April 21, 2010, Introduced by Senator THOMAS 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 4 and 51a (MCL 388.1604 and 388.1651a),
section 4 as amended by 2008 PA 268 and section 51a as amended by
2009 PA 121.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 4. (1) "Elementary pupil" means a pupil in membership in
grades K to 8 in a district not maintaining classes above the
eighth grade or in grades K to 6 in a district maintaining classes
above the eighth grade. For the purposes of calculating universal
service fund (e-rate) discounts, "elementary pupil" includes
children enrolled in a preschool program operated by a district in
its facilities.
(2) "Extended school year" means an educational program
conducted by a district in which pupils must be enrolled but not
necessarily in attendance on the pupil membership count day in an
extended year program. The mandatory clock hours shall be completed
by each pupil not more than 365 calendar days after the pupil's
first day of classes for the school year prescribed. The department
shall prescribe pupil, personnel, and other reporting requirements
for the educational program.
(3) "Fiscal year" means the state fiscal year that commences
October
July 1 and continues through September June 30.
(4) "General educational development testing preparation
program" means a program that has high school level courses in
English language arts, social studies, science, and mathematics and
that prepares a person to successfully complete the general
educational development (GED) test.
(5) "High school pupil" means a pupil in membership in grades
7 to 12, except in a district not maintaining grades above the
eighth grade.
Sec. 51a. (1) From the appropriation in section 11, there is
allocated for 2009-2010 an amount not to exceed $1,061,283,000.00
from state sources and all available federal funding under sections
611 to 619 of part B of the individuals with disabilities education
act, 20 USC 1411 to 1419, estimated at $350,700,000.00, plus any
carryover federal funds from previous year appropriations. The
allocations under this subsection are for the purpose of
reimbursing districts and intermediate districts for special
education programs, services, and special education personnel as
prescribed in article 3 of the revised school code, MCL 380.1701 to
380.1766; net tuition payments made by intermediate districts to
the Michigan schools for the deaf and blind; and special education
programs and services for pupils who are eligible for special
education programs and services according to statute or rule. For
meeting the costs of special education programs and services not
reimbursed under this article, a district or intermediate district
may use money in general funds or special education funds, not
otherwise restricted, or contributions from districts to
intermediate districts, tuition payments, gifts and contributions
from individuals, or federal funds that may be available for this
purpose, as determined by the intermediate district plan prepared
pursuant to article 3 of the revised school code, MCL 380.1701 to
380.1766. All federal funds allocated under this section in excess
of those allocated under this section for 2002-2003 may be
distributed in accordance with the flexible funding provisions of
the individuals with disabilities education act, Public Law 108-
446, including, but not limited to, 34 CFR 300.206 and 300.208.
Notwithstanding section 17b, payments of federal funds to
districts, intermediate districts, and other eligible entities
under this section shall be paid on a schedule determined by the
department.
(2) From the funds allocated under subsection (1), there is
allocated the amount necessary, estimated at $240,300,000.00 for
2009-2010, for payments toward reimbursing districts and
intermediate districts for 28.6138% of total approved costs of
special education, excluding costs reimbursed under section 53a,
and 70.4165% of total approved costs of special education
transportation. Allocations under this subsection shall be made as
follows:
(a) The initial amount allocated to a district under this
subsection toward fulfilling the specified percentages shall be
calculated by multiplying the district's special education pupil
membership, excluding pupils described in subsection (12), times
the sum of the foundation allowance under section 20 of the pupil's
district of residence plus the amount of the district's per pupil
allocation under section 20j(2), not to exceed the basic foundation
allowance under section 20 for the current fiscal year, or, for a
special education pupil in membership in a district that is a
public school academy or university school, times an amount equal
to the amount per membership pupil calculated under section 20(6).
For an intermediate district, the amount allocated under this
subdivision toward fulfilling the specified percentages shall be an
amount per special education membership pupil, excluding pupils
described in subsection (12), and shall be calculated in the same
manner as for a district, using the foundation allowance under
section 20 of the pupil's district of residence, not to exceed the
basic foundation allowance under section 20 for the current fiscal
year, and that district's per pupil allocation under section
20j(2).
(b) After the allocations under subdivision (a), districts and
intermediate districts for which the payments under subdivision (a)
do not fulfill the specified percentages shall be paid the amount
necessary to achieve the specified percentages for the district or
intermediate district.
(3) From the funds allocated under subsection (1), there is
allocated for 2009-2010 the amount necessary, estimated at
$1,300,000.00, to make payments to districts and intermediate
districts under this subsection. If the amount allocated to a
district or intermediate district for a fiscal year under
subsection (2)(b) is less than the sum of the amounts allocated to
the district or intermediate district for 1996-97 under sections 52
and 58, there is allocated to the district or intermediate district
for the fiscal year an amount equal to that difference, adjusted by
applying the same proration factor that was used in the
distribution of funds under section 52 in 1996-97 as adjusted to
the district's or intermediate district's necessary costs of
special education used in calculations for the fiscal year. This
adjustment is to reflect reductions in special education program
operations or services between 1996-97 and subsequent fiscal years.
Adjustments for reductions in special education program operations
or services shall be made in a manner determined by the department
and shall include adjustments for program or service shifts.
(4) If the department determines that the sum of the amounts
allocated for a fiscal year to a district or intermediate district
under subsection (2)(a) and (b) is not sufficient to fulfill the
specified percentages in subsection (2), then the shortfall shall
be paid to the district or intermediate district during the fiscal
year
beginning on the October July
1 following the determination
and payments under subsection (3) shall be adjusted as necessary.
If the department determines that the sum of the amounts allocated
for a fiscal year to a district or intermediate district under
subsection (2)(a) and (b) exceeds the sum of the amount necessary
to fulfill the specified percentages in subsection (2), then the
department shall deduct the amount of the excess from the
district's or intermediate district's payments under this act for
the
fiscal year beginning on the October July 1 following the
determination and payments under subsection (3) shall be adjusted
as necessary. However, if the amount allocated under subsection
(2)(a) in itself exceeds the amount necessary to fulfill the
specified percentages in subsection (2), there shall be no
deduction under this subsection.
(5) State funds shall be allocated on a total approved cost
basis. Federal funds shall be allocated under applicable federal
requirements, except that an amount not to exceed $3,500,000.00 may
be allocated by the department for 2009-2010 to districts,
intermediate districts, or other eligible entities on a competitive
grant basis for programs, equipment, and services that the
department determines to be designed to benefit or improve special
education on a statewide scale.
(6) From the amount allocated in subsection (1), there is
allocated an amount not to exceed $2,200,000.00 for 2009-2010 to
reimburse 100% of the net increase in necessary costs incurred by a
district or intermediate district in implementing the revisions in
the administrative rules for special education that became
effective on July 1, 1987. As used in this subsection, "net
increase in necessary costs" means the necessary additional costs
incurred solely because of new or revised requirements in the
administrative rules minus cost savings permitted in implementing
the revised rules. Net increase in necessary costs shall be
determined in a manner specified by the department.
(7) For purposes of this article, all of the following apply:
(a) "Total approved costs of special education" shall be
determined in a manner specified by the department and may include
indirect costs, but shall not exceed 115% of approved direct costs
for section 52 and section 53a programs. The total approved costs
include salary and other compensation for all approved special
education personnel for the program, including payments for social
security and medicare and public school employee retirement system
contributions. The total approved costs do not include salaries or
other compensation paid to administrative personnel who are not
special education personnel as defined in section 6 of the revised
school code, MCL 380.6. Costs reimbursed by federal funds, other
than those federal funds included in the allocation made under this
article, are not included. Special education approved personnel not
utilized full time in the evaluation of students or in the delivery
of special education programs, ancillary, and other related
services shall be reimbursed under this section only for that
portion of time actually spent providing these programs and
services, with the exception of special education programs and
services provided to youth placed in child caring institutions or
juvenile detention programs approved by the department to provide
an on-grounds education program.
(b) Beginning with the 2004-2005 fiscal year, a district or
intermediate district that employed special education support
services staff to provide special education support services in
2003-2004 or in a subsequent fiscal year and that in a fiscal year
after 2003-2004 receives the same type of support services from
another district or intermediate district shall report the cost of
those support services for special education reimbursement purposes
under this act. This subdivision does not prohibit the transfer of
special education classroom teachers and special education
classroom aides if the pupils counted in membership associated with
those special education classroom teachers and special education
classroom aides are transferred and counted in membership in the
other district or intermediate district in conjunction with the
transfer of those teachers and aides.
(c) If the department determines before bookclosing for 2008-
2009 that the amounts allocated for 2008-2009 under subsections
(2), (3), (6), (8), and (12) and sections 53a, 54, and 56 will
exceed expenditures for 2008-2009 under subsections (2), (3), (6),
(8), and (12) and sections 53a, 54, and 56, then for 2008-2009
only, for a district or intermediate district whose reimbursement
for 2008-2009 would otherwise be affected by subdivision (b),
subdivision (b) does not apply to the calculation of the
reimbursement for that district or intermediate district and
reimbursement for that district or intermediate district shall be
calculated in the same manner as it was for 2003-2004. If the
amount of the excess allocations under subsections (2), (3), (6),
(8), and (12) and sections 53a, 54, and 56 is not sufficient to
fully fund the calculation of reimbursement to those districts and
intermediate districts under this subdivision, then the
calculations and resulting reimbursement under this subdivision
shall be prorated on an equal percentage basis.
(d) Reimbursement for ancillary and other related services, as
defined by R 340.1701c of the Michigan administrative code, shall
not be provided when those services are covered by and available
through private group health insurance carriers or federal
reimbursed program sources unless the department and district or
intermediate district agree otherwise and that agreement is
approved by the state budget director. Expenses, other than the
incidental expense of filing, shall not be borne by the parent. In
addition, the filing of claims shall not delay the education of a
pupil. A district or intermediate district shall be responsible for
payment of a deductible amount and for an advance payment required
until the time a claim is paid.
(e) Beginning with calculations for 2004-2005, if an
intermediate district purchases a special education pupil
transportation service from a constituent district that was
previously purchased from a private entity; if the purchase from
the constituent district is at a lower cost, adjusted for changes
in fuel costs; and if the cost shift from the intermediate district
to the constituent does not result in any net change in the revenue
the constituent district receives from payments under sections 22b
and 51c, then upon application by the intermediate district, the
department shall direct the intermediate district to continue to
report the cost associated with the specific identified special
education pupil transportation service and shall adjust the costs
reported by the constituent district to remove the cost associated
with that specific service.
(8) From the allocation in subsection (1), there is allocated
for 2009-2010 an amount not to exceed $15,313,900.00 to
intermediate districts. The payment under this subsection to each
intermediate district shall be equal to the amount of the 1996-97
allocation to the intermediate district under subsection (6) of
this section as in effect for 1996-97.
(9) A pupil who is enrolled in a full-time special education
program conducted or administered by an intermediate district or a
pupil who is enrolled in the Michigan schools for the deaf and
blind shall not be included in the membership count of a district,
but shall be counted in membership in the intermediate district of
residence.
(10) Special education personnel transferred from 1 district
to another to implement the revised school code shall be entitled
to the rights, benefits, and tenure to which the person would
otherwise be entitled had that person been employed by the
receiving district originally.
(11) If a district or intermediate district uses money
received under this section for a purpose other than the purpose or
purposes for which the money is allocated, the department may
require the district or intermediate district to refund the amount
of money received. Money that is refunded shall be deposited in the
state treasury to the credit of the state school aid fund.
(12) From the funds allocated in subsection (1), there is
allocated the amount necessary, estimated at $7,800,000.00 for
2009-2010, to pay the foundation allowances for pupils described in
this subsection. The allocation to a district under this subsection
shall be calculated by multiplying the number of pupils described
in this subsection who are counted in membership in the district
times the sum of the foundation allowance under section 20 of the
pupil's district of residence plus the amount of the district's per
pupil allocation under section 20j(2), not to exceed the basic
foundation allowance under section 20 for the current fiscal year,
or, for a pupil described in this subsection who is counted in
membership in a district that is a public school academy or
university school, times an amount equal to the amount per
membership pupil under section 20(6). The allocation to an
intermediate district under this subsection shall be calculated in
the same manner as for a district, using the foundation allowance
under section 20 of the pupil's district of residence, not to
exceed the basic foundation allowance under section 20 for the
current fiscal year, and that district's per pupil allocation under
section 20j(2). This subsection applies to all of the following
pupils:
(a) Pupils described in section 53a.
(b) Pupils counted in membership in an intermediate district
who are not special education pupils and are served by the
intermediate district in a juvenile detention or child caring
facility.
(c) Emotionally impaired pupils counted in membership by an
intermediate district and provided educational services by the
department of community health.
(13) If it is determined that funds allocated under subsection
(2) or (12) or under section 51c will not be expended, funds up to
the amount necessary and available may be used to supplement the
allocations under subsection (2) or (12) or under section 51c in
order to fully fund those allocations. After payments under
subsections (2) and (12) and section 51c, the remaining
expenditures from the allocation in subsection (1) shall be made in
the following order:
(a) 100% of the reimbursement required under section 53a.
(b) 100% of the reimbursement required under subsection (6).
(c) 100% of the payment required under section 54.
(d) 100% of the payment required under subsection (3).
(e) 100% of the payment required under subsection (8).
(f) 100% of the payments under section 56.
(14) The allocations under subsections (2), (3), and (12)
shall be allocations to intermediate districts only and shall not
be allocations to districts, but instead shall be calculations used
only to determine the state payments under section 22b.
(15) If a public school academy enrolls pursuant to this
section a pupil who resides outside of the intermediate district in
which the public school academy is located and who is eligible for
special education programs and services according to statute or
rule, or who is a child with disabilities, as defined under the
individuals with disabilities education act, Public Law 108-446,
the provision of special education programs and services and the
payment of the added costs of special education programs and
services for the pupil are the responsibility of the district and
intermediate district in which the pupil resides unless the
enrolling district or intermediate district has a written agreement
with the district or intermediate district in which the pupil
resides or the public school academy for the purpose of providing
the pupil with a free appropriate public education and the written
agreement includes at least an agreement on the responsibility for
the payment of the added costs of special education programs and
services for the pupil.
Enacting section 1. This amendatory act does not take effect
unless Senate Bill No. 1281
of the 95th Legislature is enacted into law.