Bill Text: TX SB712 | 2013-2014 | 83rd Legislature | Introduced

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Bill Title: Relating to the financing of school district facilities and property tax relief for school district debt; providing for reduced property tax rates.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2013-03-04 - Referred to s/c on Fiscal Matters by Chair [SB712 Detail]

Download: Texas-2013-SB712-Introduced.html

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83R4607 GCB-F
By: Lucio S.B. No. 712

A BILL TO BE ENTITLED
AN ACT
relating to the financing of school district facilities and
property tax relief for school district debt; providing for reduced
property tax rates.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. The heading to Chapter 46, Education Code, is
amended to read as follows:
CHAPTER 46. ASSISTANCE WITH SCHOOL [INSTRUCTIONAL] FACILITIES AND
PROPERTY TAX RELIEF FOR [PAYMENT OF] EXISTING DEBT
SECTION 2. The heading to Subchapter A, Chapter 46,
Education Code, is amended to read as follows:
SUBCHAPTER A. INITIAL INSTRUCTIONAL FACILITIES ALLOTMENT
SECTION 3. The heading to Section 46.003, Education Code,
is amended to read as follows:
Sec. 46.003. INITIAL SCHOOL FACILITIES ALLOTMENT.
SECTION 4. Sections 46.003(a), (d), (e), and (h), Education
Code, are amended to read as follows:
(a) In the second year of the state fiscal biennium in which
the bonds are issued [For each year], except as provided by Section
[Sections] 46.005 [and 46.006], a school district is guaranteed a
specified amount per student in state and local funds for each cent
of tax effort, up to the maximum rate under Subsection (b), to pay
the principal of and interest on eligible bonds issued to
construct, acquire, renovate, or improve an instructional
facility. The amount of state support is determined by the formula:
FYA = (FYL X ADA X BTR X 100) - (BTR X (DPV/100))
where:
"FYA" is the guaranteed facilities yield amount of state
funds allocated to the district for the year;
"FYL" is the dollar amount guaranteed level of state and
local funds per student per cent of tax effort, which is the amount
of district tax revenue per student in average daily attendance per
cent of tax effort available to a district at the ____ percentile in
wealth per student in average daily attendance, as determined by
the commissioner in cooperation with the Legislative Budget Board,
[$35] or a greater amount for any year provided by appropriation;
"ADA" is the greater of the number of students in average
daily attendance, as determined under Section 42.005, in the
district or 400;
"BTR" is the district's bond tax rate for the current year,
which is determined by dividing the amount budgeted by the district
for payment of eligible bonds by the quotient of the district's
taxable value of property as determined under Subchapter M, Chapter
403, Government Code, or, if applicable, Section 42.2521, divided
by 100; and
"DPV" is the district's taxable value of property as
determined under Subchapter M, Chapter 403, Government Code, or, if
applicable, Section 42.2521.
(d) The amount budgeted by a district for payment of
eligible bonds may include:
(1) bond taxes collected in the current school year;
(2) bond taxes collected in a preceding school year in
excess of the amount necessary to pay the district's share of actual
debt service on bonds in that year, provided that the taxes were not
used to generate other state financial assistance for the district;
[or]
(3) maintenance and operations taxes collected in the
current school year or a preceding school year in excess of the
amount eligible to be used to generate other state financial
assistance for the district; or
(4) penalty and interest on delinquent taxes, interest
on bond tax revenue, and any other available local revenue received
in the current school year or a preceding school year, provided that
the revenue was not used to generate other state financial
assistance for the district.
(e) Bonds are eligible to be paid with state and local funds
under this section if[:
[(1) taxes to pay the principal of and interest on the
bonds were first levied in the 1997-1998 school year or a later
school year; and
[(2)] the bonds do not have a weighted average
maturity of less than eight years.
(h) To receive state assistance under this subchapter, a
school district must certify [apply] to the commissioner, in
accordance with rules adopted by the commissioner, the amount of
the payment due on the [before issuing] bonds that will be paid with
state assistance that year. [Until the bonds are fully paid or the
instructional facility is sold:
[(1) a school district is entitled to continue
receiving state assistance without reapplying to the commissioner;
and
[(2) the guaranteed level of state and local funds per
student per cent of tax effort applicable to the bonds may not be
reduced below the level provided for the year in which the bonds
were issued.]
SECTION 5. Section 46.005, Education Code, is amended to
read as follows:
Sec. 46.005. LIMITATION ON GUARANTEED AMOUNT. (a) The
guaranteed amount of state and local funds to which a school
district is entitled [for a new project that a district may be
awarded in any state fiscal biennium] under Section 46.003 [for a
school district] may not exceed the lesser of:
(1) the amount of [the] actual debt service payments
the district makes in the biennium in which the bonds are issued; or
(2) the greater of:
(A) $___________ [$100,000]; or
(B) the product of the number of students in
average daily attendance in the district multiplied by $________
[$250].
(b) A school district may not receive state assistance for a
project under this subchapter for more than one year. After that
year, the district is entitled to state assistance for that project
only as provided by Subchapter B.
SECTION 6. The heading to Section 46.009, Education Code,
is amended to read as follows:
Sec. 46.009. PAYMENT OF INITIAL SCHOOL FACILITIES
ALLOTMENTS.
SECTION 7. Section 46.009, Education Code, is amended by
amending Subsection (b) and adding Subsection (b-1) to read as
follows:
(b) The total amount of money to which a district is
entitled under this subchapter is a portion of the total amount of
the district's entitlement under this chapter and is not a separate
item subject to specific appropriation. If the amount available
[appropriated] for purposes of this subchapter for a year is less
than the total amount determined under Subsection (a) for that
year, the commissioner shall[:
[(1)] transfer from the Foundation School Program to
the instructional facilities program the amount by which the total
amount determined under Subsection (a) exceeds the amount
available.
(b-1) If as a result of the transfer made under Subsection
(b) there are insufficient funds in the Foundation School Program
to pay for the program as required under Section 42.253, the
commissioner shall [appropriated; and
[(2)] reduce each district's foundation school fund
allocations for that year and increase each district's foundation
school fund allocations for the following year in the manner
provided by Section 42.253(h).
SECTION 8. Section 46.0111(a)(2), Education Code, is
amended to read as follows:
(2) "State's share" means an amount equal to the
district's net proceeds from the recovery multiplied by a
percentage determined by dividing the amount of state assistance
under this chapter [subchapter] used to pay the principal of and
interest on bonds issued in connection with the instructional
facility that is the subject of the action by the total amount of
principal and interest paid on the bonds as of the date of the
judgment or settlement.
SECTION 9. Sections 46.0111(b) and (d), Education Code, are
amended to read as follows:
(b) A school district that brings an action for recovery of
damages for the defective design, construction, renovation, or
improvement of an instructional facility financed by bonds for
which the district receives state assistance under this chapter
[subchapter] shall provide the commissioner with written notice of
the action.
(d) A school district shall use the net proceeds from an
action brought by the district for the defective design,
construction, renovation, or improvement of an instructional
facility financed by bonds for which the district receives state
assistance under this chapter [subchapter] to repair the defective
design, construction, renovation, or improvement of the
instructional facility on which the action is brought or to replace
the facility. Section 46.008 applies to the repair.
SECTION 10. The heading to Subchapter B, Chapter 46,
Education Code, is amended to read as follows:
SUBCHAPTER B. [ASSISTANCE WITH PAYMENT OF EXISTING] DEBT TAX
RELIEF
SECTION 11. The heading to Section 46.032, Education Code,
is amended to read as follows:
Sec. 46.032. DEBT TAX RELIEF ALLOTMENT.
SECTION 12. Section 46.032, Education Code, is amended by
amending Subsections (a) and (c) and adding Subsections (a-1),
(a-2), and (d) to read as follows:
(a) Each school district is guaranteed a specified amount
per student in state and local funds for each cent of tax effort to
pay the principal of and interest on eligible bonds. The amount of
state support, subject only to the maximum amount under Section
46.034, is determined by the formula:
DTRA [EDA] = (EDGL X ADA X EDTR X 100) - (EDTR X (DPV/100))
where:
"DTRA" ["EDA"] is the amount of state funds to be allocated to
the district for reduction of the [assistance with] existing debt
tax rate;
"EDGL" is the dollar amount guaranteed level of state and
local funds per student per cent of tax effort, which is the
greatest of the amount of district tax revenue per student in
average daily attendance per cent of tax effort available to a
district at the ____ percentile in wealth per student in average
daily attendance, as determined by the commissioner in cooperation
with the Legislative Budget Board, the amount of district tax
revenue per student per cent of tax effort used for purposes of this
subchapter in the preceding year, [$35] or a specified [greater]
amount for any year provided by appropriation;
"ADA" is the greater of the number of students in average
daily attendance, as determined under Section 42.005, in the
district or 400;
"EDTR" is the existing debt tax rate of the district, which is
determined by dividing the amount budgeted by the district for
payment of eligible bonds by the quotient of the district's taxable
value of property as determined under Subchapter M, Chapter 403,
Government Code, or, if applicable, under Section 42.2521, divided
by 100; and
"DPV" is the district's taxable value of property as
determined under Subchapter M, Chapter 403, Government Code, or, if
applicable, under Section 42.2521.
(a-1) The percentile in wealth per student described by
Subsection (a) for purposes of determining the dollar amount
guaranteed level of state and local funds ("EDGL") applies
beginning with the 2018-2019 school year. For the 2013-2014
through 2017-2018 school years, "EDGL" is determined as follows:
(1) for the 2013-2014 school year, "EDGL" is $35;
(2) for the 2014-2015 school year, "EDGL" is
determined under Subsection (a) using the ____ percentile in wealth
per student;
(3) for the 2015-2016 school year, "EDGL" is
determined under Subsection (a) using the ____ percentile in wealth
per student;
(4) for the 2016-2017 school year, "EDGL" is
determined under Subsection (a) using the ____ percentile in wealth
per student; and
(5) for the 2017-2018 school year, "EDGL" is
determined under Subsection (a) using the ____ percentile in wealth
per student.
(a-2) Subsection (a-1) and this subsection expire September
1, 2018.
(c) The amount budgeted by a district for payment of
eligible bonds may include:
(1) bond taxes collected in the current school year;
(2) bond taxes collected in a preceding school year in
excess of the amount necessary to pay the district's share of actual
debt service on bonds in that year, provided that the taxes were not
used to generate other state financial assistance for the district;
[or]
(3) maintenance and operations taxes collected in the
current school year or a preceding school year in excess of the
amount eligible to be used to generate other state financial
assistance for the district; or
(4) penalty and interest on delinquent taxes, interest
on bond tax revenue, and any other available local revenue received
in the current school year or a preceding school year, provided that
the revenue was not used to generate other state financial
assistance for the district.
(d) A school district shall reduce the tax rate levied by
the district for payment of eligible bonds by a percentage
established by the commissioner to account for an increase in the
yield guaranteed under Subsection (a) or an increase in the yield
produced by a higher yield under this subchapter over the yield
received by the district before the bonds became eligible for
assistance under this subchapter.
SECTION 13. Section 46.033, Education Code, is amended to
read as follows:
Sec. 46.033. ELIGIBLE BONDS. Bonds, including bonds issued
under Section 45.006, are eligible to be paid with state and local
funds under this subchapter if during the final school year of the
preceding state fiscal biennium:
(1) the district:
(A) made payments on the bonds;
(B) [during the final school year of the
preceding state fiscal biennium or taxes] levied taxes to pay the
principal of and interest on the bonds that were included in the
district's audited debt service collections; or
(C) received [for that school year; and (2) the
district does not receive] state assistance under Subchapter A for
payment of [the] principal of and interest on [the] bonds; and
(2) the district certifies to the commissioner in
accordance with rules adopted by the commissioner the amount of
payments due on the bonds in each year of the subsequent state
fiscal biennium.
SECTION 14. Section 46.034, Education Code, is amended by
amending Subsections (a) and (c) and adding Subsection (d) to read
as follows:
(a) The existing debt tax rate ("EDTR") under Section 46.032
may not exceed $_____ [$0.29] per $100 of valuation, or a greater
amount for any year provided by appropriation.
(c) Except as provided by Subsection (d), if [If] the amount
required to pay the principal of and interest on eligible bonds in a
school year is less than the amount of payments made by the district
on the bonds during the final school year of the preceding state
fiscal biennium or the district's audited debt service collections
for that school year, the district may not receive aid in excess of
the amount that, when added to the district's local revenue for the
school year, equals the amount required to pay the principal of and
interest on the bonds.
(d) A school district is entitled to state assistance under
this subchapter based on the district's tax rate for the current
school year if the district demonstrates to the commissioner's
satisfaction that the district must construct, acquire, renovate,
or improve one or more instructional facilities to serve the
children of military personnel transferred to a military
installation in or near the district under the Defense Base Closure
and Realignment Act of 1990 (10 U.S.C. Section 2687).
SECTION 15. The heading to Subchapter C, Chapter 46,
Education Code, is amended to read as follows:
SUBCHAPTER C. FINANCING AND REFINANCING
SECTION 16. Subchapter C, Chapter 46, Education Code, is
amended by adding Section 46.051 to read as follows:
Sec. 46.051. DETERMINATION BY COMMISSIONER OF GUARANTEED
YIELDS AND PERCENTAGE REDUCTION OF DISTRICT DEBT TAX RATES. (a)
Before the beginning of each school year, the commissioner, in
cooperation with the Legislative Budget Board, shall estimate the
guaranteed yields under Subchapters A and B.
(b) As required under Section 46.032(d), the commissioner
shall determine the percentage by which a district is required to
reduce the district's debt tax rate to account for an increase in
the guaranteed yield over the preceding year.
SECTION 17. Section 46.061, Education Code, is amended to
read as follows:
Sec. 46.061. AUTHORITY OF COMMISSIONER OVER [STATE
ASSISTANCE FOR] REFINANCING. [(a)] The commissioner by rule may
provide for the payment of state assistance under this chapter to
refinance school district debt. A refinancing may not increase the
cost to the state of providing the assistance.
[(b) The commissioner may allocate state assistance
provided for a refinancing to Subchapter A, Subchapter B, or both,
as appropriate.]
SECTION 18. The following sections of the Education Code
are repealed:
(1) Section 46.006;
(2) Section 46.011; and
(3) Sections 46.034(b) and (b-1).
SECTION 19. This Act takes effect September 1, 2013.