1     
CHARTER SCHOOL PROPERTY TAX FUNDING

2     
2015 GENERAL SESSION

3     
STATE OF UTAH

4     
Chief Sponsor: Kraig Powell

5     
Senate Sponsor: ____________

6     

7     LONG TITLE
8     General Description:
9          This bill establishes a property tax for charter school funding.
10     Highlighted Provisions:
11          This bill:
12          ▸     establishes a property tax for charter school funding.
13     Money Appropriated in this Bill:
14          None
15     Other Special Clauses:
16          None
17     Utah Code Sections Affected:
18     AMENDS:
19          53A-1a-513, as last amended by Laws of Utah 2013, Chapter 470
20     ENACTS:
21          53A-1a-513.1, Utah Code Annotated 1953
22     

23     Be it enacted by the Legislature of the state of Utah:
24          Section 1. Section 53A-1a-513 is amended to read:
25          53A-1a-513. Funding for charter schools.
26          (1) As used in this section:
27          (a) "Charter school funding tax revenues" means the charter school funding tax
28     revenues remitted to the State Board of Education under Section 53A-1a-513.1.
29          (b) "Charter school per pupil funding tax revenues" means an amount equal to the
30     following:
31          (i) charter school funding tax revenues; divided by
32          (ii) the number of students enrolled in a charter school on October 1.
33          [(a)] (c) "Charter school students' average local revenues" means the amount
34     determined as follows:
35          (i) for each student enrolled in a charter school on the previous October 1, calculate the
36     district per pupil local revenues of the school district in which the student resides;
37          (ii) sum the district per pupil local revenues for each student enrolled in a charter
38     school on the previous October 1; and
39          (iii) divide the sum calculated under Subsection (1)(a)(ii) by the number of students
40     enrolled in charter schools on the previous October 1.
41          [(b)] (d) "District local property tax revenues" means the sum of a school district's
42     revenue received from the following levies:
43          [(i) (A) a voted levy imposed under Section 53A-17a-133;]
44          [(B) a board levy imposed under Section 53A-17a-134;]
45          [(C) a 10% of basic levy imposed under Section 53A-17a-145;]
46          [(D) a tort liability levy imposed under Section 63G-7-704;]
47          [(E) a capital outlay levy imposed under Section 53A-16-107; and]
48          [(F) a voted capital outlay levy imposed under Section 53A-16-110; or]
49          [(ii) (A)] (i) a voted local levy imposed under Section 53A-17a-133;
50          [(B)] (ii) a board local levy imposed under Section 53A-17a-164, excluding revenues
51     expended for:
52          [(I)] (A) recreational facilities and activities authorized under Title 11, Chapter 2,
53     Playgrounds;
54          [(II)] (B) pupil transportation, up to the amount of revenue generated by a .0003 per
55     dollar of taxable value of the school district's board local levy; and
56          [(III)] (C) the K-3 Reading Improvement Program, up to the amount of revenue
57     generated by a .000121 per dollar of taxable value of the school district's board local levy; and
58          [(C)] (iii) a capital local levy imposed under Section 53A-16-113.
59          [(c)] (e) "District per pupil local revenues" means an amount equal to the following,
60     using data from the most recently published school district annual financial reports and state
61     superintendent's annual report:
62          (i) district local property tax revenues; divided by
63          (ii) the sum of:
64          (A) a school district's average daily membership; and
65          (B) the average daily membership of a school district's resident students who attend
66     charter schools.
67          [(d)] (f) "Resident student" means a student who is considered a resident of the school
68     district under Title 53A, Chapter 2, Part 2, District of Residency.
69          [(e)] (g) "Statewide average debt service revenues" means the amount determined as
70     follows, using data from the most recently published state superintendent's annual report:
71          (i) sum the revenues of each school district from the debt service levy imposed under
72     Section 11-14-310; and
73          (ii) divide the sum calculated under Subsection (1)(e)(i) by statewide school district
74     average daily membership.
75          (2) (a) Charter schools shall receive funding as described in this section, except
76     Subsections (3) through (8) do not apply to charter schools described in Subsection (2)(b).
77          (b) Charter schools authorized by local school boards that are converted from district
78     schools or operate in district facilities without paying reasonable rent shall receive funding as
79     prescribed in Section 53A-1a-515.
80          (3) (a) Except as provided in Subsections (3)(b) and (3)(c), a charter school shall
81     receive state funds, as applicable, on the same basis as a school district receives funds.
82          (b) For the 2013-14 and 2014-15 school years, the number of weighted pupil units
83     assigned to a charter school for the kindergarten and grades 1 through 12 programs of the Basic
84     School Program shall be:
85          (i) based on the higher of:
86          (A) October 1 enrollment in the current school year; or
87          (B) average daily membership in the prior school year plus growth as determined under
88     Section 53A-17a-106; and
89          (ii) weighted as provided in Subsection (3)(c).
90          (c) In distributing funds under Chapter 17a, Minimum School Program Act, to charter
91     schools, charter school pupils shall be weighted, where applicable, as follows:
92          (i) .55 for kindergarten pupils;
93          (ii) .9 for pupils in grades 1 through 6;
94          (iii) .99 for pupils in grades 7 through 8; and
95          (iv) 1.2 for pupils in grades 9 through 12.
96          [(4) (a) (i) A school district shall allocate a portion of school district revenues for each
97     resident student of the school district who is enrolled in a charter school on October 1 equal to
98     25% of the lesser of:]
99          [(A) district per pupil local revenues; or]
100          [(B) charter school students' average local revenues.]
101          [(ii) Nothing in this Subsection (4)(a) affects the school bond guarantee program
102     established under Chapter 28, Utah School Bond Guaranty Act.]
103          [(b) The State Board of Education shall:]
104          [(i) deduct an amount equal to the allocation provided under Subsection (4)(a) from
105     state funds the school district is authorized to receive under Chapter 17a, Minimum School
106     Program Act; and]
107          [(ii) remit the money to the student's charter school.]
108          [(c) Notwithstanding the method used to transfer school district revenues to charter
109     schools as provided in Subsection (4)(b), a school district may deduct the allocations to charter
110     schools under this section from:]
111          [(i) unrestricted revenues available to the school district; or]
112          [(ii) the revenue sources listed in Subsection (1)(b) based on the portion of the
113     allocations to charter schools attributed to each of the revenue sources listed in Subsection
114     (1)(b).]
115          (4) (a) For each charter school student, the State Board of Education shall annually
116     remit the charter school per pupil funding tax revenues to the student's charter school.
117          [(d)] (b) (i) Subject to future budget constraints, the Legislature shall provide an
118     appropriation for charter schools for each student enrolled on October 1 to supplement the
119     [allocation of school district revenues under Subsection (4)(a)] charter school per pupil funding
120     tax revenues remitted under Subsection (4)(a).
121          (ii) Except as provided in Subsection (4)[(d)](b)(iii), the amount of money provided by
122     the state for a charter school student shall be the sum of:
123          (A) charter school students' average local revenues minus the [allocation of school
124     district revenues under Subsection (4)(a)] charter school per pupil funding tax revenues; and
125          (B) statewide average debt service revenues.
126          (iii) If the total of [a school district's allocation for a charter school student under
127     Subsection (4)(a)] charter school per pupil funding tax revenues and the amount provided by
128     the state under Subsection (4)[(d)](b)(ii) is less than $1427, the state shall provide an additional
129     supplement so that a charter school receives at least $1427 per student under this Subsection
130     (4).
131          (iv) (A) If the appropriation provided under this Subsection (4)[(d)](b) is less than the
132     amount prescribed by Subsection (4)[(d)](b)(ii) or [(4)(d)](iii), the appropriation shall be
133     allocated among charter schools in proportion to each charter school's enrollment as a
134     percentage of the total enrollment in charter schools.
135          (B) If the State Board of Education makes adjustments to Minimum School Program
136     allocations as provided under Section 53A-17a-105, the allocation provided in Subsection
137     (4)[(d)](b)(iv)(A) shall be determined after adjustments are made under Section 53A-17a-105.
138          [(e)] (c) Of the money provided to a charter school under this Subsection (4), 10% shall
139     be expended for funding school facilities only.
140          (5) Charter schools are eligible to receive federal funds if they meet all applicable
141     federal requirements and comply with relevant federal regulations.
142          (6) The State Board of Education shall distribute funds for charter school students
143     directly to the charter school.
144          (7) (a) Notwithstanding Subsection (3), a charter school is not eligible to receive state
145     transportation funding.
146          (b) The board shall also adopt rules relating to the transportation of students to and
147     from charter schools, taking into account Sections 53A-2-210 and 53A-17a-127.
148          (c) The governing body of the charter school may provide transportation through an
149     agreement or contract with the local school board, a private provider, or with parents.
150          (8) (a) (i) In accordance with Section 53A-1a-513.5, the State Charter School Board
151     may allocate grants for start-up costs to charter schools from money appropriated for charter
152     school start-up costs.
153          (ii) The governing board of a charter school that receives money from a grant under
154     Section 53A-1a-513.5 shall use the grant for expenses for planning and implementation of the
155     charter school.
156          (b) The State Board of Education shall coordinate the distribution of federal money
157     appropriated to help fund costs for establishing and maintaining charter schools within the
158     state.
159          (9) (a) A charter school may receive, hold, manage and use any devise, bequest, grant,
160     endowment, gift, or donation of any property made to the school for any of the purposes of this
161     part.
162          (b) It is unlawful for any person affiliated with a charter school to demand or request
163     any gift, donation, or contribution from a parent, teacher, employee, or other person affiliated
164     with the charter school as a condition for employment or enrollment at the school or continued
165     attendance at the school.
166          Section 2. Section 53A-1a-513.1 is enacted to read:
167          53A-1a-513.1. Charter school funding tax.
168          (1) As used in this section:
169          (a) "District local property tax revenues" means the sum of a school district's revenue
170     received from the following levies:
171          (i) a voted local levy imposed under Section 53A-17a-133;
172          (ii) a board local levy imposed under Section 53A-17a-164, excluding revenues
173     expended for:
174          (A) recreational facilities and activities authorized under Title 11, Chapter 2,
175     Playgrounds;
176          (B) pupil transportation, up to the amount of revenue generated by a .0003 per dollar of
177     taxable value of the school district's board local levy; and
178          (C) the K-3 Reading Improvement Program, up to the amount of revenue generated by
179     a .000121 per dollar of taxable value of the school district's board local levy; and
180          (iii) a capital local levy imposed under Section 53A-16-113.
181          (b) "District per pupil local revenues" means an amount equal to the following:
182          (i) district local property tax revenues reported from the previous year; divided by
183          (ii) the sum of:
184          (A) a school district's average daily membership; and
185          (B) the number of students enrolled in a charter school on October 1.
186          (c) "Resident student" means a student who is considered a resident of the school
187     district under Title 53A, Chapter 2, Part 2, District of Residency.
188          (2) (a) Beginning with the taxable year beginning on January 1, 2016, the state shall
189     annually impose a charter school funding tax as described in this Subsection (2).
190          (b) (i) For each school district, on or before June 22, the State Tax Commission shall
191     certify a rate for the charter school funding tax described in Subsection (2)(a) that generates an
192     amount of revenue within the school district equal to the product of:
193          (A) district per pupil revenues; and
194          (B) the number of charter school students that are resident students.
195          (ii) For purposes of calculating the charter school funding tax rate for a school district
196     as described in Subsection (2)(b)(i), the State Tax Commission shall use:
197          (A) the taxable value of real property assessed by a county assessor contained on the
198     assessment roll;
199          (B) the taxable value of real and personal property assessed by the State Tax
200     Commission; and
201          (C) the taxable year end value of personal property assessed by a county assessor
202     contained on the prior year's assessment roll.
203          (c) (i) The county treasurer shall collect the charter school funding tax revenues for all
204     school districts located within the county treasurer's county and remit the money to the state
205     treasurer.
206          (ii) The state treasurer shall remit the money from a county treasurer described in
207     Subsection (2)(c)(i) to the State Board of Education.




Legislative Review Note
     as of 3-12-15 9:10 PM

Office of Legislative Research and General Counsel