2008 Legislation
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HOUSE BILL NO. 457<br /> – Schools/bond equalizatn support prg


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Bill Status

H0457...............................................by REVENUE AND TAXATION
SCHOOLS - Amends existing law to clarify that the Bond Levy Equalization
Support Program applies to actual projects that were previously eligible.

02/01    House intro - 1st rdg - to printing
02/04    Rpt prt - to Rev/Tax
02/06    Rpt out - rec d/p - to 2nd rdg
02/07    2nd rdg - to 3rd rdg
02/13    3rd rdg - PASSED - 68-1-1
      AYES -- Anderson, Andrus, Barrett, Bayer, Bedke, Bell, Bilbao, Black,
      Block, Bock, Boe, Bolz, Bowers, Brackett, Bradford, Chadderdon,
      Chavez, Chew, Clark, Collins, Crane, Durst, 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, Ringo, Roberts, Ruchti, Rusche, Sayler, Schaefer,
      Shepherd(08), Shirley, Shively, Smith(30), Smith(24), Snodgrass,
      Stevenson, Thayn, Thomas, Trail, Vander Woude, Wills, Wood(27),
      NAYS -- Shepherd(02)
      Absent and excused -- Mr. Speaker
    Floor Sponsor - Bedke
    Title apvd - to Senate
02/14    Senate intro - 1st rdg - to Loc Gov
02/20    Rpt out - rec d/p - to 2nd rdg
02/21    2nd rdg - to 3rd rdg
02/27    3rd rdg - PASSED - 34-0-1
      AYES -- Andreason, Bair, Bastian, Bilyeu, Broadsword, Burkett,
      Cameron, Coiner, Corder, Darrington, Davis, Fulcher, Geddes, Goedde,
      Hammond, Heinrich, Hill, Jorgenson, Kelly, Keough, Langhorst, Little,
      Lodge, Malepeai(Sagness), McGee, McKague, McKenzie, Pearce,
      Richardson, Schroeder, Siddoway, Stegner, Stennett, Werk
      NAYS -- None
      Absent and excused -- Gannon
    Floor Sponsor - Langhorst
    Title apvd - to House
02/28    To enrol
02/29    Rpt enrol - Sp signed
03/03    Pres signed
03/04    To Governor
03/05    Governor signed
         Session Law Chapter 70
         Effective: 07/01/08

Bill Text

  ]]]]              LEGISLATURE OF THE STATE OF IDAHO             ]]]]
 Fifty-ninth Legislature                   Second Regular Session - 2008


                              IN THE HOUSE OF REPRESENTATIVES

                                     HOUSE BILL NO. 457

                             BY REVENUE AND TAXATION COMMITTEE

  1                                        AN ACT

  5    Be It Enacted by the Legislature of the State of Idaho:

  6        SECTION  1.  That  Section  33-906, Idaho Code, be, and the same is hereby
  7    amended to read as follows:

  8        33-906.  BOND LEVY EQUALIZATION SUPPORT PROGRAM. (1) Pursuant  to  section
  9    33-906B,  Idaho  Code, school districts with a value index below one (1) shall
 10    be eligible to receive additional state financial assistance for the  cost  of
 11    annual  bond interest and redemption payments made on bonds passed on or after
 12    September 15, 2002. However, any school district with a value  index  of  less
 13    than  one  and one-half (1.5), shall receive no less than ten percent (10%) of
 14    the interest cost portion of the annual bond interest and  redemption  payment
 15    for  bonds passed on or after September 15, 2002. The state department of edu-
 16    cation shall disburse such funds to school districts from moneys  appropriated
 17    from  the bond levy equalization fund. The department shall disburse the funds
 18    by no later than September 1 of each year for school districts in which voters
 19    have approved the issuance of qualifying bonds by no later than January  1  of
 20    that  calendar  year,  and which are certifying a qualifying bond interest and
 21    redemption payment for the fiscal year in which the disbursement is made.  For
 22    districts with a value index below one (1), the percentage of each annual bond
 23    interest  and redemption payment that is paid by the state shall be determined
 24    by dividing the difference between one (1) and  the  school  district's  value
 25    index by one (1).
 26        (2)  For  the  purposes  of  this  section,  the  annual bond interest and
 27    redemption payment shall be determined by dividing the total  payment  amounts
 28    by  the  number of fiscal years in which payments are to be made. The interest
 29    cost portion of the annual bond  interest  and  redemption  payment  shall  be
 30    determined  by  dividing the total interest paid by the number of fiscal years
 31    in which payments are to be made. For school districts not  qualifying  for  a
 32    state  payment  in  the first year of the bond interest and redemption payment
 33    schedule, due solely to the January 1 eligibility deadline, the state  depart-
 34    ment  of  education  shall distribute an additional payment in the next fiscal
 35    year, in the amount of such funds that the school district would  have  other-
 36    wise qualified for in the current fiscal year.
 37        (3)  The  provisions  of  this  section  may  not be utilized to refinance
 38    existing debt or subsidize projects previously  subsidized  by  state  grants,
 39    unless the existing debt being refinanced is a bond passed on or after Septem-
 40    ber 15, 2002; provided however, that any school district that has issued qual-
 41    ifying  bonds  prior  to June 30, 2004, in conformance with this section shall
 42    not be deemed to be refinancing existing debt when the  qualifying  bonds  are
 43    utilized  to  finance  the  acquisition of public school facilities previously


  1    leased or financed through means other than the issuance of general obligation
  2    bonds approved by a two-thirds (2/3) vote at an election called for that  pur-
  3    pose subject to subsection (5) of this section.
  4        (4)  School  districts  shall annually report the status of all qualifying
  5    bonds to the state department of education by January 1 of each year,  includ-
  6    ing  bonds  approved  by the voters, but not yet issued. Information submitted
  7    shall include the following:
  8        (a)  The actual or estimated bond interest and redemption  payment  sched-
  9        ule;
 10        (b)  Any qualifying bond that has been paid off;
 11        (c)  Other  information as may be required by the state department of edu-
 12        cation.
 13        (5)  No school district project eligible for  participation  in  the  bond
 14    levy equalization support program shall be deemed ineligible for participation
 15    due to that school district's project's eligibility and prior participation in
 16    the  safe  school  facilities loan and grant program or the Idaho safe schools
 17    facilities program under section 33-804A, 33-1017 or 33-1613, Idaho Code, pro-
 18    vided that:
 19        (a)  Such school district notifies the state department  of  education  of
 20        its  desire  and  eligibility to participate in the bond levy equalization
 21        support program; and
 22        (b)  Such school district shall receive no state financial assistance  for
 23        the  project  under  the  bond levy equalization support program until the
 24        amount to which it would otherwise have been  entitled  to  receive  shall
 25        equal  the  amounts  received by the school district under the safe school
 26        facilities loan and grant program or the  Idaho  safe  schools  facilities
 27        program under section 33-804A, 33-1017 or 33-1613, Idaho Code.
 28        (6)  Any  school  district  formed as a result of the consolidation of two
 29    (2) or more school districts that passes an eligible  bond  within  three  (3)
 30    years  of  the successful consolidation election shall participate in the bond
 31    levy equalization support program at the district's actual value  index  minus
 32    twenty-five  hundredths (.25). This adjustment shall apply for the duration of
 33    the bond interest and  redemption  payment  schedule.  If  a  school  district
 34    advantaged  by this subsection (6) deconsolidates either during the applicable
 35    bond interest and redemption payment schedule, or  within  a  three  (3)  year
 36    period  thereafter,  each deconsolidated district shall, upon deconsolidation,
 37    repay to the bond levy equalization fund  all  additional  subsidies  received
 38    pursuant  to  this subsection (6). The proportions owed by each deconsolidated
 39    district shall be determined by the proportion  that  each  district's  market
 40    value for assessment purposes bears to the whole.

Statement of Purpose / Fiscal Impact

                      STATEMENT OF PURPOSE

                            RS 17480
This legislation makes technical corrections to the state's Bond
Levy Equalization law for school districts. When the amendments of
2004 were passed, the intention was to allow school districts that
were refinancing projects previously subsidized through the
state's old safe schools facilities programs to get the better of
the two subsidies, so as not to punish the districts for
participating in the old program, as opposed to waiting for the
new Bond Levy Equalization program.

These amendments inadvertently applied this standard not only to
the old, previously subsidized projects, but any new projects, as
well. As a result, a school district that participated in the old
program cannot receive its normal Bond Levy Equalization subsidy
for its new project, even though the new project has nothing to do
with the old project.

This effectively discriminates against districts who participated
in the old program, since any other district would have a new
project subsidized under Bond Levy Equalization, provided that
they qualified under the normal criteria.

This legislation corrects this deficiency by clarifying that the
amendments added in 2004 apply only to the actual projects that
were previously subsidized under the old programs, and not to new
projects in the same school district. 

                           FISCAL NOTE

There is no automatic fiscal impact. One of the affected school
districts would have to pass a qualifying bond in order for there
to be any possible fiscal impact. The school districts are: Troy,
Fremont, Minidoka, Wendell, Boundary, Wallace, Whitepine.    

Name: Representative Wendy Jaquet, Chairman Dennis Lake 
Phone: (208)332-1130
Name: Representative Donna Pence

STATEMENT OF PURPOSE/FISCAL NOTE                            H 457