Bill Text: MI HB4183 | 2013-2014 | 97th Legislature | Introduced

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Bill Title: School aid; foundation allowance; per-pupil funding formula; increase. Amends sec. 20 of 1979 PA 94 (MCL 388.1620).

Spectrum: Partisan Bill (Democrat 4-0)

Status: (Introduced - Dead) 2013-02-06 - Printed Bill Filed 02/06/2013 [HB4183 Detail]

Download: Michigan-2013-HB4183-Introduced.html

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HOUSE BILL No. 4183

 

February 5, 2013, Introduced by Reps. Schor, Brown, Cavanagh and Slavens and referred to the Committee on Appropriations.

 

     A bill to amend 1979 PA 94, entitled

 

"The state school aid act of 1979,"

 

by amending section 20 (MCL 388.1620), as amended by 2012 PA 201.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 20. (1) For 2011-2012, and for 2012-2013, the basic

 

foundation allowance is $8,019.00. For 2013-2014, the basic

 

foundation allowance shall be $8,119.00.

 

     (2) The amount of each district's foundation allowance shall

 

be calculated as provided in this section, using a basic foundation

 

allowance in the amount specified in subsection (1).

 

     (3) Except as otherwise provided in this section, the amount

 

of a district's foundation allowance shall be calculated as

 

follows, using in all calculations the total amount of the

 

district's foundation allowance as calculated before any proration:

 

     (a) For a district that had a foundation allowance for the

 

immediately preceding state fiscal year that was at least equal to

 

the sum of $7,108.00 $$6,846.00 plus the total dollar amount of all

 

adjustments made from 2006-2007 2011-2012 to the immediately

 

preceding state fiscal year in the lowest foundation allowance

 

among all districts, but less than the basic foundation allowance

 

for the immediately preceding state fiscal year, the district shall

 

receive a foundation allowance in an amount equal to the sum of the

 

district's foundation allowance for the immediately preceding state

 

fiscal year plus the difference between twice the dollar amount of

 

the adjustment from the immediately preceding state fiscal year to

 

the current state fiscal year made in the basic foundation

 

allowance and [(the dollar amount of the adjustment from the

 

immediately preceding state fiscal year to the current state fiscal

 

year made in the basic foundation allowance minus $20.00) times

 

(the difference between the district's foundation allowance for the

 

immediately preceding state fiscal year and the sum of $7,108.00

 

$6,846.00 plus the total dollar amount of all adjustments made from

 

2006-2007 2011-2012 to the immediately preceding state fiscal year

 

in the lowest foundation allowance among all districts) divided by

 

the difference between the basic foundation allowance for the

 

current state fiscal year and the sum of $7,108.00 $6,846.00 plus

 

the total dollar amount of all adjustments made from 2006-2007

 

2011-2012 to the immediately preceding state fiscal year in the

 

lowest foundation allowance among all districts]. For 2011-2012,

 

for a district that had a foundation allowance for the immediately

 

preceding state fiscal year that was at least equal to the sum of

 

$7,108.00 plus the total dollar amount of all adjustments made from

 

2006-2007 to the immediately preceding state fiscal year in the

 

lowest foundation allowance among all districts, but less than the

 

basic foundation allowance for the immediately preceding state

 

fiscal year, the district shall receive a foundation allowance in

 

an amount equal to the district's foundation allowance for 2010-

 

2011, minus $470.00. Except as otherwise provided in subdivision

 

(h), for 2012-2013, for a district that had a foundation allowance

 

for the immediately preceding state fiscal year that was at least

 

equal to the sum of $7,108.00 $6,846.00 plus the total dollar

 

amount of all adjustments made from 2006-2007 2011-2012 to the

 

immediately preceding state fiscal year in the lowest foundation

 

allowance among all districts, but less than the basic foundation

 

allowance for the immediately preceding state fiscal year, the

 

district shall receive a foundation allowance in an amount equal to

 

the district's foundation allowance for the immediately preceding

 

state fiscal year. However, the foundation allowance for a district

 

that had less than the basic foundation allowance for the

 

immediately preceding state fiscal year shall not exceed the basic

 

foundation allowance for the current state fiscal year.

 

     (b) Except as otherwise provided in this subsection, for a

 

district that in the immediately preceding state fiscal year had a

 

foundation allowance in an amount at least equal to the amount of

 

the basic foundation allowance for the immediately preceding state

 

fiscal year, the district shall receive a foundation allowance for

 

2011-2012 in an amount equal to the district's foundation allowance

 

for 2010-2011, minus $470.00. For 2012-2013, except Except as

 

otherwise provided in this subsection, for a district that in the

 

immediately preceding state fiscal year had a foundation allowance

 

in an amount at least equal to the amount of the basic foundation

 

allowance for the immediately preceding state fiscal year, the

 

district shall receive a foundation allowance for 2012-2013 in an

 

amount equal to the district's foundation allowance for the

 

immediately preceding state fiscal year. For 2013-2014, except as

 

otherwise provided in this subsection, for a district that in the

 

immediately preceding state fiscal year had a foundation allowance

 

in an amount at least equal to the amount of the basic foundation

 

allowance for the immediately preceding state fiscal year, the

 

district shall receive a foundation allowance for 2013-2014 in an

 

amount equal to the district's foundation allowance for the

 

immediately preceding state fiscal year plus $100.00.

 

     (c) Except as otherwise provided in subdivision (d), for a

 

district that in the 1994-95 state fiscal year had a foundation

 

allowance greater than $6,500.00, the district's foundation

 

allowance is an amount equal to the sum of the district's

 

foundation allowance for the immediately preceding state fiscal

 

year plus the lesser of the increase in the basic foundation

 

allowance for the current state fiscal year, as compared to the

 

immediately preceding state fiscal year, or the product of the

 

district's foundation allowance for the immediately preceding state

 

fiscal year times the percentage increase in the United States

 

consumer price index in the calendar year ending in the immediately

 

preceding fiscal year as reported by the May revenue estimating

 

conference conducted under section 367b of the management and

 

budget act, 1984 PA 431, MCL 18.1367b. Except as otherwise provided

 

in subdivision (d), for 2011-2012, for a district that in the 1994-

 

1995 state fiscal year had a foundation allowance greater than

 

$6,500.00, the district's foundation allowance is an amount equal

 

to the district's foundation allowance for the 2010-2011 fiscal

 

year minus $470.00. For 2012-2013, except as otherwise provided in

 

subdivision (d), for a district that in the 1994-1995 state fiscal

 

year had a foundation allowance greater than $6,500.00, the

 

district's foundation allowance is an amount equal to the

 

district's foundation allowance for the immediately preceding state

 

fiscal year.

 

     (d) For a district that in the 1994-95 state fiscal year had a

 

foundation allowance greater than $6,500.00 and that had a

 

foundation allowance for the 2009-2010 state fiscal year, as

 

otherwise calculated under this section, that was less than the

 

basic foundation allowance, the district's foundation allowance for

 

2011-2012 2012-2013 and each succeeding fiscal year shall be

 

considered to be an amount equal to the basic foundation allowance.

 

     (e) For a district that has a foundation allowance that is not

 

a whole dollar amount, the district's foundation allowance shall be

 

rounded up to the nearest whole dollar.

 

     (f) For a district that received a payment under former

 

section 22c as that section was in effect for 2001-2002, the

 

district's 2001-2002 foundation allowance shall be considered to

 

have been an amount equal to the sum of the district's actual 2001-

 

2002 foundation allowance as otherwise calculated under this

 

section plus the per pupil amount of the district's equity payment

 

for 2001-2002 under former section 22c as that section was in

 

effect for 2001-2002.

 

     (g) For a district that received a payment under former

 

section 22c as that section was in effect for 2006-2007, the

 

district's 2006-2007 foundation allowance shall be considered to

 

have been an amount equal to the sum of the district's actual 2006-

 

2007 foundation allowance as otherwise calculated under this

 

section plus the per pupil amount of the district's equity payment

 

for 2006-2007 under former section 22c as that section was in

 

effect for 2006-2007.

 

     (h) For 2012-2013, for a district that had a foundation

 

allowance for the 2011-2012 state fiscal year of less than

 

$6,966.00, the district's foundation allowance is an amount equal

 

to $6,966.00.

 

     (4) Except as otherwise provided in this subsection, the state

 

portion of a district's foundation allowance is an amount equal to

 

the district's foundation allowance or the basic foundation

 

allowance for the current state fiscal year, whichever is less,

 

minus the difference between the sum of the product of the taxable

 

value per membership pupil of all property in the district that is

 

nonexempt property times the district's certified mills and, for a

 

district with certified mills exceeding 12, the product of the

 

taxable value per membership pupil of property in the district that

 

is commercial personal property times the certified mills minus 12

 

mills and the quotient of the ad valorem property tax revenue of

 

the district captured under tax increment financing acts divided by

 

the district's membership excluding special education pupils. For a

 

district described in subsection (3)(c), the state portion of the

 

district's foundation allowance is an amount equal to $6,962.00

 

plus the difference between the district's foundation allowance for

 

the current state fiscal year and the district's foundation

 

allowance for 1998-99, minus the difference between the sum of the

 

product of the taxable value per membership pupil of all property

 

in the district that is nonexempt property times the district's

 

certified mills and, for a district with certified mills exceeding

 

12, the product of the taxable value per membership pupil of

 

property in the district that is commercial personal property times

 

the certified mills minus 12 mills and the quotient of the ad

 

valorem property tax revenue of the district captured under tax

 

increment financing acts divided by the district's membership

 

excluding special education pupils. For a district that has a

 

millage reduction required under section 31 of article IX of the

 

state constitution of 1963, the state portion of the district's

 

foundation allowance shall be calculated as if that reduction did

 

not occur.

 

     (5) The allocation calculated under this section for a pupil

 

shall be based on the foundation allowance of the pupil's district

 

of residence. For a pupil enrolled pursuant to section 105 or 105c

 

in a district other than the pupil's district of residence, the

 

allocation calculated under this section shall be based on the

 

lesser of the foundation allowance of the pupil's district of

 

residence or the foundation allowance of the educating district.

 

For a pupil in membership in a K-5, K-6, or K-8 district who is

 

enrolled in another district in a grade not offered by the pupil's

 

district of residence, the allocation calculated under this section

 

shall be based on the foundation allowance of the educating

 

district if the educating district's foundation allowance is

 

greater than the foundation allowance of the pupil's district of

 

residence.

 

     (6) Except as otherwise provided in this subsection, for

 

pupils in membership, other than special education pupils, in a

 

public school academy, the allocation calculated under this section

 

is an amount per membership pupil other than special education

 

pupils in the public school academy equal to the foundation

 

allowance of the district in which the public school academy is

 

located or the state maximum public school academy allocation,

 

whichever is less. However, a public school academy that had an

 

allocation under this subsection before 2009-2010 that was equal to

 

the sum of the local school operating revenue per membership pupil

 

other than special education pupils for the district in which the

 

public school academy is located and the state portion of that

 

district's foundation allowance shall not have that allocation

 

reduced as a result of the 2010 amendment to this subsection.

 

Notwithstanding section 101, for a public school academy that

 

begins operations after the pupil membership count day, the amount

 

per membership pupil calculated under this subsection shall be

 

adjusted by multiplying that amount per membership pupil by the

 

number of hours of pupil instruction provided by the public school

 

academy after it begins operations, as determined by the

 

department, divided by the minimum number of hours of pupil

 

instruction required under section 101(3). The result of this

 

calculation shall not exceed the amount per membership pupil

 

otherwise calculated under this subsection.

 

     (7) Except as otherwise provided in this subsection, for

 

pupils attending an achievement school and in membership in the

 

education achievement system, other than special education pupils,

 

the allocation calculated under this section is an amount per

 

membership pupil other than special education pupils equal to the

 

foundation allowance of the district in which the achievement

 

school is located, not to exceed the basic foundation allowance.

 

Notwithstanding section 101, for an achievement school that begins

 

operation after the pupil membership count day, the amount per

 

membership pupil calculated under this subsection shall be adjusted

 

by multiplying that amount per membership pupil by the number of

 

hours of pupil instruction provided by the achievement school after

 

it begins operations, as determined by the department, divided by

 

the minimum number of hours of pupil instruction required under

 

section 101(3). The result of this calculation shall not exceed the

 

amount per membership pupil otherwise calculated under this

 

subsection. For the purposes of this subsection, if a public school

 

is transferred from a district to the state school reform/redesign

 

district or the achievement authority under section 1280c of the

 

revised school code, that public school is considered to be an

 

achievement school within the education achievement system and not

 

a school that is part of a district, and a pupil attending that

 

public school is considered to be in membership in the education

 

achievement system and not in membership in the district that

 

operated the school before the transfer.

 

     (8) Subject to subsection (4), for a district that is formed

 

or reconfigured after June 1, 2002 by consolidation of 2 or more

 

districts or by annexation, the resulting district's foundation

 

allowance under this section beginning after the effective date of

 

the consolidation or annexation shall be the average of the

 

foundation allowances of each of the original or affected

 

districts, calculated as provided in this section, weighted as to

 

the percentage of pupils in total membership in the resulting

 

district who reside in the geographic area of each of the original

 

or affected districts.

 

     (9) Each fraction used in making calculations under this

 

section shall be rounded to the fourth decimal place and the dollar

 

amount of an increase in the basic foundation allowance shall be

 

rounded to the nearest whole dollar.

 

     (10) State payments related to payment of the foundation

 

allowance for a special education pupil are not calculated under

 

this section but are instead calculated under section 51a.

 

     (11) To assist the legislature in determining the basic

 

foundation allowance for the subsequent state fiscal year, each

 

revenue estimating conference conducted under section 367b of the

 

management and budget act, 1984 PA 431, MCL 18.1367b, shall

 

calculate a pupil membership factor, a revenue adjustment factor,

 

and an index as follows:

 

     (a) The pupil membership factor shall be computed by dividing

 

the estimated membership in the school year ending in the current

 

state fiscal year, excluding intermediate district membership, by

 

the estimated membership for the school year ending in the

 

subsequent state fiscal year, excluding intermediate district

 

membership. If a consensus membership factor is not determined at

 

the revenue estimating conference, the principals of the revenue

 

estimating conference shall report their estimates to the house and

 

senate subcommittees responsible for school aid appropriations not

 

later than 7 days after the conclusion of the revenue conference.

 

     (b) The revenue adjustment factor shall be computed by

 

dividing the sum of the estimated total state school aid fund

 

revenue for the subsequent state fiscal year plus the estimated

 

total state school aid fund revenue for the current state fiscal

 

year, adjusted for any change in the rate or base of a tax the

 

proceeds of which are deposited in that fund and excluding money

 

transferred into that fund from the countercyclical budget and

 

economic stabilization fund under the management and budget act,

 

1984 PA 431, MCL 18.1101 to 18.1594, by the sum of the estimated

 

total school aid fund revenue for the current state fiscal year

 

plus the estimated total state school aid fund revenue for the

 

immediately preceding state fiscal year, adjusted for any change in

 

the rate or base of a tax the proceeds of which are deposited in

 

that fund. If a consensus revenue factor is not determined at the

 

revenue estimating conference, the principals of the revenue

 

estimating conference shall report their estimates to the house and

 

senate subcommittees responsible for school aid appropriations not

 

later than 7 days after the conclusion of the revenue conference.

 

     (c) The index shall be calculated by multiplying the pupil

 

membership factor by the revenue adjustment factor. However, for

 

2011-2012, the index shall be 0.93575 and for 2012-2013, the index

 

shall be 1.00. If a consensus index is not determined at the

 

revenue estimating conference, the principals of the revenue

 

estimating conference shall report their estimates to the house and

 

senate subcommittees responsible for school aid appropriations not

 

later than 7 days after the conclusion of the revenue conference.

 

     (12) For a district in which 7.75 mills levied in 1992 for

 

school operating purposes in the 1992-93 school year were not

 

renewed in 1993 for school operating purposes in the 1993-94 school

 

year, the district's combined state and local revenue per

 

membership pupil shall be recalculated as if that millage reduction

 

did not occur and the district's foundation allowance shall be

 

calculated as if its 1994-95 foundation allowance had been

 

calculated using that recalculated 1993-94 combined state and local

 

revenue per membership pupil as a base. A district is not entitled

 

to any retroactive payments for fiscal years before 2000-2001 due

 

to this subsection. A district receiving an adjustment under this

 

subsection shall not receive as a result of this adjustment an

 

amount that exceeds 50% of the amount the district received as a

 

result of this adjustment for 2010-2011. This adjustment shall not

 

be made after 2011-2012.

 

     (13) For a district in which an industrial facilities

 

exemption certificate that abated taxes on property with a state

 

equalized valuation greater than the total state equalized

 

valuation of the district at the time the certificate was issued or

 

$700,000,000.00, whichever is greater, was issued under 1974 PA

 

198, MCL 207.551 to 207.572, before the calculation of the

 

district's 1994-95 foundation allowance, the district's foundation

 

allowance for 2002-2003 is an amount equal to the sum of the

 

district's foundation allowance for 2002-2003, as otherwise

 

calculated under this section, plus $250.00. A district receiving

 

an adjustment under this subsection shall not receive as a result

 

of this adjustment an amount that exceeds 50% of the amount the

 

district received as a result of this adjustment for 2010-2011.

 

This adjustment shall not be made after 2011-2012.

 

     (14) For a district that received a grant under former section

 

32e for 2001-2002, the district's foundation allowance for 2002-

 

2003 and each succeeding fiscal year shall be adjusted to be an

 

amount equal to the sum of the district's foundation allowance, as

 

otherwise calculated under this section, plus the quotient of 100%

 

of the amount of the grant award to the district for 2001-2002

 

under former section 32e divided by the number of pupils in the

 

district's membership for 2001-2002 who were residents of and

 

enrolled in the district. Except as otherwise provided in this

 

subsection, a district qualifying for a foundation allowance

 

adjustment under this subsection shall use the funds resulting from

 

this adjustment for at least 1 of grades K to 3 for purposes

 

allowable under former section 32e as in effect for 2001-2002. For

 

an individual school or schools operated by a district qualifying

 

for a foundation allowance under this subsection that have been

 

determined by the department to meet the adequate yearly progress

 

standards of the federal no child left behind act of 2001, Public

 

Law 107-110, in both mathematics and English language arts at all

 

applicable grade levels for all applicable subgroups, the district

 

may submit to the department an application for flexibility in

 

using the funds resulting from this adjustment that are

 

attributable to the pupils in the school or schools. The

 

application shall identify the affected school or schools and the

 

affected funds and shall contain a plan for using the funds for

 

specific purposes identified by the district that are designed to

 

reduce class size, but that may be different from the purposes

 

otherwise allowable under this subsection. The department shall

 

approve the application if the department determines that the

 

purposes identified in the plan are reasonably designed to reduce

 

class size. If the department does not act to approve or disapprove

 

an application within 30 days after it is submitted to the

 

department, the application is considered to be approved. If an

 

application for flexibility in using the funds is approved, the

 

district may use the funds identified in the application for any

 

purpose identified in the plan. A district receiving an adjustment

 

under this subsection shall not receive as a result of this

 

adjustment an amount that exceeds 68.5% of the amount the district

 

received as a result of this adjustment for 2010-2011.

 

     (15) For a district that levied 1.9 mills in 1993 to finance

 

an operating deficit, the district's foundation allowance shall be

 

calculated as if those mills were included as operating mills in

 

the calculation of the district's 1994-1995 foundation allowance. A

 

district is not entitled to any retroactive payments for fiscal

 

years before 2006-2007 due to this subsection. A district receiving

 

an adjustment under this subsection shall not receive more than

 

$800,000.00 for a fiscal year as a result of this adjustment. A

 

district receiving an adjustment under this subsection shall not

 

receive as a result of this adjustment an amount that exceeds 50%

 

of the amount the district received as a result of this adjustment

 

for 2010-2011. This adjustment shall not be made after 2011-2012.

 

     (16) For a district that levied 2.23 mills in 1993 to finance

 

an operating deficit, the district's foundation allowance shall be

 

calculated as if those mills were included as operating mills in

 

the calculation of the district's 1994-1995 foundation allowance. A

 

district is not entitled to any retroactive payments for fiscal

 

years before 2006-2007 due to this subsection. A district receiving

 

an adjustment under this subsection shall not receive more than

 

$500,000.00 for a fiscal year as a result of this adjustment. A

 

district receiving an adjustment under this subsection shall not

 

receive as a result of this adjustment an amount that exceeds 50%

 

of the amount the district received as a result of this adjustment

 

for 2010-2011. This adjustment shall not be made after 2011-2012.

 

     (17) Payments to districts, public school academies, or the

 

education achievement system shall not be made under this section.

 

Rather, the calculations under this section shall be used to

 

determine the amount of state payments under section 22b.

 

     (18) If an amendment to section 2 of article VIII of the state

 

constitution of 1963 allowing state aid to some or all nonpublic

 

schools is approved by the voters of this state, each foundation

 

allowance or per pupil payment calculation under this section may

 

be reduced.

 

     (19) As used in this section:

 

     (a) "Certified mills" means the lesser of 18 mills or the

 

number of mills of school operating taxes levied by the district in

 

1993-94.

 

     (b) "Combined state and local revenue" means the aggregate of

 

the district's state school aid received by or paid on behalf of

 

the district under this section and the district's local school

 

operating revenue.

 

     (c) "Combined state and local revenue per membership pupil"

 

means the district's combined state and local revenue divided by

 

the district's membership excluding special education pupils.

 

     (d) "Current state fiscal year" means the state fiscal year

 

for which a particular calculation is made.

 

     (e) "Immediately preceding state fiscal year" means the state

 

fiscal year immediately preceding the current state fiscal year.

 

     (f) "Local school operating revenue" means school operating

 

taxes levied under section 1211 of the revised school code, MCL

 

380.1211.

 

     (g) "Local school operating revenue per membership pupil"

 

means a district's local school operating revenue divided by the

 

district's membership excluding special education pupils.

 

     (h) "Maximum public school academy allocation", except as

 

otherwise provided in this subdivision, means the maximum per-pupil

 

allocation as calculated by adding the highest per-pupil allocation

 

among all public school academies for the immediately preceding

 

state fiscal year plus the difference between twice the dollar

 

amount of the adjustment from the immediately preceding state

 

fiscal year to the current state fiscal year made in the basic

 

foundation allowance and [(the dollar amount of the adjustment from

 

the immediately preceding state fiscal year to the current state

 

fiscal year made in the basic foundation allowance minus $20.00)

 

times (the difference between the highest per-pupil allocation

 

among all public school academies for the immediately preceding

 

state fiscal year and the sum of $7,108.00 $6,846.00 plus the total

 

dollar amount of all adjustments made from 2006-2007 2011-2012 to

 

the immediately preceding state fiscal year in the lowest per-pupil

 

allocation among all public school academies) divided by the

 

difference between the basic foundation allowance for the current

 

state fiscal year and the sum of $7,108.00 $6,846.00 plus the total

 

dollar amount of all adjustments made from 2006-2007 2011-2012 to

 

the immediately preceding state fiscal year in the lowest per-pupil

 

allocation among all public school academies]. For 2011-2012 and

 

2012-2013, maximum public school academy allocation means

 

$7,110.00.

 

     (i) "Membership" means the definition of that term under

 

section 6 as in effect for the particular fiscal year for which a

 

particular calculation is made.

 

     (j) "Nonexempt property" means property that is not a

 

principal residence, qualified agricultural property, qualified

 

forest property, supportive housing property, industrial personal

 

property, or commercial personal property.

 

     (k) "Principal residence", "qualified agricultural property",

 

"qualified forest property", "supportive housing property",

 

"industrial personal property", and "commercial personal property"

 

mean those terms as defined in section 1211 of the revised school

 

code, MCL 380.1211.

 

     (l) "School operating purposes" means the purposes included in

 

the operation costs of the district as prescribed in sections 7 and

 

18.

 

     (m) "School operating taxes" means local ad valorem property

 

taxes levied under section 1211 of the revised school code, MCL

 

380.1211, and retained for school operating purposes.

 

     (n) "Tax increment financing acts" means 1975 PA 197, MCL

 

125.1651 to 125.1681, the tax increment finance authority act, 1980

 

PA 450, MCL 125.1801 to 125.1830, the local development financing

 

act, 1986 PA 281, MCL 125.2151 to 125.2174, the brownfield

 

redevelopment financing act, 1996 PA 381, MCL 125.2651 to 125.2672,

 

or the corridor improvement authority act, 2005 PA 280, MCL

 

125.2871 to 125.2899.

 

     (o) "Taxable value per membership pupil" means taxable value,

 

as certified by the department of treasury, for the calendar year

 

ending in the current state fiscal year divided by the district's

 

membership excluding special education pupils for the school year

 

ending in the current state fiscal year.