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H0001.....................................by REVENUE AND TAXATION COMMITTEE
PROPERTY TAX RELIEF ACT - Amends, repeals and adds to existing law to enact
the "Property Tax Relief Act of 2006"; to revise school funding; to remove
the maintenance and operation levy for school funding; to increase the
sales and use tax to six percent; to appropriate an additional $250,645,700
to the Educational Support Program/Division of Operations; to provide for a
transfer of funds to the Public Education Stabilization Fund; to provide
legislative findings; and to provide a ballot question regarding the
property tax reduction and sales tax increase to be submitted to the voters
in November 2006.
08/25 House intro - 1st rdg - to printing
Rpt prt - to 2nd rdg
Rls susp - PASSED - 47-23-0
AYES -- Anderson, Andrus, Barraclough, Barrett, Bayer, Bedke, Bell,
Bilbao, Black, Block, Bolz, Brackett, Chadderdon, Clark, Collins,
Crow, Deal, Denney, Edmunson, Ellsworth, Eskridge, Field(18),
Field(23), Garrett, Hart, Harwood, Henderson, Lake, Loertscher,
Marriott, McKague, Moyle, Nielsen, Nonini, Raybould, Ring, Roberts,
Rydalch, Sali, Schaefer, Shepherd(2), Shepherd(8), Shirley,
Stevenson, Wills, Wood, Mr. Speaker
NAYS -- Bastian, Boe(Sagness), Bradford, Henbest, Jaquet, Kemp,
LeFavour, Martinez, Mathews, McGeachin, Miller, Mitchell,
Pasley-Stuart, Pence, Ringo, Rusche, Sayler, Skippen, Smith(30),
Smith(24), Smylie, Snodgrass, Trail(Harkins)
Absent and excused -- None
Floor Sponsors - Crow, Moyle & Roberts
Title apvd - to Senate
08/25 Senate intro - 1st rdg - to Loc Gov
Rpt out - w/o rec - to 2nd rdg
Rls susp - PASSED - 24-11-0
AYES -- Brandt, Broadsword, Burtenshaw, Cameron, Coiner, Compton,
Darrington, Davis, Fulcher, Gannon, Geddes, Goedde, Hill, Jorgenson,
Keough, Little, Lodge, McGee, McKenzie, Pearce, Richardson, Stegner,
Sweet, Williams
NAYS -- Andreason, Bunderson, Burkett, Corder, Kelly, Langhorst,
Malepeai, Marley, Schroeder, Stennett, Werk
Absent and excused -- None
Floor Sponsors - Hill & Stegner
Title apvd - to House
To enrol
08/28 Rpt enrol - Sp signed - Pres signed
08/28 To Governor
08/31 Governor signed
Session Law Chapter 1
Effective:
01/01/06 Sections 1 through 17 and Section 26
10/01/06 Sections 18 and 19
11/01/06 Section 20
08/31/06 Sections 21 through 25
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]] Fifty-eighth Legislature First Extraordinary Session - 2006IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 1 BY REVENUE AND TAXATION COMMITTEE 1 AN ACT 2 RELATING TO TAXATION; PROVIDING A SHORT TITLE; AMENDING SECTION 33-701, IDAHO 3 CODE, TO PROVIDE A GRAMMATICAL CORRECTION, TO DELETE REFERENCE TO SCHOOL 4 MAINTENANCE AND OPERATION LEVIES AND TO MAKE TECHNICAL CORRECTIONS; AMEND- 5 ING SECTION 33-802, IDAHO CODE, TO DELETE REFERENCE TO SCHOOL DISTRICT 6 LEVIES THAT MAY BE IMPOSED WITHOUT VOTER APPROVAL, TO DELETE REFERENCE TO 7 THE CREDIT FOR PREPAID TAXES, TO PROVIDE BUDGET STABILIZATION LEVIES FOR 8 CERTAIN DISTRICTS, TO DELETE THE LOCAL DISTRICT CONTRIBUTION FOR SCHOOL 9 FORMULA PURPOSES, TO PROVIDE FOR CHARTER DISTRICT LEVIES FOR MAINTENANCE 10 AND OPERATION CONSISTENT WITH THE DISTRICT'S CHARTER, TO PROVIDE FOR PROP- 11 ERTY IN A REVENUE ALLOCATION AREA WITHIN A CHARTER DISTRICT AND TO MAKE 12 TECHNICAL CORRECTIONS; AMENDING SECTION 33-802A, IDAHO CODE, TO CLARIFY 13 REFERENCES TO SCHOOL LEVIES; AMENDING SECTION 33-808, IDAHO CODE, TO PRO- 14 VIDE NOTICE BY CHARTER DISTRICTS, TO PROVIDE CORRECT CODE CITATIONS AND TO 15 MAKE A TECHNICAL CORRECTION; AMENDING SECTION 33-905, IDAHO CODE, TO PRO- 16 VIDE A CORRECT CODE REFERENCE AND TO MAKE A TECHNICAL CORRECTION; AMENDING 17 SECTION 33-907, IDAHO CODE, TO PROVIDE THAT BALANCES IN THE FUND THAT ARE 18 IN EXCESS OF A CERTAIN AMOUNT SHALL BE TRANSFERRED TO THE BOND LEVY EQUAL- 19 IZATION FUND AND TO PROVIDE THAT INTEREST EARNINGS BE RETAINED IN THE PUB- 20 LIC EDUCATION STABILIZATION FUND; AMENDING SECTION 33-1002, IDAHO CODE, TO 21 REVISE HOW THE EDUCATIONAL SUPPORT PROGRAM IS CALCULATED, TO PROVIDE ELI- 22 GIBILITY FOR CHARTER DISTRICTS TO CONTINUE TO RECEIVE SCHOOL FORMULA 23 MONEYS AND TO MAKE TECHNICAL CORRECTIONS; REPEALING SECTION 33-1002A, 24 IDAHO CODE, RELATING TO THE LOCAL DISTRICT CONTRIBUTION REDUCTION AND 25 REPEALING SECTION 33-1002D, IDAHO CODE, RELATING TO PROPERTY TAX REPLACE- 26 MENT; AMENDING SECTION 33-1003, IDAHO CODE, TO DELETE REFERENCE TO AN 27 OBSOLETE PROVISION AND TO MAKE TECHNICAL CORRECTIONS; AMENDING SECTION 28 33-1004, IDAHO CODE, TO PROVIDE A CORRECT CODE REFERENCE AND TO MAKE A 29 TECHNICAL CORRECTION; AMENDING SECTION 33-1408, IDAHO CODE, TO REVISE THE 30 SPECIAL LEVY FOR TUITION AND TO EXEMPT THE LEVY FROM THE THREE PERCENT 31 PROPERTY TAX CAP; AMENDING SECTION 33-5208, IDAHO CODE, TO PROVIDE A COR- 32 RECT CODE REFERENCE; AMENDING SECTION 50-2908, IDAHO CODE, TO DELETE REF- 33 ERENCE TO PROPERTY TAX FOR SCHOOLS AND TO MAKE A TECHNICAL CORRECTION; 34 AMENDING SECTION 63-315, IDAHO CODE, TO PROVIDE APPLICATION TO CHARTER 35 DISTRICTS LEVYING A MAINTENANCE AND OPERATION LEVY IN THE PRIOR CALENDAR 36 YEAR; AMENDING SECTION 63-802A, IDAHO CODE, TO DELETE REFERENCE TO SCHOOL 37 DISTRICT MAINTENANCE AND OPERATION LEVIES, TO PROVIDE APPLICATION TO 38 SCHOOL DISTRICTS AND TO MAKE A TECHNICAL CORRECTION; AMENDING SECTION 39 63-811, IDAHO CODE, TO DELETE REFERENCE TO PROPERTY TAX ALLOCATED FOR 40 SCHOOLS AND TO MAKE A TECHNICAL CORRECTION; AMENDING SECTION 63-3619, 41 IDAHO CODE, TO INCREASE THE SALES TAX TO SIX PERCENT; AMENDING SECTION 42 63-3621, IDAHO CODE, TO INCREASE THE USE TAX TO SIX PERCENT; AMENDING SEC- 43 TION 63-3638, IDAHO CODE, TO REVISE THE DISTRIBUTION FOR SALES TAX REVE- 44 NUES, TO DELETE REFERENCE TO MAINTENANCE AND OPERATION TAXES FOR SCHOOL 45 DISTRICTS AND TO MAKE A TECHNICAL CORRECTION; AMENDING SECTION 63-3640, 46 IDAHO CODE, TO PROVIDE DATE CHANGES FOR CERTAIN CONTRACTS; APPROPRIATING 2 1 MONEYS FROM THE GENERAL FUND TO THE PUBLIC SCHOOL INCOME FUND FOR FISCAL 2 YEAR 2007; APPROPRIATING ADDITIONAL MONEYS FROM THE PUBLIC SCHOOL INCOME 3 FUND TO THE EDUCATIONAL SUPPORT PROGRAM/DIVISION OF OPERATIONS FOR FISCAL 4 YEAR 2007; DIRECTING THE STATE CONTROLLER TO TRANSFER MONEYS FROM THE GEN- 5 ERAL FUND TO THE PUBLIC EDUCATION STABILIZATION FUND BY A DATE CERTAIN; 6 STATING LEGISLATIVE FINDINGS, SUBMITTING AN ADVISORY VOTE TO THE ELECTORS, 7 DIRECTING THE SECRETARY OF STATE TO SUBMIT THE QUESTION, STATING THE 8 QUESTION TO BE SUBMITTED, DECLARING THE ADVISORY QUESTION A MEASURE AND 9 MAKING APPLICABLE CERTAIN PROVISIONS GOVERNING ELECTION CAMPAIGN CONTRIBU- 10 TIONS AND EXPENDITURES; PROVIDING SEVERABILITY; DECLARING AN EMERGENCY, 11 PROVIDING RETROACTIVE APPLICATION AND PROVIDING EFFECTIVE DATES. 12 Be It Enacted by the Legislature of the State of Idaho: 13 SECTION 1. SHORT TITLE. This act may be known and cited as the "Property 14 Tax Relief Act of 2006." 15 SECTION 2. That Section 33-701, Idaho Code, be, and the same is hereby 16 amended to read as follows: 17 33-701. FISCAL YEAR -- PAYMENT AND ACCOUNTING OF FUNDS. The fiscal year 18 of each school district shall be a period of twelve (12) months commencing on 19 the first day of July in each year. 20 The board of trustees of each school district shall have the following 21 powers and duties: 22 1. To determine and order paid all lawful expenses for salaries, wages 23 and purchases, whether or not there be money in the treasury for payment of 24 warrants drawn against any fund of the district. Warrants shall be signed by 25 the treasurer of the district and countersigned by the chairman or vice-chair- 26 man of the board of trustees. 27 Whenever any school district has sufficient funds on depositsoto do so, 28 it may pay any allowed claim for salaries, wages or purchases by regular bank 29 check signed by the treasurer or assistant treasurer of the district and coun- 30 tersigned by the chairman, or vice-chairman, of the board of trustees. 31 The total amount of warrants or orders for warrants drawn on any fund, 32 together with disbursements from such fund in any other manner made, shall not 33 exceed ninety-five percent (95%) of the estimated income and revenue accrued 34 or accruing to such fund for the same school year, until such income and reve- 35 nue shall have been paid into the treasury to the credit of the district; 36 2. To invest all or part of any plant facilities reserve fund, or any 37 fund accumulated for the payment of interest on, and the redemption of, out- 38 standing bonds, or other obligations of the district in bonds or certificates 39 of indebtedness of the United States of America, or in bonds or warrants of 40 the state of Idaho, or in warrants or tax anticipation notes of any county or 41 school district of the state of Idaho, when such investments shall be due and 42 payable on or before the date any plant facilities reserve fund shall be 43 required to be expended or any bonds or other obligations, or interest 44 thereon, of the investing district shall become payable. 45 Whenever in the judgment of the board of trustees, the proceeds of any 46 bond issue should be temporarily invested pending the expenditure of such pro- 47 ceeds for the purposes for which such bonds were issued, the proceeds may be 48 invested in the manner and form hereinabove prescribed. Any interest, or prof- 49 its accruing from such investments shall be used for the purposes for which 50 the bonds were issued. Unless otherwise provided by law, any interest or prof- 51 its accruing from the investment of any funds shall be credited to the general 3 1 fund of the district; 2 3. To insure anyschool houseschoolhouse and other property, and the 3 district, against any loss by fire, casualty, or liability, and the board, its 4 officers and employees, and to preserve its property for the benefit of the 5 district. In case of loss of any insured property, any proceeds from insur- 6 ance: 7 (a)mMay be expended in constructing a temporary or permanent structure, 8 but no sum greater than the insurance proceeds shall be so expended except 9 upon approval of a majority of the school district electors voting in an 10 election called for that purpose; or 11 (b)mMay be placed in and made a part of the school plant facilities 12 reserve fund of the district, if the district has such a fund; or 13 (c)mMay be placed in a separate account in the bond interest and redemp- 14 tion fund of the district to repay any kind of obligation incurred by the 15 district in replacing or restoring the property for which the insurance 16 proceeds were received, and shall not be included in the computations of 17 bond and bond interest levies as provided in section 33-802A, Idaho Code. 18 If the proceeds of any insurance received by a school district by reason 19 of loss on real property shall be less than five thousand dollars ($5,000), 20 such proceeds may be credited to the general fund of the district; 21 4. To pay from the general fund of the district the expense of any member 22 of the board incurred while traveling on the business of the board, or attend- 23 ing any meeting called by the state board of education or by the state super- 24 intendent of public instruction, or attending any annual or special meetings 25 of the state school trustees association, and to pay the membership fee of the 26 board of trustees in said association. Whenever any member of the board of 27 trustees resides at such distance from the meeting place of the board as to 28 require, in the judgment of the board, such member to incur extraordinary 29 expense in traveling from his home to and from said meeting place, the board 30 may approve payment to such member of the extraordinary expense incurred in 31 attending any meeting of the board. 32 For the purpose of this paragraph, the term "expense" or "extraordinary 33 expense" shall include allowance for mileage or actual travel expense incur- 34 red; 35 5. To prepare, or cause to be prepared and published, in the manner here- 36 inafter prescribed, within one hundred twenty (120) days from the last day of 37 each fiscal year, an annual statement of financial condition and report of the 38 school district as of the end of such fiscal year in a form prescribed by the 39 state superintendent of public instruction. Such annual statement shall 40 include, but not be limited to, the amounts of money budgeted and received and 41 from what sources, and the amounts budgeted and expended for salaries and 42 other expenses by category. Salaries may be reported in gross amount. Each 43 school district shall have available at the administrative office, upon 44 request, a full and complete list of vendors and the amount paid to each and a 45 list of the number of teachers paid at each of the several stated gross salary 46 levels in effect in the district. 47 Nothing herein provided shall be construed as limiting any school district 48 as to any additional or supplementary statements and reports it may elect to 49 make for the purpose of informing the public of its financial operations, 50 either as to form, content, method, or frequency; and if all the information 51 required herein to be published shall have been published as provided herein 52 at regular intervals during the fiscal year covering successive portions of 53 the fiscal year, then such information may be omitted from the annual state- 54 ment of financial condition and report for such portions of the fiscal year as 55 already have been reported. 4 1 The annual statement of financial condition and report shall be published 2 within the time above prescribed in one (1) issue of a newspaper printed and 3 published within the district, or, if there be none, then in a newspaper as 4 provided in section 60-106, Idaho Code, published within the district, or, if 5 there be none, then in a newspaper as provided in section 60-106, Idaho Code, 6 in the county in which the school district is located, or, if more than one 7 (1) newspaper is published in said district or county, then in the newspaper 8 most likely to give best general notice of the contents of such annual state- 9 ment of financial condition and report to the residents of said district; pro- 10 vided, that if no newspaper is published in the district or county, then such 11 statement of financial condition and report shall be published in a newspaper 12 as provided in section 60-106, Idaho Code, most likely to give best general 13 notice of the contents to the residents of said district. 14 The chairman, clerk and treasurer of each school district shall certify 15 the annual statement of financial condition and report to be true and correct, 16 and the certification shall be included in each published statement. 17 In the event the board of trustees of any school district shall fail to 18 prepare or cause to be prepared or to publish the annual statement of finan- 19 cial condition and report as herein required, the state superintendent of pub- 20 lic instruction shall cause the same to be prepared and published, and the 21 cost thereof shall be an obligation of the school district. One (1) copy of 22 the annual statement of financial condition and report shall be retained in 23 the office of the clerk of the board of school trustees, where the same shall 24 be open at all times to examination and inspection by any person; 25 6. To cause to be made a full and complete audit of the financial state- 26 ments of the district as required in section 67-450B, Idaho Code. 27 The auditor shall be employed on written contract. 28 One (1) copy of the audit report shall be filed with the state department 29 of education, after its acceptance by the board of trustees, but not later 30 than October 15; 31 7. To file annually with the state department of education such financial 32 and statistical reports as said state superintendent of public instruction may 33 require; 34 8. To order and have destroyed any canceled check or warrant, or any form 35 of claim or voucher which has been paid, at any time after five (5) years from 36 the date the same was canceled and paid; 37 9. To review the school district budget periodically and make appropriate 38 budget adjustments to reflect the availability of funds and the requirements 39 of the school district.Revenue derived from maintenance and operation levies40made pursuant to section 33-802 2, Idaho Code, shall be excluded from budget41adjustments as provided in this paragraph.Any person or persons proposing a 42 budget adjustment under this section shall notify in writing each member of 43 the board of trustees one (1) week prior to the meeting at which such proposal 44 will be made. Prior to the final vote on such a proposal, notice shall be 45 posted and published once, as prescribed in section 33-402, Idaho Code. A bud- 46 get adjustment shall not be approved unless voted affirmatively by sixty per- 47 cent (60%) of the members of the board of trustees. Such amended budgets shall 48 be submitted to the state superintendent of public instruction; 49 10. To invest any money coming into the hands of the school district in 50 investments permitted by section 67-1210, Idaho Code. Unless otherwise pro- 51 vided by law, any interest or profits accruing from the investment of any 52 funds shall be credited to the general fund of the district. 53 SECTION 3. That Section 33-802, Idaho Code, be, and the same is hereby 54 amended to read as follows: 5 1 33-802. SCHOOL LEVIES. Any tax levied for school purposes shall be a lien 2 on the property against which the tax is levied. The board of trustees shall 3 determine the levies upon each dollar of taxable property in the district for 4 the ensuing fiscal year as follows: 5 (1.) Bond, Interest and Judgment Obligation Levies. Such levies as shall 6 be required to satisfy all maturing bond, bond interest, and judgment obliga- 7 tions. 8 (2.)Maximum School Maintenance and OperationBudget Stabilization 9 Levies.Such levies for maintaining and operating the schools of the district10and for the payment of tuition and transportation, that do not exceed an11amount equal to four-tenths of one percent (.4%) during tax year 1994, and do12not exceed an amount equal to three-tenths of one percent (.3%) during tax13year 1995 and thereafter, applied to the actual or adjusted market value for14assessment purposes of the district as such valuation existed on December 3115of the previous year, but allowances necessary as a credit for prepaid taxes,16as provided in section 63-1607, Idaho Code, shall not be included in such max-17imum levies. Provided however, that in the event property within a district's18boundaries is contained in a revenue allocation area established under chapter1929, title 50, Idaho Code, and such revenue allocation area has given notice of20termination thereunder, then, only for the purpose of determining the levy21described in this subsection, the district may add the increment value, as22defined in section 50-2903, Idaho Code, to the actual or adjusted market value23for assessment purposes of the district as such value existed on December 3124of the previous year.253. Authorized School Maintenance and Operation Levies. Such levies for26maintaining and operating the schools of the district and for the payment of27tuition and transportation that do not exceed one hundred eleven percent28(111%) of the local district's contribution authorized in subsection 2. of29section 33-1002, Idaho Code. Implementation of the provisions of this subsec-30tion shall be authorized only after approval by a majority of the district's31electors voting on the question. Levies otherwise authorized by law shall not32require an electionSchool districts not receiving state equalization funds in 33 fiscal year 2006 may authorize a budget stabilization levy for calendar year 34 2006 and each year thereafter. Such levies shall not exceed the difference 35 between the amount of equalized funds that the state department of education 36 estimates the school district will receive in fiscal year 2007, based on the 37 school district's fiscal year 2006 reporting data, and the combined amount of 38 money the school district would have received from its maintenance and opera- 39 tion levy and state property tax replacement funds in fiscal year 2007 under 40 the laws of the state of Idaho as they existed prior to amendment by the first 41 extraordinary session of the fifty-eighth Idaho legislature. The state depart- 42 ment of education shall notify the state tax commission and affected counties 43 and school districts of the maximum levy amounts permitted, by no later than 44 September 1, 2006. 454.(3) Supplemental Maintenance and Operation Levies. No levy in excess of 46 the levy permitted bysubsection 2. or 3. ofthis section shall be made by a 47 noncharterschooldistrict unless such a supplemental levy in a specified 48 amount and for a specified time not to exceed two (2) years be first autho- 49 rized through an election held pursuant to chapter 4, title 33, Idaho Code, 50 and approved by a majority of the district electors voting in such election. A 51 levy approved pursuant to this subsection may be reduced by a majority vote of 52 the board of trustees in the second year. 535.(4) Charter District Supplemental Maintenance and Operation. Levies 54 pursuant to the respective charter of any such charter district shall be first 55 authorized through an election held pursuant to chapter 4, title 33, Idaho 6 1 Code, and approved by a majority of the district electors voting in such elec- 2 tion. 36. The Local District Contribution. The local school district contribu-4tion levy is the amount utilized for calculating local district participation5in the educational foundation program, which is applied to the adjusted market6value for assessment purposes, as such valuation existed on December 31 of the7previous year, together with the increment value, as defined in section850-2903, Idaho Code, if applicable under the circumstance described in subsec-9tion 2. of this section, relating to termination of a revenue allocation area.107.(5) The board of trustees of any school district that has, for at least 11 seven (7) consecutive years, been authorized through an election held pursuant 12 to chapter 4, title 33, Idaho Code, to certify a supplemental levy that has 13 annually been equal to or greater than twenty percent (20%) of the total gen- 14 eral maintenance and operation fund, may submit the question of an indefinite 15 term supplemental levy to the electors of the school district. Such question 16 shall clearly state the dollar amount that will be certified annually and that 17 the levy will be for an indefinite number of years. The question must be 18 approved by a majority of the district electors voting on the question in an 19 election held pursuant to chapter 4, title 33, Idaho Code. The levy approved 20 pursuant to this subsection may be reduced by a majority vote of the board of 21 trustees during any fiscal year. 22 (6) A charter district may levy for maintenance and operations if such 23 authority is contained within its charter. In the event property within a 24 charter district's boundaries is contained in a revenue allocation area 25 established under chapter 29, title 50, Idaho Code, and such revenue alloca- 26 tion area has given notice of termination thereunder, then, only for the pur- 27 pose of determining the levy described in this subsection, the district may 28 add the increment value, as defined in section 50-2903, Idaho Code, to the 29 actual or adjusted market value for assessment purposes of the district as 30 such value existed on December 31 of the previous year. 31 SECTION 4. That Section 33-802A, Idaho Code, be, and the same is hereby 32 amended to read as follows: 33 33-802A. COMPUTATION OF BOND AND BOND INTEREST LEVIES. When the board of 34 trustees of any school district determines and makesthea levyrequired35 allowed by section 33-802, Idaho Code, and incorporates such levy as a part of 36 the school district's budget to service all maturing bond and bond interest 37 payments for the ensuing fiscal year, it shall take into consideration any 38 state bond levy equalization funds provided pursuant to section 33-906, Idaho 39 Code, and any balances remaining or that may remain in its bond interest and 40 redemption fund after meeting its bond and bond interest obligations for its 41 current fiscal year. The levy so made for the ensuing fiscal year shall be an 42 amount which, together with any state bond levy equalization funds provided 43 pursuant to section 33-906, Idaho Code, and the balance in its bond interest 44 and redemption fund remaining after meeting its current fiscal year bond and 45 bond interest obligations, shall satisfy all maturing bond and bond interest 46 payments for at least the ensuing twelve (12) months, and not to exceed the 47 ensuing twenty-one (21) months counted from July 1 of the current calendar 48 year. 49 SECTION 5. That Section 33-808, Idaho Code, be, and the same is hereby 50 amended to read as follows: 51 33-808. NOTICE OF ADJUSTMENT TO MARKET VALUE FOR ASSESSMENT PURPOSES UPON 7 1 TERMINATION OF A REVENUE ALLOCATION AREA. (1) Aschoolcharter district with a 2 maintenance and operation levy in the immediately previous year that shall 3 adjust its market value for assessment purposes in accordance with the provi- 4 sions of section 33-8022.(6), Idaho Code, relating to termination of a reve- 5 nue allocation area, shall advertise its action by publishing in at least the 6 newspaper of largest paid circulation published in the county of the district, 7 or if there is no such newspaper, then in a newspaper published nearest to the 8 district where the advertisement is required to be published. 9 (2) For purposes of this section, the definition of "newspaper" shall be 10 as established in sections 60-106 and 60-107, Idaho Code; provided further, 11 that the newspaper of largest circulation shall be established by the state- 12 ment of average annual paid weekday circulation listed on the newspaper's 13 sworn statement of ownership that was filed with the United States post office 14 on a date most recently preceding the date on which the advertisement required 15 in this section is to be published. The advertisement shall be run when the 16 school district ascertains that it will adjust its market value for assessment 17 purposes in accordance with the provisions of section 33-8022.(6), Idaho 18 Code, relating to termination of a revenue allocation area, and shall be pub- 19 lished once a week for two (2) weeks following action by the board of 20 trustees. 21 (3) The form and content of the notice shall be substantially as follows: 22 NOTICE OF PROPERTY TAX ADJUSTMENT BY SCHOOL BOARD 23 The (insert name of the school district) hereinafter the "District," has 24 increased its market value for assessment purposes as of December 31, ...., by 25 the amount of the increment value of the (insert name of Redevelopment Agency 26 Revenue Allocation Area) on such date, in accordance with the provisions of 27 Section 33-802, Idaho Code, because the revenue allocation area gave notice of 28 termination pursuant to Section 50-2903, Idaho Code, and as a result thereof 29 property taxes on the incrementalvalue of the revenue allocation area will 30 not be collected and distributed to the District. Section 33-802, Idaho Code, 31 permits the District to replace those funds by adjusting its market value as 32 described herein. The total amount of dollars in property taxes to be directly 33 collected by the District pursuant to this action is estimated to be $....... 34 SECTION 6. That Section 33-905, Idaho Code, be, and the same is hereby 35 amended to read as follows: 36 33-905. SCHOOL DISTRICT BUILDING ACCOUNT -- PAYMENTS TO ACCOUNT -- MONEYS 37 APPROPRIATED TO STATE BOARD -- APPLICATION FOR MONEYS -- PAYMENTS TO DISTRICTS 38 -- REPORTS ON APPLICATIONS -- USES OF MONEYS. (1) The state of Idaho, in order 39 to fulfill its responsibility to establish and maintain a general, uniform and 40 thorough system of public, free common schools, hereby creates and establishes 41 the school district building account in the state treasury. The school dis- 42 trict building account shall have paid into it such appropriations or revenues 43 as may be provided by law. 44 (2) By not later than August 31, moneys in the account pursuant to dis- 45 tribution from section 67-7434, Idaho Code, the lottery dividends and interest 46 earned thereon, shall be distributed to each of the several school districts, 47 in the proportion that the average daily attendance of that district for the 48 previous school year bears to the total average daily attendance of the state 49 during the previous school year. For the purposes of this subsection (2) only, 50 the Idaho school for the deaf and the blind shall be considered a school dis- 51 trict, and shall receive a distribution based upon the average daily atten- 8 1 dance of the school. Average daily attendance shall be calculated as provided 2 in section 33-10025.(3), Idaho Code. 3 (3) Any other state moneys that may be made available shall be distrib- 4 uted to meet the requirements of section 33-1019, Idaho Code. If the amount of 5 such funds exceeds the amount needed to meet the provisions of section 6 33-1019, Idaho Code, then the excess balance shall be transferred to the pub- 7 lic education stabilization fund. 8 (4) All payments from the school district building account shall be paid 9 out directly to the school district in warrants drawn by the state controller 10 upon presentation of proper vouchers from the state board of education. Pend- 11 ing payments out of the school district building account, the moneys in the 12 account shall be invested by the state treasurer in the same manner as pro- 13 vided under section 67-1210, Idaho Code, with respect to other idle moneys in 14 the state treasury. Interest earned on the investments shall be returned to 15 the school district building account. 16 (5) Payments from the school district building account received by a 17 school district shall be used by the school district for the purposes autho- 18 rized in section 33-1019, Idaho Code, up to the level of the state match so 19 required. Any payments from the school district building account received by a 20 school district that are in excess of the state match requirements of section 21 33-1019, Idaho Code, may be used by the school district for the purposes 22 authorized in section 33-1102, Idaho Code. 23 SECTION 7. That Section 33-907, Idaho Code, be, and the same is hereby 24 amended to read as follows: 25 33-907. PUBLIC EDUCATION STABILIZATION FUND. There is hereby created in 26 the state treasury a fund to be known as the public education stabilization 27 fund, which shall function as a fund detail of the public school income fund. 28 The fund shall consist of moneys transferred to the fund according to the pro- 29 visions of sections 33-905 and 33-1018, Idaho Code, and any other moneys made 30 available through legislative transfers or appropriations. Moneys in the fund 31 are hereby continuously appropriated for the purposes stated in sections 32 33-1018 and 33-1018B, Idaho Code, and shall only be expended for the purposes 33 stated in sections 33-1018, 33-1018A and 33-1018B, Idaho Code. Any accumulated 34 balances in the fund that are in excess offiveeight and one-third percent 35 (58.334%) of the current fiscal year's totalgeneral fundappropriation of 36 state funds for public school support shall be transferred to the bond levy 37 equalization fund. Interest earned from the investment of moneys in the fund 38 shall becredited toretained in thepublic school incomefund. 39 SECTION 8. That Section 33-1002, Idaho Code, be, and the same is hereby 40 amended to read as follows: 41 33-1002. EDUCATIONAL SUPPORT PROGRAM. The educational support program is 42 calculated as follows: 43 (1.) State Educational Support Funds. Add the state appropriation, 44 including the moneys available in the public school income fund, together 45 with all miscellaneous revenues to determine the total state funds. 46 (2.) From the total state funds subtract the following amounts needed for 47 state support of special programs provided by a school district: 48 (a.) Pupil tuition-equivalency allowances as provided in section 49 33-1002B, Idaho Code; 50 (b.) Transportation support program as provided in section 33-1006, Idaho 51 Code; 9 1 (c.) Feasibility studies allowance as provided in section 33-1007A, Idaho 2 Code; 3 (d.) The approved costs for border district allowance, provided in sec- 4 tion 33-1403, Idaho Code, as determined by the state superintendent of 5 public instruction; 6 (e.) The approved costs for exceptional child approved contract allow- 7 ance, provided in subsection 2. of section 33-2004, Idaho Code, as deter- 8 mined by the state superintendent of public instruction; 9 (f.) Certain expectant and delivered mothers allowance as provided in 10 section 33-2006, Idaho Code; 11 (g.) Salary-based apportionment calculated as provided in sections 12 33-1004 through 33-1004F, Idaho Code; 13 (h.) Unemployment insurance benefit payments according to the provisions 14 of section 72-1349A, Idaho Code; 15 (i.) For expenditure as provided by the public school technology program; 16 (j.) For the support of provisions that provide a safe environment condu- 17 cive to student learning and maintain classroom discipline, an allocation 18 of $300 per support unit; and 19 (k.) Any additional amounts as required by statute to effect administra- 20 tive adjustments or as specifically required by the provisions of any bill 21 of appropriation; 22 to secure thestatetotal educational support distribution funds. 23 (3.)Local Districts' Contribution Calculation. Without including any24allowance as a credit for prepaid taxes as provided by section 63-1607, Idaho25Code, the local districts' contribution shall be the amount appropriated pur-26suant to section 33-1002D, Idaho Code, plus three-tenths percent (.3%) during27fiscal year 2003-04 and each year thereafter, of the total state adjusted mar-28ket value for assessment purposes for the previous year with such value being29determined by the provisions of section 63-315, Idaho Code, and four-tenths30percent (.4%) during fiscal year 1994-95 and each year thereafter, of the31cooperative electrical associations' property values that have been derived32from the taxes paid in lieu of property taxes for the previous year as pro-33vided in section 63-3502, Idaho Code , less any maintenance and operations34levy funds credited as a reduction against state funds provided for students35attending school in another state.364. Educational Support Program Distribution Funds. Add the local dis-37tricts' contribution, subsection 3. of this section, and the state educational38support program funds, subsection 1. of this section, together to secure the39total educational support program distribution funds.405.Average Daily Attendance. The total state average daily attendance 41 shall be the sum of the average daily attendance of all of the school dis- 42 tricts of the state. The state board of education shall establish rules set- 43 ting forth the procedure to determine average daily attendance and the time 44 for, and method of, submission of such report. Average daily attendance calcu- 45 lation shall be carried out to the nearest hundredth. Computation of average 46 daily attendance shall also be governed by the provisions of section 33-1003A, 47 Idaho Code. 486.(4) Support Units. The total state support units shall be determined by 49 using the tables set out hereafter called computation of kindergarten support 50 units, computation of elementary support units, computation of secondary sup- 51 port units, computation of exceptional education support units, and computa- 52 tion of alternative school secondary support units. The sum of all of the 53 total support units of all school districts of the state shall be the total 54 state support units. 10 1 COMPUTATION OF KINDERGARTEN SUPPORT UNITS 2 Average Daily 3 Attendance Attendance Divisor Units Allowed 4 41 or more .... 40....................... 1 or more as computed 5 31 - 40.99 ADA.... -....................... 1 6 26 - 30.99 ADA.... -....................... .85 7 21 - 25.99 ADA.... -....................... .75 8 16 - 20.99 ADA.... -....................... .6 9 8 - 15.99 ADA.... -....................... .5 10 1 - 7.99 ADA.... -....................... count as elementary 11 COMPUTATION OF ELEMENTARY SUPPORT UNITS 12 Average Daily 13 Attendance Attendance Divisor Minimum Units Allowed 14 300 or more ADA........................................ 15 15 ..23...grades 4,5 & 6.... 16 ..22...grades 1,2 & 3....1994-95 17 ..21...grades 1,2 & 3....1995-96 18 ..20...grades 1,2 & 3....1996-97 19 and each year thereafter. 20 160 to 299.99 ADA... 20..................... 8.4 21 110 to 159.99 ADA... 19..................... 6.8 22 71.1 to 109.99 ADA... 16..................... 4.7 23 51.7 to 71.0 ADA... 15..................... 4.0 24 33.6 to 51.6 ADA... 13..................... 2.8 25 16.6 to 33.5 ADA... 12..................... 1.4 26 1.0 to 16.5 ADA... n/a.................... 1.0 27 COMPUTATION OF SECONDARY SUPPORT UNITS 28 Average Daily 29 Attendance Attendance Divisor Minimum Units Allowed 30 750 or more .... 18.5..................... 47 31 400 - 749.99 ADA.... 16....................... 28 32 300 - 399.99 ADA.... 14.5..................... 22 33 200 - 299.99 ADA.... 13.5..................... 17 34 100 - 199.99 ADA.... 12....................... 9 35 99.99 or fewer Units allowed as follows: 36 Grades 7-12 ......................... 8 37 Grades 9-12 ......................... 6 38 Grades 7- 9 ......................... 1 per 14 ADA 39 Grades 7- 8 ......................... 1 per 16 ADA 40 COMPUTATION OF EXCEPTIONAL EDUCATION SUPPORT UNITS 41 Average Daily 42 Attendance Attendance Divisor Minimum Units Allowed 43 14 or more .... 14.5..................... 1 or more as computed 44 12 - 13.99.... -....................... 1 45 8 - 11.99.... -....................... .75 46 4 - 7.99.... -....................... .5 47 1 - 3.99.... -....................... .25 48 COMPUTATION OF ALTERNATIVE SCHOOL SECONDARY SUPPORT UNITS 49 Pupils in Attendance Attendance Divisor Minimum Units Allowed 50 12 or more.......... 12...................... 1 or more as computed 11 1 In applying these tables to any given separate attendance unit, no school 2 district shall receive less total money than it would receive if it had a 3 lesser average daily attendance in such separate attendance unit. In applying 4 the kindergarten table to a kindergarten program of less days than a full 5 school year, the support unit allowance shall be in ratio to the number of 6 days of a full school year. The tables for exceptional education and alterna- 7 tive school secondary support units shall be applicable only for programs 8 approved by the state department of education following rules established by 9 the state board of education. Moneys generated from computation of support 10 units for alternative schools shall be utilized for alternative school pro- 11 grams. School district administrative and facility costs may be included as 12 part of the alternative school expenditures. 137.(5) State Distribution Factor per Support Unit. Divide educational sup- 14 port program distribution funds, after subtracting the amounts necessary to 15 pay the obligations specified in subsection (2.) of this section, by the total 16 state support units to secure the state distribution factor per support unit. 178.(6)District Share of State Funds for Educational Support Program.18Ascertain a district's share of state funds for the educational support pro-19gram as follows:20a. District Contribution Calculation. Without including any allowance as21a credit for prepaid taxes, as provided in section 63-1607, Idaho Code,22the district contribution calculation shall be the rate determined under23subsection 3. of this section.24b.District Support Units. The number of support units for each school 25 district in the state shall be determined as follows: 26 (a) (1i) Divide the actual average daily attendance, excluding students 27 approved for inclusion in the exceptional child educational program, 28 for the administrative schools and each of the separate schools and 29 attendance units by the appropriate divisor from the tables of sup- 30 port units in this section, then add the quotients to obtain the 31 district's support units allowance for regular students, kindergarten 32 through grade 12 including alternative school secondary students. 33 Calculations in application of this subsection shall be carried out 34 to the nearest tenth. 35 (2ii) Divide the combined totals of the average daily attendance of 36 all preschool, handicapped, kindergarten, elementary, secondary and 37 juvenile detention center students approved for inclusion in the 38 exceptional child program of the district by the appropriate divisor 39 from the table for computation of exceptional education support units 40 to obtain the number of support units allowed for the district's 41 approved exceptional child program. Calculations for this subsection 42 shall be carried out to the nearest tenth when more than one (1) unit 43 is allowed. 44 (3iii) The total number of support units of the district shall be the 45 sum of the total support units for regular students, subsection 468.b.(1)(6)(a)(i) of this section, and the support units allowance for 47 the approved exceptional child program, subsection8.b.(2)(6)(a)(ii) 48 of this section. 49c.(b) Total District Allowance Educational Program. Multiply the 50 district's total number of support units, carried out to the nearest 51 tenth, by the state distribution factor per support unit and to this prod- 52 uct add the approved amount of programs of the district provided in sub- 53 section (2.) of this section to secure the district's total allowance for 54 the educational support program. 55d.(c) District Share.To secure tThe district's share of state apportion- 12 1 ment, subtract the amount of the local district contribution calculation,2subsection 3. of this section, fromis the amount of the total district 3 allowance, subsection8.c.(6)(b) of this section. 4e.(d) Adjustment of District Share. The contract salary of every noncer- 5 tificated teacher shall be subtracted from the district's share as calcu- 6 lated from the provisions of subsection8.d.(6)(c) of this section. 7 (7) Property Tax Computation Ratio. In order to receive state funds pur- 8 suant to this section a charter district shall utilize a school maintenance 9 and operation property tax computation ratio for the purpose of calculating 10 its maintenance and operation levy, that is no greater than that which it uti- 11 lized in tax year 1994, less four-tenths of one percent (.4%). As used herein, 12 the term "property tax computation ratio" shall mean a ratio determined by 13 dividing the district's certified property tax maintenance and operation bud- 14 get by the actual or adjusted market value for assessment purposes as such 15 values existed on December 31, l993. Such maintenance and operation levy shall 16 be based on the property tax computation ratio multiplied by the actual or 17 adjusted market value for assessment purposes as such values existed on Decem- 18 ber 31 of the prior calendar year. 19 SECTION 9. That Sections 33-1002A and 33-1002D, Idaho Code, be, and the 20 same are hereby repealed. 21 SECTION 10. That Section 33-1003, Idaho Code, be, and the same is hereby 22 amended to read as follows: 23 33-1003. SPECIAL APPLICATIONS OF EDUCATIONAL SUPPORT PROGRAM. (1.) 24 Decrease in Average Daily Attendance. -- Any school district which has a 25 decrease in total average daily attendance of one percent (1%) of its average 26 daily attendance in the then current school year from the total average daily 27 attendance used for determining the allowance in the educational support pro- 28 gram for the school year immediately preceding, the allowance of funds from 29 the educational support program may be based on the average daily attendance 30 of the school year immediately preceding, less one percent (1%). When this 31 provision is applied, the decrease in average daily attendance shall be pro- 32 portionately distributed among the various categories of support units that 33 are appropriate for the district. 34 (2.) Application of Support Program to Separate Schools/Attendance Units 35 in District. 36 (a.) Separate Elementary School. -- Any separate elementary school shall 37 be allowed to participate in the educational support program as though 38 the school were the only elementary school operated by the district. 39 (b.) Hardship Elementary School. -- Upon application of the board of 40 trustees of a school district, the state board of education is empowered 41 to determine that a given elementary school or elementary schools within 42 the school district, not otherwise qualifying, are entitled to be counted 43 as a separate elementary school as defined in section 33-1001, Idaho Code, 44 when, in the discretion of the state board of education, special condi- 45 tions exist warranting the retention of the school as a separate atten- 46 dance unit and the retention results in a substantial increase in cost per 47 pupil in average daily attendance above the average cost per pupil in 48 average daily attendance of the remainder of the district's elementary 49 grade school pupils. An elementary school operating as a previously 50 approved hardship elementary school shall continue to be considered as a 51 separate attendance unit, unless the hardship status of the elementary 52 school is rescinded by the state board of education. 13 1 (c.) Separate Secondary School. -- Any separate secondary school shall be 2 allowed to participate in the educational support program as though the 3 school were the only secondary school operated by the district. 4 (d.) Elementary/Secondary School Attendance Units. -- Elementary grades 5 in an elementary/secondary school will be funded as a separate attendance 6 unit if all elementary grades served are situated more than ten (10) miles 7 distance from both the nearest like elementary grades within the same 8 school district and from the location of the office of the superintendent 9 of schools of such district, or from the office of the chief administra- 10 tive officer of such district if the district employs no superintendent of 11 schools. Secondary grades in an elementary/secondary school will be funded 12 as a separate attendance unit if all secondary grades served are located 13 more than fifteen (15) miles by an all-weather road from the nearest like 14 secondary grades operated by the district. 15 (e.) Hardship Secondary School. -- Any district which operated two (2) 16 secondary schools separated by less than fifteen (15) miles, but which 17 district was created through consolidation subsequent to legislative 18 action pursuant to chapter 111, laws of 1947, and which school buildings 19 were constructed prior to 1935, shall be entitled to count the schools as 20 separate attendance units. 21 (f.) Minimum Pupils Required. -- Any elementary school having less than 22 ten (10) pupils in average daily attendance shall not be allowed to par- 23 ticipate in the state or county support program unless the school has been 24 approved for operation by the state board of education. 25 (3.) Remote Schools. -- The board of trustees of any Idaho school dis- 26 trict which operates and maintains a school which is remote and isolated from 27 the other schools of the state because of geographical or topographical con- 28 ditions may petition the state board of education to recognize and approve the 29 school as a remote and necessary school. The petition shall be in form and 30 content approved by the state board of education and shall provide such infor- 31 mation as the state board of education may require. Petitions for the recogni- 32 tion of a school as a remote and necessary school shall be filed annually at 33 least ninety (90) days prior to the date of the annual meeting of the board of 34 trustees as established in section 33-510, Idaho Code. 35 Within forty-five (45) days after the receipt of a petition for the recog- 36 nition of a remote and necessary school, the state board of education shall 37 either approve or disapprove the petition and notify the board of trustees of 38 its decision. Schools which the state board of education approves as being 39 necessary and remote shall be allowed adequate funding within the support pro- 40 gram for an acceptable educational program for the students of the school. In 41 the case of a remote and necessary secondary school, grades 7-12, the educa- 42 tional program shall be deemed acceptable when, in the opinion of the state 43 board of education, the accreditation standard relating to staff size, estab- 44 lished in accordance with section 33-119, Idaho Code, has been met. The final 45 determination of an acceptable program and adequate funding in the case of a 46 remote and necessary elementary school shall be made by the state board of 47 education. 48 (4.) Support Program When District Boundaries are Changed. 49 (a.) In new districts formed by the division of a district, the support 50 program computed for the district divided in its last year of operation, 51 shall be apportioned to the new districts created by the division, in the 52 proportion that the average daily attendance of pupils, elementary and 53 secondary combined, residing in the area of each new district so created, 54 is to the average daily attendance of all pupils, elementary and secondary 55 combined, in the district divided in its last year of operation before the 14 1 division. 2 (b.) When boundaries of districts are changed by excision or annexation 3 of territory, the support program of any district from which territory is 4 excised for the last year of operation before such excision shall be 5 divided, and apportioned among the districts involved, as prescribed in 6 subsection4a.(4)(a) of this section. 7 (c.) In new districts formed by consolidation of former districts, the 8 support program allowance for a seven (7) year period following the forma- 9 tion of the new district, shall not be less than the combined support pro- 10 gram allowances of the component districts in the last year of operation 11 before consolidation. 125. For the fiscal year which commences on July 1, 1986, and for each suc-13ceeding fiscal year, any school district whose adjusted market value for14assessment purposes decreases forty percent (40%) or more from the previous15year's adjusted market value for assessment purposes as such valuation existed16on December 31, is eligible to receive an adjustment to its educational sup-17port program entitlement, subject to qualifications as follows:18a. The adjusted market value for assessment purposes has decreased forty19percent (40%) or more from the previous year's adjusted market value for20assessment purposes as such valuation existed on December 31; and21b. The school levy to be certified for the general maintenance and opera-22tion fund shall be no less than four-tenths of one percent (.4%); and23c. An eligible school district has made application to the state depart-24ment of education for an adjustment to entitlement from the state educa-25tional support program on or before June 1 of the fiscal year. Such appli-26cation must document the need for additional funds and must include a dis-27trict plan to minimize impact of a reduced local tax base.28 SECTION 11. That Section 33-1004, Idaho Code, be, and the same is hereby 29 amended to read as follows: 30 33-1004. STAFF ALLOWANCE. For each school district, a staff allowance 31 shall be determined as follows: 32 (1) Using the daily attendance reports that have been submitted for com- 33 puting the February 15thapportionment of state funds as provided in section 34 33-1009, Idaho Code, determine the total support units for the district in the 35 manner provided in section 33-10028.b.(6)(a), Idaho Code; 36 (2) Determine the instructional staff allowance by multiplying the sup- 37 port units by 1.1. A district must demonstrate that it actually employs the 38 number of certificated instructional staff allowed. If the district does not 39 employ the number allowed, the staff allowance shall be reduced to the actual 40 number employed; 41 (3) Determine the administrative staff allowance by multiplying the sup- 42 port units by .075; 43 (4) Determine the classified staff allowance by multiplying the support 44 units by .375; 45 (5) Additional conditions governing staff allowance: 46 (a) In determining the number of staff in subsections (2), (3) and (4) of 47 this section, a district may contract separately for services to be ren- 48 dered by nondistrict employees and such employees may be counted in the 49 staff allowance. A "nondistrict employee" means a person for whom the 50 school district does not pay the employer's obligations for employee bene- 51 fits. When a district contracts for the services of a nondistrict 52 employee, only the salary portion of the contract shall be allowable for 53 computations. 15 1 (b) If there are circumstances preventing eligible use of staff allowance 2 to which a district is entitled as provided in subsections (2) and (3) of 3 this section, an appeal may be filed with the state department of educa- 4 tion outlining the reasons and proposed alternative use of these funds, 5 and a waiver may be granted. 6 (c) For any district with less than forty (40) support units: 7 (i) The instructional staff allowance shall be calculated applying 8 the actual number of support units. If the actual instructional staff 9 employed in the school year is greater than the instructional staff 10 allowance, then the instructional staff allowance shall be increased 11 by one-half (1/2) staff allowance; and 12 (ii) The administrative staff allowance shall be calculated applying 13 the actual number of support units. If the actual administrative 14 staff employed in the school year is greater than the administrative 15 staff allowance, then the administrative staff allowance shall be 16 increased by one-half (1/2) staff allowance. 17 (iii) Additionally, for any district with less than twenty (20) sup- 18 port units, the instructional staff allowance shall be calculated 19 applying the actual number of support units. If the number of 20 instructional staff employed in the school year is greater than the 21 instructional staff allowance, the staff allowance shall be increased 22 as provided in paragraphs (i) and (ii) of this subsection, and by an 23 additional one-half (1/2) instructional staff allowance. 24 (d) For any school district with one (1) or more separate secondary 25 schools serving grades nine (9) through twelve (12), the instructional 26 staff allowance shall be increased by two (2) additional instructional 27 staff allowances for each such separate secondary school. 28 (e) Only instructional, administrative and classified personnel compen- 29 sated by the school district from the general maintenance and operation 30 fund of the district shall be included in the calculation of staff allow- 31 ance or in any other calculations based upon staff, including determina- 32 tion of the experience and education multiplier, the reporting require- 33 ments, or the district's salary-based apportionment calculation. No food 34 service staff or transportation staff shall be included in the staff 35 allowance. 36 (6) In the event that the staff allowance in any category is insufficient 37 to meet accreditation standards, a district may appeal to the state board of 38 education, demonstrating the insufficiency, and the state board may grant a 39 waiver authorizing sufficient additional staff to be included within the staff 40 allowance to meet accreditation standards. Such a waiver shall be limited to 41 one (1) year, but may be renewed upon showing of continuing justification. 42 SECTION 12. That Section 33-1408, Idaho Code, be, and the same is hereby 43 amended to read as follows: 44 33-1408. SPECIAL LEVY FOR TUITION. Any school district is hereby autho- 45 rized to make a levy above the maintenance and operation levy otherwise autho- 46 rized by law for the purpose of paying tuition costs of its students who, 47 under authorization of the board of trustees of the district, attend school in 48 another districteitherinor out ofIdaho, except for those costs reimbursed49by the state under border contracts. Such levy shall be exempt from the provi- 50 sions of section 63-802, Idaho Code. 51 SECTION 13. That Section 33-5208, Idaho Code, be, and the same is hereby 52 amended to read as follows: 16 1 33-5208. PUBLIC CHARTER SCHOOL FINANCIAL SUPPORT. Except as provided in 2 subsection (8) of this section, from the state educational support program the 3 state department of education shall make the following apportionment to each 4 public charter school for each fiscal year based on attendance figures submit- 5 ted in a manner and time as required by the department of education: 6 (1) Per student support. Computation of support units for each public 7 charter school shall be calculated as if it were a separate school according 8 to the schedules in section 33-10026.(4), Idaho Code, except that public 9 charter schools with fewer than one hundred (100) secondary ADA shall use a 10 divisor of twelve (12) and the minimum units shall not apply, and no public 11 charter school shall receive an increase in support units that exceeds the 12 support units it received in the prior year by more than twenty (20). Funding 13 from the state educational support program shall be equal to the total distri- 14 bution factor, plus the salary-based apportionment provided in chapter 10, 15 title 33, Idaho Code. Provided however, any public charter school that is 16 formed by the conversion of an existing traditional public school shall be 17 assigned divisors, pursuant to section 33-1002, Idaho Code, that are no lower 18 than the divisors of the school district in which the traditional public 19 school is located, for each category of pupils listed. 20 (2) Special education. For each student enrolled in the public charter 21 school who is entitled to special education services, the state and federal 22 funds from the exceptional child education program for that student that would 23 have been apportioned for that student to the school district in which the 24 public charter school is located. 25 (3) Alternative school support. Public charter schools may qualify under 26 the provisions of sections 33-1002 and 33-1002C, Idaho Code, provided the pub- 27 lic charter school meets the necessary statutory requirements, and students 28 qualify for attendance at an alternative school as provided by rule of the 29 state board of education. 30 (4) Transportation support. Support shall be paid to the public charter 31 school as provided in chapter 15, title 33, Idaho Code, and section 33-1006, 32 Idaho Code. Each public charter school shall furnish the department with an 33 enrollment count as of the first Friday in November, of public charter school 34 students living more than one and one-half (1 1/2) miles from the school. For 35 charter schools in the initial year of operation, the petition shall include a 36 proposal for transportation services with an estimated first year cost. The 37 state department of education is authorized to include in the annual appropri- 38 ation to the charter school eighty percent (80%) of the estimated transporta- 39 tion cost. The final appropriation payment in July shall reflect eighty-five 40 percent (85%) of the actual cost. 41 (5) Payment schedule. The state department of education is authorized to 42 make an advance payment of twenty-five percent (25%) of a public charter 43 school's estimated annual apportionment for its first year of operation, and 44 each year thereafter, provided the public charter school has an increase of 45 student population in any given year of twenty (20) students or more, to 46 assist the school with initial start-up costs or payroll obligations. 47 (a) For a state public charter school to receive the advance payment, the 48 school shall submit its anticipated fall membership for each grade level 49 to the state department of education by June 1. 50 (b) Using the figures provided by the public charter school, the state 51 department of education shall determine an estimated annual apportionment 52 from which the amount of the advance payment shall be calculated. Advance 53 payment shall be made to the school on or after July 1 but no later than 54 July 31. 55 (c) All subsequent payments, taking into account the one-time advance 17 1 payment made for the first year of operation, shall be made to the public 2 charter school in the same manner as other traditional public schools in 3 accordance with the provisions of section 33-1009, Idaho Code. 4 A public charter school shall comply with all applicable fiscal requirements 5 of law, except that the following provisions shall not be applicable to public 6 charter schools: section 33-1003B, Idaho Code, relating to guaranteed minimum 7 support; that portion of section 33-1004, Idaho Code, relating to reduction of 8 the administrative and instructional staff allowance when there is a discrep- 9 ancy between the number allowed and the number actually employed; and section 10 33-1004E, Idaho Code, for calculation of district staff indices. 11 (6) Nothing in this chapter shall be construed to prohibit any private 12 person or organization from providing funding or other financial assistance to 13 the establishment or operation of a public charter school. 14 (7) Nothing in this chapter shall prevent a public charter school from 15 applying for federal grant moneys. 16 (8) (a) For the period July 1, 2003, through June 30, 2005, all public 17 virtual schools shall be assigned divisors, pursuant to section 33-1002, 18 Idaho Code, that are no higher than the median divisor shown for each 19 respective category of pupils, among the possible divisors listed, for 20 each respective category of pupils that contains more than one (1) divi- 21 sor. If there is an even number of possible divisors listed for a particu- 22 lar category of pupils, then the lesser of the two (2) median divisors 23 shall be used. For the period July 1, 2005, through June 30, 2007, all 24 public virtual schools shall be assigned divisors, pursuant to section 25 33-1002, Idaho Code, that are no higher than the second highest divisor 26 shown, among the possible divisors listed, for each respective category of 27 pupils that contains more than one (1) divisor. The divisor provisions 28 contained herein shall only be applicable to the number of pupils in aver- 29 age daily attendance in such public virtual schools for the period July 1, 30 2003, through June 30, 2004. If the number of pupils in average daily 31 attendance in any particular category of pupils increases, during the 32 period July 1, 2004, through June 30, 2005, to a number above that which 33 existed in the prior fiscal year, then those additional pupils in average 34 daily attendance shall be assigned the divisor, pursuant to section 35 33-1002, Idaho Code, that would have otherwise been assigned to the school 36 district or public charter school had this section not been in force. 37 (b) Each student in attendance at a public virtual school shall be funded 38 based upon either the actual hours of attendance in the public virtual 39 school on a flexible schedule, or the percentage of coursework completed, 40 whichever is more advantageous to the school, up to the maximum of one (1) 41 full-time equivalent student. 42 (c) All federal educational funds shall be administered and distributed 43 to public charter schools, including public virtual schools, that have 44 been designated by the state board of education as a local education 45 agency (LEA), as provided in section 33-5203(7), Idaho Code. 46 (9) Nothing in this section prohibits separate face-to-face learning 47 activities or services. 48 SECTION 14. That Section 50-2908, Idaho Code, be, and the same is hereby 49 amended to read as follows: 50 50-2908. DETERMINATION OF TAX LEVIES -- CREATION OF SPECIAL FUND. (1) For 51 purposes of calculating the rate at which taxes shall be levied by or for each 52 taxing district in which a revenue allocation area is located, the county com- 53 missioners shall, with respect to the taxable property located in such revenue 18 1 allocation area, use the equalized assessed value of such taxable property as 2 shown on the base assessment roll rather than on the current equalized 3 assessed valuation of such taxable property. 4 (2) With respect to each such taxing district, the tax rate calculated 5 under subsection (1) of this section shall be applied to the current equalized 6 assessed valuation of all taxable property in the taxing district, including 7 the taxable property in the revenue allocation area. The tax revenues thereby 8 produced shall be allocated as follows: 9 (a) To the taxing district shall be allocated and shall be paid by the 10 county treasurer: 11 (i) All taxes levied by the taxing district or on its behalf on 12 taxable property located within the taxing district but outside the 13 revenue allocation area; and 14 (ii) A portion of the taxes levied by the taxing district or on its 15 behalf on the taxable property located within the revenue allocation 16 area, which portion is the amount produced by applying the taxing 17 district's tax rate determined under subsection (1) of this section 18 to the equalized assessed valuation, as shown on the base assessment 19 roll, of the taxable property located within the revenue allocation 20 area; and21(iii) If such taxing district is a school district, a further portion22of the taxes levied by such district or on its behalf on the taxable23property located within the revenue allocation area, which portion is24the amount equal to the percentage specified in section2533-1002(7)(a), Idaho Code, multiplied by the difference between the26current equalized assessed valuation of such taxable property and the27equalized assessed valuation of such taxable property as shown on the28base assessment roll. 29 (b) To the urban renewal agency shall be allocated the balance, if any, 30 of the taxes levied on the taxable property located within the revenue 31 allocation area. 32 (3) Upon enactment of an ordinance adopting a revenue allocation financ- 33 ing provision as part of an urban renewal plan, the urban renewal agency shall 34 create a special fund or funds to be used for the purposes enumerated in this 35 chapter. The revenues allocated to the urban renewal agency pursuant to this 36 chapter, shall be paid to the agency by the treasurer of the county in which 37 the revenue allocation district is located and shall be deposited by the 38 agency into one (1) or more of such special funds. The agency may, in addi- 39 tion, deposit into such special fund or funds such other income, proceeds, 40 revenues and funds it may receive from sources other than the revenues allo- 41 cated to it under subsection (2)(b) of this section. 42 (4) For the purposes of section 63-803, Idaho Code, during the period 43 when revenue allocation under this chapter is in effect, and solely with 44 respect to any taxing district in which a revenue allocation area is located, 45 the county commissioners shall, in fixing any tax levy, take into consider- 46 ation the equalized assessed valuation of the taxable property situated in the 47 revenue allocation area as shown in the base assessment roll, rather than the 48 current equalized assessed value of such taxable property. 49 (5) For all other purposes, including, without limitation, for purposes 50 of sections 33-802, 33-1002 and 63-1313, Idaho Code, reference in the Idaho 51 Code to the term "market value for assessment purposes" (or any other such 52 similar term) shall mean market value for assessment purposes as defined in 53 section 63-208, Idaho Code. 54 SECTION 15. That Section 63-315, Idaho Code, be, and the same is hereby 19 1 amended to read as follows: 2 63-315. ASSESSMENT RATIOS AND THE DETERMINATION OF ADJUSTED MARKET VALUE 3 FOR ASSESSMENT PURPOSES FOR SCHOOL DISTRICTS. (1) The provisions of this sec- 4 tion shall apply only to charter districts levying a maintenance and operation 5 levy in the prior calendar year. For the purpose of this section, adjusted 6 market value for assessment purposes shall be the adjusted market value for 7 assessment purposes of all property assessed for property tax purposes for the 8 year referred to in sections 33-802 and 33-1002, Idaho Code. 9 (2) The state tax commission shall conduct a ratio study to annually 10 ascertain the ratio between the assessed value and the market value for 11 assessment purposes of all property assessed for property tax purposes. Said 12 ratio study shall be conducted in accordance with nationally accepted proce- 13 dures. From the ratio so ascertained the state tax commission shall compute 14 the adjusted market value of all property assessed for property tax purposes. 15 (3) The ratio shall be computed in each school district and applied to 16 the market value for assessment purposes within each school district. 17 (4) Sales used in determining the ratio required by this section shall be 18 arm's length, market value property sales occurring in the year beginning on 19 October 1 of the year preceding the year for which the adjusted market value 20 is to be determined. The state tax commission may, at its discretion, modify 21 the sales period when doing so produces provably better representativeness of 22 the actual ratio in any school district. The state tax commission may also add 23 independently conducted appraisals when the state tax commission believes that 24 this procedure will improve the representativeness and reliability of the 25 ratio. 26 (5) Whenever the state tax commission is unable to determine with reason- 27 able statistical certainty that the assessed value within any school district 28 differs from the market value for assessment purposes, the state tax commis- 29 sion may certify the assessed value to be the adjusted market value of any 30 school district. 31 (6) The state tax commission shall certify the adjusted market value of 32 each school district to the state department of education and each county 33 auditor no later than the first Monday in April each year. The state tax com- 34 mission shall prepare a report indicating procedures used in computing the 35 adjusted market value and showing statistical measures computed in the ratio 36 study. This report shall be submitted to the state department of education at 37 the same time as the certification of adjusted market value. The report of the 38 state tax commission shall also be made available for public inspection in the 39 office of the county auditor. 40 (7) The state tax commission shall promulgate rules to implement the 41 ratio study described in this section. 42 SECTION 16. That Section 63-802A, Idaho Code, be, and the same is hereby 43 amended to read as follows: 44 63-802A. NOTICE OF BUDGET HEARING. (1) Not later than April 30 of each 45 year, each taxing district shall set and notify the county clerk of the date 46 and location set for the budget hearing of the district. If no budget hearing 47 is required by law, the county clerk shall be so notified. 48 (2) Beginning in 2003, anonschooltaxing district that fails to comply 49 with subsection (1) of this section shall be prohibited from including in its 50 budget any budget increase otherwise permitted by either subsection (1)(a) or 51 (1)(e) of section 63-802, Idaho Code. 52 (3)Beginning in 2003, a school district that fails to comply with sub-20 1section (1) of this section shall be prohibited, in the year of such failure,2from increasing the portion of its property tax budget raised under section333-802 2., Idaho Code, over the amount of the immediately preceding year.4(4)If a taxing district wishes to change the time and location of such 5 budget hearing as stated on the assessment notice,theyit shall publish such 6 change of time and location in advance of such hearing as provided by law. 7 SECTION 17. That Section 63-811, Idaho Code, be, and the same is hereby 8 amended to read as follows: 9 63-811. COMPUTATION OF PROPERTY TAXES -- DUTY OF COUNTY AUDITOR. (1) The 10 county auditor must cause to be computed the amount of the local property 11 taxes levied on the total of the taxable value as entered on the property and 12 operating property rolls, and must deliver the property and operating property 13 rolls to the tax collector on or before the first Monday of November. 14 (2) The county auditor must cause to be computed the amount of the local 15 property taxes levied on the total of the taxable value as entered on the sub- 16 sequent property roll, and must deliver the subsequent property roll to the 17 tax collector as soon as possible, without delay, after the first Monday of 18 December. 19 (3) The county auditor must cause to be computed the amount of the state 20 property tax and the amount of the local property taxes levied on the total 21 taxable value as entered on the missed property roll, and must deliver the 22 missed property roll to the tax collector as soon as possible, without delay, 23 after the first Monday of March of the year following the year in which the 24 assessment was entered on the missed property roll. 25 (4) For the purpose of this section, "taxable value" shall mean the por- 26 tion of the equalized assessed value, less any exemptions and the value that 27 exceeds the value of the base assessment roll for the portion of any taxing 28 district within a revenue allocation area of an urban renewal district, 29 located within each taxing district which certifies a budget to be raised from 30 a property tax levy.When the portion of the property tax to be allocated to31school districts as required in sections 33-1002 and 50-2908, Idaho Code, is32calculated, the taxable value must include the value that exceeds the value of33the base assessment roll.34 (5) The county auditor, at the time of delivery to the county tax collec- 35 tor of the property roll, subsequent property roll, missed property roll or 36 operating property roll with all property taxes computed, must subscribe an 37 affidavit to such roll that he has to the best of his knowledge and ability 38 computed the proper amount of property taxes due, and recorded such orders of 39 the board of equalization as have been made andhavehas made no other 40 changes. 41 (6) Failure of the auditor to make the affidavit shall not affect the 42 validity of any entry on the roll. The making of such affidavit, however, is 43 declared to be a duty pertaining to the office of the county auditor. In every 44 case where the said affidavit is omitted from the real property assessment 45 roll, completed and delivered as aforesaid, the board of county commissioners 46 must require the county auditor to make the same, and upon refusal or neglect 47 of such county auditor to make and subscribe to such affidavit forthwith, the 48 chairman of the said board must immediately file in the district court in the 49 county, an information in writing, verified by his oath, charging such county 50 auditor with refusal or neglect to perform the official duties pertaining to 51 his office, and thereupon he must be proceeded against as in such cases pro- 52 vided by law. 21 1 SECTION 18. That Section 63-3619, Idaho Code, be, and the same is hereby 2 amended to read as follows: 3 63-3619. IMPOSITION AND RATE OF THE SALES TAX. An excise tax is hereby 4 imposed upon each sale at retail at the rate offivesix percent (56%) of the 5 sales price of all retail sales subject to taxation under this chapter and 6 such amount shall be computed monthly on all sales at retail within the pre- 7 ceding month. 8 (a) The tax shall apply to, be computed on, and collected for all credit, 9 installment, conditional or similar sales at the time of the sale or, in the 10 case of rentals, at the time the rental is charged. 11 (b) The tax hereby imposed shall be collected by the retailer from the 12 consumer. 13 (c) The state tax commission shall provide schedules for collection of 14 the tax on sales which involve a fraction of a dollar. The retailer shall cal- 15 culate the tax upon the entire amount of the purchases of the consumer made at 16 a particular time and not separately upon each item purchased. The retailer 17 may retain any amount collected under the bracket system prescribed which is 18 in excess of the amount of tax for which he is liable to the state during the 19 period as compensation for the work of collecting the tax. 20 (d) It is unlawful for any retailer to advertise or hold out or state to 21 the public or to any customer, directly or indirectly, that the tax or any 22 part thereof will be assumed or absorbed by the retailer or that it will not 23 be added to the selling price of the property sold or that if added it or any 24 part thereof will be refunded. Any person violating any provision of this sec- 25 tion is guilty of a misdemeanor. 26 (e) The tax commission may by rule provide that the amount collected by 27 the retailer from the customer in reimbursement of the tax be displayed sepa- 28 rately from the list price, the price advertised on the premises, the marked 29 price, or other price on the sales slip or other proof of sale. 30 (f) The taxes imposed by this chapter shall apply to the sales to con- 31 tractors purchasing for use in the performance of contracts with the United 32 States. 33 SECTION 19. That Section 63-3621, Idaho Code, be, and the same is hereby 34 amended to read as follows: 35 63-3621. IMPOSITION AND RATE OF THE USE TAX -- EXEMPTIONS. An excise tax 36 is hereby imposed on the storage, use, or other consumption in this state of 37 tangible personal property acquired on or afterJulyOctober 1, 20056, for 38 storage, use, or other consumption in this state at the rate offivesix per- 39 cent (56%) of the value of the property, and a recent sales price shall be 40 presumptive evidence of the value of the property unless the property is wire- 41 less telecommunications equipment, in which case a recent sales price shall be 42 conclusive evidence of the value of the property. 43 (a) Every person storing, using, or otherwise consuming, in this state, 44 tangible personal property is liable for the tax. His liability is not extin- 45 guished until the tax has been paid to this state except that a receipt from a 46 retailer maintaining a place of business in this state or engaged in business 47 in this state given to the purchaser is sufficient to relieve the purchaser 48 from further liability for the tax to which the receipt refers. A retailer 49 shall not be considered to have stored, used or consumed wireless telecommuni- 50 cations equipment by virtue of giving, selling or otherwise transferring such 51 equipment at a discount as an inducement to a consumer to commence or continue 52 a contract for telecommunications service. 22 1 (b) Every retailer engaged in business in this state, and making sales of 2 tangible personal property for the storage, use, or other consumption in this 3 state, not exempted under section 63-3622, Idaho Code, shall, at the time of 4 making the sales or, if storage, use or other consumption of the tangible per- 5 sonal property is not then taxable hereunder, at the time the storage, use or 6 other consumption becomes taxable, collect the tax from the purchaser and give 7 to the purchaser a receipt therefor in the manner and form prescribed by the 8 state tax commission. 9 (c) The provisions of this section shall not apply when the retailer pays 10 sales tax on the transaction and collects reimbursement for such sales tax 11 from the customer. 12 (d) Every retailer engaged in business in this state or maintaining a 13 place of business in this state shall register with the state tax commission 14 and give the name and address of all agents operating in this state, the loca- 15 tion of all distributions or sales houses or offices or other places of busi- 16 ness in this state, and such other information as the state tax commission may 17 require. 18 (e) For the purpose of the proper administration of this act and to pre- 19 vent evasion of the use tax and the duty to collect the use tax, it shall be 20 presumed that tangible personal property sold by any person for delivery in 21 this state is sold for storage, use, or other consumption in this state. The 22 burden of proving the sale is tax exempt is upon the person who makes the sale 23 unless he obtains from the purchaser a resale certificate to the effect that 24 the property is purchased for resale or rental. It shall be presumed that 25 sales made to a person who has completed a resale certificate for the 26 seller's records are not taxable and the seller need not collect sales or use 27 taxes unless the tangible personal property purchased is taxable to the pur- 28 chaser as a matter of law in the particular instance claimed on the resale 29 certificate. 30 A seller may accept a resale certificate from a purchaser prior to the 31 time of sale, at the time of sale, or at any reasonable time after the sale 32 when necessary to establish the privilege of the exemption. The resale certif- 33 icate relieves the person selling the property from the burden of proof only 34 if taken from a person who is engaged in the business of selling or renting 35 tangible personal property and who holds the permit provided for by section 36 63-3620, Idaho Code, or who is a retailer not engaged in business in this 37 state, and who, at the time of purchasing the tangible personal property, 38 intends to sell or rent it in the regular course of business or is unable to 39 ascertain at the time of purchase whether the property will be sold or will be 40 used for some other purpose. Other than as provided elsewhere in this section, 41 when a resale certificate, properly executed, is presented to the seller, the 42 seller has no duty or obligation to collect sales or use taxes in regard to 43 any sales transaction so documented regardless of whether the purchaser prop- 44 erly or improperly claimed an exemption. A seller so relieved of the obliga- 45 tion to collect tax is also relieved of any liability to the purchaser for 46 failure to collect tax or for making any report or disclosure of information 47 required or permitted under this chapter. 48 The resale certificate shall bear the name and address of the purchaser, 49 shall be signed by the purchaser or his agent, shall indicate the number of 50 the permit issued to the purchaser, or that the purchaser is an out-of-state 51 retailer, and shall indicate the general character of the tangible personal 52 property sold by the purchaser in the regular course of business. The certifi- 53 cate shall be substantially in such form as the state tax commission may pre- 54 scribe. 55 (f) If a purchaser who gives a resale certificate makes any storage or 23 1 use of the property other than retention, demonstration or display while hold- 2 ing it for sale in the regular course of business, the storage or use is tax- 3 able as of the time the property is first so stored or used. 4 (g) Any person violating any provision of this section is guilty of a 5 misdemeanor and punishable by a fine not in excess of one hundred dollars 6 ($100), and each violation shall constitute a separate offense. 7 (h) It shall be presumed that tangible personal property shipped or 8 brought to this state by the purchaser was purchased from a retailer, for 9 storage, use or other consumption in this state. 10 (i) It shall be presumed that tangible personal property delivered out- 11 side this state to a purchaser known by the retailer to be a resident of this 12 state was purchased from a retailer for storage, use, or other consumption in 13 this state. This presumption may be controverted by evidence satisfactory to 14 the state tax commission that the property was not purchased for storage, use, 15 or other consumption in this state. 16 (j) When the tangible personal property subject to use tax has been sub- 17 jected to a general retail sales or use tax by another state of the United 18 States in an amount equal to or greater than the amount of the Idaho tax, and 19 evidence can be given of such payment, the property will not be subject to 20 Idaho use tax. If the amount paid the other state was less, the property will 21 be subject to use tax to the extent that the Idaho tax exceeds the tax paid to 22 the other state. For the purposes of this subsection, a registration certifi- 23 cate or title issued by another state or subdivision thereof for a vehicle or 24 trailer or a vessel as defined in section 67-7003, Idaho Code, shall be suffi- 25 cient evidence of payment of a general retail sales or use tax. 26 (k) The use tax herein imposed shall not apply to the use by a nonresi- 27 dent of this state of a motor vehicle which is registered or licensed under 28 the laws of the state of his residence and is not used in this state more 29 than a cumulative period of time totaling ninety (90) days in any consecutive 30 twelve (12) months, and which is not required to be registered or licensed 31 under the laws of this state. 32 (l) The use tax herein imposed shall not apply to the use of household 33 goods, personal effects and personally owned motor vehicles by a resident of 34 this state, if such articles were acquired by such person in another state 35 while a resident of that state and primarily for use outside this state and if 36 such use was actual and substantial, but if an article was acquired less than 37 three (3) months prior to the time he entered this state, it will be presumed 38 that the article was acquired for use in this state and that its use outside 39 this state was not actual and substantial. For purposes of this subsection, 40 "resident" shall be as defined in section 63-3013 or 63-3013A, Idaho Code. 41 (m) The use tax herein imposed shall not apply to the storage, use or 42 other consumption of tangible personal property which is or will be incorpo- 43 rated into real property and which has been donated to and has become the 44 property of: 45 (1) A nonprofit organization as defined in section 63-3622O, Idaho Code; 46 or 47 (2) The state of Idaho; or 48 (3) Any political subdivision of the state. 49 This exemption applies whether the tangible personal property is incorporated 50 in real property by the donee, a contractor or subcontractor of the donee, or 51 any other person. 52 SECTION 20. That Section 63-3638, Idaho Code, be, and the same is hereby 53 amended to read as follows: 24 1 63-3638. SALES TAX -- DISTRIBUTION. All moneys collected under this chap- 2 ter, except as may otherwise be required in sections 63-3203 and 63-3709, 3 Idaho Code, shall be distributed by the tax commission as follows: 4 (1) An amount of money shall be distributed to the state refund account 5 sufficient to pay current refund claims. All refunds authorized under this 6 chapter by the commission shall be paid through the state refund account, and 7 those moneys are continuously appropriated. 8 (2) Five million dollars ($5,000,000) per year is continuously appropri- 9 ated and shall be distributed to the permanent building fund, provided by sec- 10 tion 57-1108, Idaho Code. 11 (3) Four million eight hundred thousand dollars ($4,800,000) per year is 12 continuously appropriated and shall be distributed to the water pollution con- 13 trol account established by section 39-3605, Idaho Code. 14 (4) An amount equal to the sum required to be certified by the chairman 15 of the Idaho housing and finance association to the state tax commission pur- 16 suant to section 67-6211, Idaho Code, in each year is continuously appropri- 17 ated and shall be paid to any capital reserve fund, established by the Idaho 18 housing and finance association pursuant to section 67-6211, Idaho Code. Such 19 amounts, if any, as may be appropriated hereunder to the capital reserve fund 20 of the Idaho housing and finance association shall be repaid for distribution 21 under the provisions of this section, subject to the provisions of section 22 67-6215, Idaho Code, by the Idaho housing and finance association, as soon as 23 possible, from any moneys available therefor and in excess of the amounts 24 which the association determines will keep it self-supporting. 25 (5) An amount equal to the sum required by the provisions of sections 26 63-709 and 63-717, Idaho Code, after allowance for the amount appropriated by 27 section 63-718(3), Idaho Code, is continuously appropriated and shall be paid 28 as provided by sections 63-709 and 63-717, Idaho Code. 29 (6) An amount required by the provisions of chapter 53, title 33, Idaho 30 Code. 31 (7) An amount required by the provisions of chapter 87, title 67, Idaho 32 Code. 33 (8) One dollar ($1.00) on each application for certificate of title or 34 initial application for registration of a motor vehicle, snowmobile, all- 35 terrain vehicle or other vehicle processed by the county assessor or the Idaho 36 transportation department excepting those applications in which any sales or 37 use taxes due have been previously collected by a retailer, shall be a fee for 38 the services of the assessor of the county or the Idaho transportation depart- 39 ment in collecting such taxes, and shall be paid into the current expense fund 40 of the county or state highway account established in section 40-702, Idaho 41 Code. 42 (9)ThirteenEleven andthree-quartersfive-tenths percent (13.7511.5%) 43 is continuously appropriated and shall be distributed to the revenue sharing 44 account which is created in the state treasury, and the moneys in the revenue 45 sharing account will be paid in installments each calendar quarter by the tax 46 commission as follows: 47 (a) Twenty-eight and two-tenths percent (28.2%) shall be paid to the var- 48 ious cities as follows: 49 (i) Fifty percent (50%) of such amount shall be paid to the various 50 cities, and each city shall be entitled to an amount in the propor- 51 tion that the population of that city bears to the population of all 52 cities within the state; and 53 (ii) Fifty percent (50%) of such amount shall be paid to the various 54 cities, and each city shall be entitled to an amount in the propor- 55 tion that the preceding year's market value for assessment purposes 25 1 for that city bears to the preceding year's market value for assess- 2 ment purposes for all cities within the state. 3 (b) Twenty-eight and two-tenths percent (28.2%) shall be paid to the var- 4 ious counties as follows: 5 (i) One million three hundred twenty thousand dollars ($1,320,000) 6 annually shall be distributed one forty-fourth (1/44) to each of the 7 various counties; and 8 (ii) The balance of such amount shall be paid to the various coun- 9 ties, and each county shall be entitled to an amount in the propor- 10 tion that the population of that county bears to the population of 11 the state; 12 (c) Thirty-five and nine-tenths percent (35.9%) of the amount appropri- 13 ated in this subsection (9) shall be paid to the several counties for dis- 14 tribution to the cities and counties as follows: 15 (i) Each city and county which received a payment under the provi- 16 sions of section 63-3638(e), Idaho Code, during the fourth quarter of 17 calendar year 1999, shall be entitled to a like amount during suc- 18 ceeding calendar quarters. 19 (ii) If the dollar amount of money available under this subsection 20 (9)(c) in any quarter does not equal the amount paid in the fourth 21 quarter of calendar year 1999, each city's and county's payment shall 22 be reduced proportionately. 23 (iii) If the dollar amount of money available under this subsection 24 (9)(c) in any quarter exceeds the amount paid in the fourth quarter 25 of calendar year 1999, each city and county shall be entitled to a 26 proportionately increased payment, but such increase shall not exceed 27 one hundred five percent (105%) of the total payment made in the 28 fourth quarter of calendar year 1999. 29 (iv) If the dollar amount of money available under this subsection 30 (9)(c) in any quarter exceeds one hundred five percent (105%) of the 31 total payment made in the fourth quarter of calendar year 1999, any 32 amount over and above such one hundred five percent (105%) shall be 33 paid fifty percent (50%) to the various cities in the proportion that 34 the population of the city bears to the population of all cities 35 within the state, and fifty percent (50%) to the various counties in 36 the proportion that the population of a county bears to the popula- 37 tion of the state; and 38 (d) Seven and seven-tenths percent (7.7%) of the amount appropriated in 39 this subsection (9) shall be paid to the several counties for distribution 40 to special purpose taxing districts as follows: 41 (i) Each such district which received a payment under the provi- 42 sions of section 63-3638(e), Idaho Code, during the fourth quarter of 43 calendar year 1999, shall be entitled to a like amount during suc- 44 ceeding calendar quarters. 45 (ii) If the dollar amount of money available under this subsection 46 (9)(d) in any quarter does not equal the amount paid in the fourth 47 quarter of calendar year 1999, each special purpose taxing district's 48 payment shall be reduced proportionately. 49 (iii) If the dollar amount of money available under this subsection 50 (9)(d) in any quarter exceeds the amount distributed under paragraph 51 (i) of this subsection (9)(d), each special purpose taxing district 52 shall be entitled to a share of the excess based on the proportion 53 each such district's current property tax budget bears to the sum of 54 the current property tax budgets of all such districts in the state. 55 The state tax commission shall calculate district current property 26 1 tax budgets to include any unrecovered foregone amounts as determined 2 under section 63-802(1)(e), Idaho Code. When a special purpose taxing 3 district is situated in more than one (1) county, the tax commission 4 shall determine the portion attributable to the special purpose tax- 5 ing district from each county in which it is situated. 6 (iv) If special purpose taxing districts are consolidated, the 7 resulting district is entitled to a base amount equal to the sum of 8 the base amounts which were received in the last calendar quarter by 9 each district prior to the consolidation. 10 (v) If a special purpose taxing district is dissolved or 11 disincorporated, the state tax commission shall continuously distrib- 12 ute to the board of county commissioners an amount equal to the last 13 quarter's distribution prior to dissolution or disincorporation. The 14 board of county commissioners shall determine any redistribution of 15 moneys so received. 16 (vi) Taxing districts formed after January 1, 2001, are not entitled 17 to a payment under the provisions of this subsection (9)(d). 18 (vii) For purposes of this subsection (9)(d), a special purpose tax- 19 ing district is any taxing district which is not a city, a county or 20 a school district. 21 (10) Amounts calculated in accordance with section 2, chapter 356,Llaws 22 of 2001, for annual distribution to counties and other taxing districts begin- 23 ning in October 2001 for replacement of property tax on farm machinery and 24 equipment exempted pursuant to section 63-602EE, Idaho Code. For nonschool 25 districts, the state tax commission shall distribute one-fourth (1/4) of this 26 amount certified quarterly to each county. For school districts, the state tax 27 commission shall distribute one-fourth (1/4) of the amount certified quarterly 28 to each school district. For nonschool districts, the county auditor shall 29 distribute to each district within thirty (30) calendar days from receipt of 30 moneys from the tax commission. Moneys received by each taxing district for 31 replacement shall be utilized in the same manner and in the same proportions 32 as revenues from property taxation. The moneys remitted to the county trea- 33 surer for replacement of property exempt from taxation pursuant to section 34 63-602EE, Idaho Code, may be considered by the counties and other taxing dis- 35 tricts and budgeted at the same time, in the same manner and in the same year 36 as revenues from taxation on personal property which these moneys replace. If 37 taxing districts are consolidated, the resulting district is entitled to an 38 amount equal to the sum of the amounts which were received in the last calen- 39 dar quarter by each district pursuant to this subsection prior to the consoli- 40 dation. If a taxing district is dissolved or disincorporated, the state tax 41 commission shall continuously distribute to the board of county commissioners 42 an amount equal to the last quarter's distribution prior to dissolution or 43 disincorporation. The board of county commissioners shall determine any redis- 44 tribution of moneys so received. If a taxing district annexes territory, the 45 distribution of moneys received pursuant to this subsection shall be unaf- 46 fected. Taxing districts formed after January 1, 2001, are not entitled to a 47 payment under the provisions of this subsection. School districts shall 48 receive an amount determined by multiplying the sum of the year 2000 school 49 district levyplus .001minus .004 times the market value on December 31, 50 2000, in the district of the property exempt from taxation pursuant to section 51 63-602EE, Idaho Code. For school districts, beginning January 1, 2002, only52the portion of property tax replacement received to replace property exempt53from taxation pursuant to section 63-602EE, Idaho Code, based on the tax year542000 tax charges for maintenance and operation as limited by sections 33-802552. and 33-1002D, Idaho Code, shall not be subtracted from the maximum school27 1district maintenance and operation property taxes permitted in accordance with2section 33-802 2., Idaho Code, provided that the result of these calculations 3 shall not be less than zero (0). The result of these school district calcula- 4 tions shall be further increased by six percent (6%). For purposes of the lim- 5 itation provided by section 63-802, Idaho Code, moneys received pursuant to 6 this section as property tax replacement for property exempt from taxation 7 pursuant to section 63-602EE, Idaho Code, shall be treated as property tax 8 revenues. 9 (11) Any moneys remaining over and above those necessary to meet and 10 reserve for payments under other subsections of this section shall be distrib- 11 uted to the general fund. 12 SECTION 21. That Section 63-3640, Idaho Code, be, and the same is hereby 13 amended to read as follows: 14 63-3640. CONTRACTS ENTERED INTO BEFORE EFFECTIVE DATE OF INCREASED TAX. 15 (1) CommencingMay 1, 2003, and ending June 30, 2005October 1, 2006, the pur- 16 chase, use, storage or other consumption of tangible personal property which 17 is otherwise subject to the taxes imposed by this chapter by persons defined 18 in section 63-3609(a), Idaho Code, shall be exempt from one cent (1¢) of the 19 taxes imposed by sections 63-3619 and 63-3621, Idaho Code, if: 20 (a) The tangible personal property is purchased, used, stored or other- 21 wise consumed for incorporation into real property; and 22 (b) The tangible personal property is purchased, used, stored or other- 23 wise consumed in regard to a project performed by such person pursuant to 24 a qualified contract; and 25 (c) The taxpayer claims the exemption in the manner provided by subsec- 26 tion (3) of this section. 27 (2) As used in this section, the term "qualified contract" means a con- 28 tract which: 29 (a) Is a written contract; and 30 (b) Was in effect onApril 15, 2003September 1, 2006, or was submitted 31 for bid or bid in written form on or beforeApril 15, 2003September 1, 32 2006, and subsequently became a written contract; and 33 (c) Was negotiated or bid based upon the sales or use tax being five per- 34 cent (5%); and 35 (d) Requires the cost of the sales or use tax to be borne by the contrac- 36 tor. 37 (3) A person entitled to the exemption granted in subsection (1) of this 38 section may submit a claim for refund to the state tax commission for the 39 amount of one cent (1¢) of the tax imposed by sections 63-3619 and 63-3621, 40 Idaho Code, if it has actually been paid by him. The claim for refund shall 41 include: 42 (a) A copy of a written contract which is a qualified contract; and 43 (b) A detailed invoice prepared by the seller showing all items of tangi- 44 ble personal property purchased by the claimant, the sale of which is sub- 45 ject to the exemption granted in subsection (1) of this section; and 46 (c) A document signed by the purchaser certifying that the tangible per- 47 sonal property shown on the invoice required by subsection (3)(b) of this 48 section has in fact been used by him on the project to which the qualified 49 contract relates. 50 (4) Upon receipt of the claim for refund, the state tax commission shall 51 review the claim and, if it finds it to be proper, shall pay the refund 52 together with interest from the date that the claim was filed at the rate 53 established by section 63-3045, Idaho Code, within thirty (30) days from the 28 1 date the claim was received by the commission. 2 (5) The use or incorporation into real property of any tangible personal 3 property upon which the exemption provided by subsection (1) of this section 4 has been claimed pursuant to any contract other than a qualified contract 5 shall be a misdemeanor. 6 (6) In addition to the criminal penalties provided by subsection (5) of 7 this section, the use or incorporation into real property of tangible personal 8 property upon which the exemption provided by subsection (1) of this section 9 has been claimed pursuant to any contract which is not a qualified contract 10 shall subject the user to a penalty of three (3) times the sales or use tax 11 otherwise due under this chapter to be enforced and collected as provided by 12 sections 63-3634 and 63-3635, Idaho Code. 13 (7) In the case of a retailer who makes sales of tangible personal prop- 14 erty to any person entitled to the exemption granted in subsection (1) of this 15 section who is for any reason unable to collect one cent (1¢) of the tax 16 imposed by sections 63-3619 and 63-3621, Idaho Code, from the purchaser, the 17 retailer shall be entitled to claim the refund otherwise available to the pur- 18 chaser. The claim for refund shall be filed in the manner prescribed by sub- 19 section (3) of this section. Nothing in this subsection shall excuse the 20 retailer from reporting sales and use taxes at the full statutory rate on all 21 taxable sales made during the period to which his sales or use tax return 22 relates. If a refund claim is filed concurrently with the return, the refund 23 claimed may be credited against the tax due on the return. Any retailer who 24 claims a refund for any taxes actually collected from the purchaser shall be 25 subject to a penalty of three (3) times the sales or use tax refund improperly 26 claimed to be enforced and collected as provided by sections 63-3634 and 27 63-3635, Idaho Code. 28 SECTION 22. There is hereby appropriated the following amount to be 29 transferred to the Public School Income Fund for the period July 1, 2006, 30 through June 30, 2007: 31 FROM: 32 General Fund $250,645,700 33 SECTION 23. In addition to any other appropriation provided by law, there 34 is hereby appropriated to the Educational Support Program/Division of Opera- 35 tions, pursuant to law and the provisions of this act the following amount to 36 be expended from the listed fund for the period July 1, 2006, through June 30, 37 2007: 38 FROM: 39 Public School Income Fund $250,645,700 40 SECTION 24. The State Controller shall transfer $100,000,000 from the 41 General Fund to the Public Education Stabilization Fund by no later than Feb- 42 ruary 1, 2007. 43 44 SECTION 25. The Legislature finds and declares that the issue of the 45 property tax funding maintenance and operations of public schools is of impor- 46 tance to the citizens of the state of Idaho. As a representative body, members 47 of the Legislature desire to be responsive and responsible to these citizens. 48 For this reason, the Legislature herewith submits an advisory ballot to the 49 electors of the state of Idaho, and the results will guide the Legislature as 50 to whether the three-tenths of one percent property tax previously contained 51 in Section 33-802, Idaho Code, and levied against the market value of taxable 52 property in the school districts for maintenance and operation purposes of 29 1 school districts should continue to be removed and the funds be replaced by a 2 sufficient increase in the state sales tax. 3 The Secretary of State shall have the question below placed on the 2006 4 general election ballot and shall take necessary steps to have the results on 5 the question tabulated. The question shall be as follows: 6 "Should the State of Idaho keep the property tax relief adopted in 7 August 2006, reducing property taxes by approximately $260 million 8 and protecting funding for public schools by keeping the sales tax 9 at 6%?". 10 The advisory question provided for in this act is hereby declared to be a 11 "measure" for purposes of Chapter 66, Title 67, Idaho Code, and the provisions 12 of Chapter 66, Title 67, Idaho Code, shall apply thereto. 13 SECTION 26. SEVERABILITY. The provisions of this act are hereby declared 14 to be severable and if any provision of this act or the application of such 15 provision to any person or circumstance is declared invalid for any reason, 16 such declaration shall not affect the validity of the remaining portions of 17 this act. 18 SECTION 27. An emergency existing therefor, which emergency is hereby 19 declared to exist, Sections 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 20 16, 17 and 26 of this act shall be in full force and effect on and after pas- 21 sage and approval and retroactively to January 1, 2006. Sections 18 and 19 of 22 this act shall be in full force and effect on and after October 1, 2006. Sec- 23 tion 20 of this act shall be in full force and effect on and after November 1, 24 2006. Sections 21, 22, 23, 24 and 25 of this act shall be in full force and 25 effect on and after passage and approval.
STATEMENT OF PURPOSE
RS16445
The purposes of the Property Tax Relief Act of 2006 are:
· Permanently eliminate the 3 mil education maintenance and
operation levy on Idaho real property, which will
immediately reduce property taxes $260 million, and
replacing that amount with the state sources described
below.
· Raise the Sales Tax 1% from 5% to 6%, effective October 1,
2006, which will generate approximately $210 million
annually.
· Protect education funding now and into the future by placing
$100 million into the Public Education Stabilization Fund.
· Appropriate sufficient funds from the General Fund to
accomplish the aforementioned.
· Place an advisory question on the November 2006 general
election ballot asking Idaho voters:
"Should the State of Idaho keep the property tax relief adopted
in August 2006, reducing property taxes by approximately $260
million and protecting funding for public schools by keeping the
sales tax at 6%?"
FISCAL IMPACT
Immediately reduces Idaho property taxes $260 million.
Commencing October 1, 2006, increases annualized sales tax
revenues approximately $210 million, for a net tax reduction of
$50 million.
Contact
Name:
Gov. James E. Risch
Phone:
(208) 334-2100
STATEMENT OF PURPOSE/FISCAL NOTE H 0001