Bill Text: AZ HB2184 | 2014 | Fifty-first Legislature 2nd Regular | Introduced
Bill Title: Schools; ending balances; tax reduction
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2014-01-23 - Referred to House ED Committee [HB2184 Detail]
Download: Arizona-2014-HB2184-Introduced.html
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REFERENCE TITLE: schools; ending balances; tax reduction |
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State of Arizona House of Representatives Fifty-first Legislature Second Regular Session 2014
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HB 2184 |
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Introduced by Representative Seel
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AN ACT
amending sections 15‑971 and 15‑972, Arizona Revised Statutes; relating to school finance.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1. Section 15-971, Arizona Revised Statutes, is amended to read:
15-971. Determination of equalization assistance payments from county and state funds for school districts
A. Equalization assistance for education is computed by determining the total of the following:
1. The lesser of a school district's revenue control limit or district support level as determined in section 15‑947 or 15‑951.
2. District additional assistance of a school district as determined in section 15‑951 or 15‑961.
B. From the total of the amounts determined in subsection A of this section subtract:
1. The amount that would be produced by levying the applicable qualifying tax rate determined pursuant to section 41‑1276 for a high school district or a common school district within a high school district that does not offer instruction in high school subjects as provided in section 15‑447.
2. The amount that would be produced by levying the applicable qualifying tax rate determined pursuant to section 41‑1276 for a unified school district, a common school district not within a high school district or a common school district within a high school district that offers instruction in high school subjects as provided in section 15‑447. The qualifying tax rate shall be applied in the following manner:
(a) For the purposes of the amount determined in subsection A, paragraph 1 of this section:
(i) Determine separately the percentage that the weighted student count in preschool programs for children with disabilities, kindergarten programs and grades one through eight and the weighted student count in grades nine through twelve is to the weighted student count determined in subtotal A as provided in section 15‑943, paragraph 2, subdivision (a).
(ii) Apply the percentages determined in item (i) of this subdivision to the amount determined in subsection A, paragraph 1 of this section.
(b) For the purposes of the amounts determined in subsection A, paragraph 2 of this section, determine separately the amount of the district additional assistance attributable to the student count in preschool programs for children with disabilities, kindergarten programs and grades one through eight and grades nine through twelve.
(c) From the amounts determined in subdivisions (a) and (b) of this paragraph, subtract the levy that would be produced by the current qualifying tax rate for a high school district or a common school district within a high school district that does not offer instruction in high school subjects as provided in section 15‑447. If the qualifying tax rate generates a levy that is in excess of the total determined in subsection A of this section, the school district shall not be eligible for equalization assistance. For the purposes of this subsection, "assessed valuation" includes the values used to determine voluntary contributions collected pursuant to title 9, chapter 4, article 3 and title 48, chapter 1, article 8 and the assessed value of all property subject to the government property lease excise tax pursuant to title 42, chapter 6, article 5.
3. The amount that would be produced by levying a qualifying tax rate in a joint technical education district, which shall be five cents per one hundred dollars assessed valuation unless the legislature sets a lower rate by law.
4. For fiscal year 2014-2015 only, an amount equal to twenty per cent of the sum of the ending balances as of June 30 of the prior fiscal year for the school district's maintenance and operation fund, capital outlay fund and soft capital allocation fund.
5. For fiscal year 2015-2016 only, an amount equal to forty per cent of the sum of the ending balances as of June 30 of the prior fiscal year for the school district's maintenance and operation fund, capital outlay fund and soft capital allocation fund.
6. For fiscal year 2016-2017 only, an amount equal to sixty per cent of the sum of the ending balances as of June 30 of the prior fiscal year for the school district's maintenance and operation fund, capital outlay fund and soft capital allocation fund.
7. For fiscal year 2017-2018 only, an amount equal to eighty per cent of the sum of the ending balances as of June 30 of the prior fiscal year for the school district's maintenance and operation fund, capital outlay fund and soft capital allocation fund.
8. For fiscal year 2018-2019 only, an amount equal to the sum of the ending balances as of June 30 of the prior fiscal year for the school district's maintenance and operation fund.
C. County aid for equalization assistance for education shall be computed as follows:
1. Determine the total equalization assistance for all school districts in the county as provided in subsections A and B of this section.
2. Determine the total amount of state equalization assistance collected for all school districts in the county as provided in section 15‑994.
3. Divide the amount determined in paragraph 2 of this subsection by the amount determined in paragraph 1 of this subsection.
4. Multiply the amount determined in subsections A and B of this section by the quotient determined in paragraph 3 of this subsection for each school district.
5. The amount determined in paragraph 4 of this subsection shall be the county aid for equalization assistance for education for a school district.
D. State aid for equalization assistance for education for a school district shall be computed as follows:
1. Determine the equalization assistance for education for a school district as provided in subsections A and B of this section.
2. For each county, determine the levy that would be produced by the state equalization assistance property tax rate prescribed in section 15‑994, subsection A.
3. Prorate the amount determined in paragraph 2 of this subsection to each school district in the county as prescribed by subsection C of this section.
4. Subtract the amount determined in paragraph 3 of this subsection from the amount determined in paragraph 1 of this subsection.
E. Equalization assistance for education shall be paid from appropriations for that purpose to the school districts as provided in section 15‑973.
F. A school district shall report expenditures on approved career and technical education and vocational education programs in the annual financial report according to uniform guidelines prescribed by the uniform system of financial records and in order to facilitate compliance with sections 15‑255 and 15‑904.
G. The additional weight for state aid purposes given to special education as provided in section 15‑943 shall be given to school districts only if special education programs comply with chapter 7, article 4 of this title and the conditions and standards prescribed by the superintendent of public instruction pursuant to rules of the state board of education for pupil identification and placement pursuant to sections 15‑766 and 15‑767.
H. In addition to general fund appropriations, all amounts received pursuant to section 37‑521, subsection B, paragraph 3 and section 42‑5029, subsection E, paragraph 5 and from any other source for the purposes of this section are appropriated for state aid to schools as provided in this section.
I. The total amount of state monies that may be spent in any fiscal year for state equalization assistance shall not exceed the amount appropriated or authorized by section 35‑173 for that purpose. This section shall not be construed to impose a duty on an officer, agent or employee of this state to discharge a responsibility or to create any right in a person or group if the discharge or right would require an expenditure of state monies in excess of the expenditure authorized by legislative appropriation for that specific purpose.
Sec. 2. Section 15-972, Arizona Revised Statutes, is amended to read:
15-972. State limitation on homeowner property taxes; additional state aid to school districts; definitions
A. Notwithstanding section 15‑971, there shall be additional state aid for education computed for school districts as provided in subsection B of this section.
B. The clerk of the board of supervisors shall compute such additional state aid for education as follows:
1. For a high school district or for a common school district within a high school district which that does not offer instruction in high school subjects as provided in section 15‑447:
(a) Determine the qualifying tax rate pursuant to section 41‑1276 for the school district.
(b) Determine the following percentage of the qualifying tax rate determined in subdivision (a) of this paragraph:
(i) Thirty‑five per cent through December 31, 2005.
(ii) Thirty‑six per cent beginning from and after December 31, 2005 through December 31, 2006.
(iii) Thirty‑seven per cent beginning from and after December 31, 2006 through December 31, 2007.
(iv) Thirty‑eight per cent beginning from and after December 31, 2007 through December 31, 2008.
(v) Thirty‑nine per cent beginning from and after December 31, 2008 through December 31, 2009.
(vi) Forty per cent beginning from and after December 31, 2009.
(vii) Such further adjustments of the percentage beginning from and after December 31, 2012 as provided by law.
(c) Select the lesser of the amount determined in subdivision (b) of this paragraph or forty per cent of the primary property tax rate that would be levied in lieu of the provisions of this section for the district.
(d) Multiply the rate selected in subdivision (c) of this paragraph as a rate per one hundred dollars assessed valuation by the assessed valuation used for primary property taxes of the residential property in the school district. Monies allocated to school districts pursuant to this subdivision shall be used to reduce property taxes for class three properties only.
(e) For fiscal year 2014-2015 only, add an amount equal to one hundred forty‑four million dollars multiplied by the percentage of all statewide class one primary and secondary property tax levies for all taxing jurisdictions combined that are levied against class one properties located within the school district. Monies allocated to a school district pursuant to this subdivision shall be remitted to the county treasurer for use in reducing property taxes for property classes two through nine for all taxing jurisdictions within the school district on a pro rata basis.
(f) For fiscal year 2015-2016 only, add an amount equal to two hundred eighty‑eight million dollars multiplied by the percentage of all statewide class one primary and secondary property tax levies for all taxing jurisdictions combined that are levied against class one properties located within the school district. Monies allocated to a school district pursuant to this subdivision shall be remitted to the county treasurer for use in reducing property taxes for property classes two through nine for all taxing jurisdictions within the school district on a pro rata basis.
(g) For fiscal year 2016-2017 only, add an amount equal to four hundred thirty‑two million dollars multiplied by the percentage of all statewide class one primary and secondary property tax levies for all taxing jurisdictions combined that are levied against class one properties located within the school district. Monies allocated to a school district pursuant to this subdivision shall be remitted to the county treasurer for use in reducing property taxes for property classes two through nine for all taxing jurisdictions within the school district on a pro rata basis.
(h) For fiscal year 2017-2018 only, add an amount equal to five hundred seventy‑six million dollars multiplied by the percentage of all statewide class one primary and secondary property tax levies for all taxing jurisdictions combined that are levied against class one properties located within the school district. Monies allocated to a school district pursuant to this subdivision shall be remitted to the county treasurer for use in reducing property taxes for property classes two through nine for all taxing jurisdictions within the school district on a pro rata basis.
(i) For fiscal year 2018-2019 only, add an amount equal to seven hundred twenty million dollars multiplied by the percentage of all statewide class one primary and secondary property tax levies for all taxing jurisdictions combined that are levied against class one properties located within the school district. Monies allocated to a school district pursuant to this subdivision shall be remitted to the county treasurer for use in reducing property taxes for property classes two through nine for all taxing jurisdictions within the school district on a pro rata basis.
2. For a unified school district, for a common school district not within a high school district or for a common school district which that offers instruction in high school subjects as provided in section 15‑447:
(a) Determine the qualifying tax rate pursuant to section 41‑1276 for the school district.
(b) Determine the following percentage of the tax rate determined in subdivision (a) of this paragraph:
(i) Thirty‑five per cent through December 31, 2005.
(ii) Thirty‑six per cent beginning from and after December 31, 2005 through December 31, 2006.
(iii) Thirty‑seven per cent beginning from and after December 31, 2006 through December 31, 2007.
(iv) Thirty‑eight per cent beginning from and after December 31, 2007 through December 31, 2008.
(v) Thirty‑nine per cent beginning from and after December 31, 2008 through December 31, 2009.
(vi) Forty per cent beginning from and after December 31, 2009.
(vii) Such further adjustments of the percentage beginning from and after December 31, 2012 as provided by law.
(c) Select the lesser of the amount determined in subdivision (b) of this paragraph or forty per cent of the primary property tax rate that would be levied in lieu of the provisions of this section for the district.
(d) Multiply the rate selected in subdivision (c) of this paragraph as a rate per one hundred dollars assessed valuation by the assessed valuation used for primary property taxes of the residential property in the district. Monies allocated to school districts pursuant to this subdivision shall be used to reduce property taxes for class three properties only.
(e) For fiscal year 2014-2015 only, add an amount equal to one hundred forty‑four million dollars multiplied by the percentage of all statewide class one primary and secondary property tax levies for all taxing jurisdictions combined that are levied against class one properties located within the school district. Monies allocated to a school district pursuant to this subdivision shall be remitted to the county treasurer for use in reducing property taxes for property classes two through nine for all taxing jurisdictions within the school district on a pro rata basis.
(f) For fiscal year 2015-2016 only, add an amount equal to two hundred eighty‑eight million dollars multiplied by the percentage of all statewide class one primary and secondary property tax levies for all taxing jurisdictions combined that are levied against class one properties located within the school district. Monies allocated to a school district pursuant to this subdivision shall be remitted to the county treasurer for use in reducing property taxes for property classes two through nine for all taxing jurisdictions within the school district on a pro rata basis.
(g) For fiscal year 2016-2017 only, add an amount equal to four hundred thirty‑two million dollars multiplied by the percentage of all statewide class one primary and secondary property tax levies for all taxing jurisdictions combined that are levied against class one properties located within the school district. Monies allocated to a school district pursuant to this subdivision shall be remitted to the county treasurer for use in reducing property taxes for property classes two through nine for all taxing jurisdictions within the school district on a pro rata basis.
(h) For fiscal year 2017-2018 only, add an amount equal to five hundred seventy‑six million dollars multiplied by the percentage of all statewide class one primary and secondary property tax levies for all taxing jurisdictions combined that are levied against class one properties located within the school district. Monies allocated to a school district pursuant to this subdivision shall be remitted to the county treasurer for use in reducing property taxes for property classes two through nine for all taxing jurisdictions within the school district on a pro rata basis.
(i) For fiscal year 2018-2019 only, add an amount equal to seven hundred twenty million dollars multiplied by the percentage of all statewide class one primary and secondary property tax levies for all taxing jurisdictions combined that are levied against class one properties located within the school district. Monies allocated to a school district pursuant to this subdivision shall be remitted to the county treasurer for use in reducing property taxes for property classes two through nine for all taxing jurisdictions within the school district on a pro rata basis.
C. The clerk of the board of supervisors shall report to the department of revenue not later than the Friday following the third Monday in August of each year the amount by school district of additional state aid for education and the data used for computing the amount as provided in subsection B of this section. The department of revenue shall verify all of the amounts and report to the county board of supervisors not later than August 30 of each year the property tax rate or rates which shall be used for property tax reduction as provided in subsection E of this section.
D. The board of supervisors shall reduce the property tax rate or rates that would be levied in lieu of the provisions of this section by the school district or districts on the assessed valuation used for primary property taxes of the residential property in the school district or districts by the rate or rates selected in subsection B, paragraph 1, subdivision (c) and paragraph 2, subdivision (c) of this section. The excess of the reduction in property taxes for a parcel of property resulting from the reduction in the property tax rate pursuant to this subsection over the amounts listed in this subsection shall be deducted from the amount of additional state aid for education. The reduction in property taxes on a parcel of property resulting from the reduction in the property tax rate pursuant to this subsection shall not exceed the following amounts except as provided in subsection I of this section:
1. Five hundred dollars through December 31, 2005.
2. Five hundred twenty dollars beginning from and after December 31, 2005 through December 31, 2006.
3. Five hundred forty dollars beginning from and after December 31, 2006 through December 31, 2007.
4. Five hundred sixty dollars beginning from and after December 31, 2007 through December 31, 2008.
5. Five hundred eighty dollars beginning from and after December 31, 2008 through December 31, 2009.
6. Six hundred dollars beginning from and after December 31, 2009.
E. Prior to the levying of taxes for school purposes the board of supervisors shall determine whether the total primary property taxes to be levied for all taxing jurisdictions on each parcel of residential property, in lieu of the provisions of this subsection, violate article IX, section 18, Constitution of Arizona. For those properties that qualify for property tax exemptions pursuant to article IX, sections 2, 2.1 and 2.2, Constitution of Arizona, eligibility for the credit is determined on the basis of the limited property value that corresponds to the taxable assessed value after reduction for the applicable exemption. If the board of supervisors determines that such a situation exists, the board shall apply a credit against the primary property taxes due from each such parcel in the amount in excess of article IX, section 18, Constitution of Arizona. Such excess amounts shall also be additional state aid for education for the school district or districts in which such parcel of property is located.
F. The clerk of the board of supervisors shall report to the department of revenue not later than September 5 of each year the amount by school district of additional state aid for education and the data used for computing the amount as provided in subsection B of this section. The department of revenue shall verify all of the amounts and report to the board of supervisors not later than September 10 of each year the property tax rate which shall be used for property tax reduction as provided in subsection E of this section.
G. The clerk of the board of supervisors shall report to the department of revenue not later than September 30 of each year in writing the following:
1. The data processing specifications used in the calculations provided for in subsections B and E of this section.
2. At a minimum, copies of two actual tax bills for residential property for each distinct tax area.
H. The department of revenue shall report to the state board of education not later than October 12 of each year the amount by school district of additional state aid for education as provided in this section. The additional state aid for education provided in this section shall be apportioned as provided in section 15‑973.
I. If a parcel of property is owned by a cooperative apartment corporation or is owned by the tenants of a cooperative apartment corporation as tenants in common, the reduction in the property taxes prescribed in subsection D of this section shall not exceed the amounts listed in subsection D of this section for each owner occupied housing unit on the property. The assessed value used for determining the reduction in taxes for the property is equal to the total assessed value of the property times the ratio of the number of owner occupied housing units to the total number of housing units on the property. For the purposes of this subsection, "cooperative apartment corporation" means a corporation:
1. Having only one class of outstanding stock.
2. All of the stockholders of which are entitled, solely by reason of their ownership of stock in the corporation, to occupy for dwelling purposes apartments in a building owned or leased by such corporation and who are not entitled, either conditionally or unconditionally, except upon a complete or partial liquidation of the corporation, to receive any distribution not out of earnings and profits of the corporation.
3. Eighty per cent or more of the gross income of which is derived from tenant‑stockholders. For the purposes of this paragraph, "gross income" means gross income as defined by the United States internal revenue code, as defined in section 43‑105.
J. The total amount of state monies that may be spent in any fiscal year for state aid for education in this section shall not exceed the amount appropriated or authorized by section 35‑173 for that purpose. This section shall not be construed to impose a duty on an officer, agent or employee of this state to discharge a responsibility or to create any right in a person or group if the discharge or right would require an expenditure of state monies in excess of the expenditure authorized by legislative appropriation for that specific purpose.
K. For the purposes of this section:
1. "Owner" includes any purchaser under a contract of sale or under a deed of trust.
2. "Residential property" includes owner occupied real property and improvements to the property and owner occupied mobile homes that are used as the owner's primary residence and classified as class three property pursuant to section 42‑12003.
Sec. 3. Assessed valuation of class one property; temporary reduction; fiscal years 2014-2015 through 2018‑2019
Notwithstanding section 42-15001, Arizona Revised Statutes, the assessed valuation of class one property described in section 42-12001, Arizona Revised Statutes, is the following percentage of its full cash value or limited valuation, as applicable:
1. For tax year 2014-2015, 17.6%.
2. For tax year 2015-2016, 15.7%.
3. For tax year 2016-2017, 13.8%.
4. For tax year 2017-2018, 11.9%.
5. For tax year 2018-2019, 10.0%.
