2007 Legislation
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SENATE BILL NO. 1217 – Approp/public schools/operatn/add’l

SENATE BILL NO. 1217

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Bill Status



S1217............................................................by FINANCE
APPROPRIATIONS - Appropriates an additional $3,892,600 to the Educational
Support Program/Division of Operations for fiscal year 2007; provides for
distribution of the moneys to the school districts; and provides
legislative intent regarding a phase-out reduction of state replacement
funding provided in lieu of personal property taxes on agricultural
equipment.

03/12    Senate intro - 1st rdg - to printing
03/13    Rpt prt - to Fin
    Rpt out - rec d/p - to 2nd rdg
03/14    2nd rdg - to 3rd rdg
03/19    3rd rdg - PASSED - 26-4-5
      AYES -- Andreason, Bair, Bastian, Bilyeu, Broadsword, Cameron,
      Coiner, Corder, Darrington, Davis, Geddes, Hammond, Heinrich, Hill,
      Jorgenson, Keough, Little, Lodge, McGee, McKague, McKenzie, Pearce,
      Richardson, Schroeder, Siddoway, Stegner
      NAYS -- Burkett, Kelly, Langhorst, Werk
      Absent and excused -- Fulcher, Gannon, Goedde, Malepeai, Stennett
    Floor Sponsor - Bair
    Title apvd - to House
03/20    House intro - 1st rdg - to 2nd rdg
03/21    2nd rdg - to 3rd rdg
    Rls susp - PASSED - 69-0-1
      AYES -- Anderson, Andrus, Barrett, Bayer, Bedke, Bell, Bilbao, Black,
      Block, Bock, Boe, Bolz, Brackett, Bradford, Chadderdon, Chavez, Chew,
      Clark, Collins, Crane, Durst, Edmunson, Eskridge, Hagedorn, Hart,
      Harwood, Henbest, Henderson, Jaquet, Killen, King, Kren, Labrador,
      Lake, LeFavour, Loertscher, Luker, Marriott, Mathews, McGeachin,
      Mortimer, Moyle, Nielsen, Nonini, Pasley-Stuart, Patrick, Pence,
      Raybould, Ring, Ringo, Roberts, Ruchti, Rusche, Sayler, Schaefer,
      Shepherd(2), Shepherd(8), Shirley, Shively, Smith(30), Snodgrass,
      Stevenson, Thayn, Trail, Vander Woude, Wills, Wood(27), Wood(35), Mr.
      Speaker
      NAYS -- None
      Absent and excused -- Smith(24)
    Floor Sponsor - Wood(27)
    Title apvd - to Senate
03/22    To enrol
03/23    Rpt enrol - Pres signed
03/26    Sp signed - To Governor
03/30    Governor signed
         Session Law Chapter 325
         Effective: 07/01/07

Bill Text


                                                                        
                                                                        
  ]]]]              LEGISLATURE OF THE STATE OF IDAHO             ]]]]
 Fifty-ninth Legislature                  First Regular Session - 2007
                                                                        
                                                                        
                                       IN THE SENATE
                                                                        
                                    SENATE BILL NO. 1217
                                                                        
                                    BY FINANCE COMMITTEE
                                                                        
  1                                        AN ACT
  2    RELATING TO THE APPROPRIATION FOR THE PUBLIC SCHOOLS DIVISION  OF  OPERATIONS;
  3        APPROPRIATING MONEYS FOR TRANSFER TO THE PUBLIC SCHOOL INCOME FUND; APPRO-
  4        PRIATING  MONEYS TO THE EDUCATIONAL SUPPORT PROGRAM/DIVISION OF OPERATIONS
  5        FOR FISCAL YEAR 2007; DIRECTING THAT MONEYS BE DISTRIBUTED TO REPLACE CER-
  6        TAIN LEVIES; DIRECTING DISTRIBUTION OF CERTAIN AMOUNTS FOR REPLACEMENT  OF
  7        SCHOOL MAINTENANCE AND OPERATION LEVY FUNDS; AND STATING LEGISLATIVE FIND-
  8        INGS  AND  EXPRESSING  LEGISLATIVE INTENT WITH REGARDS TO FUTURE DISTRIBU-
  9        TIONS OF REPLACEMENT FUNDING PROVIDED IN LIEU OF PERSONAL  PROPERTY  TAXES
 10        ON AGRICULTURAL EQUIPMENT.
                                                                        
 11    Be It Enacted by the Legislature of the State of Idaho:
                                                                        
 12        SECTION  1.  Any  other  provision of law notwithstanding, there is hereby
 13    appropriated the following amount to  be  transferred  to  the  Public  School
 14    Income Fund for the period July 1, 2006, through June 30, 2007:
 15    FROM:
 16    Public Education Stabilization Fund                                 $3,892,600
                                                                        
 17        SECTION  2.  In  addition  to the appropriation made in Section 3, Chapter
 18    418, Laws of 2006 and Section 23, House Bill No. 1, as enacted  by  the  First
 19    Extraordinary  Session  of the Fifty-eighth Idaho Legislature, there is hereby
 20    appropriated to the Educational Support  Program/Division  of  Operations  the
 21    following amount for the period July 1, 2006, through June 30, 2007:
 22    FROM:
 23    Public School Income Fund                                           $3,892,600
                                                                        
 24        SECTION  3.  The  Superintendent  of  Public  Instruction shall distribute
 25    $121,300 of the moneys appropriated in Section 2 of this act  to  school  dis-
 26    tricts  in the amount of any unequalized school maintenance and operation levy
 27    funds that would have been used to calculate such levies for  tax  year  2006,
 28    under  the  laws  of  the  state  of  Idaho as they existed prior to the First
 29    Extraordinary Session of the Fifty-eighth Idaho Legislature, provided that the
 30    school district did not levy a budget stabilization levy for tax year 2006.
                                                                        
 31        SECTION 4.  The Superintendent  of  Public  Instruction  shall  distribute
 32    $3,771,300  of the moneys appropriated in Section 2 of this act to school dis-
 33    tricts, in like amounts as the moneys distributed in fiscal year 2006,  pursu-
 34    ant  to Section 63-3638(10), Idaho Code, for the replacement of school mainte-
 35    nance and operation levy funds.
                                                                        
 36        SECTION 5.  It is the finding of the Legislature that House  Bill  No.  1,
 37    enacted  by the First Extraordinary Session of the Fifty-eighth Idaho Legisla-
 38    ture, exposed the previously unrecognized lack of equalization of moneys  pro-
 39    vided to school districts for the replacement of school maintenance and opera-
 40    tion  levies on agricultural equipment. Prior to House Bill No. 1, school dis-
                                                                        
                                       2
                                                                        
  1    tricts received such unequalized funds, in highly varied amounts based, not on
  2    the size or needs of the school district, but on the  amount  of  agricultural
  3    equipment  contained  therein. As was constitutionally appropriate, House Bill
  4    No. 1 dealt solely with the state replacement of equalized funds.
  5        However, many school districts, particularly  those  in  which  the  local
  6    economy  is  based  on  agriculture,  have  grown  dependent  on  these extra,
  7    unequalized funds. In addition, school districts had already set  fiscal  year
  8    2007  budgets  based  on the assumption of receiving these funds, prior to the
  9    passage of House Bill No. 1. The immediate removal of such moneys would have a
 10    negative and destabilzing effect on many school district budgets. Since  House
 11    Bill  No. 1 provided an additional $100,000,000 to the Public Education Stabi-
 12    lization Fund for the express purpose of providing stability in public  school
 13    budgets,  it  is  legislative  intent to provide for the schedule of distribu-
 14    tions, pursuant to this section, with appropriations from the Public Education
 15    Stabilization Fund.
 16        Pursuant to the Legislature's responsibility to maintain  a  constitution-
 17    ally  uniform  system  of public school funding, it is legislative intent that
 18    the school maintenance and operation levy-related portion of state replacement
 19    funding provided in lieu of personal property taxes on agricultural  equipment
 20    be phased out according to the following schedule:
 21    FY2007:                                           100% of replacement provided
 22    FY2008:                                            80% of replacement provided
 23    FY2009:                                            60% of replacement provided
 24    FY2010:                                            40% of replacement provided
 25    FY2011:                                            20% of replacement provided
 26    FY2012 and thereafter:                              0% of replacement provided

Statement of Purpose / Fiscal Impact


Statement of Purpose
RS17134

This supplemental appropriation for the Public Schools Division of Operations provides $3,892,600 in additional funding for Fiscal Year 2007. Of this amount, $3,771,300 is provided to fully replace the amount of additional, unequalized state money previously received by school districts prior to the passage of HB 1 in August, 2006. The passage of HB 1 exposed a previously unrecognized flaw in the methodology used by the state for replacing personal property taxes on agricultural equipment. This flaw resulted in the state overfunding school districts, based on the value of agricultural equipment in the district during the year 2000.

This unequalized funding resulted in considerable inequity, with school districts receiving extra money based not on the needs of the district or the number of children, but on factors unrelated to education. However, inasmuch as many school districts are currently dependent on the receipt of these moneys for a portion of their operating budgets, this bill fully replaces these lost funds for Fiscal Year 2007, and provides (in Section 5) a planned schedule of gradual reductions in the amount of replacement funds provided.

This bill also provides $121,300 for two school districts that lost the opportunity to levy unequalized maintenance and operations levy funds for Fiscal Year 2007 as a result of the passage of HB 1. Due to the timing of HB 1, coming after school district budget setting, but prior to the application of property tax levies, these funds had been included in the school district budgets, but were not subsequently captured in a maintenance and operations levy. This replacement, which provides $45,400 to the Cascade School District and $75,900 to the Kootenai Joint School District, is provided on a one-time basis.

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Fiscal Note
FTP  Gen  Ded  Fed  Total 


FY 2007 Original Appropriation 0.00  504,096,100  28,643,900  5,887,200  538,627,200 


Operations          
 1. Ag Replacement Funds 0.00  3,892,600  3,892,600 


FY 2007 Total Appropriation 0.00  504,096,100  32,536,500  5,887,200  542,519,800 
Chg from FY 2007 Orig Approp 0.00  3,892,600  3,892,600 
% Chg from FY 2007 Orig Approp.   0.0%  13.6%  0.0%  0.7% 

Contact: Jason Hancock 334-4739

Legislative Services Office, Budget & Policy Analysis

Statement of Purpose/Fiscal Note Bill No. S1217