February 23, 2005, Introduced by Senators EMERSON, THOMAS, BARCIA, SCOTT, CHERRY, SCHAUER, BASHAM, OLSHOVE, JACOBS, BRATER, CLARK-COLEMAN, CLARKE and BERNERO and referred to the Committee on Appropriations.
A bill to amend 1979 PA 94, entitled
"The state school aid act of 1979,"
by amending the title and section 11 (MCL 388.1611), the title as
amended by 2003 PA 158 and section 11 as amended by 2004 PA 518,
and by adding sections 12 and 147a.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
TITLE
An act to make appropriations to aid in the support of the
public schools and the intermediate school districts of the state;
to make appropriations for certain other purposes relating to
education; to provide for the disbursement of the appropriations;
to establish minimum funding for the public schools, the
intermediate school districts, the community colleges, and the
public universities of this state; to supplement the school aid
fund by the levy and collection of certain taxes; to authorize the
issuance of certain bonds and provide for the security of those
bonds; to prescribe the powers and duties of certain state
departments, the state board of education, and certain other boards
and officials; to create certain funds and provide for their
expenditure; to prescribe penalties; and to repeal acts and parts
of acts.
Sec.
11. (1) In addition to all other appropriations under
this
act for that fiscal year, for the fiscal year ending September
30,
2004, there is appropriated to the state school aid fund from
the
unreserved balance in the general fund an amount equal to any
deficit
balance that would otherwise exist in the state school aid
fund
at bookclosing for the fiscal year ending September 30, 2004.
For
the fiscal year ending September 30, 2005 2006,
there is
appropriated
for the public schools of this state and certain other
state
purposes relating to education the sum of $10,909,200,000.00
from
the state school aid fund established by section 11 of article
IX
of the state constitution of 1963 and the sum of $264,700,000.00
from
the general fund from the
state school aid fund the sum
necessary to fulfill the requirements of this act, and any
deficiency is appropriated from the general fund. In addition,
available
federal funds are appropriated for each of those fiscal
years that fiscal year. The estimated appropriations and
the
estimated sources of revenue provided for in this 2005 amendatory
act are as follows:
(a) The gross appropriation is estimated at $________________.
(b) The sources of revenue are estimated as follows:
(i) From the state school aid fund, $_______________.
(ii) From the general fund, $_______________.
(iii) From federal funds, $_____________.
(2) For the 2005-2006 state fiscal year, the total amount
appropriated under this act from state funds shall not be less than
the total amount appropriated under this act from state funds for
the 2002-2003 state fiscal year, adjusted by the percentage
increase in the general price level from the 2002 calendar year to
the 2005 calendar year. For each state fiscal year after the 2005-
2006 state fiscal year, the total amount appropriated under this
act from state funds shall be increased from that total amount for
the immediately preceding state fiscal year by an amount at least
equal to the lesser of 5% or the percentage increase in the general
price level for the calendar year ending in the immediately
preceding state fiscal year. As used in this subsection, "general
price level" means the consumer price index for the United States
as defined and officially reported by the United States department
of labor or its successor agency.
(3) (2)
The appropriations under this section shall be
allocated
as provided in this act. Money appropriated under this
section
from the general fund shall be expended to fund the
purposes
of this act before the expenditure of money appropriated
under
this section from the state school aid fund. If the maximum
amount
appropriated amount available for appropriation under this
section from the state school aid fund for a fiscal year exceeds
the amount necessary to fully fund allocations under this act from
the state school aid fund, that excess amount shall not be expended
in that state fiscal year and shall not lapse to the general fund,
but instead shall be deposited into the school aid stabilization
fund created in section 11a.
(3)
If the maximum amount appropriated under this section from
the
state school aid fund and the school aid stabilization fund for
a
fiscal year exceeds the amount available for expenditure from the
state
school aid fund for that fiscal year, payments under sections
11f,
11g, 11j, 22a, 26a, 31d, 51a(2), 51a(12), 51c, 53a, and 56
shall
be made in full. In addition, for districts beginning
operations
after 1994-95 that qualify for payments under section
22b,
payments under section 22b shall be made so that the
qualifying
districts receive the lesser of an amount equal to the
1994-95
foundation allowance of the district in which the district
beginning
operations after 1994-95 is located or $5,500.00. The
amount
of the payment to be made under section 22b for these
qualifying
districts shall be as calculated under section 22a, with
the
balance of the payment under section 22b being subject to the
proration
otherwise provided under this subsection and subsection
(4).
Subject to subsection (5), if proration is necessary after
2002-2003,
state payments under each of the other sections of this
act
from all state funding sources shall be prorated in the manner
prescribed
in subsection (4) as necessary to reflect the amount
available
for expenditure from the state school aid fund for the
affected
fiscal year. However, if the department of treasury
determines
that proration will be required under this subsection,
or
if the department of treasury determines that further proration
is
required under this subsection after an initial proration has
already
been made for a fiscal year, the department of treasury
shall
notify the state budget director, and the state budget
director
shall notify the legislature at least 30 calendar days or
6
legislative session days, whichever is more, before the
department
reduces any payments under this act because of the
proration.
During the 30 calendar day or 6 legislative session day
period
after that notification by the state budget director, the
department
shall not reduce any payments under this act because of
proration
under this subsection. The legislature may prevent
proration
from occurring by, within the 30 calendar day or 6
legislative
session day period after that notification by the state
budget
director, enacting legislation appropriating additional
funds
from the general fund, countercyclical budget and economic
stabilization
fund, state school aid fund balance, or another
source
to fund the amount of the projected shortfall.
(4)
Subject to subsection (5), if proration is necessary, the
department
shall calculate the proration in district and
intermediate
district payments that is required under subsection
(3)
as follows:
(a)
The department shall calculate the percentage of total
state
school aid allocated under this act for the affected fiscal
year
for each of the following:
(i) Districts.
(ii) Intermediate districts.
(iii) Entities other than districts or intermediate
districts.
(b)
The department shall recover a percentage of the proration
amount
required under subsection (3) that is equal to the
percentage
calculated under subdivision (a)(i) for districts by
reducing
payments to districts. This reduction shall be made by
calculating
an equal dollar amount per pupil as necessary to
recover
this percentage of the proration amount and reducing each
district's
total state school aid from state sources, other than
payments
under sections 11f, 11g, 11j, 22a, 26a, 31d, 51a(2),
51a(12),
51c, and 53a, by that amount.
(c)
The department shall recover a percentage of the proration
amount
required under subsection (3) that is equal to the
percentage
calculated under subdivision (a)(ii) for intermediate
districts
by reducing payments to intermediate districts. This
reduction
shall be made by reducing the payments to each
intermediate
district, other than payments under sections 11f, 11g,
26a,
51a(2), 51a(12), 53a, and 56, on an equal percentage basis.
(d)
The department shall recover a percentage of the proration
amount
required under subsection (3) that is equal to the
percentage
calculated under subdivision (a)(iii) for entities other
than
districts and intermediate districts by reducing payments to
these
entities. This reduction shall be made by reducing the
payments
to each of these entities, other than payments under
sections
11j and 26a, on an equal percentage basis.
(5)
Beginning in 2004-2005, if a district has an emergency
financial
manager in place under the local government fiscal
responsibility
act, 1990 PA 72, MCL 141.1201 to 141.1291, payments
to
that district are not subject to proration under this section.
(4)
(6) Except
for the allocation under section 26a, any
general fund allocations under this act that are not expended by
the end of the state fiscal year are transferred to the state
school aid fund. If it is determined at the May
2005 revenue
estimating conference conducted under section 367b
of the
management and budget act, 1984 PA 431, MCL 18.1367b,
that there is
additional school aid fund revenue beyond that
determined at the
May 2004 revenue estimating conference, then it is
the intent of
the legislature to enact legislation to fund, to the
extent that
revenues are available, the same programs in the
same amount that
were funded under section 81 in 2003 PA 236 and the
same pupil
membership formula as in effect under 2003 PA 236.
Sec. 12. (1) For the 2005-2006 state fiscal year, the amount
of the basic foundation allowance as calculated under section 20
and the amounts allocated under sections 22a, 22b, 31a, 51a, 51c,
and 81, respectively, shall not be less than those amounts as
originally enacted for the 2002-2003 state fiscal year before any
proration, adjusted by the percentage increase in the general price
level from the 2002 calendar year to the 2005 calendar year. For
each state fiscal year after the 2005-2006 state fiscal year, the
amount of the basic foundation allowance as calculated under
section 20 and the amounts allocated under sections 22a, 22b, 31a,
51a, 51c, and 81, respectively, shall be increased from those
amounts for the immediately preceding state fiscal year by an
amount at least equal to the lesser of 5% or the percentage
increase in the general price level for the calendar year ending in
the immediately preceding state fiscal year.
(2) Beginning with the 2005-2006 state fiscal year, if the
total number of pupils enrolled and counted in membership in a
district is less than 90% of the total number of pupils residing in
the district who are enrolled and counted in membership in either
that district or 1 or more other districts, the total amount of
money allocated to that district under sections 22a, 22b, and 51c,
as calculated pursuant to subsection (1), shall be adjusted so that
the district receives a total allocation under sections 22a, 22b,
and 51c equal to the amount the district would receive under
sections 22a, 22b, and 51c if exactly 90% of the pupils residing in
the district who are enrolled and counted in either that district
or 1 or more other districts were enrolled and counted in
membership in that district.
(3) For the 2005-2006 state fiscal year, the gross
appropriation for operations for all community colleges shall not
be less than the gross appropriation for operations for all
community colleges for the 2002-2003 state fiscal year, as provided
by 2002 PA 161 and 2003 PA 146, adjusted by the percentage increase
in the general price level from the 2002 calendar year to the 2005
calendar year. For each state fiscal year after the 2005-2006
state fiscal year, the gross appropriation for operations for all
community colleges shall be increased from the gross appropriation
for operations for all community colleges for the immediately
preceding state fiscal year by an amount at least equal to the
lesser of 5% or the percentage increase in the general price level
for the calendar year ending in the immediately preceding state
fiscal year.
(4) In the 2005-2006 state fiscal year, the sum of the gross
appropriations for each public university shall not be less than
the sum of the gross appropriations for each public university for
the 2002-2003 state fiscal year, as provided by 2002 PA 144 and
2003 PA 144, adjusted by the percentage increase in the general
price level from the 2002 calendar year to the 2005 calendar year.
For each state fiscal year after the 2005-2006 state fiscal year,
the sum of the gross appropriations for each public university
shall be increased from the sum of the gross appropriations for
each public university for the immediately preceding state fiscal
year by an amount at least equal to the lesser of 5% or the
percentage increase in the general price level for the calendar
year ending in the immediately preceding state fiscal year. For the
purposes of this subsection, the gross appropriation for Michigan
state university includes appropriations for the agricultural
experiment station and cooperative extension service at Michigan
state university.
(5) As used in this section:
(a) "Community college" means a community college organized
under the community college act of 1966, 1966 PA 331, MCL 389.1 to
389.195, or established under part 25 of the revised school code,
MCL 380.1601 to 380.1607.
(b) "General price level" means the consumer price index for
the United States as defined and officially reported by the United
States Department of Labor or its successor agency.
(c) "Public university" means a state university described in
section 4, 5, or 6 of article VIII of the state constitution of
1963.
Sec. 147a. (1) Of all of the total percentage points
determined and assigned to reporting units pursuant to the public
school employees retirement act of 1979, 1980 PA 300, MCL 38.1301
to 38.1408, and allocated to reporting units under section 147 or
otherwise officially communicated to reporting units, each
reporting unit is responsible for paying from its general operating
funds 80% of the total percentage points or 12.99%, whichever is
less. Each reporting unit shall pay the remaining balance of the
total percentage points to the public school employees’ retirement
system from funds appropriated to the reporting units for this
purpose under subsection (2).
(2) For the fiscal year ending September 30, 2006, in addition
to the general fund money appropriated under section 11, there is
appropriated from the general fund to the reporting units the sum
necessary for paying the remaining balance of the total percentage
points to be paid by the reporting units as described in subsection
(1).
(3) As used in this section, "reporting unit" means that term
as defined in section 7 of the public school employees retirement
act of 1979, 1980 PA 300, MCL 38.1307.
Enacting section 1. This amendatory act shall be known as the
"educational funding guarantee law".