HB-4325, As Passed Senate, May 11, 2011

 

 

 

 

 

 

 

 

 

 

 

 

SENATE SUBSTITUTE FOR

 

HOUSE BILL NO. 4325

 

 

 

 

 

 

 

 

 

 

 

 

     A bill to amend 1979 PA 94, entitled

 

"The state school aid act of 1979,"

 

by amending sections 11 and 17b (MCL 388.1611 and 388.1617b),

 

section 11 as amended by 2010 PA 217 and section 17b as amended by

 

2007 PA 137, and by adding articles II and III.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 11. (1) Subject to subsection (5), for the fiscal year

 

ending September 30, 2011 2012 and for the fiscal year ending

 

September 30, 2013, there is appropriated each fiscal year for the

 

public schools of this state and certain other state purposes

 

relating to education the sum of $10,937,260,500.00 $100.00 from

 

the state school aid fund and the sum of $18,642,400.00 $0.00

 

from the general fund. For the fiscal year ending September 30,

 


2011, there is also appropriated the remaining balance of the

 

federal funding awarded to this state under title XIV of the

 

American recovery and reinvestment act of 2009, Public Law 111-5,

 

estimated at $184,256,600.00, to be used solely for the purpose of

 

funding the primary funding formula calculated under section 20, in

 

accordance with federal law. In addition, all other available

 

federal funds, except those otherwise appropriated under section

 

11p, are appropriated each fiscal year for the fiscal year ending

 

September 30, 2011 2012 and for the fiscal year ending September

 

30, 2013.

 

     (2) The appropriations under this section shall be allocated

 

as provided in this act. Money appropriated under this section from

 

the general fund shall be expended to fund the purposes of this act

 

before the expenditure of money appropriated under this section

 

from the state school aid fund. If the maximum amount appropriated

 

under this section from the state school aid fund for a fiscal year

 

exceeds the amount necessary to fully fund allocations under this

 

act from the state school aid fund, that excess amount shall not be

 

expended in that state fiscal year and shall not lapse to the

 

general fund, but instead shall be deposited into the school aid

 

stabilization fund created in section 11a. For 2009-2010 only, if

 

the department determines before bookclosing for the 2009-2010

 

state fiscal year that the maximum amount appropriated under this

 

section from the state school aid fund for 2009-2010 exceeds the

 

amount necessary to fully fund allocations under this act from the

 

state school aid fund for 2009-2010 and that state support for

 

elementary and secondary education for 2009-2010 will fall below

 


the level of support needed to comply with the maintenance of

 

effort provisions under title XIV of the American recovery and

 

reinvestment act of 2009, Public Law 111-5, then there is

 

appropriated for 2009-2010 from the school aid stabilization fund

 

an amount equal to $30,000,000.00 or the amount that the department

 

determines is necessary for the state support for elementary and

 

secondary education to meet the level of support needed to comply

 

with the maintenance of effort provisions under title XIV of the

 

American recovery and reinvestment act of 2009, Public Law 111-5,

 

whichever is greater. The department shall use any funds

 

appropriated under this subsection as follows:

 

     (a) First, to allocate $10,000,000.00 to provide funding to

 

each intermediate district in an amount equal to the product of

 

14.75% multiplied by the amount of funding allocated to that

 

intermediate district under section 81 for 2009-2010 under 2010 PA

 

110.

 

     (b) Second, to allocate the amount necessary, estimated at

 

$10,000,000.00, to provide funding under this subdivision to

 

districts for which the amount of per-pupil funding calculated and

 

allocated under section 11p(2) is less than $154.00. The payment to

 

a district under this subdivision is an amount equal to the

 

difference between $154.00 and the per-pupil funding amount

 

calculated and allocated under section 11p(2) for the district,

 

multiplied by the district's 2010-2011 membership used for the

 

October 2010 payment.

 

     (c) Third, to allocate any remaining funds to reduce the

 

amount of the per-pupil reduction under section 11d(1) for 2009-

 


2010.

 

     (3) If the maximum amount appropriated under this section from

 

the state school aid fund and the school aid stabilization fund for

 

a fiscal year exceeds the amount available for expenditure from the

 

state school aid fund for that fiscal year, payments under sections

 

11f, 11g, 11j, 22a, 26a, 26b, 31d, 31f, 51a(2), 51a(12), 51c, 53a,

 

56, and 152a shall be made in full. In addition, for districts

 

beginning operations after 1994-95 that qualify for payments under

 

section 22b, payments under section 22b shall be made so that the

 

qualifying districts receive the lesser of an amount equal to the

 

1994-95 foundation allowance of the district in which the district

 

beginning operations after 1994-95 is located or $5,500.00. The

 

amount of the payment to be made under section 22b for these

 

qualifying districts shall be as calculated under section 22a, with

 

the balance of the payment under section 22b being subject to the

 

proration otherwise provided under this subsection and subsection

 

(4). If proration is necessary, state payments under each of the

 

other sections of this act from all state funding sources shall be

 

prorated in the manner prescribed in subsection (4) as necessary to

 

reflect the amount available for expenditure from the state school

 

aid fund for the affected fiscal year. However, if the department

 

of treasury determines that proration will be required under this

 

subsection, or if the department of treasury determines that

 

further proration is required under this subsection after an

 

initial proration has already been made for a fiscal year, the

 

department of treasury shall notify the state budget director, and

 

the state budget director shall notify the legislature at least 30

 


calendar days or 6 legislative session days, whichever is more,

 

before the department reduces any payments under this act because

 

of the proration. During the 30 calendar day or 6 legislative

 

session day period after that notification by the state budget

 

director, the department shall not reduce any payments under this

 

act because of proration under this subsection. The legislature may

 

prevent proration from occurring by, within the 30 calendar day or

 

6 legislative session day period after that notification by the

 

state budget director, enacting legislation appropriating

 

additional funds from the general fund, countercyclical budget and

 

economic stabilization fund, state school aid fund balance, or

 

another source to fund the amount of the projected shortfall.

 

     (4) If proration is necessary under subsection (3), the

 

department shall calculate the proration in district and

 

intermediate district payments that is required under subsection

 

(3) as follows:

 

     (a) The department shall calculate the percentage of total

 

state school aid allocated under this act for the affected fiscal

 

year for each of the following:

 

     (i) Districts.

 

     (ii) Intermediate districts.

 

     (iii) Entities other than districts or intermediate districts.

 

     (b) The department shall recover a percentage of the proration

 

amount required under subsection (3) that is equal to the

 

percentage calculated under subdivision (a)(i) for districts by

 

reducing payments to districts. This reduction shall be made by

 

calculating an equal dollar amount per pupil as necessary to

 


recover this percentage of the proration amount and reducing each

 

district's total state school aid from state sources, other than

 

payments under sections 11f, 11g, 11j, 22a, 26a, 26b, 31d, 31f,

 

51a(2), 51a(12), 51c, 53a, and 152a, by that amount.

 

     (c) The department shall recover a percentage of the proration

 

amount required under subsection (3) that is equal to the

 

percentage calculated under subdivision (a)(ii) for intermediate

 

districts by reducing payments to intermediate districts. This

 

reduction shall be made by reducing the payments to each

 

intermediate district, other than payments under sections 11f, 11g,

 

26a, 26b, 51a(2), 51a(12), 53a, 56, and 152a, on an equal

 

percentage basis.

 

     (d) The department shall recover a percentage of the proration

 

amount required under subsection (3) that is equal to the

 

percentage calculated under subdivision (a)(iii) for entities other

 

than districts and intermediate districts by reducing payments to

 

these entities. This reduction shall be made by reducing the

 

payments to each of these entities, other than payments under

 

sections 11j, 26a, and 26b, on an equal percentage basis.

 

     (5) Any general fund allocations under this act that are not

 

expended by the end of the state fiscal year are transferred to the

 

school aid stabilization fund created under section 11a.

 

     Sec. 17b. (1) Not later than October 20, November 20, December

 

20, January 20, February 20, March 20, April 20, May 20, June 20,

 

July 20, and August 20, the department shall prepare electronic

 

files of the amount to be distributed under this act in the

 

installment to the districts and intermediate districts and deliver

 


the electronic files to the state treasurer, and the state

 

treasurer shall pay the installments on each of those dates or, if

 

the date is not a business day, on the next business day following

 

that date. Except as otherwise provided in this act, the portion of

 

the district's or intermediate district's state fiscal year

 

entitlement to be included in each installment shall be 1/11. A

 

district or intermediate district shall accrue the payments

 

received in July and August to the school fiscal year ending the

 

immediately preceding June 30.

 

     (2) The state treasurer shall make payment under this section

 

by drawing a warrant in favor of the treasurer of each district or

 

intermediate district for the amount payable to the district or

 

intermediate district according to the electronic files and

 

delivering the warrant to the treasurer of each district or

 

intermediate district, or if the state treasurer receives a written

 

request by the treasurer of the district or intermediate district

 

specifying an account, by electronic funds transfer to that account

 

of the amount payable to the district or intermediate district

 

according to the electronic files. The department may make

 

adjustments in payments made under this section through additional

 

payments when changes in law or errors in computation cause the

 

regularly scheduled payment to be less than the amount to which the

 

district or intermediate district is entitled pursuant to this act.

 

     (3) Except as otherwise provided in this act, grant payments

 

to districts and intermediate districts under this act shall be

 

paid according to the installment payment schedule under subsection

 

(1).

 


     (4) Upon the written request of a district or intermediate

 

district and the submission of proof satisfactory to the department

 

of a need of a temporary and nonrecurring nature, the

 

superintendent, with the written concurrence of the state treasurer

 

and the state budget director, may authorize an advance release of

 

funds due a district or intermediate district under this act. An

 

advance authorized under this subsection shall not cause funds to

 

be paid to a district or intermediate district more than 30 days

 

earlier than the established payment date for those funds.

 

                             ARTICLE II

 

                   STATE AID TO COMMUNITY COLLEGES

 

     Sec. 201. Subject to the conditions set forth in this article,

 

$100.00 is appropriated for community colleges for the fiscal year

 

ending September 30, 2012.

 

     Sec. 201a. Subject to the conditions set forth in this

 

article, $100.00 is anticipated to be appropriated for community

 

colleges for the fiscal year ending September 30, 2013.

 

                             ARTICLE III

 

        STATE AID FOR UNIVERSITIES AND STUDENT FINANCIAL AID

 

     Sec. 236. Subject to the conditions set forth in this article,

 

$100.00 is appropriated for higher education for the fiscal year

 

ending September 30, 2012.

 

     Sec. 236a. Subject to the conditions set forth in this

 

article, $100.00 is anticipated to be appropriated for higher

 

education for the fiscal year ending September 30, 2013.

 

     Enacting section 1. (1) In accordance with section 30 of

 

article IX of the state constitution of 1963, total state spending

 


on school aid under article I as amended by this amendatory act

 

from state sources for fiscal year 2011-2012 is estimated at

 

$100.00 and the amount of those state appropriations for school aid

 

to be paid to local units of government for fiscal year 2011-2012

 

are estimated at $100.00.

 

     (2) In accordance with section 30 of article IX of the state

 

constitution of 1963, total state spending from state resources for

 

community colleges for fiscal year 2011-2012 under article II as

 

added by this amendatory act is estimated at $100.00 and the amount

 

of that state spending from state resources to be paid to local

 

units of government for fiscal year 2011-2012 is estimated at

 

$100.00.

 

     (3) In accordance with section 30 of article IX of the state

 

constitution of 1963, total state spending from state resources for

 

higher education for fiscal year 2011-2012 under article III as

 

added by this amendatory act is estimated at $100.00 and the amount

 

of that state spending from state resources to be paid to local

 

units of government for fiscal year 2011-2012 is estimated at $0.