Bill Text: IA HSB647 | 2017-2018 | 87th General Assembly | Introduced


Bill Title: A bill for an act relating to the collection of sales tax for deposit in the secure an advanced vision for education fund and to the use of tax revenue from the secure an advanced vision for education fund.

Spectrum: Committee Bill

Status: (N/A - Dead) 2018-02-13 - Subcommittee recommends amendment and passage. [HSB647 Detail]

Download: Iowa-2017-HSB647-Introduced.html
House Study Bill 647 - Introduced HOUSE FILE _____ BY (PROPOSED COMMITTEE ON EDUCATION BILL BY CHAIRPERSON ROGERS) A BILL FOR An Act relating to the collection of sales tax for deposit in 1 the secure an advanced vision for education fund and to the 2 use of tax revenue from the secure an advanced vision for 3 education fund. 4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 5 TLSB 5423YC (1) 87 md/jh
H.F. _____ Section 1. Section 423.2, subsection 11, paragraph b, 1 subparagraph (3), Code 2018, is amended to read as follows: 2 (3) Transfer one-sixth of the remaining revenues to the 3 secure an advanced vision for education fund created in section 4 423F.2 . This subparagraph (3) is repealed December 31, 2029 5 January 1, 2050 . 6 Sec. 2. Section 423.2, subsection 14, Code 2018, is amended 7 to read as follows: 8 14. The sales tax rate of six percent is reduced to five 9 percent on January 1, 2030 2050 . 10 Sec. 3. Section 423.5, subsection 5, Code 2018, is amended 11 to read as follows: 12 5. The use tax rate of six percent is reduced to five 13 percent on January 1, 2030 2050 . 14 Sec. 4. Section 423.43, subsection 1, paragraph b, Code 15 2018, is amended to read as follows: 16 b. Subsequent to the deposit into the general fund of 17 the state and after the transfer of such revenues collected 18 under chapter 423B , the department shall transfer one-sixth of 19 such remaining revenues to the secure an advanced vision for 20 education fund created in section 423F.2 . This paragraph is 21 repealed December 31, 2029 January 1, 2050 . 22 Sec. 5. Section 423F.2, subsection 3, Code 2018, is amended 23 to read as follows: 24 3. a. The moneys available in a fiscal year in the secure 25 an advanced vision for education fund shall be distributed by 26 the department of revenue to each school district on a per 27 pupil basis calculated using each school district’s budget 28 enrollment, as defined in section 257.6 , for that fiscal year. 29 b. (1) Prior to distribution of moneys in the secure an 30 advanced vision for education fund to school districts, two and 31 one-tenths percent of the moneys available in a an amount equal 32 to the equity transfer amount for the fiscal year shall be 33 distributed and credited to the property tax equity and relief 34 fund created in section 257.16A . 35 -1- LSB 5423YC (1) 87 md/jh 1/ 11
H.F. _____ (2) For purposes of this subsection, the equity transfer 1 amount is determined by multiplying the equity transfer 2 percentage by the amount of moneys available in the secure an 3 advanced vision for education fund in the fiscal year. 4 (a) For the fiscal year beginning July 1, 2017, the equity 5 transfer percentage is two and one-tenths percent. 6 (b) For each fiscal year beginning on or after July 1, 2018, 7 the equity transfer percentage is equal to the equity transfer 8 percentage for the immediately preceding fiscal year, unless 9 the amount of moneys available in the secure an advanced vision 10 for education fund in the fiscal year equals or exceeds one 11 hundred two percent of the amount of moneys available in the 12 fund for the immediately preceding fiscal year, in which case 13 the equity transfer percentage shall be the equity transfer 14 percentage for the immediately preceding fiscal year plus one 15 percent subject to the limitation in subparagraph division (c). 16 (c) If the equity transfer percentage calculated under 17 subparagraph division (b) exceeds ten percent, the equity 18 transfer percentage for that fiscal year shall be ten percent. 19 Sec. 6. Section 423F.3, subsection 3, paragraph b, Code 20 2018, is amended to read as follows: 21 b. (1) If the board of directors intends to use funds for 22 purposes other than those listed in paragraph “a” , or change the 23 use of funds to purposes other than those listed in paragraph 24 “a” , the board shall adopt a revenue purpose statement or amend 25 an existing revenue purpose statement , subject to approval of 26 the electors, listing the proposed use of the funds. School 27 districts shall submit the statement to the voters no later 28 than sixty days prior to the expiration of any existing revenue 29 purpose statement or change in use not included in the existing 30 revenue purpose statement. 31 (2) (a) Notwithstanding any provision of law to the 32 contrary, for each school district with an existing revenue 33 purpose statement for the use of revenues from the secure an 34 advanced vision for education fund adopted under this paragraph 35 -2- LSB 5423YC (1) 87 md/jh 2/ 11
H.F. _____ or adopted under another provision of law before July 1, 2018, 1 such revenue purpose statement shall terminate and be of no 2 further force and effect on January 1, 2023. If such a school 3 district intends to use funds for purposes other than those 4 listed in paragraph “a” and does not intend to operate without 5 a revenue purpose statement on or after January 1, 2023, the 6 board of directors shall submit a revenue purpose statement for 7 approval by the electors under subparagraph (1) on or after 8 July 1, 2018, and such revenue purpose statement submitted 9 to the electors shall include all proposed uses including 10 those previously approved by the electors, if applicable. A 11 revenue purpose statement submitted to the electors under this 12 subparagraph shall include the following statement on the 13 ballot: 14 If a majority of eligible electors voting on the question 15 fail to approve this revenue purpose statement, revenues 16 received by the school district from the secure an advanced 17 vision for education fund shall first be expended to pay 18 principal and interest on outstanding bonds for which the 19 revenues have been pledged and then expended to reduce 20 bond levies and all other debt levies, the regular and 21 voter-approved physical plant and equipment levies, and the 22 public educational and recreational levy. 23 (b) If a revenue purpose statement is terminated under the 24 provisions of this subparagraph, such termination shall not 25 affect the validity of or a first lien on bonds issued under 26 section 423E.5, Code 2018, or section 423F.5 prior to January 27 1, 2023. 28 Sec. 7. Section 423F.3, subsection 5, unnumbered paragraph 29 1, Code 2018, is amended to read as follows: 30 A school district with a certified enrollment of fewer 31 than two three hundred fifty pupils in the entire district or 32 certified enrollment of fewer than one hundred forty pupils 33 in high school shall not expend the amount received for new 34 construction without prior application to the department of 35 -3- LSB 5423YC (1) 87 md/jh 3/ 11
H.F. _____ education and receipt of a certificate of need pursuant to 1 this subsection . A certificate of need is not required for 2 repairing schoolhouses or buildings, equipment, technology, or 3 transportation equipment for transporting students as provided 4 in section 298.3 , or for construction necessary for compliance 5 with the federal Americans With Disabilities Act pursuant to 42 6 U.S.C. §12101 12117. In determining whether a certificate of 7 need shall be issued or denied, the department shall consider 8 all of the following: 9 Sec. 8. Section 423F.3, subsection 5, paragraph b, Code 10 2018, is amended to read as follows: 11 b. The infeasibility cost-benefit analysis of remodeling, 12 reconstructing, or repairing existing buildings. 13 Sec. 9. Section 423F.3, subsection 5, Code 2018, is amended 14 by adding the following new paragraph: 15 NEW PARAGRAPH . i. Benefits and effects of the new 16 construction on student learning. 17 Sec. 10. Section 423F.3, Code 2018, is amended by adding the 18 following new subsection: 19 NEW SUBSECTION . 6A. a. Prior to approving the use 20 of revenues received under this chapter for a school 21 infrastructure project within the scope of the school 22 district’s approved revenue purpose statement or pursuant 23 to subsection 4 for a school district without an approved 24 revenue statement and that includes in whole or in part the 25 construction of an athletic facility, the board of directors 26 shall adopt a resolution setting forth the proposal for the 27 school infrastructure project and hold an additional public 28 hearing on the issue of the athletic facility. Notice of 29 the time and place of the public hearing shall be published 30 not less than ten nor more than twenty days before the 31 public hearing in a newspaper which is a newspaper of general 32 circulation in the school district. If at any time prior to 33 the fifteenth day following the hearing, the secretary of the 34 board of directors receives a petition containing the required 35 -4- LSB 5423YC (1) 87 md/jh 4/ 11
H.F. _____ number of signatures and asking that the question of the 1 approval of the use of revenues for the school infrastructure 2 project be submitted to the voters of the school district, the 3 board of directors shall either rescind the board’s resolution 4 and abandon approval of the use of revenues for the school 5 infrastructure project or direct the county commissioner of 6 elections to submit the question to the registered voters of 7 the school district at an election held on a date specified in 8 section 39.2, subsection 4, paragraph “c” . The petition must be 9 signed by eligible electors equal in number to not less than 10 one hundred or thirty percent of the number of voters at the 11 last preceding regular school election, whichever is greater. 12 If a majority of those voting on the question favors the use of 13 the revenues for the school infrastructure project, the board 14 shall be authorized to approve such use by resolution of the 15 board. If a majority of those voting on the question does not 16 favor the use of the revenues for the school infrastructure 17 project, the board of directors shall rescind the board’s 18 resolution and abandon approval of the use of revenues for the 19 school infrastructure project. If a petition is not received 20 by the board of directors within the prescribed time period, 21 the board of directors may approve the use of revenues for the 22 school infrastructure project without voter approval. 23 b. After fourteen days from the date of the hearing under 24 paragraph “a” or fourteen days after the date of the election 25 held under paragraph “b” , if applicable, whichever is later, an 26 action shall not be brought questioning the board of directors’ 27 authority to use funds for the school infrastructure project or 28 questioning the legality of any proceedings in connection with 29 the authorization of such use. 30 c. For purposes of this subsection: 31 (1) “Athletic facility” means a building or structure, or 32 portion thereof, that is not physically attached to a student 33 attendance center. 34 (2) “Construction” does not include replacement, upgrade, 35 -5- LSB 5423YC (1) 87 md/jh 5/ 11
H.F. _____ repair, or maintenance of an existing facility. 1 Sec. 11. Section 423F.4, Code 2018, is amended to read as 2 follows: 3 423F.4 Borrowing authority for school districts. 4 1. A Subject to the conditions established under subsection 5 2, a school district may anticipate its share of the revenues 6 under section 423F.2 by issuing bonds in the manner provided in 7 section 423E.5 , Code 2018 . However, to the extent any school 8 district has issued bonds anticipating the proceeds of an 9 extended local sales and services tax for school infrastructure 10 purposes imposed by a county pursuant to former chapter 423E, 11 Code and Code Supplement 2007, prior to July 1, 2008, the 12 pledge of such revenues for the payment of principal and 13 interest on such bonds shall be replaced by a pledge of its 14 share of the revenues under section 423F.2 . 15 2. a. Bonds issued on or after July 1, 2018, shall not be 16 sold at public sale as provided in chapter 75, or at a private 17 sale, without notice and hearing. Notice of the time and place 18 of the public hearing shall be published not less than ten nor 19 more than twenty days before the public hearing in a newspaper 20 which is a newspaper of general circulation in the school 21 district. 22 b. For bonds subject to the requirements of paragraph 23 “a” , if at any time prior to the fifteenth day following the 24 hearing, the secretary of the board of directors receives a 25 petition containing the required number of signatures and 26 asking that the question of the issuance of such bonds be 27 submitted to the voters of the school district, the board shall 28 either rescind its adoption of the resolution or direct the 29 county commissioner of elections to submit the question to the 30 registered voters of the school district at an election held 31 on a date specified in section 39.2, subsection 4, paragraph 32 “c” . The petition must be signed by eligible electors equal in 33 number to not less than one hundred or thirty percent of the 34 number of voters at the last preceding regular school election, 35 -6- LSB 5423YC (1) 87 md/jh 6/ 11
H.F. _____ whichever is greater. If the board submits the question at an 1 election and a majority of those voting on the question favors 2 issuance of the bonds, the board shall be authorized to issue 3 the bonds. 4 c. After fourteen days from the date of the hearing under 5 paragraph “a” or fourteen days after the date of the election 6 held under paragraph “b” , if applicable, whichever is later, 7 an action shall not be brought questioning the legality of 8 any bonds or the power of the authority to issue any bonds 9 or to the legality of any proceedings in connection with the 10 authorization or issuance of the bonds. 11 Sec. 12. Section 423F.6, Code 2018, is amended to read as 12 follows: 13 423F.6 Repeal. 14 This chapter is repealed December 31, 2029 January 1, 2050 . 15 Sec. 13. STATE MANDATE FUNDING SPECIFIED. In accordance 16 with section 25B.2, subsection 3, the state cost of requiring 17 compliance with any state mandate included in this Act shall 18 be paid by a school district from state school foundation aid 19 received by the school district under section 257.16. This 20 specification of the payment of the state cost shall be deemed 21 to meet all of the state funding-related requirements of 22 section 25B.2, subsection 3, and no additional state funding 23 shall be necessary for the full implementation of this Act 24 by and enforcement of this Act against all affected school 25 districts. 26 EXPLANATION 27 The inclusion of this explanation does not constitute agreement with 28 the explanation’s substance by the members of the general assembly. 29 Code section 423.2 imposes a state tax of 6 percent upon 30 the sales price of all sales of tangible personal property, 31 consisting of goods, wares, merchandise, and other items 32 designated by statute, sold at retail in the state to consumers 33 or users, except as otherwise provided by Code chapter 423. 34 Generally, by operation of law, a sale subject to the sales 35 -7- LSB 5423YC (1) 87 md/jh 7/ 11
H.F. _____ tax is also subject to the use tax. Following the transfer 1 of amounts required by statute, if applicable, one-sixth of 2 the remaining state sales tax revenue from the 6 percent tax 3 is transferred to the secure an advanced vision for education 4 (SAVE) fund created in Code section 423F.2. Moneys in the SAVE 5 fund are allocated to school districts on a per pupil basis to 6 be used for infrastructure and property tax reduction purposes 7 specified in Code chapter 423F. Under current law, the sales 8 tax rate of 6 percent is reduced to 5 percent on January 1, 9 2030, and Code chapter 423F, along with other corresponding 10 provisions, is repealed December 31, 2029. 11 This bill extends the 6 percent sales tax rate, the 12 allocation to the SAVE fund, and the statutory repeal of Code 13 chapter 423F until January 1, 2050. 14 Current law requires that one-sixth of the revenue from the 15 6 percent statewide sales tax be deposited in the SAVE fund 16 for distribution to school districts on a per pupil basis. 17 Code section 423F.2 provides that prior to such distribution, 18 2.1 percent of the moneys available in the SAVE fund are 19 distributed and credited to the property tax equity and relief 20 (PTER) fund to be used for additional property tax levy aid. 21 The bill provides that for each fiscal year beginning on or 22 after July 1, 2018, the percentage used to determine the 23 amount of the transfer from the SAVE fund to the PTER fund is 24 equal to the percentage for the immediately preceding fiscal 25 year, unless the amount of money available in the SAVE fund 26 in the fiscal year is equal to or exceeds 102 percent of the 27 amount of money available in the SAVE fund for the immediately 28 preceding fiscal year, in which case the percentage shall be 29 the percentage for the immediately preceding fiscal year plus 1 30 percent. However, the bill caps the percentage at 10 percent. 31 Under the bill, revenue purpose statements for the use of 32 SAVE fund revenues adopted before July 1, 2018, shall terminate 33 and be of no further force and effect on January 1, 2023. 34 If a school district intends to use SAVE fund revenues for 35 -8- LSB 5423YC (1) 87 md/jh 8/ 11
H.F. _____ purposes other than those which can be approved by the school 1 board alone and does not intend to operate without a revenue 2 purpose statement on or after January 1, 2023, the school 3 board must submit a revenue purpose statement for approval 4 by the electors on or after July 1, 2018, and such revenue 5 purpose statement submitted to the electors shall include 6 all proposed uses including those previously approved by the 7 electors, if applicable. The bill specifies that if a revenue 8 purpose statement is terminated on January 1, 2023, under the 9 provisions of the bill, such termination shall not affect the 10 validity of or a first lien on bonds issued under Code sections 11 423E.5 and 423F.5 prior to January 1, 2023. 12 The bill provides that prior to approving the use of SAVE 13 revenues for a school infrastructure project that includes in 14 whole or in part the construction of an athletic facility, as 15 defined in the bill, the board of directors must first hold 16 an additional public hearing on the issue of the athletic 17 facility. If at any time prior to the fifteenth day following 18 the hearing, the secretary of the board of directors receives 19 a petition containing the required number of signatures and 20 asking that the question of the approval of the use of revenues 21 for the school infrastructure project be submitted to the 22 voters of the school district, the board of directors shall 23 either abandon approval of the use of SAVE revenues for the 24 school infrastructure project or direct the county commissioner 25 of elections to submit the question to the registered voters 26 of the school district. If a majority of those voting on the 27 question favors the use of the SAVE revenues for the school 28 infrastructure project, the board shall be authorized to 29 approve such use by resolution of the board. If a majority 30 of those voting on the question does not favor the use of 31 the SAVE revenues for the school infrastructure project, the 32 board of directors shall rescind the board’s resolution and 33 abandon approval of the use of SAVE revenues for the school 34 infrastructure project. If a petition is not received by the 35 -9- LSB 5423YC (1) 87 md/jh 9/ 11
H.F. _____ board of directors within the prescribed time period, the 1 board of directors may approve the use of SAVE revenues for 2 the school infrastructure project without voter approval. The 3 bill also establishes limitations on the period of time to 4 bring an action to question the authority to use funds for such 5 purpose or the legality of any proceedings in connection with 6 the authorization of such use. 7 Current law authorizes a school district to anticipate 8 its share of SAVE fund revenues by issuing bonds without 9 voter approval. The bill provides that revenue bonds issued 10 on or after July 1, 2018, shall not be sold at public sale 11 or at a private sale without notice and a public hearing. 12 Additionally, if at any time prior to the 15th day following 13 the hearing, the secretary of the board of directors receives 14 a petition containing the required number of signatures and 15 asking that the question of the issuance of such bonds be 16 submitted to the voters of the school district, the school 17 board shall either rescind its adoption of the resolution or 18 direct the county commissioner of elections to submit the 19 question to the registered voters of the school district. The 20 petition must be signed by eligible electors equal in number to 21 not less than 100 or 30 percent of the number of voters at the 22 last preceding regular school election, whichever is greater. 23 If the school board submits the question at an election and a 24 majority of those voting on the question favors issuance of the 25 bonds, the board shall be authorized to issue the bonds. The 26 bill also places limitations on the period of time during which 27 an action questioning the legality or procedural compliance for 28 the issuance of such bonds may be brought. 29 Currently, a school district with a certified enrollment 30 of fewer than 250 pupils in the entire district or certified 31 enrollment of fewer than 100 pupils in high school must apply 32 to the department of education for a certificate of need 33 before the school district can expend the supplemental school 34 infrastructure amount received for new construction or for 35 -10- LSB 5423YC (1) 87 md/jh 10/ 11
H.F. _____ payments for bonds issued for new construction against the 1 supplemental school infrastructure amount. The bill increases 2 the enrollment thresholds to a total enrollment of 350 pupils 3 and to a high school enrollment of 140 pupils. 4 The bill also modifies the criteria to be used by the 5 department of education in determining whether to issue a 6 certificate of need to include the cost-benefit analysis of 7 remodeling, reconstructing, or repairing existing buildings 8 versus new construction and consideration of the benefit of the 9 new construction on student learning. 10 The bill may include a state mandate as defined in Code 11 section 25B.3. The bill requires that the state cost of 12 any state mandate included in the bill be paid by a school 13 district from state school foundation aid received by the 14 school district under section 257.16. The specification is 15 deemed to constitute state compliance with any state mandate 16 funding-related requirements of Code section 25B.2. The 17 inclusion of this specification is intended to reinstate the 18 requirement of political subdivisions to comply with any state 19 mandates included in the bill. 20 -11- LSB 5423YC (1) 87 md/jh 11/ 11
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