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First Substitute S.B. 30

Senator Carlene M. Walker proposes the following substitute bill:


             1     
CREATION OF NEW SCHOOL DISTRICT

             2     
AMENDMENTS

             3     
2007 GENERAL SESSION

             4     
STATE OF UTAH

             5     
Chief Sponsor: Carlene M. Walker

             6     
House Sponsor: Gregory H. Hughes

             7     
             8      LONG TITLE
             9      General Description:
             10          This bill modifies provisions related to the creation of a new school district.
             11      Highlighted Provisions:
             12          This bill:
             13          .    adds a vote to elect school district board members resulting from the creation of a
             14      new school district to the list of special elections that a local political subdivision
             15      may call;
             16          .    adds a definition relating to the creation of a new school district;
             17          .    provides a process for certifying the creation of a new school district and establishes
             18      the date that the new district is created;
             19          .    clarifies the duties of a new district and the district from which the new district was
             20      created with respect to providing educational services;
             21          .    makes exceptions to requirements applicable to a proposal by interlocal agreement
             22      participants to create a new school district where the proposal would otherwise
             23      geographically isolate an area within a municipality that is served by a separate
             24      school district;
             25          .    provides for the election of school district board members of a new school district


             26      and of the school district from which the new district was created, and provides for the terms of
             27      those members;
             28          .    establishes a process for allocating the property of an existing school district
             29      between a newly created district and the school district from which it was created,
             30      including:
             31              .    transition teams to represent the new district and the district from which the new
             32      district was created; and
             33              .    a requirement that disputes about the allocation of property be decided by
             34      binding arbitration;
             35          .    shifts from the board of a new school district to the board of the district from which
             36      the new district was created the responsibility to continue to levy a tax on property
             37      in the new district to pay the new district's proportionate share of bonds issued
             38      before the new district was created;
             39          .    prohibits a school district board from issuing bonds approved but not issued before
             40      the creation of a new district under certain circumstances; and
             41          .    makes technical, conforming, and clarifying changes.
             42      Monies Appropriated in this Bill:
             43          None
             44      Other Special Clauses:
             45          None
             46      Utah Code Sections Affected:
             47      AMENDS:
             48          20A-1-203, as last amended by Chapter 211, Laws of Utah 2005
             49          20A-14-201, as last amended by Chapter 233, Laws of Utah 2005
             50          53A-2-104, as last amended by Chapter 183, Laws of Utah 2006
             51          53A-2-105, as last amended by Chapter 183, Laws of Utah 2006
             52          53A-2-117, as enacted by Chapter 234, Laws of Utah 2003
             53          53A-2-118, as last amended by Chapter 183, Laws of Utah 2006
             54          53A-2-118.1, as enacted by Chapter 183, Laws of Utah 2006
             55          53A-2-119, as enacted by Chapter 234, Laws of Utah 2003
             56          53A-2-120, as enacted by Chapter 234, Laws of Utah 2003


             57          53A-2-121, as enacted by Chapter 234, Laws of Utah 2003
             58     
             59      Be it enacted by the Legislature of the state of Utah:
             60          Section 1. Section 20A-1-203 is amended to read:
             61           20A-1-203. Calling and purpose of special elections.
             62          (1) Statewide and local special elections may be held for any purpose authorized by
             63      law.
             64          (2) (a) Statewide special elections shall be conducted using the procedure for regular
             65      general elections.
             66          (b) Except as otherwise provided in this title, local special elections shall be conducted
             67      using the procedures for regular municipal elections.
             68          (3) The governor may call a statewide special election by issuing an executive order
             69      that designates:
             70          (a) the date for the statewide special election; and
             71          (b) the purpose for the statewide special election.
             72          (4) The Legislature may call a statewide special election by passing a joint or
             73      concurrent resolution that designates:
             74          (a) the date for the statewide special election; and
             75          (b) the purpose for the statewide special election.
             76          (5) (a) The legislative body of a local political subdivision may call a local special
             77      election only for:
             78          (i) a vote on a bond or debt issue;
             79          (ii) a vote on a voted leeway program authorized by Section 53A-17a-133 or
             80      53A-17a-134 ;
             81          (iii) an initiative authorized by Chapter 7, Part 5, Local Initiatives - Procedure;
             82          (iv) a referendum authorized by Chapter 7, Part 6, Local Referenda - Procedures;
             83          (v) if required or authorized by federal law, a vote to determine whether or not Utah's
             84      legal boundaries should be changed; [or]
             85          (vi) a vote authorized or required by Title 59, Chapter 12, Sales and Use Tax Act[.]; or
             86          (vii) a vote to elect members to school district boards for a new school district and a
             87      remaining school district, as defined in Section 53A-2-117 , following the creation of a new


             88      school district under Section 53A-2-118.1 .
             89          (b) The legislative body of a local political subdivision may call a local special election
             90      by adopting an ordinance or resolution that designates:
             91          (i) the date for the local special election; and
             92          (ii) the purpose for the local special election.
             93          Section 2. Section 20A-14-201 is amended to read:
             94           20A-14-201. Boards of education -- School board districts -- Creation --
             95      Reapportionment.
             96          (1) (a) The county legislative body, for local school districts whose boundaries
             97      encompass more than a single municipality, and the municipal legislative body, for school
             98      districts contained completely within a municipality, shall divide the local school district into
             99      local school board districts as required under Subsection 20A-14-202 (1)(a).
             100          (b) The county and municipal legislative bodies shall divide the school district so that
             101      the local school board districts are substantially equal in population and are as contiguous and
             102      compact as practicable.
             103          (2) (a) County and municipal legislative bodies shall reapportion district boundaries to
             104      meet the population, compactness, and contiguity requirements of this section:
             105          (i) at least once every ten years;
             106          (ii) [whenever] if a new district is created[;]:
             107          (A) within 45 days after the canvass of an election at which voters approve the creation
             108      of a new district; and
             109          (B) at least 60 days before the candidate filing deadline for a school board election;
             110          (iii) whenever districts are consolidated;
             111          (iv) whenever a district loses more than 20% of the population of the entire school
             112      district to another district;
             113          (v) whenever a district loses more than 50% of the population of a local school board
             114      district to another district;
             115          (vi) whenever a district receives new residents equal to at least 20% of the population
             116      of the district at the time of the last reapportionment because of a transfer of territory from
             117      another district; and
             118          (vii) whenever it is necessary to increase the membership of a board from five to seven


             119      members as a result of changes in student membership under Section 20A-14-202 .
             120          (b) If a school district receives territory containing less than 20% of the population of
             121      the transferee district at the time of the last reapportionment, the local school board may assign
             122      the new territory to one or more existing school board districts.
             123          (3) (a) Reapportionment does not affect the right of any school board member to
             124      complete the term for which the member was elected.
             125          (b) (i) After reapportionment, representation in a local school board district shall be
             126      determined as provided in Subsection (3).
             127          (ii) If only one board member whose term extends beyond reapportionment lives
             128      within a reapportioned local school board district, that board member shall represent that local
             129      school board district.
             130          (iii) (A) If two or more members whose terms extend beyond reapportionment live
             131      within a reapportioned local school board district, the members involved shall select one
             132      member by lot to represent the local school board district.
             133          (B) The other members shall serve at-large for the remainder of their terms.
             134          (C) The at-large board members shall serve in addition to the designated number of
             135      board members for the board in question for the remainder of their terms.
             136          (iv) If there is no board member living within a local school board district whose term
             137      extends beyond reapportionment, the seat shall be treated as vacant and filled as provided in
             138      this part.
             139          (4) (a) If, before an election affected by reapportionment, the county or municipal
             140      legislative body that conducted the reapportionment determines that one or more members
             141      must be elected to terms of two years to meet this part's requirements for staggered terms, the
             142      legislative body shall determine by lot which of the reapportioned local school board districts
             143      will elect members to two-year terms and which will elect members to four-year terms.
             144          (b) All subsequent elections are for four-year terms.
             145          (5) Within ten days after any local school board district boundary change, the county or
             146      municipal legislative body making the change shall send an accurate map or plat of the
             147      boundary change to the Automated Geographic Reference Center created under Section
             148      63F-1-506 .
             149          Section 3. Section 53A-2-104 is amended to read:


             150           53A-2-104. Transfer of a portion of a school district -- Board resolution -- Board
             151      petition -- Elector petition -- Transfer election.
             152          (1) Part of a school district may be transferred to another district in one of the
             153      following ways:
             154          (a) presentation to the county legislative body of each of the affected counties of a
             155      resolution requesting the transfer, approved by at least four-fifths of the members of the local
             156      board of education of each affected school district;
             157          (b) presentation to the county legislative body of each affected county of a petition
             158      requesting that the electors vote on the transfer, signed by a majority of the members of the
             159      local school board of each affected school district; or
             160          (c) presentation to the county legislative body of each affected county of a petition
             161      requesting that the electors vote on the transfer, signed by 15% of the qualified electors in each
             162      of the affected school districts within that county[; or].
             163          [(d) voter approval of a proposal pursuant to Section 53A-2-118.1 .]
             164          (2) (a) If an annexation of property by a city would result in its residents being served
             165      by more than one school district, then the presidents of the affected local school boards shall
             166      meet within 60 days prior to the effective date of the annexation to determine whether it would
             167      be advisable to adjust school district boundaries to permit all residents of the expanded city to
             168      be served by a single school district.
             169          (b) Upon conclusion of the meeting, the local school board presidents shall prepare a
             170      recommendation for presentation to their respective boards as soon as reasonably possible.
             171          (c) The boards may then initiate realignment proceedings under Subsection (1)(a) or
             172      (b).
             173          (d) If a local board rejects realignment under Subsection (1)(a) or (b), the other board
             174      may initiate the following procedures by majority vote within 60 days of the vote rejecting
             175      realignment:
             176          (i) (A) within 30 days after a vote to initiate these procedures, each local board shall
             177      appoint one member to a boundary review committee; or
             178          (B) if the local board becomes deadlocked in selecting the appointee under Subsection
             179      (2)(d)(i)(A), the board's chair shall make the appointment or serve as the appointee to the
             180      review committee.


             181          (ii) The two local board-appointed members of the committee shall meet and appoint a
             182      third member of the committee.
             183          (iii) If the two local board-appointed members are unable to agree on the appointment
             184      of a third member within 30 days after both are appointed, the State Superintendent of Public
             185      Instruction shall appoint the third member.
             186          (iv) The committee shall meet as necessary to prepare recommendations concerning
             187      resolution of the realignment issue, and shall submit the recommendations to the affected local
             188      boards within six months after the appointment of the third member of the committee.
             189          (v) If a majority of the members of each local board accepts the recommendation of the
             190      committee, or accepts the recommendation after amendment by the boards, then the accepted
             191      recommendation shall be implemented.
             192          (vi) If the committee fails to submit its recommendation within the time allotted, or if
             193      one local board rejects the recommendation, the affected boards may agree to extend the time
             194      for the committee to prepare an acceptable recommendation or either board may request the
             195      State Board of Education to resolve the question.
             196          (vii) If the committee has submitted a recommendation which the state board finds to
             197      be reasonably supported by the evidence, the state board shall adopt the committee's
             198      recommendation.
             199          (viii) The decision of the state board is final.
             200          (3) (a) The electors of each affected district shall vote on the transfer requested under
             201      Subsection (1)(b) or (c) at an election called for that purpose, which may be the next general
             202      election.
             203          (b) The election shall be conducted and the returns canvassed as provided by election
             204      law.
             205          (c) A transfer is effected only if a majority of votes cast by the electors in both the
             206      proposed transferor district and in the proposed transferee district are in favor of the transfer.
             207          Section 4. Section 53A-2-105 is amended to read:
             208           53A-2-105. Transfer of school property -- Indebtedness on transferred property.
             209          (1) If a transfer of a portion of one school district to another school district is approved
             210      under Section 53A-2-104 [or 53A-2-118.1 ], the state superintendent and the superintendents
             211      and presidents of the boards of education of each of the affected school districts shall determine


             212      the basis for a transfer of all school property reasonably and fairly allocable to that portion
             213      being transferred.
             214          (2) (a) Title to property transferred vests in the transferee board of education.
             215          (b) The transfer of a school building that is in operation at the time of determination
             216      shall be made at the close of a fiscal year.
             217          (c) The transfer of all other school property shall be made five days after approval of
             218      the transfer of territory under Section 53A-2-104 .
             219          (3) (a) The individuals referred to in Subsection (1) shall determine the portion of
             220      bonded indebtedness and other indebtedness of the transferor board for which the transferred
             221      property remains subject to the levy of taxes to pay a proportionate share of the outstanding
             222      indebtedness of the transferor board.
             223          (b) This is done by:
             224          (i) determining the amount of the outstanding bonded indebtedness and other
             225      indebtedness of the transferor board of education;
             226          (ii) determining the total taxable value of the property of the transferor district and the
             227      taxable value of the property to be transferred; and
             228          (iii) calculating the portion of the indebtedness of the transferor board for which the
             229      transferred portion retains liability.
             230          (4) (a) The agreement reflecting these determinations takes effect upon being filed with
             231      the State Board of Education.
             232          (b) The transferred property remains subject to the levy of taxes to pay a proportionate
             233      share of the outstanding indebtedness of the transferor school board.
             234          (c) The transferee school board may assume the obligation to pay the proportionate
             235      share of the transferor school board's indebtedness that has been determined under Subsection
             236      (3) to be the obligation of the transferred portion by the approval of a resolution by a majority
             237      of the qualified electors of the transferee school district at an election called and held for that
             238      purpose under Title 11, Chapter 14, Local Government Bonding Act.
             239          (5) If the transferee school district assumes the obligation to pay this proportionate
             240      share of the transferor school board's indebtedness, the transferee school board shall levy a tax
             241      in the whole of the transferee district, including the transferred portion, sufficient to pay the
             242      assumed indebtedness, and shall turn over the proceeds of the tax to the business administrator


             243      of the transferor board.
             244          (6) If the transferee school board does not assume this obligation, the transferee school
             245      board shall levy a tax on the transferred territory sufficient to pay the proportionate share of the
             246      indebtedness determined under this section, and shall turn over the proceeds of the tax to the
             247      business administrator of the transferor board.
             248          (7) For the purposes of school districts affected by repealed laws governing the
             249      annexation of an unincorporated area of a school district by a city which included what was
             250      formerly known as a city school district, transitions of unincorporated areas and property from
             251      the transferor district to the transferee district in progress on the effective date of this act shall
             252      revert to the boundaries and ownership prior to the initiation of annexation and may then
             253      proceed under this section and Section 53A-2-104 .
             254          Section 5. Section 53A-2-117 is amended to read:
             255           53A-2-117. Definitions.
             256          As used in Sections 53A-2-117 through 53A-2-121 :
             257          (1) "Existing district" or "existing school district" means a school district from which a
             258      new district is created.
             259          (2) "New district" or "new school district" means a school district created under
             260      Section 53A-2-118 [.] or 53A-2-118.1 .
             261          (3) "Remaining district" means an existing district after the creation of a new district.
             262          Section 6. Section 53A-2-118 is amended to read:
             263           53A-2-118. Creation of new school district by county legislative body -- Initiation
             264      of process -- Procedures to be followed.
             265          (1) A county legislative body may create a new school district from an existing school
             266      district, as provided in this section, if the area of the new school district is within or, under
             267      Subsection 53A-2-118.1 (2)(b)(ii), considered to be within the geographical boundaries of the
             268      county.
             269          (2) (a) The process may be initiated:
             270          (i) through a citizens' initiative petition;
             271          (ii) at the request of the board of the existing district or districts to be affected by the
             272      creation of the new district; or
             273          (iii) at the request of a city within the boundaries of the school district or at the request


             274      of interlocal agreement participants, pursuant to Section 53A-2-118.1 .
             275          (b) (i) A petition submitted under Subsection (2)(a)(i) must be signed by qualified
             276      electors residing within the geographical boundaries of the proposed new school district equal
             277      in number to at least 15% of the number of electors in the area who voted for the office of
             278      governor at the last regular general election.
             279          (ii) A request or petition submitted under Subsection (2)(a) shall:
             280          (A) be filed with the county clerk;
             281          (B) indicate the typed or printed name and current residence address of each governing
             282      board member making a request, or registered voter signing a petition, as the case may be;
             283          (C) describe the proposed new school district boundaries; and
             284          (D) designate up to five signers of the petition or request as sponsors, one of whom
             285      shall be designated as the contact sponsor, with the mailing address and telephone number of
             286      each.
             287          (c) A signer of a petition under Subsection (2)(a)(i) may withdraw or, once withdrawn,
             288      reinstate the signer's signature at any time before the filing of the petition by filing a written
             289      withdrawal or reinstatement with the county clerk.
             290          (d) The process under Subsection (2)(a)(i) may only be initiated once during any
             291      four-year period.
             292          (e) A new district may not be formed pursuant to Subsection (2)(a) if the student
             293      population of the proposed new district is less than 3,000 or the existing district's student
             294      population would be less than 3,000 because of the creation of the new school district.
             295          (f) Within 45 days after the filing of a request or petition under Subsection (2)(a), the
             296      county clerk shall:
             297          (i) determine whether the request or petition complies with Subsections (2)(a), (b), (d),
             298      and (e), as applicable; and
             299          (ii) (A) if the county clerk determines that the request or petition complies with the
             300      applicable requirements:
             301          (I) certify the request or petition and deliver the certified request or petition to the
             302      county legislative body; and
             303          (II) mail or deliver written notification of the certification to the contact sponsor; or
             304          (B) if the county clerk determines that the request or petition fails to comply with any


             305      of the applicable requirements, reject the request or petition and notify the contact sponsor in
             306      writing of the rejection and reasons for the rejection.
             307          (g) If the county clerk fails to certify or reject a request or petition within 45 days after
             308      its filing, the request or petition shall be considered to be certified.
             309          (h) (i) If the county clerk rejects a request or petition, the request or petition may be
             310      amended to correct the deficiencies for which it was rejected and then refiled.
             311          (ii) Subsection (2)(d) does not apply to a request or petition that is amended and refiled
             312      after having been rejected by a county clerk.
             313          (i) If a county legislative body receives a request from a school board under Subsection
             314      (2)(a)(ii) or a petition under Subsection (2)(a)(i) which is certified by the county clerk on or
             315      before December 1:
             316          (i) the county legislative body shall appoint an ad hoc advisory committee, as provided
             317      by Subsection (3), on or before January 1;
             318          (ii) the ad hoc advisory committee shall submit its report and recommendations to the
             319      county legislative body, as provided by Subsection (3), on or before July 1; and
             320          (iii) if the county legislative body approves a proposal to create a new district, the
             321      proposal shall be submitted to the county clerk to be voted on by the electors of the existing
             322      district at the regular general or municipal general election held in November.
             323          (3) (a) The county legislative body shall appoint an ad hoc advisory committee to
             324      review and make recommendations on a request for the creation of a new school district
             325      submitted under Subsection (2)(a)(i) or (ii).
             326          (b) The advisory committee shall:
             327          (i) seek input from:
             328          (A) those requesting the creation of the new school district;
             329          (B) the school board and school personnel of the existing school district;
             330          (C) those citizens residing within the geographical boundaries of the existing school
             331      district;
             332          (D) the State Board of Education; and
             333          (E) other interested parties;
             334          (ii) review data and gather information on at least:
             335          (A) the financial viability of the proposed new school district;


             336          (B) the proposal's financial impact on the existing school district;
             337          (C) the exact placement of school district boundaries; and
             338          (D) the positive and negative effects of creating a new school district and whether the
             339      positive effects outweigh the negative if a new school district were to be created; and
             340          (iii) make a report to the county legislative body in a public meeting on the committee's
             341      activities, together with a recommendation on whether to create a new school district.
             342          (4) For a request or petition submitted under Subsection (2)(a)(i) or (2)(a)(ii):
             343          (a) The county legislative body shall provide for a 45-day public comment period on
             344      the report and recommendation to begin on the day the report is given under Subsection
             345      (3)(b)(iii).
             346          (b) Within 14 days after the end of the comment period, the county legislative body
             347      shall vote on the creation of the proposed new school district.
             348          (c) The proposal is approved if a majority of the members of the county legislative
             349      body votes in favor of the proposal.
             350          (d) If the proposal is approved, the county legislative body shall submit the proposal to
             351      the county clerk to be voted on:
             352          (i) by the legal voters of the existing school district;
             353          (ii) in accordance with Title 20A, Election Code; and
             354          (iii) at the next regular general election or municipal general election, whichever is
             355      first.
             356          (e) Creation of the new school district shall occur if a majority of the electors within
             357      both the proposed school district and the remaining school district voting on the proposal vote
             358      in favor of the creation of the new district.
             359          (f) The county legislative body shall provide notice of the action as required in Section
             360      53A-2-101.5 .
             361          (g) If a proposal submitted under Subsection (2)(a)(i) or (ii) to create a new district is
             362      approved by the electors, the existing district's documented costs to study and implement the
             363      proposal shall be reimbursed by the new district.
             364          (5) (a) If a proposal submitted under Subsection (2)(a)(iii) is certified under Subsection
             365      (2)(f) or (g), the county legislative body shall submit the proposal to the county clerk to be
             366      voted on:


             367          (i) by the legal voters residing within the proposed new school district boundaries;
             368          (ii) in accordance with Title 20A, Election Code; and
             369          (iii) at the next regular general election or municipal general election, whichever is
             370      first.
             371          (b) (i) [Creation of the new school district shall occur if] If a majority of the legal
             372      voters within the proposed new school district boundaries voting on the proposal at an election
             373      under Subsection (5)(a) vote in favor of the creation of the new district[.]:
             374          (A) the county legislative body shall, within 30 days after the canvass of the election,
             375      file with the lieutenant governor the written notice required under Section 53A-2-101.5 ; and
             376          (B) upon the lieutenant governor's issuance of the certificate under Section 67-1a-6.5 ,
             377      the new district is created.
             378          (ii) Notwithstanding the creation of a new district as provided in Subsection
             379      (5)(b)(i)(B):
             380          (A) a new school district may not begin to provide educational services to the area
             381      within the new district until July 1 of the second calendar year following the election at which
             382      voters approve creation of the new school district;
             383          (B) a remaining district may not begin to provide educational services to the area
             384      within the remaining district until the time specified in Subsection (5)(b)(ii)(A); and
             385          (C) the existing district shall continue, until the time specified in Subsection
             386      (5)(b)(ii)(A), to provide educational services within the entire area covered by the existing
             387      district as though the new district had not been created.
             388          Section 7. Section 53A-2-118.1 is amended to read:
             389           53A-2-118.1. Option for school district creation.
             390          (1) After conducting a feasibility study, a city of the first or second class, as defined
             391      under Section 10-2-301 , may by majority vote of the legislative body, submit for voter approval
             392      a measure to create a new school district with boundaries contiguous with that city's
             393      boundaries, in accordance with Section 53A-2-118 .
             394          (2) (a) By majority vote of the legislative body, a city of any class, a town, or a county,
             395      may, together with one or more other cities, towns, or the county enter into an interlocal
             396      agreement, in accordance with Title 11, Chapter 13, Interlocal Cooperation Act, for the purpose
             397      of submitting for voter approval a measure to create a new school district.


             398          (b) (i) In accordance with Section 53A-2-118 , interlocal agreement participants under
             399      Subsection (2)(a) may submit a proposal for voter approval if:
             400          [(i)] (A) the interlocal agreement participants conduct a feasibility study prior to
             401      submitting the proposal to the county;
             402          [(ii)] (B) the combined population within the proposed new school district boundaries
             403      meets the minimum population threshold for a city of the second class; and
             404          [(iii)] (C) the new school district boundaries:
             405          [(A)] (I) are contiguous;
             406          [(B)] (II) do not completely surround or otherwise completely geographically isolate a
             407      portion of an existing school district that is not part of the proposed new school district from
             408      the remaining part of the existing school district, except as provided in Subsection (2)(d)(iii);
             409          [(C)] (III) include the entire boundaries of [any] each participant city or town, except as
             410      provided in Subsection (2)(d)(ii); and
             411          [(D)] (IV) subject to Subsection (2)(b)(ii), do not cross county lines.
             412          (ii) For purposes of Subsection (2)(b)(i)(C)(IV) and Subsection 53A-2-118 (1), a
             413      municipality located in more than one county is considered to be entirely within the same
             414      county as other participants in an interlocal agreement under Subsection (2)(a) if more of the
             415      municipality's land area and population is located in that same county than outside the county.
             416          (c) (i) A county may only participate in an interlocal agreement under this Subsection
             417      (2) for the unincorporated areas of the county.
             418          (ii) Boundaries of a new school district created under this section may include a portion
             419      of the unincorporated area of the county, including a portion of a township.
             420          (d) (i) As used in this Subsection (2)(d):
             421          (A) "Isolated area" means an area that:
             422          (I) is entirely within the boundaries of a municipality that, except for that area, is
             423      entirely within a school district different than the school district in which the area is located;
             424      and
             425          (II) would, because of the creation of a new school district from the existing district in
             426      which the area is located, become completely geographically isolated.
             427          (B) "Municipality's school district" means the school district that includes all of the
             428      municipality in which the isolated area is located except the isolated area.


             429          (ii) Notwithstanding Subsection (2)(b)(i)(C)(III), a municipality may be a participant in
             430      an interlocal agreement under Subsection (2)(a) with respect to some but not all of the area
             431      within the municipality's boundaries if the portion of the municipality proposed to be included
             432      in the new school district would, if not included, become an isolated area upon the creation of
             433      the new school district.
             434          (iii) (A) Notwithstanding Subsection (2)(b)(i)(C)(II), a proposal to create a new school
             435      district may be submitted for voter approval pursuant to an interlocal agreement under
             436      Subsection (2)(a), even though the new school district boundaries would create an isolated
             437      area, if:
             438          (I) the potential isolated area is contiguous to one or more of the interlocal agreement
             439      participants;
             440          (II) the interlocal participants submit a written request to the municipality in which the
             441      potential isolated area is located, requesting the municipality to enter into an interlocal
             442      agreement under Subsection (2)(a) that proposes to submit for voter approval a measure to
             443      create a new school district that includes the potential isolated area; and
             444          (III) 90 days after a request under Subsection (2)(d)(iii)(A)(II) is submitted, the
             445      municipality has not entered into an interlocal agreement as requested in the request.
             446          (B) Each municipality receiving a request under Subsection (2)(d)(iii)(A)(II) shall hold
             447      one or more public hearings to allow input from the public and affected school districts
             448      regarding whether or not the municipality should enter into an interlocal agreement with
             449      respect to the potential isolated area.
             450          (C) (I) This Subsection (2)(d)(iii)(C) applies if:
             451          (Aa) a new school district is created under this section after a measure is submitted to
             452      voters based on the authority of Subsection (2)(d)(iii)(A); and
             453          (Bb) the creation of the new school district results in an isolated area.
             454          (II) The isolated area shall, on July 1 of the second calendar year following the election
             455      at which voters approve the creation of a new school district, become part of the municipality's
             456      school district.
             457          (III) Unless the isolated area is the only remaining part of the existing district, the
             458      process described in Subsection (4) shall be modified to:
             459          (Aa) include a third transition team, appointed by the local school board of the


             460      municipality's school district, to represent that school district;
             461          (Bb) require allocation of the existing district's property among the new district, the
             462      remaining district, and the municipality's school district;
             463          (Cc) require each of the three transition teams to appoint one member to the
             464      three-member arbitration panel, if an arbitration panel is established; and
             465          (Dd) require the municipality's school district to bear 1/3 of the costs of arbitration.
             466          (IV) The existing district shall continue to provide educational services to the isolated
             467      area until July 1 of the second calendar year following the election at which voters approve the
             468      creation of a new school district.
             469          (3) (a) If a proposal under this section is approved by voters:
             470          (i) an election shall be held on the June special election date, as provided in Section
             471      20A-1-204 , in the year following the election at which voters approved the creation of a new
             472      school district, to elect:
             473          (A) all members to the board of the new school district; and
             474          (B) all members to the board of the remaining district;
             475          [(a) transfer of] (ii) school district property [and indebtedness to a newly created] shall
             476      be divided between the existing school district and the new school district [shall be handled in
             477      accordance with Sections 53A-2-120 and 53A-2-121 ] as provided in Subsection (4);
             478          [(b)] (iii) transferred employees shall be treated in accordance with Sections
             479      53A-2-116 and 53A-2-122 ; and
             480          [(c)] (iv) within one year after [creation of] the new district begins providing
             481      educational services, the superintendent of [the previously existing] each remaining district [or
             482      districts] affected and the superintendent of the new district shall meet, together with the
             483      Superintendent of Public Instruction, to determine if further boundary changes should be
             484      proposed in accordance with Section 53A-2-104 or Subsection 53A-2-118 (2).
             485          (b) Each member elected to a school district board of a new district and remaining
             486      district at an election under Subsection (3)(a)(i) shall take office on July 15 immediately
             487      following the election.
             488          (c) (i) Subject to Subsection (3)(c)(ii), the terms of the initial members of the school
             489      district board of the new district and remaining district who are elected at an election under
             490      Subsection (3)(a)(i) shall be staggered and adjusted by the county legislative body so that:


             491          (A) the school district board members' successors are elected at a future regular general
             492      election; and
             493          (B) the terms of their successors coincide with the schedule of terms for school district
             494      board members established in Section 20A-14-202 .
             495          (ii) (A) The term of a member elected to a school district board at an election under
             496      Subsection (3)(a)(i) may not be less than 17 months.
             497          (B) In order to comply with the requirements of Subsection (3)(c)(i), the term of a
             498      member elected to a school district board at an election under Subsection (3)(a)(i) held in an
             499      even-numbered year may exceed four years but may not exceed five years.
             500          (d) (i) The term of each member of the school district board of the existing district
             501      terminates on July 15 of the second year after the election at which voters approve the creation
             502      of a new district, regardless of when the term would otherwise have terminated.
             503          (ii) Notwithstanding the election of a board for the new district and a board for the
             504      remaining district under Subsection (3)(a)(i), the board of the existing district shall continue,
             505      until the time specified in Subsection 53A-2-118 (5)(b)(ii)(A), to function and exercise
             506      authority as a board to the extent necessary to continue to provide educational services to the
             507      entire existing district as though the new district had not been created.
             508          (iii) A person may simultaneously serve as a member of the board of an existing
             509      district and a member of the board of:
             510          (A) a new district; or
             511          (B) a remaining district.
             512          (4) (a) Within 30 days after the canvass of an election at which voters approve the
             513      creation of a new school district under this section:
             514          (i) a transition team to represent the remaining district shall be appointed by the
             515      members of the existing district board who reside within the area of the remaining district, in
             516      consultation with:
             517          (A) the legislative bodies of all municipalities in the area of the remaining district; and
             518          (B) the legislative body of the county in which the remaining district is located, if the
             519      remaining district includes one or more unincorporated areas of the county; and
             520          (ii) another transition team to represent the new district shall be appointed by:
             521          (A) for a new district located entirely within the boundaries of a single city, the


             522      legislative body of that city; or
             523          (B) for each other new district, the legislative bodies of all interlocal agreement
             524      participants.
             525          (b) The local board of the existing school district shall:
             526          (i) within 30 days after the canvass of an election at which voters approve the creation
             527      of a new school district under this section, prepare an inventory of the existing district's assets
             528      and liabilities; and
             529          (ii) within 45 days after the canvass, deliver a copy of the inventory to each of the
             530      transition teams.
             531          (c) (i) (A) The transition teams appointed under Subsection (4)(a) shall, subject to
             532      Subsection (4)(c)(iii), determine the allocation of the existing district's property between the
             533      remaining district and the new district in accordance with Subsection (4)(c)(ii).
             534          (B) The transition teams shall determine the allocation under Subsection (4)(c)(i)(A)
             535      before July 1 of the year following the election at which voters approve the creation of a new
             536      district, unless that deadline is extended by the mutual agreement of:
             537          (I) the school district board of the remaining district; and
             538          (II) (Aa) the legislative body of the city in which the new district is located, for a new
             539      district located entirely within a single city; or
             540          (Bb) the legislative bodies of all interlocal agreement participants, for each other new
             541      district.
             542          (ii) Subject to Subsection (4)(c)(iii), all property of the existing district, both tangible
             543      and intangible, real and personal, shall be allocated between the existing district and the new
             544      district in a way that is fair and equitable to both the existing district and the new district,
             545      taking into account:
             546          (A) the relative student populations between the existing district and new district;
             547          (B) the relative assessed value of taxable property between the existing district and the
             548      new district;
             549          (C) the historical amount of property used to deliver educational services to students in
             550      the existing district and the new district; and
             551          (D) any other factors that the transition teams consider relevant in dividing the property
             552      in a fair and equitable manner.


             553          (iii) (A) The transition teams shall allocate school buildings and associated property
             554      used primarily to provide educational services to local residents and not serving district-wide
             555      purposes to the school district in which the buildings are geographically located after the
             556      creation of the new district.
             557          (B) Except as provided in Subsection (4)(c)(iii)(A), nothing in this Subsection (4)(c)
             558      may be construed to limit the ability of the transition teams to:
             559          (A) provide that an existing district's property be shared by a remaining district and
             560      new district;
             561          (B) determine, by mutual agreement, that the value of the school buildings and
             562      associated property described in Subsection (4)(c)(iii)(A) may be excluded from consideration
             563      in the asset allocation process under this Subsection (4)(c); or
             564          (C) provide for any other arrangement with respect to existing district property that is
             565      beneficial to and in the best interests of the remaining district and new district.
             566          (d) (i) Each disagreement between the transition teams about the proper allocation of
             567      property between the districts shall be resolved by binding arbitration to a three-member
             568      arbitration panel.
             569          (ii) Each transition team shall appoint one member to an arbitration panel under this
             570      Subsection (4)(d), and those two members shall appoint a third member.
             571          (iii) The costs of arbitration shall initially be borne entirely by the existing district, but
             572      the new district shall reimburse the existing district half of those costs within one year after the
             573      new district begins providing educational services.
             574          (e) Each decision of the transition teams and of the arbitration panel resolving a
             575      disagreement between the transition teams is final and binding on the boards of the existing
             576      district and new district.
             577          (f) (i) All costs and expenses of the transition team that represents a remaining district
             578      shall be borne by the remaining district.
             579          (ii) All costs and expenses of the transition team that represents a new district shall:
             580          (A) initially be borne by:
             581          (I) the city whose legislative body appoints the transition team, if the transition team is
             582      appointed by the legislative body of a single city; or
             583          (II) the interlocal agreement participants, if the transition team is appointed by the


             584      legislative bodies of interlocal agreement participants; and
             585          (B) be reimbursed to the city or interlocal agreement participants by the new district
             586      within one year after the new district begins providing educational services.
             587          Section 8. Section 53A-2-119 is amended to read:
             588           53A-2-119. Reapportionment -- Local school board membership.
             589          (1) Upon the creation of a new school district, the county legislative body shall
             590      reapportion the affected school districts pursuant to Section 20A-14-201 .
             591          (2) [(a)] Except as provided in [Subsection (2)(b)] Subsections (3) and
             592      53A-2-118.1 (3)(c), school board membership in the affected school districts shall be
             593      determined under Title 20A, Chapter 14, Part 2, Nomination and Election of Members of Local
             594      Boards of Education.
             595          (3) (a) Subsection (3)(b) does not apply to a new school district created under Section
             596      53A-2-118.1 .
             597          (b) (i) If, as a result of a reapportionment conducted following the creation of a new
             598      school district, a local school board district is created in which no board member whose term
             599      extends beyond reapportionment resides, the first board member for the local school board
             600      district shall be elected at the next regular general election or municipal general election,
             601      whichever occurs first, after the election at which the creation of the new school district is
             602      approved.
             603          (ii) (A) The initial term of office of a board member elected under Subsection [(2)]
             604      (3)(b)(i) shall be three years, except as provided in Subsection [(2)] (3)(b)(ii)(B).
             605          (B) If more than one position on a local school board needs to be filled pursuant to
             606      Subsection [(2)] (3)(b)(i), the initial term of the board members elected shall be staggered. The
             607      county legislative body shall determine by lot which of the reapportioned local school board
             608      districts will elect members to three-year terms and which will elect members to one-year
             609      terms.
             610          Section 9. Section 53A-2-120 is amended to read:
             611           53A-2-120. Transfer of school property to new school district.
             612          (1) (a) On [the] July 1 of the year following the school board elections for the new and
             613      existing districts as provided in Section 53A-1-119 , the board of the existing district shall
             614      convey and deliver to the board of the new district all school property which the new district is


             615      entitled to receive.
             616          (b) (i) Any disagreements as to the disposition of school property shall be resolved by
             617      the county legislative body.
             618          (ii) Subsection (1)(b)(i) does not apply to disagreements between transition teams
             619      about the proper allocation of property under Subsection 53A-2-118.1 (4).
             620          (2) Title vests in the new school board, including all rights, claims, and causes of
             621      action to or for the property, for the use or the income from the property, for conversion,
             622      disposition, or withholding of the property, or for any damage or injury to the property.
             623          (3) The new school board may bring and maintain actions to recover, protect, and
             624      preserve the property and rights of the district's schools and to enforce contracts.
             625          (4) (a) The intangible property of the existing school district shall be prorated between
             626      it and the new district on the same basis used to determine the new district's proportionate
             627      share of the existing district's indebtedness under Section 53A-2-121 .
             628          (b) Subsection (4)(a) does not apply to the allocation of intangible property between a
             629      remaining district and a new district created under Section 53A-2-118.1 .
             630          Section 10. Section 53A-2-121 is amended to read:
             631           53A-2-121. Indebtedness on property within new school district.
             632          (1) (a) The boards of the [existing] remaining and new districts shall determine the
             633      portion of the existing district's bonded indebtedness and other indebtedness for which the
             634      property within the new district remains subject to the levy of taxes to pay a proportionate
             635      share of the existing district's outstanding indebtedness.
             636          (b) The proportionate share of the existing district's outstanding indebtedness for which
             637      property within the new district remains subject to the levy of taxes shall be calculated by
             638      determining the proportion that the total assessed valuation of the property within the new
             639      district bears to the total assessed valuation of the existing district in the year immediately
             640      preceding the date the new district was created.
             641          (c) The agreement reflecting the determinations made under this Subsection (1) shall
             642      take effect upon being filed with the county legislative body and the State Board of Education.
             643          (2) The board of the [new] remaining district shall continue to levy a tax on property
             644      within the new district sufficient to pay the new district's proportionate share of the
             645      indebtedness determined under this section, and shall [turn over] annually report the amount of


             646      the proceeds of the tax to the business administrator of the [existing] new district.
             647          (3) (a) The boards of the [existing] remaining and new districts shall determine by
             648      mutual agreement the disposition of bonds approved but not issued by the existing district
             649      before the creation of the new district based primarily on the representation made to the voters
             650      at the time of the bond election.
             651          (b) Before a determination is made under Subsection (3)(a), a remaining district may
             652      not issue bonds approved but not issued before the creation of the new district if property in the
             653      new district would be subject to the levy of a tax to pay the bonds.


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