPUTATION
 11        RATIO FOR CHARTER SCHOOL DISTRICTS THAT MUST BE UTILIZED FOR  THE  CHARTER
 12        DISTRICT TO BE ELIGIBLE TO RECEIVE STATE FUNDS AND TO DEFINE "PROPERTY TAX
 13        COMPUTATION  RATIO";  PROVIDING  SEVERABILITY;  DECLARING AN EMERGENCY AND
 14        PROVIDING RETROACTIVE APPLICATION.
                                                                        
 15    Be It Enacted by the Legislature of the State of Idaho:
                                                                        
 16        SECTION 1.  The Legislature finds that the issue of property taxes  is  of
 17    importance  to  the  citizens of the state of Idaho. As a representative body,
 18    members of the Legislature desire to be responsive and  responsible  to  these
 19    citizens. For this reason, the Legislature herewith submits an advisory ballot
 20    to the electors of the state of Idaho, and the results will guide the Legisla-
 21    ture as to reducing property taxes and replacing the funds with an increase in
 22    the state sales tax.
 23        At  the  election  to  be  held on November 7, 2006, the question provided
 24    herein shall be placed on the ballot as an advisory  vote.  The  Secretary  of
 25    State  and  the Attorney General shall perform the duties as prescribed for an
 26    initiative in Chapter 18, Title 34, Idaho Code. The question shall be as  fol-
 27    lows:
 28             "Shall property taxes be reduced and the funds be replaced by an
 29        increase in the state sales tax?".
 30        The  advisory question provided for in this act is hereby declared to
 31    be a "measure" for purposes of Chapter 66, Title 67, Idaho Code, and  the
 32    provisions of Chapter 66, Title 67, Idaho Code, shall apply thereto.
                                                                        
 33        SECTION  2.  That  Section  33-802,  Idaho  Code, be, and the same is
 34    hereby amended to read as follows:
                                                                        
 35        33-802.  SCHOOL LEVIES. Any tax levied for school purposes shall be a
 36    lien on the property against which  the  tax  is  levied.  The  board  of
 37    trustees  shall determine the levies upon each dollar of taxable property
 38    in the district for the ensuing fiscal year as follows:
 39        1.  Bond, Interest and Judgment Obligation  Levies.  Such  levies  as
 40    shall  be required to satisfy all maturing bond, bond interest, and judg-
 41    ment obligations.
 42        2.  Maximum School Maintenance and Operation Levies. Such levies  for
                                                                        
                                           2
                                                                        
  1    maintaining and operating the schools of the district and for the payment
  2    of  tuition  and  transportation,  that  do not exceed an amount equal to
  3    four-tenths of one percent (.4%) during tax year 1994, and do not  exceed
  4    an amount equal to three-tenths of one percent (.3%) during tax year 1995
  5    and  thereafter  through tax year 2005, applied to the actual or adjusted
  6    market value for assessment purposes of the district  as  such  valuation
  7    existed  on December 31 of the previous year, but allowances necessary as
  8    a credit for prepaid taxes, as provided in section 63-1607,  Idaho  Code,
  9    shall  not  be included in such maximum levies. Provided however, that in
 10    the event property within a district's boundaries is contained in a reve-
 11    nue allocation area established under chapter 29, title 50,  Idaho  Code,
 12    and such revenue allocation area has given notice of termination thereun-
 13    der, then, only for the purpose of determining the levy described in this
 14    subsection,  the district may add the increment value, as defined in sec-
 15    tion 50-2903, Idaho Code, to the actual  or  adjusted  market  value  for
 16    assessment  purposes of the district as such value existed on December 31
 17    of the previous year. For tax year 2006, and each  year  thereafter,  the
 18    maximum  levy   of this subsection 2. shall not exceed an amount equal to
 19    the following percentage as applied pursuant to this section:
 20        (a)  Multiply the amount of money raised statewide in the prior year,
 21        pursuant to this section, by 1.03;
 22        (b)  Subtract the value of any increase in statewide market value for
 23        assessment purposes resulting from new construction or change of land
 24        use classification as evidenced by  the  value  shown  on  the  prior
 25        year's  new  construction  roll compiled pursuant to section 63-301A,
 26        Idaho Code, from the actual or adjusted  statewide  market  value  as
 27        such valuation existed on December 31 of the previous year;
 28        (c)  Divide  the  amount  in  subsection 2.(a) of this section by the
 29        amount in subsection 2.(b) of this section.
 30        3.  Authorized School Maintenance and Operation Levies.  Such  levies
 31    for  maintaining  and  operating  the schools of the district and for the
 32    payment of tuition and transportation that  do  not  exceed  one  hundred
 33    eleven  percent (111%) of the local district's contribution authorized in
 34    subsection 2. of section 33-1002, Idaho Code. Implementation of the  pro-
 35    visions  of  this subsection shall be authorized only after approval by a
 36    majority of the district's electors voting on the question. Levies other-
 37    wise authorized by law shall not require an election.
 38        4.  Supplemental Maintenance and Operation Levies. No levy in  excess
 39    of  the  levy  permitted  by subsection 2. or 3. of this section shall be
 40    made by a noncharter school district unless such a supplemental levy in a
 41    specified amount and for a specified time not to exceed two (2) years  be
 42    first  authorized  through  an election held pursuant to chapter 4, title
 43    33, Idaho Code, and approved by a majority of the district electors  vot-
 44    ing  in such election. A levy approved pursuant to this subsection may be
 45    reduced by a majority vote of the board of trustees in the second year.
 46        5.  Charter District Supplemental Maintenance and  Operation.  Levies
 47    pursuant  to the respective charter of any such charter district shall be
 48    first authorized through an election held pursuant to  chapter  4,  title
 49    33,  Idaho Code, and approved by a majority of the district electors vot-
 50    ing in such election.
 51        6.  The Local District Contribution. The local school  district  con-
 52    tribution levy is the amount utilized for calculating local district par-
 53    ticipation in the educational foundation program, which is applied to the
 54    adjusted  market value for assessment purposes, as such valuation existed
 55    on December 31 of the previous year, together with the  increment  value,
                                                                        
                                           3
                                                                        
  1    as  defined  in section 50-2903, Idaho Code, if applicable under the cir-
  2    cumstance described in subsection 2. of this section, relating to  termi-
  3    nation of a revenue allocation area.
  4        7.  The  board  of  trustees  of any school district that has, for at
  5    least seven (7) consecutive years, been authorized  through  an  election
  6    held pursuant to chapter 4, title 33, Idaho Code, to certify a supplemen-
  7    tal  levy  that has annually been equal to or greater than twenty percent
  8    (20%) of the total general maintenance and operation fund, may submit the
  9    question of an indefinite term supplemental levy to the electors  of  the
 10    school district. Such question shall clearly state the dollar amount that
 11    will  be  certified  annually and that the levy will be for an indefinite
 12    number of years. The question must be approved by a majority of the  dis-
 13    trict  electors  voting  on  the question in an election held pursuant to
 14    chapter 4, title 33, Idaho Code. The levy approved pursuant to this  sub-
 15    section may be reduced by a majority vote of the board of trustees during
 16    any fiscal year.
                                                                        
 17        SECTION  3.  That  Section  33-1002,  Idaho Code, be, and the same is
 18    hereby amended to read as follows:
                                                                        
 19        33-1002.  EDUCATIONAL SUPPORT PROGRAM. The educational  support  pro-
 20    gram is calculated as follows:
 21        1.  State  Educational  Support  Funds.  Add the state appropriation,
 22    including the moneys available in the public school income fund, together
 23    with all miscellaneous revenues to determine the total state funds.
 24        2.  From the total state funds subtract the following amounts  needed
 25    for state support of special programs provided by a school district:
 26        a.  Pupil  tuition-equivalency  allowances  as  provided  in  section
 27        33-1002B, Idaho Code;
 28        b.  Transportation  support  program  as provided in section 33-1006,
 29        Idaho Code;
 30        c.  Feasibility studies allowance as provided  in  section  33-1007A,
 31        Idaho Code;
 32        d.  The  approved  costs  for  border district allowance, provided in
 33        section  33-1403, Idaho Code, as determined by the state superintend-
 34        ent of public instruction;
 35        e.  The approved costs for exceptional child approved contract allow-
 36        ance, provided in subsection 2. of section 33-2004,  Idaho  Code,  as
 37        determined by the state superintendent of public instruction;
 38        f.  Certain  expectant and delivered mothers allowance as provided in
 39        section 33-2006, Idaho Code;
 40        g.  Salary-based apportionment calculated  as  provided  in  sections
 41        33-1004 through 33-1004F, Idaho Code;
 42        h.  Unemployment  insurance  benefit payments according to the provi-
 43        sions of section 72-1349A, Idaho Code;
 44        i.  For expenditure as provided by the public school technology  pro-
 45        gram;
 46        j.  For  the  support  of  provisions that provide a safe environment
 47        conducive to student learning and maintain classroom  discipline,  an
 48        allocation of $300 per support unit; and
 49        k.  Any  additional amounts as required by statute to effect adminis-
 50        trative adjustments or as specifically required by the provisions  of
 51        any bill of appropriation;
 52    to secure the state educational support funds.
 53        3.  Local  Districts' Contribution Calculation. Without including any
                                                                        
                                           4
                                                                        
  1    allowance as a credit for prepaid taxes as provided by  section  63-1607,
  2    Idaho  Code, the local districts' contribution shall be the amount appro-
  3    priated pursuant to section 33-1002D, Idaho Code, plus three-tenths  per-
  4    cent  (.3%)  during  fiscal year 2003-04 and each year thereafter, a per-
  5    centage of the total state adjusted market value for assessment  purposes
  6    for  the previous year, with such percentage being determined pursuant to
  7    section 33-802, Idaho Code, and with such value being determined  by  the
  8    provisions  of  section 63-315, Idaho Code, and four-tenths percent (.4%)
  9    during fiscal year 1994-95 and each year thereafter, of  the  cooperative
 10    electrical  associations' property values that have been derived from the
 11    taxes paid in lieu of ad valorem taxes for the previous year as  provided
 12    in section 63-3502, Idaho Code.
 13        4.  Educational  Support  Program  Distribution  Funds. Add the local
 14    districts' contribution, subsection 3. of this  section,  and  the  state
 15    educational  support  program  funds,  subsection  1.  of  this  section,
 16    together  to  secure  the  total educational support program distribution
 17    funds.
 18        5.  Average Daily Attendance. The total state  average  daily  atten-
 19    dance  shall  be  the  sum  of the average daily attendance of all of the
 20    school districts of the state. The state board of education shall  estab-
 21    lish  rules setting forth the procedure to determine average daily atten-
 22    dance and the time for, and method of, submission of such report. Average
 23    daily  attendance  calculation  shall  be  carried  out  to  the  nearest
 24    hundredth. Computation of average daily attendance shall also be governed
 25    by the provisions of section 33-1003A, Idaho Code.
 26        6.  Support Units. The total state support units shall be  determined
 27    by  using the tables set out hereafter called computation of kindergarten
 28    support units, computation of elementary support  units,  computation  of
 29    secondary  support  units,  computation  of exceptional education support
 30    units, and computation of alternative school secondary support units. The
 31    sum of all of the total support units of  all  school  districts  of  the
 32    state shall be the total state support units.
 33                    COMPUTATION OF KINDERGARTEN SUPPORT UNITS
 34    Average Daily
 35    Attendance            Attendance Divisor         Units Allowed
 36    41 or more     ....   40.......................  1 or more as computed
 37    31 -  40.99 ADA....    -.......................  1
 38    26 -  30.99 ADA....    -.......................   .85
 39    21 -  25.99 ADA....    -.......................   .75
 40    16 -  20.99 ADA....    -.......................   .6
 41     8 -  15.99 ADA....    -.......................   .5
 42     1 -   7.99 ADA....    -.......................  count as elementary
                                                                        
 43                     COMPUTATION OF ELEMENTARY SUPPORT UNITS
 44    Average Daily
 45    Attendance            Attendance Divisor         Minimum Units Allowed
 46    300 or more ADA........................................  15
 47                        ..23...grades 4,5 & 6....
 48                        ..22...grades 1,2 & 3....1994-95
 49                        ..21...grades 1,2 & 3....1995-96
 50                        ..20...grades 1,2 & 3....1996-97
 51                              and each year thereafter.
 52    160   to  299.99 ADA... 20.....................         8.4
 53    110   to  159.99 ADA... 19.....................         6.8
 54     71.1 to  109.99 ADA... 16.....................         4.7
                                                                        
                                           5
                                                                        
  1     51.7 to   71.0  ADA... 15.....................         4.0
  2     33.6 to   51.6  ADA... 13.....................         2.8
  3     16.6 to   33.5  ADA... 12.....................         1.4
  4      1.0 to   16.5  ADA... n/a....................         1.0
                                                                        
  5                     COMPUTATION OF SECONDARY SUPPORT UNITS
  6    Average Daily
  7    Attendance            Attendance Divisor         Minimum Units Allowed
  8    750 or more      .... 18.5.....................        47
  9    400 -  749.99 ADA.... 16.......................        28
 10    300 -  399.99 ADA.... 14.5.....................        22
 11    200 -  299.99 ADA.... 13.5.....................        17
 12    100 -  199.99 ADA.... 12.......................         9
 13     99.99 or fewer       Units allowed as follows:
 14             Grades 7-12  .........................         8
 15             Grades 9-12  .........................         6
 16             Grades 7- 9  .........................         1 per 14 ADA
 17             Grades 7- 8  .........................         1 per 16 ADA
                                                                        
 18               COMPUTATION OF EXCEPTIONAL EDUCATION SUPPORT UNITS
 19    Average Daily
 20    Attendance            Attendance Divisor         Minimum Units Allowed
 21    14 or more ....       14.5.....................  1 or more as computed
 22    12 -  13.99....        -.......................  1
 23     8 -  11.99....        -.......................   .75
 24     4 -   7.99....        -.......................   .5
 25     1 -   3.99....        -.......................   .25
                                                                        
 26            COMPUTATION OF ALTERNATIVE SCHOOL SECONDARY SUPPORT UNITS
 27    Pupils in Attendance  Attendance Divisor         Minimum Units Allowed
 28    12 or more..........  12......................   1 or more as computed
                                                                        
 29        In  applying  these  tables to any given separate attendance unit, no
 30    school district shall receive less total money than it would  receive  if
 31    it  had  a  lesser  average  daily attendance in such separate attendance
 32    unit. In applying the kindergarten table to  a  kindergarten  program  of
 33    less days than a full school year, the support unit allowance shall be in
 34    ratio  to the number of days of a full school year. The tables for excep-
 35    tional education and alternative school secondary support units shall  be
 36    applicable  only  for programs approved by the state department of educa-
 37    tion following rules established by the state board of education.  Moneys
 38    generated from computation of support units for alternative schools shall
 39    be  utilized for alternative school programs. School district administra-
 40    tive and facility costs may be included as part of the alternative school
 41    expenditures.
 42        7.  State Distribution Factor per Support  Unit.  Divide  educational
 43    support  program distribution funds, after subtracting the amounts neces-
 44    sary to pay the obligations specified in subsection 2. of  this  section,
 45    by  the total state support units to secure the state distribution factor
 46    per support unit.
 47        8.  District Share of State Funds for  Educational  Support  Program.
 48    Ascertain  a  district's share of state funds for the educational support
 49    program as follows:
 50        a.  District Contribution Calculation. Without including  any  allow-
 51        ance  as  a credit for prepaid taxes, as provided in section 63-1607,
                                                                        
                                           6
                                                                        
  1        Idaho Code, the district contribution calculation shall be  the  rate
  2        determined under subsection 3. of this section.
  3        b.  District  Support  Units.  The  number  of support units for each
  4        school district in the state shall be determined as follows:
  5             (1)  Divide the actual average daily attendance, excluding  stu-
  6             dents  approved  for  inclusion  in the exceptional child educa-
  7             tional program, for the administrative schools and each  of  the
  8             separate schools and attendance units by the appropriate divisor
  9             from  the  tables of support units in this section, then add the
 10             quotients to obtain the district's support units  allowance  for
 11             regular students, kindergarten through grade 12 including alter-
 12             native school secondary students. Calculations in application of
 13             this subsection shall be carried out to the nearest tenth.
 14             (2)  Divide  the combined totals of the average daily attendance
 15             of all preschool, handicapped, kindergarten, elementary, second-
 16             ary and juvenile detention center students approved  for  inclu-
 17             sion  in  the  exceptional  child program of the district by the
 18             appropriate divisor from the table  for  computation  of  excep-
 19             tional  education  support units to obtain the number of support
 20             units allowed for the district's approved exceptional child pro-
 21             gram. Calculations for this subsection shall be carried  out  to
 22             the nearest tenth when more than one (1) unit is allowed.
 23             (3)  The  total number of support units of the district shall be
 24             the sum of the total support units for regular students, subsec-
 25             tion 8.b.(1) of this section, and the  support  units  allowance
 26             for  the  approved exceptional child program, subsection 8.b.(2)
 27             of this section.
 28        c.  Total  District  Allowance  Educational  Program.  Multiply   the
 29        district's  total number of support units, carried out to the nearest
 30        tenth, by the state distribution factor per support unit and to  this
 31        product  add the approved amount of programs of the district provided
 32        in subsection 2. of this  section  to  secure  the  district's  total
 33        allowance for the educational support program.
 34        d.  District  Share.  To  secure the district's share of state appor-
 35        tionment, subtract the amount of the local district contribution cal-
 36        culation, subsection 3. of this section, from the amount of the total
 37        district allowance, subsection 8.c. of this section.
 38        e.  Adjustment of District Share. The contract salary of  every  non-
 39        certificated teacher shall be subtracted from the district's share as
 40        calculated from the provisions of subsection 8.d. of this section.
 41        9.  Property  Tax  Computation Ratio. In order to receive state funds
 42    pursuant to this section a charter district shall utilize a school  main-
 43    tenance  and  operation property tax computation ratio for the purpose of
 44    calculating its maintenance and operation  levy, that is no greater  than
 45    that  which it utilized in tax year 1994, less the difference between the
 46    maximum levy rate permitted by section 33-802 2., Idaho Code,  and  four-
 47    tenths  of one percent (.4%). As used herein, the term "property tax com-
 48    putation ratio" shall mean a ratio determined by dividing the  district's
 49    certified  property tax maintenance and operation budget by the actual or
 50    adjusted market value for assessment purposes as such values  existed  on
 51    December  31, 1993. Such maintenance and operation levy shall be based on
 52    the property tax computation ratio multiplied by the actual  or  adjusted
 53    market  value  for assessment purposes as such values existed on December
 54    31 of the prior calendar year.
                                                                        
                                           7
                                                                        
  1        SECTION 4.  SEVERABILITY. The  provisions  of  this  act  are  hereby
  2    declared to be severable and if any provision of this act or the applica-
  3    tion  of such provision to any person or circumstance is declared invalid
  4    for any reason, such declaration shall not affect  the  validity  of  the
  5    remaining portions of this act.
                                                                        
  6        SECTION 5.  An emergency existing therefor, which emergency is hereby
  7    declared  to  exist,  this  act  shall be in full force and effect on and
  8    after its passage and approval, and retroactively to January 1, 2006.

Statement of Purpose / Fiscal Impact



                       STATEMENT OF PURPOSE

                             RS 16258

Advisory vote to be placed on the November 7, 2006 ballot - The
public policy regarding Idaho's public school's funding for
maintenance and operation (M&O) expenses has been a matter of
significant debate and proposed legislation.  The public policy
question is, should public school M&O be paid with local property
taxes or be shifted to the state general fund which would require
a commensurate increase in the sales tax rate sufficient to offset
the cash flow from property taxes?
This proposed action is a major public policy change.  The long-
term consequences would affect the way local public schools are
funded and could affect the manner in which local public schools
are operated.
Because of the magnitude of this public policy change, this
legislation requests the citizens of Idaho to provide an advisory
vote to the legislature in the November 7, 2006 general election.

 
                          FISCAL NOTE

The cost of placing the advisory vote on the November 7, 2006
ballot with pro and con arguments to be supplied by the Secretary
of State and Attorney General in the voters guide should not exceed
$50,000.



Contact
Name: Senator Brad Little 
Phone: (208) 332- 1304
Name: Senator Hal Bunderson
Phone: (208) 332-1320
Name: Senator Brent Hill
Phone: (208) 332-1347


STATEMENT OF PURPOSE/FISCAL NOTE                        S 1501