Second Substitute H.B. 53

Representative Thomas V. Hatch proposes to substitute the following bill:

1 PUBLIC EDUCATION CAPITAL OUTLAY AMENDMENTS
2 2000 GENERAL SESSION
3 STATE OF UTAH
4 Sponsor: Thomas V. Hatch
5 AN ACT RELATING TO PUBLIC SCHOOLS; MODIFYING THE CRITERIA AND
6 FORMULA FOR DISTRIBUTING CAPITAL OUTLAY FOUNDATION MONIES AND
7 EMERGENCY SCHOOL BUILDING AID; AND PROVIDING AN EFFECTIVE DATE.
8 This act affects sections of Utah Code Annotated 1953 as follows:
9 AMENDS:
10 53A-21-103, as last amended by Chapter 129, Laws of Utah 1999
11 Be it enacted by the Legislature of the state of Utah:
12 Section 1. Section 53A-21-103 is amended to read:
13 53A-21-103. Qualifications for participation in the foundation program --
14 Distribution of monies -- Distribution formulas.
15 (1) In order for a school district to qualify for monies under the capital outlay foundation
16 program established in Subsection 53A-21-102 (1), a local school board must levy a tax rate of [up
17 to] at least .0024 per dollar of taxable value for capital outlay and debt service.
18 [(2) (a) The State Board of Education shall adopt a rule in accordance with Title 63,
19 Chapter 46a, Utah Administrative Rulemaking Act, that allows a school district levying less than
20 the full .0024 tax rate to receive proportional funding under the foundation program based upon
21 the percentage of the .0024 tax rate levied by the district.]
22 [(b) The rules may include hold harmless provisions for up to two years.]
23 [(3) (a) Through June 30, 2001, 20% of the monies in the capital outlay foundation
24 program shall be used in]
25 (2) (a) There is established an emergency school building [needs] aid program.

26 (b) [Beginning July 1, 2001, the emergency school building needs] The program shall be
27 [terminated and the monies otherwise spent in that program shall be used for the general purposes
28 of the capital outlay foundation program] supplementary to the capital outlay foundation program
29 established in Subsection 53A-21-102 (1) and funded from monies in the capital outlay foundation
30 program.
31 (c) The monies designated for the emergency school building aid program shall be limited
32 to $2,000 times the sum of the positive growth in the number of students averaged over the prior
33 five years in each district as measured by the October 1 enrollment counts.
34 (d) To qualify for the emergency school building aid program, a school district must levy
35 a tax rate of at least .0024 for capital outlay and debt service, have experienced positive growth
36 in its student population over the prior five years as measured by the October 1 enrollment counts,
37 and demonstrated a need for emergency aid.
38 [(4)] (3) The State Board of Education shall distribute monies in the capital outlay
39 foundation program and the emergency school building [needs] aid program in accordance with
40 formulas developed by the state superintendent of public instruction.
41 (a) The board shall distribute capital outlay foundation monies on the basis of a minimum
42 guarantee per three-year average [daily membership] October 1 enrollment as computed by the
43 state superintendent of public instruction using the following criteria:
44 [(i) available monies; and ]
45 [(ii) the assessed valuation per average daily membership in each school district.]
46 (i) calculate the net tax yield by multiplying the district's prior year assessed valuation by
47 a tax rate of .0042 per dollar of assessed valuation and subtracting the prior three-year average
48 bond principal and interest payments;
49 (ii) calculate the net yield per student by dividing the net tax yield by the prior three-year
50 average October 1 enrollment; and
51 (iii) compute revenues available to each district based on the net yield per student subject
52 to the total available foundation monies.
53 (b) (i) The formula for the emergency school building [needs] aid distribution shall include
54 [the following components: (i)] a school district's need, ability, and effort to raise money for
55 [school building needs as related to the assessed valuation per student for real property within the
56 school district;] new school space based on the following criteria:

57 [(ii) need as reflected by:]
58 [(A) the current number of students in the school district who are in alternative housing;
59 and]
60 [(B) growth, both within the district and compared to the state as a whole; and]
61 [(iii) the school district's effort to raise money based on:]
62 [(A) the district's total tax rate; and]
63 [(B) the district's bond and bond interest payments compared to its ability to raise
64 revenue.]
65 (A) identifying the districts that had a positive five-year average October 1 enrollment
66 growth;
67 (B) calculating the net tax yield by subtracting the three-year average bond principal and
68 interest payments from the district's prior year assessed valuation multiplied by a tax rate of .0042
69 per dollar of assessed valuation;
70 (C) dividing the net tax yield by the prior three-year average October 1 enrollment and
71 excluding districts exceeding $2,000 per student;
72 (D) subtracting the net tax yield per student from $2,000 and multiplying by the five-year
73 average growth of October 1 student enrollments; and
74 (E) distributing the available monies based on the product arrived at in Subsection
75 (3)(b)(i)(D).
76 (ii) Qualifying bond issues that are recognized for principal and interest payments must
77 have a minimum repayment period of 10 years or be prorated as though debt repayment would
78 have been calculated on a minimum of 10 years.
79 (iii) Only bond and debt incurred for new school space shall be included in the
80 calculations, excluding any part of the levy not used for capital facilities, such as technology or
81 instructional improvement programs.
82 Section 2. Effective date.
83 This act takes effect on July 1, 2000.