SENATE BILL No. 1107

 

 

February 13, 2008, Introduced by Senator JELINEK and referred to the Committee on Appropriations.

 

 

 

     A bill to amend 1979 PA 94, entitled

 

"The state school aid act of 1979,"

 

by amending sections 11 and 17b (MCL 388.1611 and 388.1617b), as

 

amended by 2007 PA 137.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 11. (1) For the fiscal year ending September 30, 2008,

 

there is appropriated for the public schools of this state and

 

certain other state purposes relating to education the sum of

 

$11,493,064,200.00 from the state school aid fund established by

 

section 11 of article IX of the state constitution of 1963 and the

 

sum of $34,909,600.00 from the general fund. For the fiscal year

 

ending September 30, 2009, there is appropriated for the public

 

schools of this state and certain other state purposes relating to

 

education the sum of $_________________ from the state school aid


 

fund established by section 11 of article IX of the state

 

constitution of 1963 and the sum of $_____________ from the general

 

fund. In addition, available federal funds are appropriated for the

 

fiscal year ending September 30, 2008 and for the fiscal year

 

ending September 30, 2009.

 

     (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

 

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, 26b, 31d, 31f, 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). If proration is necessary, 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) If proration is necessary under subsection (3), 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, 26b, 31d, 31f,

 

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, 26b, 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, 26a, and 26b, on an equal percentage basis.

 

     (5) 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 school aid

 

stabilization fund created under section 11a.

 

     Sec. 17b. (1) Not later than October 20, November 20, December

 

20, January 20, February 20, March 20, April 20, May 20, June 20,

 

July 20, and August 20, the department shall prepare electronic

 

files of the amount to be distributed under this act in the

 

installment to the districts and intermediate districts and deliver

 

the electronic files to the state treasurer, and the state

 

treasurer shall pay the installments on each of those dates or, if

 

the date is not a business day, on the next business day following

 

that date. Except as otherwise provided in this act, the portion of

 

the district's or intermediate district's state fiscal year

 

entitlement to be included in each installment shall be 1/11. A

 

district or intermediate district shall accrue the payments

 

received in July and August to the school fiscal year ending the

 

immediately preceding June 30.

 

     (2) The state treasurer shall make payment under this section

 

by drawing a warrant in favor of the treasurer of each district or


 

intermediate district for the amount payable to the district or

 

intermediate district according to the electronic files and

 

delivering the warrant to the treasurer of each district or

 

intermediate district, or if the state treasurer receives a written

 

request by the treasurer of the district or intermediate district

 

specifying an account, by electronic funds transfer to that account

 

of the amount payable to the district or intermediate district

 

according to the electronic files. The department may make

 

adjustments in payments made under this section through additional

 

payments when changes in law or errors in computation cause the

 

regularly scheduled payment to be less than the amount to which the

 

district or intermediate district is entitled pursuant to this act.

 

     (3) Except as otherwise provided in this act, grant payments

 

to districts and intermediate districts under this act shall be

 

paid according to the installment payment schedule under subsection

 

(1).

 

     (4) Upon the written request of a district or intermediate

 

district and the submission of proof satisfactory to the department

 

of a need of a temporary and nonrecurring nature, the

 

superintendent, with the written concurrence of the state treasurer

 

and the state budget director, may authorize an advance release of

 

funds due a district or intermediate district under this act. An

 

advance authorized under this subsection shall not cause funds to

 

be paid to a district or intermediate district more than 30 days

 

earlier than the established payment date for those funds.