HB-4721, As Passed Senate, June 24, 2009

 

 

 

 

 

 

 

 

 

 

 

SENATE SUBSTITUTE FOR

 

HOUSE BILL NO. 4721

 

 

 

 

 

 

 

 

 

 

 

     A bill to amend 1979 PA 94, entitled

 

"The state school aid act of 1979,"

 

by amending sections 6, 11, 11j, 11n, 20, 22a, 22b, 26a, 31a, 51a,

 

51c, 53a, and 94a (MCL 388.1606, 388.1611, 388.1611j, 388.1611n,

 

388.1620, 388.1622a, 388.1622b, 388.1626a, 388.1631a, 388.1651a,

 

388.1651c, 388.1653a, and 388.1694a), sections 6, 11, 11j, 22a,

 

22b, 26a, 31a, 51a, 51c, 53a, and 94a as amended and section 11n as

 

added by 2008 PA 268 and section 20 as amended by 2008 PA 561, and

 

by adding section 98a.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 6. (1) "Center program" means a program operated by a

 

district or intermediate district for special education pupils from

 

several districts in programs for pupils with autism spectrum

 

disorder, pupils with severe cognitive impairment, pupils with

 

moderate cognitive impairment, pupils with severe multiple

 

impairments, pupils with hearing impairment, pupils with visual

 

impairment, and pupils with physical impairment or other health

 

impairment. Programs for pupils with emotional impairment housed in

 

buildings that do not serve regular education pupils also qualify.

 

Unless otherwise approved by the department, a center program

 

either shall serve all constituent districts within an intermediate

 

district or shall serve several districts with less than 50% of the

 

pupils residing in the operating district. In addition, special

 

education center program pupils placed part-time in noncenter

 

programs to comply with the least restrictive environment

 

provisions of section 612 of part B of the individuals with

 

disabilities education act, 20 USC 1412, may be considered center

 

program pupils for pupil accounting purposes for the time scheduled

 

in either a center program or a noncenter program.

 

     (2) "District and high school graduation rate" means the

 

annual completion and pupil dropout rate that is calculated by the

 

center pursuant to nationally recognized standards.

 

     (3) "District and high school graduation report" means a

 

report of the number of pupils, excluding adult participants, in

 

the district for the immediately preceding school year, adjusted

 

for those pupils who have transferred into or out of the district

 

or high school, who leave high school with a diploma or other

 

credential of equal status.

 

     (4) "Membership", except as otherwise provided in this act,

 

means for a district, public school academy, university school, or

 

intermediate district the sum of the product of .75 times the

 

number of full-time equated pupils in grades K to 12 actually

 

enrolled and in regular daily attendance on the pupil membership

 

count day for the current school year, plus the product of .25

 

times the final audited count from the supplemental count day for

 

the immediately preceding school year. All pupil counts used in

 

this subsection are as determined by the department and calculated

 

by adding the number of pupils registered for attendance plus

 

pupils received by transfer and minus pupils lost as defined by

 

rules promulgated by the superintendent, and as corrected by a

 

subsequent department audit. The amount of the foundation allowance

 

for a pupil in membership is determined under section 20. In making

 

the calculation of membership, all of the following, as applicable,

 

apply to determining the membership of a district, public school

 

academy, university school, or intermediate district:

 

     (a) Except as otherwise provided in this subsection, and

 

pursuant to subsection (6), a pupil shall be counted in membership

 

in the pupil's educating district or districts. An individual pupil

 

shall not be counted for more than a total of 1.0 full-time equated

 

membership.

 

     (b) If a pupil is educated in a district other than the

 

pupil's district of residence, if the pupil is not being educated

 

as part of a cooperative education program, if the pupil's district

 

of residence does not give the educating district its approval to

 

count the pupil in membership in the educating district, and if the

 

pupil is not covered by an exception specified in subsection (6) to

 

the requirement that the educating district must have the approval

 

of the pupil's district of residence to count the pupil in

 

membership, the pupil shall not be counted in membership in any

 

district.

 

     (c) A special education pupil educated by the intermediate

 

district shall be counted in membership in the intermediate

 

district.

 

     (d) A pupil placed by a court or state agency in an on-grounds

 

program of a juvenile detention facility, a child caring

 

institution, or a mental health institution, or a pupil funded

 

under section 53a, shall be counted in membership in the district

 

or intermediate district approved by the department to operate the

 

program.

 

     (e) A pupil enrolled in the Michigan schools for the deaf and

 

blind shall be counted in membership in the pupil's intermediate

 

district of residence.

 

     (f) A pupil enrolled in a vocational education program

 

supported by a millage levied over an area larger than a single

 

district or in an area vocational-technical education program

 

established pursuant to section 690 of the revised school code, MCL

 

380.690, shall be counted only in the pupil's district of

 

residence.

 

     (g) A pupil enrolled in a university school shall be counted

 

in membership in the university school.

 

     (h) A pupil enrolled in a public school academy shall be

 

counted in membership in the public school academy.

 

     (i) For a new district, university school, or public school

 

academy beginning its operation after December 31, 1994, membership

 

for the first 2 full or partial fiscal years of operation shall be

 

determined as follows:

 

     (i) If operations begin before the pupil membership count day

 

for the fiscal year, membership is the average number of full-time

 

equated pupils in grades K to 12 actually enrolled and in regular

 

daily attendance on the pupil membership count day for the current

 

school year and on the supplemental count day for the current

 

school year, as determined by the department and calculated by

 

adding the number of pupils registered for attendance on the pupil

 

membership count day plus pupils received by transfer and minus

 

pupils lost as defined by rules promulgated by the superintendent,

 

and as corrected by a subsequent department audit, plus the final

 

audited count from the supplemental count day for the current

 

school year, and dividing that sum by 2.

 

     (ii) If operations begin after the pupil membership count day

 

for the fiscal year and not later than the supplemental count day

 

for the fiscal year, membership is the final audited count of the

 

number of full-time equated pupils in grades K to 12 actually

 

enrolled and in regular daily attendance on the supplemental count

 

day for the current school year.

 

     (j) If a district is the authorizing body for a public school

 

academy, then, in the first school year in which pupils are counted

 

in membership on the pupil membership count day in the public

 

school academy, the determination of the district's membership

 

shall exclude from the district's pupil count for the immediately

 

preceding supplemental count day any pupils who are counted in the

 

public school academy on that first pupil membership count day who

 

were also counted in the district on the immediately preceding

 

supplemental count day.

 

     (k) In a district, public school academy, university school,

 

or intermediate district operating an extended school year program

 

approved by the superintendent, a pupil enrolled, but not scheduled

 

to be in regular daily attendance on a pupil membership count day,

 

shall be counted.

 

     (l) Pupils to be counted in membership shall be not less than 5

 

years of age on December 1 and less than 20 years of age on

 

September 1 of the school year except a special education pupil who

 

is enrolled and receiving instruction in a special education

 

program or service approved by the department and not having a high

 

school diploma who is less than 26 years of age as of September 1

 

of the current school year shall be counted in membership.

 

     (m) An individual who has obtained a high school diploma shall

 

not be counted in membership. An individual who has obtained a

 

general educational development (G.E.D.) certificate shall not be

 

counted in membership. An individual participating in a job

 

training program funded under former section 107a or a jobs program

 

funded under former section 107b, administered by the Michigan

 

strategic fund or the department of labor and economic growth, or

 

participating in any successor of either of those 2 programs, shall

 

not be counted in membership.

 

     (n) If a pupil counted in membership in a public school

 

academy is also educated by a district or intermediate district as

 

part of a cooperative education program, the pupil shall be counted

 

in membership only in the public school academy unless a written

 

agreement signed by all parties designates the party or parties in

 

which the pupil shall be counted in membership, and the

 

instructional time scheduled for the pupil in the district or

 

intermediate district shall be included in the full-time equated

 

membership determination under subdivision (q). However, for pupils

 

receiving instruction in both a public school academy and in a

 

district or intermediate district but not as a part of a

 

cooperative education program, the following apply:

 

     (i) If the public school academy provides instruction for at

 

least 1/2 of the class hours specified in subdivision (q), the

 

public school academy shall receive as its prorated share of the

 

full-time equated membership for each of those pupils an amount

 

equal to 1 times the product of the hours of instruction the public

 

school academy provides divided by the number of hours specified in

 

subdivision (q) for full-time equivalency, and the remainder of the

 

full-time membership for each of those pupils shall be allocated to

 

the district or intermediate district providing the remainder of

 

the hours of instruction.

 

     (ii) If the public school academy provides instruction for less

 

than 1/2 of the class hours specified in subdivision (q), the

 

district or intermediate district providing the remainder of the

 

hours of instruction shall receive as its prorated share of the

 

full-time equated membership for each of those pupils an amount

 

equal to 1 times the product of the hours of instruction the

 

district or intermediate district provides divided by the number of

 

hours specified in subdivision (q) for full-time equivalency, and

 

the remainder of the full-time membership for each of those pupils

 

shall be allocated to the public school academy.

 

     (o) An individual less than 16 years of age as of September 1

 

of the current school year who is being educated in an alternative

 

education program shall not be counted in membership if there are

 

also adult education participants being educated in the same

 

program or classroom.

 

     (p) The department shall give a uniform interpretation of

 

full-time and part-time memberships.

 

     (q) The number of class hours used to calculate full-time

 

equated memberships shall be consistent with section 101(3). In

 

determining full-time equated memberships for pupils who are

 

enrolled in a postsecondary institution, a pupil shall not be

 

considered to be less than a full-time equated pupil solely because

 

of the effect of his or her postsecondary enrollment, including

 

necessary travel time, on the number of class hours provided by the

 

district to the pupil.

 

     (r) Except as otherwise provided in this subdivision, full-

 

time equated memberships for pupils in kindergarten shall be

 

determined by dividing the number of class hours scheduled and

 

provided per year per kindergarten pupil by a number equal to 1/2

 

the number used for determining full-time equated memberships for

 

pupils in grades 1 to 12. Beginning in 2009-2010, full-time equated

 

memberships for pupils enrolled in developmental kindergarten,

 

prekindergarten, or a similar class intended to be the first of 2

 

school years before a pupil enters grade 1 shall be determined by

 

dividing the number of class hours scheduled and provided per year

 

per kindergarten pupil by the number used for determining full-time

 

equated memberships for pupils in grades 1 to 12. For 2010-2011,

 

full-time equated memberships for pupils enrolled in kindergarten

 

shall be determined by dividing the number of class hours scheduled

 

and provided per year per kindergarten pupil by a number equal to

 

60% of the number used for determining full-time equated

 

memberships for pupils in grades 1 to 12. Beginning in 2011-2012,

 

full-time equated memberships for pupils enrolled in kindergarten

 

shall be determined by dividing the number of class hours scheduled

 

and provided per year per kindergarten pupil by a number equal to

 

70% of the number used for determining full-time equated

 

memberships for pupils in grades 1 to 12.

 

     (s) For a district, university school, or public school

 

academy that has pupils enrolled in a grade level that was not

 

offered by the district, university school, or public school

 

academy in the immediately preceding school year, the number of

 

pupils enrolled in that grade level to be counted in membership is

 

the average of the number of those pupils enrolled and in regular

 

daily attendance on the pupil membership count day and the

 

supplemental count day of the current school year, as determined by

 

the department. Membership shall be calculated by adding the number

 

of pupils registered for attendance in that grade level on the

 

pupil membership count day plus pupils received by transfer and

 

minus pupils lost as defined by rules promulgated by the

 

superintendent, and as corrected by subsequent department audit,

 

plus the final audited count from the supplemental count day for

 

the current school year, and dividing that sum by 2.

 

     (t) A pupil enrolled in a cooperative education program may be

 

counted in membership in the pupil's district of residence with the

 

written approval of all parties to the cooperative agreement.

 

     (u) If, as a result of a disciplinary action, a district

 

determines through the district's alternative or disciplinary

 

education program that the best instructional placement for a pupil

 

is in the pupil's home or otherwise apart from the general school

 

population, if that placement is authorized in writing by the

 

district superintendent and district alternative or disciplinary

 

education supervisor, and if the district provides appropriate

 

instruction as described in this subdivision to the pupil at the

 

pupil's home or otherwise apart from the general school population,

 

the district may count the pupil in membership on a pro rata basis,

 

with the proration based on the number of hours of instruction the

 

district actually provides to the pupil divided by the number of

 

hours specified in subdivision (q) for full-time equivalency. For

 

the purposes of this subdivision, a district shall be considered to

 

be providing appropriate instruction if all of the following are

 

met:

 

     (i) The district provides at least 2 nonconsecutive hours of

 

instruction per week to the pupil at the pupil's home or otherwise

 

apart from the general school population under the supervision of a

 

certificated teacher.

 

     (ii) The district provides instructional materials, resources,

 

and supplies, except computers, that are comparable to those

 

otherwise provided in the district's alternative education program.

 

     (iii) Course content is comparable to that in the district's

 

alternative education program.

 

     (iv) Credit earned is awarded to the pupil and placed on the

 

pupil's transcript.

 

     (v) For 2007-2008 only, a pupil enrolled in an alternative or

 

disciplinary education program described in section 25 shall be

 

counted in membership in the district or public school academy that

 

expelled the pupil.

 

     (w) If a pupil was enrolled in a public school academy on the

 

pupil membership count day, if the public school academy's contract

 

with its authorizing body is revoked or the public school academy

 

otherwise ceases to operate, and if the pupil enrolls in a district

 

within 45 days after the pupil membership count day, the department

 

shall adjust the district's pupil count for the pupil membership

 

count day to include the pupil in the count.

 

     (x) For a public school academy that has been in operation for

 

at least 2 years and that suspended operations for at least 1

 

semester and is resuming operations, membership is the sum of the

 

product of .75 times the number of full-time equated pupils in

 

grades K to 12 actually enrolled and in regular daily attendance on

 

the first pupil membership count day or supplemental count day,

 

whichever is first, occurring after operations resume, plus the

 

product of .25 times the final audited count from the most recent

 

pupil membership count day or supplemental count day that occurred

 

before suspending operations, as determined by the superintendent.

 

     (y) If a district's membership for a particular fiscal year,

 

as otherwise calculated under this subsection, would be less than

 

1,550 pupils and the district has 4.5 or fewer pupils per square

 

mile, as determined by the department, and, beginning in 2007-2008,

 

if the district does not receive funding under section 22d(2), the

 

district's membership shall be considered to be the membership

 

figure calculated under this subdivision. If a district educates

 

and counts in its membership pupils in grades 9 to 12 who reside in

 

a contiguous district that does not operate grades 9 to 12 and if 1

 

or both of the affected districts request the department to use the

 

determination allowed under this sentence, the department shall

 

include the square mileage of both districts in determining the

 

number of pupils per square mile for each of the districts for the

 

purposes of this subdivision. The membership figure calculated

 

under this subdivision is the greater of the following:

 

     (i) The average of the district's membership for the 3-fiscal-

 

year period ending with that fiscal year, calculated by adding the

 

district's actual membership for each of those 3 fiscal years, as

 

otherwise calculated under this subsection, and dividing the sum of

 

those 3 membership figures by 3.

 

     (ii) The district's actual membership for that fiscal year as

 

otherwise calculated under this subsection.

 

     (z) If a public school academy that is not in its first or

 

second year of operation closes at the end of a school year and

 

does not reopen for the next school year, the department shall

 

adjust the membership count of the district in which a former pupil

 

of the public school academy enrolls and is in regular daily

 

attendance for the next school year to ensure that the district

 

receives the same amount of membership aid for the pupil as if the

 

pupil were counted in the district on the supplemental count day of

 

the preceding school year.

 

     (aa) Full-time equated memberships for preprimary-aged special

 

education pupils who are not enrolled in kindergarten but are

 

enrolled in a classroom program under R 340.1754 of the Michigan

 

administrative code shall be determined by dividing the number of

 

class hours scheduled and provided per year by 450. Full-time

 

equated memberships for preprimary-aged special education pupils

 

who are not enrolled in kindergarten but are receiving nonclassroom

 

services under R 340.1755 of the Michigan administrative code shall

 

be determined by dividing the number of hours of service scheduled

 

and provided per year per pupil by 180.

 

     (bb) A pupil of a district that begins its school year after

 

Labor day who is enrolled in an intermediate district program that

 

begins before Labor day shall not be considered to be less than a

 

full-time pupil solely due to instructional time scheduled but not

 

attended by the pupil before Labor day.

 

     (cc) For the first year in which a pupil is counted in

 

membership on the pupil membership count day in a middle college

 

program described in section 64, the membership is the average of

 

the full-time equated membership on the pupil membership count day

 

and on the supplemental count day for the current school year, as

 

determined by the department. If a pupil was counted by the

 

operating district on the immediately preceding supplemental count

 

day, the pupil shall be excluded from the district's immediately

 

preceding supplemental count for purposes of determining the

 

district's membership.

 

     (5) "Public school academy" means a public school academy,

 

urban high school academy, or strict discipline academy operating

 

under the revised school code.

 

     (6) "Pupil" means a person in membership in a public school. A

 

district must have the approval of the pupil's district of

 

residence to count the pupil in membership, except approval by the

 

pupil's district of residence is not required for any of the

 

following:

 

     (a) A nonpublic part-time pupil enrolled in grades 1 to 12 in

 

accordance with section 166b.

 

     (b) A pupil receiving 1/2 or less of his or her instruction in

 

a district other than the pupil's district of residence.

 

     (c) A pupil enrolled in a public school academy or university

 

school.

 

     (d) A pupil enrolled in a district other than the pupil's

 

district of residence under an intermediate district schools of

 

choice pilot program as described in section 91a or former section

 

91 if the intermediate district and its constituent districts have

 

been exempted from section 105.

 

     (e) A pupil enrolled in a district other than the pupil's

 

district of residence if the pupil is enrolled in accordance with

 

section 105 or 105c.

 

     (f) A pupil who has made an official written complaint or

 

whose parent or legal guardian has made an official written

 

complaint to law enforcement officials and to school officials of

 

the pupil's district of residence that the pupil has been the

 

victim of a criminal sexual assault or other serious assault, if

 

the official complaint either indicates that the assault occurred

 

at school or that the assault was committed by 1 or more other

 

pupils enrolled in the school the pupil would otherwise attend in

 

the district of residence or by an employee of the district of

 

residence. A person who intentionally makes a false report of a

 

crime to law enforcement officials for the purposes of this

 

subdivision is subject to section 411a of the Michigan penal code,

 

1931 PA 328, MCL 750.411a, which provides criminal penalties for

 

that conduct. As used in this subdivision:

 

     (i) "At school" means in a classroom, elsewhere on school

 

premises, on a school bus or other school-related vehicle, or at a

 

school-sponsored activity or event whether or not it is held on

 

school premises.

 

     (ii) "Serious assault" means an act that constitutes a felony

 

violation of chapter XI of the Michigan penal code, 1931 PA 328,

 

MCL 750.81 to 750.90g, or that constitutes an assault and

 

infliction of serious or aggravated injury under section 81a of the

 

Michigan penal code, 1931 PA 328, MCL 750.81a.

 

     (g) A pupil whose district of residence changed after the

 

pupil membership count day and before the supplemental count day

 

and who continues to be enrolled on the supplemental count day as a

 

nonresident in the district in which he or she was enrolled as a

 

resident on the pupil membership count day of the same school year.

 

     (h) A pupil enrolled in an alternative education program

 

operated by a district other than his or her district of residence

 

who meets 1 or more of the following:

 

     (i) The pupil has been suspended or expelled from his or her

 

district of residence for any reason, including, but not limited

 

to, a suspension or expulsion under section 1310, 1311, or 1311a of

 

the revised school code, MCL 380.1310, 380.1311, and 380.1311a.

 

     (ii) The pupil had previously dropped out of school.

 

     (iii) The pupil is pregnant or is a parent.

 

     (iv) The pupil has been referred to the program by a court.

 

     (v) The pupil is enrolled in an alternative or disciplinary

 

education program described in section 25.

 

     (i) A pupil enrolled in the Michigan virtual high school, for

 

the pupil's enrollment in the Michigan virtual high school.

 

     (j) A pupil who is the child of a person who is employed by

 

the district. As used in this subdivision, "child" includes an

 

adopted child, stepchild, or legal ward.

 

     (k) An expelled pupil who has been denied reinstatement by the

 

expelling district and is reinstated by another school board under

 

section 1311 or 1311a of the revised school code, MCL 380.1311 and

 

380.1311a.

 

     (l) A pupil enrolled in a district other than the pupil's

 

district of residence in a program described in section 64 if the

 

pupil's district of residence and the enrolling district are both

 

constituent districts of the same intermediate district.

 

     (m) A pupil enrolled in a district other than the pupil's

 

district of residence who attends a United States Olympic education

 

center.

 

     However, if a district that is not a first class district

 

educates pupils who reside in a first class district and if the

 

primary instructional site for those pupils is located within the

 

boundaries of the first class district, the educating district must

 

have the approval of the first class district to count those pupils

 

in membership. As used in this subsection, "first class district"

 

means a district organized as a school district of the first class

 

under the revised school code.

 

     (7) "Pupil membership count day" of a district or intermediate

 

district means:

 

     (a) Except as provided in subdivision (b), the fourth

 

Wednesday after Labor day each school year or, for a district or

 

building in which school is not in session on that Wednesday due to

 

conditions not within the control of school authorities, with the

 

approval of the superintendent, the immediately following day on

 

which school is in session in the district or building.

 

     (b) For a district or intermediate district maintaining school

 

during the entire school year, the following days:

 

     (i) Fourth Wednesday in July.

 

     (ii) Fourth Wednesday after Labor day.

 

     (iii) Second Wednesday in February.

 

     (iv) Fourth Wednesday in April.

 

     (8) "Pupils in grades K to 12 actually enrolled and in regular

 

daily attendance" means pupils in grades K to 12 in attendance and

 

receiving instruction in all classes for which they are enrolled on

 

the pupil membership count day or the supplemental count day, as

 

applicable. Except as otherwise provided in this subsection, a

 

pupil who is absent from any of the classes in which the pupil is

 

enrolled on the pupil membership count day or supplemental count

 

day and who does not attend each of those classes during the 10

 

consecutive school days immediately following the pupil membership

 

count day or supplemental count day, except for a pupil who has

 

been excused by the district, shall not be counted as 1.0 full-time

 

equated membership. A pupil who is excused from attendance on the

 

pupil membership count day or supplemental count day and who fails

 

to attend each of the classes in which the pupil is enrolled within

 

30 calendar days after the pupil membership count day or

 

supplemental count day shall not be counted as 1.0 full-time

 

equated membership. In addition, a pupil who was enrolled and in

 

attendance in a district, intermediate district, or public school

 

academy before the pupil membership count day or supplemental count

 

day of a particular year but was expelled or suspended on the pupil

 

membership count day or supplemental count day shall only be

 

counted as 1.0 full-time equated membership if the pupil resumed

 

attendance in the district, intermediate district, or public school

 

academy within 45 days after the pupil membership count day or

 

supplemental count day of that particular year. Pupils not counted

 

as 1.0 full-time equated membership due to an absence from a class

 

shall be counted as a prorated membership for the classes the pupil

 

attended. For purposes of this subsection, "class" means a period

 

of time in 1 day when pupils and a certificated teacher or legally

 

qualified substitute teacher are together and instruction is taking

 

place.

 

     (9) "Rule" means a rule promulgated pursuant to the

 

administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to

 

24.328.

 

     (10) "The revised school code" means 1976 PA 451, MCL 380.1 to

 

380.1852.

 

     (11) "School district of the first class", "first class school

 

district", and "district of the first class", except in subsection

 

(6), mean a district that had at least 60,000 pupils in membership

 

for the immediately preceding fiscal year.

 

     (12) "School fiscal year" means a fiscal year that commences

 

July 1 and continues through June 30.

 

     (13) "State board" means the state board of education.

 

     (14) "Superintendent", unless the context clearly refers to a

 

district or intermediate district superintendent, means the

 

superintendent of public instruction described in section 3 of

 

article VIII of the state constitution of 1963.

 

     (15) "Supplemental count day" means the day on which the

 

supplemental pupil count is conducted under section 6a.

 

     (16) "Tuition pupil" means a pupil of school age attending

 

school in a district other than the pupil's district of residence

 

for whom tuition may be charged. Tuition pupil does not include a

 

pupil who is a special education pupil or a pupil described in

 

subsection (6)(c) to (m). A pupil's district of residence shall not

 

require a high school tuition pupil, as provided under section 111,

 

to attend another school district after the pupil has been assigned

 

to a school district.

 

     (17) "State school aid fund" means the state school aid fund

 

established in section 11 of article IX of the state constitution

 

of 1963.

 

     (18) "Taxable value" means the taxable value of property as

 

determined under section 27a of the general property tax act, 1893

 

PA 206, MCL 211.27a.

 

     (19) "Textbook" means a book that is selected and approved by

 

the governing board of a district and that contains a presentation

 

of principles of a subject, or that is a literary work relevant to

 

the study of a subject required for the use of classroom pupils, or

 

another type of course material that forms the basis of classroom

 

instruction.

 

     (20) "Total state aid" or "total state school aid" means the

 

total combined amount of all funds due to a district, intermediate

 

district, or other entity under all of the provisions of this act.

 

     (21) "University school" means an instructional program

 

operated by a public university under section 23 that meets the

 

requirements of section 23.

 

     Sec. 11. (1) For the fiscal year ending September 30, 2008,

 

there is appropriated for the public schools of this state and

 

certain other state purposes relating to education the sum of

 

$11,386,866,600.00 from the state school aid fund established by

 

section 11 of article IX of the state constitution of 1963 and the

 

sum of $34,909,600.00 from the general fund. For the fiscal year

 

ending September 30, 2009, there is appropriated for the public

 

schools of this state and certain other state purposes relating to

 

education the sum of $11,776,098,200.00 $11,019,798,200.00 from the

 

state school aid fund established by section 11 of article IX of

 

the state constitution of 1963 and the sum of $40,800,000.00

 

$78,000,000.00 from the general fund. For the fiscal year ending

 

September 30, 2009, there is also appropriated the sum of

 

$600,000,000.00 from the federal funding awarded to this state

 

under title XIV of the American recovery and reinvestment act of

 

2009, Public Law 111-5, to be used solely for the purpose of

 

funding the primary funding formula calculated under section 20, in

 

accordance with federal law. In addition, other available federal

 

funds are appropriated for the fiscal year ending September 30,

 

2008 and for the fiscal year ending September 30, 2009.

 

     (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.

 

     (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,

 

and 56 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, and 53a, 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, and 56, 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) Except for the allocation under section 26a, 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. 11j. From the appropriation in section 11, there is

 

allocated an amount not to exceed $3,900,000.00 for 2007-2008 and

 

an amount not to exceed $39,000,000.00 $40,000,000.00 for 2008-2009

 

for payments to the school loan bond redemption fund in the

 

department of treasury on behalf of districts and intermediate

 

districts. Notwithstanding section 11 or any other provision of

 

this act, funds allocated under this section are not subject to

 

proration and shall be paid in full.

 

     Sec. 11n. (1) From the appropriation in section 11, there is

 

allocated $15,000,000.00 $8,000,000.00 for 2008-2009 for the

 

purposes of this section. Money allocated under this section shall

 

be deposited in the 21st century schools fund on November 15 of the

 

fiscal year for which it is allocated or on the next business day

 

following that date.

 

     (2) The 21st century schools fund is created as a separate

 

account within the state school aid fund. The state treasurer may

 

receive money or other assets from any source for deposit into the

 

21st century schools fund. The state treasurer shall direct the

 

investment of the 21st century schools fund. The state treasurer

 

shall credit to the 21st century schools fund interest and earnings

 

from 21st century schools fund investments. Money in the 21st

 

century schools fund at the close of the fiscal year shall remain

 

in the 21st century schools fund and shall not lapse to the state

 

school aid fund or to the general fund. The department of treasury

 

shall be the administrator of the 21st century schools fund for

 

auditing purposes. Money from the 21st century schools fund shall

 

be expended, upon appropriation, only for purposes of this section.

 

     (3) For 2008-2009, an amount not to exceed $15,000,000.00

 

$8,000,000.00 is allocated from the 21st century schools fund for

 

21st century schools grants under this section of up to

 

$3,000,000.00 for each school project to eligible districts that

 

meet the requirements of this section. The funds may be used for

 

planning and start-up costs of newly constructed or newly

 

configured schools or learning communities and renovations of

 

existing facilities as well as other expenditures outlined in the

 

applicants' proposals relating to planning and start-up costs and

 

approved by the department. Notwithstanding section 17b, the total

 

grant amount for 2008-2009 to each eligible district or public

 

school academy shall be distributed over a 4-year period on a

 

schedule to be determined by the department.

 

     (4) To apply for a 21st century schools grant, an eligible

 

district shall submit an application to the department, in a form

 

and manner prescribed by the department, that meets the application

 

criteria under this section. An application shall demonstrate to

 

the satisfaction of the department that the school or learning

 

community of an eligible district to be funded meets all of the

 

following:

 

     (a) Will be designed to achieve the following outcomes not

 

later than the school year in which the third high school

 

graduating class graduates from the school or learning community:

 

     (i) An 80% graduation rate, as determined by the department.

 

     (ii) At least 80% of the high school graduates from the school

 

or learning community are enrolled in postsecondary studies within

 

6 months after high school graduation. For purposes of this

 

subparagraph, "postsecondary studies" includes 4-year colleges and

 

universities, community colleges, technical schools,

 

apprenticeships, and military enlistment.

 

     (b) Will provide an open enrollment such that if there are

 

more applications to enroll than there are spaces available, pupils

 

shall be selected to attend using a random selection process.

 

However, a school or learning community may give enrollment

 

priority to a sibling of a pupil enrolled in the school or learning

 

community, and a school or learning community shall allow any pupil

 

who was enrolled in the school or learning community in the

 

immediately preceding school year to enroll in the school or

 

learning community in the next appropriate grade until the pupil

 

graduates from the school or learning community.

 

     (c) Will have a maximum of 110 pupils in each high school

 

grade level and an average of at least 75 pupils in each high

 

school grade level.

 

     (d) Will incorporate a relationship-building goal between the

 

teaching staff, administration, pupils, and parents.

 

     (e) Has a commitment of private matching funds at least equal

 

to the amount of the grant under this section.

 

     (5) If the department determines that a grant recipient has

 

failed to achieve the outcomes described in subsection (4)(a), the

 

grant recipient shall return to the state 50% of the total grant

 

awarded. To accomplish the return of these funds, the department

 

shall deduct an amount equal to 50% of the total grant awarded from

 

the grant recipient's state school aid installment payments, on a

 

schedule determined by the department. Funds returned under this

 

subsection shall be deposited in the 21st century schools fund.

 

     (6) In awarding grants under this section, the department

 

shall give preference to grant applications for starting a new

 

school or learning community that will implement strategies to

 

prepare middle school students likely to attend the school or

 

learning community or that will include grades 6 to 12 rather than

 

proposals for stand-alone schools including only grades 9 to 12 and

 

not implementing strategies to prepare middle school students.

 

     (7) The department shall not award more than 1/3 of the grants

 

under this section to public school academies.

 

     (8) The department shall establish and publicize the

 

application process and a schedule for the application process.

 

     (9) As used in this section, "eligible district" means all of

 

the following:

 

     (a) A district with a districtwide cohort graduation rate for

 

high school pupils below 70%, as determined by the center for

 

educational performance and information, for its most recent

 

graduating class for which data are available.

 

     (b) A public school academy if a majority of the pupils

 

enrolled in the public school academy reside in a district that

 

meets the criteria under subdivision (a).

 

     Sec. 20. (1) For 2007-2008, the basic foundation allowance is

 

$8,433.00. For 2008-2009, the basic foundation allowance is

 

$8,489.00.

 

     (2) The amount of each district's foundation allowance shall

 

be calculated as provided in this section, using a basic foundation

 

allowance in the amount specified in subsection (1).

 

     (3) Except as otherwise provided in this section, the amount

 

of a district's foundation allowance shall be calculated as

 

follows, using in all calculations the total amount of the

 

district's foundation allowance as calculated before any proration:

 

     (a) For 2007-2008, for a district that had a foundation

 

allowance for 2006-2007, including any adjustment under subdivision

 

(f), that was at least equal to $7,108.00 but less than $8,385.00,

 

the district shall receive a foundation allowance in an amount

 

equal to the sum of the district's foundation allowance for 2006-

 

2007 plus the difference between $96.00 and [($48.00 minus $20.00)

 

times (the difference between the district's foundation allowance

 

for 2006-2007, including any adjustment under subdivision (f), and

 

$7,108.00) divided by $1,325.00]. Beginning in 2008-2009, for a

 

district that had a foundation allowance for the immediately

 

preceding state fiscal year that was at least equal to the sum of

 

$7,108.00 plus the total dollar amount of all adjustments made from

 

2006-2007 to the immediately preceding state fiscal year in the

 

lowest foundation allowance among all districts, but less than the

 

basic foundation allowance for the immediately preceding state

 

fiscal year, the district shall receive a foundation allowance in

 

an amount equal to the sum of the district's foundation allowance

 

for the immediately preceding state fiscal year plus the difference

 

between twice the dollar amount of the adjustment from the

 

immediately preceding state fiscal year to the current state fiscal

 

year made in the basic foundation allowance and [(the dollar amount

 

of the adjustment from the immediately preceding state fiscal year

 

to the current state fiscal year made in the basic foundation

 

allowance minus $20.00) times (the difference between the

 

district's foundation allowance for the immediately preceding state

 

fiscal year and the sum of $7,108.00 plus the total dollar amount

 

of all adjustments made from 2006-2007 to the immediately preceding

 

state fiscal year in the lowest foundation allowance among all

 

districts) divided by the difference between the basic foundation

 

allowance for the current state fiscal year and the sum of

 

$7,108.00 plus the total dollar amount of all adjustments made from

 

2006-2007 to the immediately preceding state fiscal year in the

 

lowest foundation allowance among all districts]. However, the

 

foundation allowance for a district that had less than the basic

 

foundation allowance for the immediately preceding state fiscal

 

year shall not exceed the basic foundation allowance for the

 

current state fiscal year.

 

     (b) Except as otherwise provided in this subsection, beginning

 

in 2008-2009, for a district that in the immediately preceding

 

state fiscal year had a foundation allowance in an amount at least

 

equal to the amount of the basic foundation allowance for the

 

immediately preceding state fiscal year, the district shall receive

 

a foundation allowance in an amount equal to the sum of the

 

district's foundation allowance for the immediately preceding state

 

fiscal year plus the dollar amount of the adjustment from the

 

immediately preceding state fiscal year to the current state fiscal

 

year in the basic foundation allowance.

 

     (c) For a district that in the 1994-95 state fiscal year had a

 

foundation allowance greater than $6,500.00, the district's

 

foundation allowance is an amount equal to the sum of the

 

district's foundation allowance for the immediately preceding state

 

fiscal year plus the lesser of the increase in the basic foundation

 

allowance for the current state fiscal year, as compared to the

 

immediately preceding state fiscal year, or the product of the

 

district's foundation allowance for the immediately preceding state

 

fiscal year times the percentage increase in the United States

 

consumer price index in the calendar year ending in the immediately

 

preceding fiscal year as reported by the May revenue estimating

 

conference conducted under section 367b of the management and

 

budget act, 1984 PA 431, MCL 18.1367b.

 

     (d) For a district that has a foundation allowance that is not

 

a whole dollar amount, the district's foundation allowance shall be

 

rounded up to the nearest whole dollar.

 

     (e) For a district that received a payment under section 22c

 

as that section was in effect for 2001-2002, the district's 2001-

 

2002 foundation allowance shall be considered to have been an

 

amount equal to the sum of the district's actual 2001-2002

 

foundation allowance as otherwise calculated under this section

 

plus the per pupil amount of the district's equity payment for

 

2001-2002 under section 22c as that section was in effect for 2001-

 

2002.

 

     (f) For a district that received a payment under section 22c

 

as that section was in effect for 2006-2007, the district's 2006-

 

2007 foundation allowance shall be considered to have been an

 

amount equal to the sum of the district's actual 2006-2007

 

foundation allowance as otherwise calculated under this section

 

plus the per pupil amount of the district's equity payment for

 

2006-2007 under section 22c as that section was in effect for 2006-

 

2007.

 

     (4) Except as otherwise provided in this subsection, the state

 

portion of a district's foundation allowance is an amount equal to

 

the district's foundation allowance or the basic foundation

 

allowance for the current state fiscal year, whichever is less,

 

minus the difference between the sum of the product of the taxable

 

value per membership pupil of all property in the district that is

 

nonexempt property times the district's certified mills and, for a

 

district with certified mills exceeding 12, the product of the

 

taxable value per membership pupil of property in the district that

 

is commercial personal property times the certified mills minus 12

 

mills and the quotient of the ad valorem property tax revenue of

 

the district captured under tax increment financing acts divided by

 

the district's membership excluding special education pupils. For a

 

district described in subsection (3)(c), the state portion of the

 

district's foundation allowance is an amount equal to $6,962.00

 

plus the difference between the district's foundation allowance for

 

the current state fiscal year and the district's foundation

 

allowance for 1998-99, minus the difference between the sum of the

 

product of the taxable value per membership pupil of all property

 

in the district that is nonexempt property times the district's

 

certified mills and, for a district with certified mills exceeding

 

12, the product of the taxable value per membership pupil of

 

property in the district that is commercial personal property times

 

the certified mills minus 12 mills and the quotient of the ad

 

valorem property tax revenue of the district captured under tax

 

increment financing acts divided by the district's membership

 

excluding special education pupils. For a district that has a

 

millage reduction required under section 31 of article IX of the

 

state constitution of 1963, the state portion of the district's

 

foundation allowance shall be calculated as if that reduction did

 

not occur. For the purposes of state law, federal funding awarded

 

to this state under title XIV of the American recovery and

 

reinvestment act of 2009, Public Law 111-5, that is appropriated

 

under section 11 and allocated under section 22b, is considered to

 

be part of the state portion of a district's foundation allowance

 

and is considered to be part of the total state school aid paid to

 

a public school academy.

 

     (5) The allocation calculated under this section for a pupil

 

shall be based on the foundation allowance of the pupil's district

 

of residence. However, for a pupil enrolled in a district other

 

than the pupil's district of residence, if the foundation allowance

 

of the pupil's district of residence has been adjusted pursuant to

 

subsection (19), the allocation calculated under this section shall

 

House Bill No. 4721 as amended June 24, 2009

 

not include the adjustment described in subsection (19). For a

 

pupil enrolled pursuant to section 105 or 105c in a district other

 

than the pupil's district of residence, the allocation calculated

 

under this section shall be based on the lesser of the foundation

 

allowance of the pupil's district of residence or the foundation

 

allowance of the educating district. For a pupil in membership in a

 

K-5, K-6, or K-8 district who is enrolled in another district in a

 

grade not offered by the pupil's district of residence, the

 

allocation calculated under this section shall be based on the

 

foundation allowance of the educating district if the educating

 

district's foundation allowance is greater than the foundation

 

allowance of the pupil's district of residence. The calculation

 

under this subsection shall take into account a district's per

 

pupil allocation under section 20j(2).

 

     (6) For 2007-2008, subject to subsection (7) and section

 

22b(3) and except as otherwise provided in this subsection, for

 

pupils in membership, other than special education pupils, in a

 

public school academy or a university school, the allocation

 

calculated under this section is an amount per membership pupil

 

other than special education pupils in the public school academy or

 

university school equal to the sum of the local school operating

 

revenue per membership pupil other than special education pupils

 

for the district in which the public school academy or university

 

school is located and the state portion of that district's

 

foundation allowance, or $7,475.00, whichever is less. Beginning in

 

2008-2009, subject to subsection (7) <<and section 22b(3)>> and except

 

as otherwise provided in this subsection, for pupils in membership,

 

other than special education pupils, in a public school academy or

 

a university school, the allocation calculated under this section

 

is an amount per membership pupil other than special education

 

pupils in the public school academy or university school equal to

 

the sum of the local school operating revenue per membership pupil

 

other than special education pupils for the district in which the

 

public school academy or university school is located and the state

 

portion of that district's foundation allowance, or the state

 

maximum public school academy allocation, whichever is less.

 

Notwithstanding section 101, for a public school academy that

 

begins operations after the pupil membership count day, the amount

 

per membership pupil calculated under this subsection shall be

 

adjusted by multiplying that amount per membership pupil by the

 

number of hours of pupil instruction provided by the public school

 

academy after it begins operations, as determined by the

 

department, divided by the minimum number of hours of pupil

 

instruction required under section 101(3). The result of this

 

calculation shall not exceed the amount per membership pupil

 

otherwise calculated under this subsection.

 

     (7) If more than 25% of the pupils residing within a district

 

are in membership in 1 or more public school academies located in

 

the district, then the amount per membership pupil calculated under

 

this section for a public school academy located in the district

 

shall be reduced by an amount equal to the difference between the

 

sum of the product of the taxable value per membership pupil of all

 

property in the district that is nonexempt property times the

 

district's certified mills and, for a district with certified mills

 

exceeding 12, the product of the taxable value per membership pupil

 

of property in the district that is commercial personal property

 

times the certified mills minus 12 mills and the quotient of the ad

 

valorem property tax revenue of the district captured under tax

 

increment financing acts divided by the district's membership

 

excluding special education pupils, in the school fiscal year

 

ending in the current state fiscal year, calculated as if the

 

resident pupils in membership in 1 or more public school academies

 

located in the district were in membership in the district. In

 

order to receive state school aid under this act, a district

 

described in this subsection shall pay to the authorizing body that

 

is the fiscal agent for a public school academy located in the

 

district for forwarding to the public school academy an amount

 

equal to that local school operating revenue per membership pupil

 

for each resident pupil in membership other than special education

 

pupils in the public school academy, as determined by the

 

department.

 

     (8) If a district does not receive an amount calculated under

 

subsection (9); if the number of mills the district may levy on a

 

principal residence, qualified agricultural property, qualified

 

forest property, industrial personal property, and commercial

 

personal property under section 1211 of the revised school code,

 

MCL 380.1211, is 0.5 mills or less; and if the district elects not

 

to levy those mills, the district instead shall receive a separate

 

supplemental amount calculated under this subsection in an amount

 

equal to the amount the district would have received had it levied

 

those mills, as determined by the department of treasury. A

 

district shall not receive a separate supplemental amount

 

calculated under this subsection for a fiscal year unless in the

 

calendar year ending in the fiscal year the district levies the

 

district's certified mills on property that is nonexempt property.

 

     (9) For a district that had combined state and local revenue

 

per membership pupil in the 1993-94 state fiscal year of more than

 

$6,500.00 and that had fewer than 350 pupils in membership, if the

 

district elects not to reduce the number of mills from which a

 

principal residence, qualified agricultural property, qualified

 

forest property, industrial personal property, and commercial

 

personal property are exempt and not to levy school operating taxes

 

on a principal residence, qualified agricultural property,

 

qualified forest property, industrial personal property, and

 

commercial personal property as provided in section 1211 of the

 

revised school code, MCL 380.1211, and not to levy school operating

 

taxes on all property as provided in section 1211(2) of the revised

 

school code, MCL 380.1211, there is calculated under this

 

subsection for 1994-95 and each succeeding fiscal year a separate

 

supplemental amount in an amount equal to the amount the district

 

would have received per membership pupil had it levied school

 

operating taxes on a principal residence, qualified agricultural

 

property, qualified forest property, industrial personal property,

 

and commercial personal property at the rate authorized for the

 

district under section 1211 of the revised school code, MCL

 

380.1211, and levied school operating taxes on all property at the

 

rate authorized for the district under section 1211(2) of the

 

revised school code, MCL 380.1211, as determined by the department

 

of treasury. If in the calendar year ending in the fiscal year a

 

district does not levy the district's certified mills on property

 

that is nonexempt property, the amount calculated under this

 

subsection will be reduced by the same percentage as the millage

 

actually levied compares to the district's certified mills.

 

     (10) Subject to subsection (4), for a district that is formed

 

or reconfigured after June 1, 2002 by consolidation of 2 or more

 

districts or by annexation, the resulting district's foundation

 

allowance under this section beginning after the effective date of

 

the consolidation or annexation shall be the average of the

 

foundation allowances of each of the original or affected

 

districts, calculated as provided in this section, weighted as to

 

the percentage of pupils in total membership in the resulting

 

district who reside in the geographic area of each of the original

 

or affected districts. The calculation under this subsection shall

 

take into account a district's per pupil allocation under section

 

20j(2).

 

     (11) Each fraction used in making calculations under this

 

section shall be rounded to the fourth decimal place and the dollar

 

amount of an increase in the basic foundation allowance shall be

 

rounded to the nearest whole dollar.

 

     (12) State payments related to payment of the foundation

 

allowance for a special education pupil are not calculated under

 

this section but are instead calculated under section 51a.

 

     (13) To assist the legislature in determining the basic

 

foundation allowance for the subsequent state fiscal year, each

 

revenue estimating conference conducted under section 367b of the

 

management and budget act, 1984 PA 431, MCL 18.1367b, shall

 

calculate a pupil membership factor, a revenue adjustment factor,

 

and an index as follows:

 

     (a) The pupil membership factor shall be computed by dividing

 

the estimated membership in the school year ending in the current

 

state fiscal year, excluding intermediate district membership, by

 

the estimated membership for the school year ending in the

 

subsequent state fiscal year, excluding intermediate district

 

membership. If a consensus membership factor is not determined at

 

the revenue estimating conference, the principals of the revenue

 

estimating conference shall report their estimates to the house and

 

senate subcommittees responsible for school aid appropriations not

 

later than 7 days after the conclusion of the revenue conference.

 

     (b) The revenue adjustment factor shall be computed by

 

dividing the sum of the estimated total state school aid fund

 

revenue for the subsequent state fiscal year plus the estimated

 

total state school aid fund revenue for the current state fiscal

 

year, adjusted for any change in the rate or base of a tax the

 

proceeds of which are deposited in that fund and excluding money

 

transferred into that fund from the countercyclical budget and

 

economic stabilization fund under the management and budget act,

 

1984 PA 431, MCL 18.1101 to 18.1594, by the sum of the estimated

 

total school aid fund revenue for the current state fiscal year

 

plus the estimated total state school aid fund revenue for the

 

immediately preceding state fiscal year, adjusted for any change in

 

the rate or base of a tax the proceeds of which are deposited in

 

that fund. If a consensus revenue factor is not determined at the

 

revenue estimating conference, the principals of the revenue

 

estimating conference shall report their estimates to the house and

 

senate subcommittees responsible for school aid appropriations not

 

later than 7 days after the conclusion of the revenue conference.

 

     (c) The index shall be calculated by multiplying the pupil

 

membership factor by the revenue adjustment factor. However, for

 

2008-2009, the index shall be 1.00. If a consensus index is not

 

determined at the revenue estimating conference, the principals of

 

the revenue estimating conference shall report their estimates to

 

the house and senate subcommittees responsible for school aid

 

appropriations not later than 7 days after the conclusion of the

 

revenue conference.

 

     (14) If the principals at the revenue estimating conference

 

reach a consensus on the index described in subsection (13)(c), the

 

lowest foundation allowance among all districts for the subsequent

 

state fiscal year shall be at least the amount of that consensus

 

index multiplied by the lowest foundation allowance among all

 

districts for the immediately preceding state fiscal year.

 

     (15) If at the January revenue estimating conference it is

 

estimated that pupil membership, excluding intermediate district

 

membership, for the subsequent state fiscal year will be greater

 

than 101% of the pupil membership, excluding intermediate district

 

membership, for the current state fiscal year, then it is the

 

intent of the legislature that the executive budget proposal for

 

the school aid budget for the subsequent state fiscal year include

 

a general fund/general purpose allocation sufficient to support the

 

membership in excess of 101% of the current year pupil membership.

 

     (16) For a district that had combined state and local revenue

 

per membership pupil in the 1993-94 state fiscal year of more than

 

$6,500.00, that had fewer than 7 pupils in membership in the 1993-

 

94 state fiscal year, that has at least 1 child educated in the

 

district in the current state fiscal year, and that levies the

 

number of mills of school operating taxes authorized for the

 

district under section 1211 of the revised school code, MCL

 

380.1211, a minimum amount of combined state and local revenue

 

shall be calculated for the district as provided under this

 

subsection. The minimum amount of combined state and local revenue

 

for 1999-2000 shall be $67,000.00 plus the district's additional

 

expenses to educate pupils in grades 9 to 12 educated in other

 

districts as determined and allowed by the department. The minimum

 

amount of combined state and local revenue under this subsection,

 

before adding the additional expenses, shall increase each fiscal

 

year by the same percentage increase as the percentage increase in

 

the basic foundation allowance from the immediately preceding

 

fiscal year to the current fiscal year. The state portion of the

 

minimum amount of combined state and local revenue under this

 

subsection shall be calculated by subtracting from the minimum

 

amount of combined state and local revenue under this subsection

 

the sum of the district's local school operating revenue and an

 

amount equal to the product of the sum of the state portion of the

 

district's foundation allowance plus the amount calculated under

 

section 20j times the district's membership. As used in this

 

subsection, "additional expenses" means the district's expenses for

 

tuition or fees, not to exceed the basic foundation allowance for

 

the current state fiscal year, plus a room and board stipend not to

 

exceed $10.00 per school day for each pupil in grades 9 to 12

 

educated in another district, as approved by the department.

 

     (17) For a district in which 7.75 mills levied in 1992 for

 

school operating purposes in the 1992-93 school year were not

 

renewed in 1993 for school operating purposes in the 1993-94 school

 

year, the district's combined state and local revenue per

 

membership pupil shall be recalculated as if that millage reduction

 

did not occur and the district's foundation allowance shall be

 

calculated as if its 1994-95 foundation allowance had been

 

calculated using that recalculated 1993-94 combined state and local

 

revenue per membership pupil as a base. A district is not entitled

 

to any retroactive payments for fiscal years before 2000-2001 due

 

to this subsection.

 

     (18) For a district in which an industrial facilities

 

exemption certificate that abated taxes on property with a state

 

equalized valuation greater than the total state equalized

 

valuation of the district at the time the certificate was issued or

 

$700,000,000.00, whichever is greater, was issued under 1974 PA

 

198, MCL 207.551 to 207.572, before the calculation of the

 

district's 1994-95 foundation allowance, the district's foundation

 

allowance for 2002-2003 is an amount equal to the sum of the

 

district's foundation allowance for 2002-2003, as otherwise

 

calculated under this section, plus $250.00.

 

     (19) For a district that received a grant under former section

 

32e for 2001-2002, the district's foundation allowance for 2002-

 

2003 and each succeeding fiscal year shall be adjusted to be an

 

amount equal to the sum of the district's foundation allowance, as

 

otherwise calculated under this section, plus the quotient of 100%

 

of the amount of the grant award to the district for 2001-2002

 

under former section 32e divided by the number of pupils in the

 

district's membership for 2001-2002 who were residents of and

 

enrolled in the district. Except as otherwise provided in this

 

subsection, a district qualifying for a foundation allowance

 

adjustment under this subsection shall use the funds resulting from

 

this adjustment for at least 1 of grades K to 3 for purposes

 

allowable under former section 32e as in effect for 2001-2002, and

 

may also use these funds for an early intervening program described

 

in subsection (20). For an individual school or schools operated by

 

a district qualifying for a foundation allowance under this

 

subsection that have been determined by the department to meet the

 

adequate yearly progress standards of the federal no child left

 

behind act of 2001, Public Law 107-110, in both mathematics and

 

English language arts at all applicable grade levels for all

 

applicable subgroups, the district may submit to the department an

 

application for flexibility in using the funds resulting from this

 

adjustment that are attributable to the pupils in the school or

 

schools. The application shall identify the affected school or

 

schools and the affected funds and shall contain a plan for using

 

the funds for specific purposes identified by the district that are

 

designed to reduce class size, but that may be different from the

 

purposes otherwise allowable under this subsection. The department

 

shall approve the application if the department determines that the

 

purposes identified in the plan are reasonably designed to reduce

 

class size. If the department does not act to approve or disapprove

 

an application within 30 days after it is submitted to the

 

department, the application is considered to be approved. If an

 

application for flexibility in using the funds is approved, the

 

district may use the funds identified in the application for any

 

purpose identified in the plan.

 

     (20) An early intervening program that uses funds resulting

 

from the adjustment under subsection (19) shall meet either or both

 

of the following:

 

     (a) Shall monitor individual pupil learning for pupils in

 

grades K to 3 and provide specific support or learning strategies

 

to pupils in grades K to 3 as early as possible in order to reduce

 

the need for special education placement. The program shall include

 

literacy and numeracy supports, sensory motor skill development,

 

behavior supports, instructional consultation for teachers, and the

 

development of a parent/school learning plan. Specific support or

 

learning strategies may include support in or out of the general

 

classroom in areas including reading, writing, math, visual memory,

 

motor skill development, behavior, or language development. These

 

would be provided based on an understanding of the individual

 

child's learning needs.

 

     (b) Shall provide early intervening strategies for pupils in

 

grades K to 3 using schoolwide systems of academic and behavioral

 

supports and shall be scientifically research-based. The strategies

 

to be provided shall include at least pupil performance indicators

 

based upon response to intervention, instructional consultation for

 

teachers, and ongoing progress monitoring. A schoolwide system of

 

academic and behavioral support should be based on a support team

 

available to the classroom teachers. The members of this team could

 

include the principal, special education staff, reading teachers,

 

and other appropriate personnel who would be available to

 

systematically study the needs of the individual child and work

 

with the teacher to match instruction to the needs of the

 

individual child.

 

     (21) For a district that levied 1.9 mills in 1993 to finance

 

an operating deficit, the district's foundation allowance shall be

 

calculated as if those mills were included as operating mills in

 

the calculation of the district's 1994-1995 foundation allowance. A

 

district is not entitled to any retroactive payments for fiscal

 

years before 2006-2007 due to this subsection. A district receiving

 

an adjustment under this subsection shall not receive more than

 

$800,000.00 for a fiscal year as a result of this adjustment.

 

     (22) For a district that levied 2.23 mills in 1993 to finance

 

an operating deficit, the district's foundation allowance shall be

 

calculated as if those mills were included as operating mills in

 

the calculation of the district's 1994-1995 foundation allowance. A

 

district is not entitled to any retroactive payments for fiscal

 

years before 2006-2007 due to this subsection. A district receiving

 

an adjustment under this subsection shall not receive more than

 

$500,000.00 for a fiscal year as a result of this adjustment.

 

     (23) Payments to districts, university schools, or public

 

school academies shall not be made under this section. Rather, the

 

calculations under this section shall be used to determine the

 

amount of state payments under section 22b.

 

     (24) If an amendment to section 2 of article VIII of the state

 

constitution of 1963 allowing state aid to some or all nonpublic

 

schools is approved by the voters of this state, each foundation

 

allowance or per pupil payment calculation under this section may

 

be reduced.

 

     (25) As used in this section:

 

     (a) "Certified mills" means the lesser of 18 mills or the

 

number of mills of school operating taxes levied by the district in

 

1993-94.

 

     (b) "Combined state and local revenue" means the aggregate of

 

the district's state school aid received by or paid on behalf of

 

the district under this section and the district's local school

 

operating revenue.

 

     (c) "Combined state and local revenue per membership pupil"

 

means the district's combined state and local revenue divided by

 

the district's membership excluding special education pupils.

 

     (d) "Current state fiscal year" means the state fiscal year

 

for which a particular calculation is made.

 

     (e) "Immediately preceding state fiscal year" means the state

 

fiscal year immediately preceding the current state fiscal year.

 

     (f) "Local school operating revenue" means school operating

 

taxes levied under section 1211 of the revised school code, MCL

 

380.1211.

 

     (g) "Local school operating revenue per membership pupil"

 

means a district's local school operating revenue divided by the

 

district's membership excluding special education pupils.

 

     (h) "Maximum public school academy allocation" means the

 

maximum per-pupil allocation as calculated by adding the highest

 

per-pupil allocation among all public school academies for the

 

immediately preceding state fiscal year plus the difference between

 

twice the dollar amount of the adjustment from the immediately

 

preceding state fiscal year to the current state fiscal year made

 

in the basic foundation allowance and [(the dollar amount of the

 

adjustment from the immediately preceding state fiscal year to the

 

current state fiscal year made in the basic foundation allowance

 

minus $20.00) times (the difference between the highest per-pupil

 

allocation among all public school academies for the immediately

 

preceding state fiscal year and the sum of $7,108.00 plus the total

 

dollar amount of all adjustments made from 2006-2007 to the

 

immediately preceding state fiscal year in the lowest per-pupil

 

allocation among all public school academies) divided by the

 

difference between the basic foundation allowance for the current

 

state fiscal year and the sum of $7,108.00 plus the total dollar

 

amount of all adjustments made from 2006-2007 to the immediately

 

preceding state fiscal year in the lowest per-pupil allocation

 

among all public school academies].

 

     (i) "Membership" means the definition of that term under

 

section 6 as in effect for the particular fiscal year for which a

 

particular calculation is made.

 

     (j) "Nonexempt property" means property that is not a

 

principal residence, qualified agricultural property, qualified

 

forest property, industrial personal property, or commercial

 

personal property.

 

     (k) "Principal residence", "qualified agricultural property",

 

"qualified forest property", "industrial personal property", and

 

"commercial personal property" mean those terms as defined in

 

section 7dd of the general property tax act, 1893 PA 206, MCL

 

211.7dd, and section 1211 of the revised school code, MCL 380.1211.

 

     (l) "School operating purposes" means the purposes included in

 

the operation costs of the district as prescribed in sections 7 and

 

18.

 

     (m) "School operating taxes" means local ad valorem property

 

taxes levied under section 1211 of the revised school code, MCL

 

380.1211, and retained for school operating purposes.

 

     (n) "Tax increment financing acts" means 1975 PA 197, MCL

 

125.1651 to 125.1681, the tax increment finance authority act, 1980

 

PA 450, MCL 125.1801 to 125.1830, the local development financing

 

act, 1986 PA 281, MCL 125.2151 to 125.2174, the brownfield

 

redevelopment financing act, 1996 PA 381, MCL 125.2651 to 125.2672,

 

or the corridor improvement authority act, 2005 PA 280, MCL

 

125.2871 to 125.2899.

 

     (o) "Taxable value per membership pupil" means taxable value,

 

as certified by the department of treasury, for the calendar year

 

ending in the current state fiscal year divided by the district's

 

membership excluding special education pupils for the school year

 

ending in the current state fiscal year.

 

     Sec. 22a. (1) From the appropriation in section 11, there is

 

allocated an amount not to exceed $5,951,000,000.00 for 2007-2008

 

and an amount not to exceed $6,092,000,000.00 $6,008,000,000.00 for

 

2008-2009 for payments to districts, qualifying university schools,

 

and qualifying public school academies to guarantee each district,

 

qualifying university school, and qualifying public school academy

 

an amount equal to its 1994-95 total state and local per pupil

 

revenue for school operating purposes under section 11 of article

 

IX of the state constitution of 1963. Pursuant to section 11 of

 

article IX of the state constitution of 1963, this guarantee does

 

not apply to a district in a year in which the district levies a

 

millage rate for school district operating purposes less than it

 

levied in 1994. However, subsection (2) applies to calculating the

 

payments under this section. Funds allocated under this section

 

that are not expended in the state fiscal year for which they were

 

allocated, as determined by the department, may be used to

 

supplement the allocations under sections 22b and 51c in order to

 

fully fund those calculated allocations for the same fiscal year.

 

     (2) To ensure that a district receives an amount equal to the

 

district's 1994-95 total state and local per pupil revenue for

 

school operating purposes, there is allocated to each district a

 

state portion of the district's 1994-95 foundation allowance in an

 

amount calculated as follows:

 

     (a) Except as otherwise provided in this subsection, the state

 

portion of a district's 1994-95 foundation allowance is an amount

 

equal to the district's 1994-95 foundation allowance or $6,500.00,

 

whichever is less, minus the difference between the sum of the

 

product of the taxable value per membership pupil of all property

 

in the district that is nonexempt property times the district's

 

certified mills and, for a district with certified mills exceeding

 

12, the product of the taxable value per membership pupil of

 

property in the district that is commercial personal property times

 

the certified mills minus 12 mills and the quotient of the ad

 

valorem property tax revenue of the district captured under tax

 

increment financing acts divided by the district's membership. For

 

a district that has a millage reduction required under section 31

 

of article IX of the state constitution of 1963, the state portion

 

of the district's foundation allowance shall be calculated as if

 

that reduction did not occur.

 

     (b) For a district that had a 1994-95 foundation allowance

 

greater than $6,500.00, the state payment under this subsection

 

shall be the sum of the amount calculated under subdivision (a)

 

plus the amount calculated under this subdivision. The amount

 

calculated under this subdivision shall be equal to the difference

 

between the district's 1994-95 foundation allowance minus $6,500.00

 

and the current year hold harmless school operating taxes per

 

pupil. If the result of the calculation under subdivision (a) is

 

negative, the negative amount shall be an offset against any state

 

payment calculated under this subdivision. If the result of a

 

calculation under this subdivision is negative, there shall not be

 

a state payment or a deduction under this subdivision. The taxable

 

values per membership pupil used in the calculations under this

 

subdivision are as adjusted by ad valorem property tax revenue

 

captured under tax increment financing acts divided by the

 

district's membership.

 

     (3) Beginning in 2003-2004, for pupils in membership in a

 

qualifying public school academy or qualifying university school,

 

there is allocated under this section to the authorizing body that

 

is the fiscal agent for the qualifying public school academy for

 

forwarding to the qualifying public school academy, or to the board

 

of the public university operating the qualifying university

 

school, an amount equal to the 1994-95 per pupil payment to the

 

qualifying public school academy or qualifying university school

 

under section 20.

 

     (4) A district, qualifying university school, or qualifying

 

public school academy may use funds allocated under this section in

 

conjunction with any federal funds for which the district,

 

qualifying university school, or qualifying public school academy

 

otherwise would be eligible.

 

     (5) For a district that is formed or reconfigured after June

 

1, 2000 by consolidation of 2 or more districts or by annexation,

 

the resulting district's 1994-95 foundation allowance under this

 

section beginning after the effective date of the consolidation or

 

annexation shall be the average of the 1994-95 foundation

 

allowances of each of the original or affected districts,

 

calculated as provided in this section, weighted as to the

 

percentage of pupils in total membership in the resulting district

 

in the state fiscal year in which the consolidation takes place who

 

reside in the geographic area of each of the original districts. If

 

an affected district's 1994-95 foundation allowance is less than

 

the 1994-95 basic foundation allowance, the amount of that

 

district's 1994-95 foundation allowance shall be considered for the

 

purpose of calculations under this subsection to be equal to the

 

amount of the 1994-95 basic foundation allowance.

 

     (6) As used in this section:

 

     (a) "1994-95 foundation allowance" means a district's 1994-95

 

foundation allowance calculated and certified by the department of

 

treasury or the superintendent under former section 20a as enacted

 

in 1993 PA 336 and as amended by 1994 PA 283.

 

     (b) "Certified mills" means the lesser of 18 mills or the

 

number of mills of school operating taxes levied by the district in

 

1993-94.

 

     (c) "Current state fiscal year" means the state fiscal year

 

for which a particular calculation is made.

 

     (d) "Current year hold harmless school operating taxes per

 

pupil" means the per pupil revenue generated by multiplying a

 

district's 1994-95 hold harmless millage by the district's current

 

year taxable value per membership pupil.

 

     (e) "Hold harmless millage" means, for a district with a 1994-

 

95 foundation allowance greater than $6,500.00, the number of mills

 

by which the exemption from the levy of school operating taxes on a

 

homestead, qualified agricultural property, qualified forest

 

property, industrial personal property, and commercial personal

 

property could be reduced as provided in section 1211 of the

 

revised school code, MCL 380.1211, and the number of mills of

 

school operating taxes that could be levied on all property as

 

provided in section 1211(2) of the revised school code, MCL

 

380.1211, as certified by the department of treasury for the 1994

 

tax year.

 

     (f) "Homestead" means that term as defined in section 1211 of

 

the revised school code, MCL 380.1211.

 

     (g) "Membership" means the definition of that term under

 

section 6 as in effect for the particular fiscal year for which a

 

particular calculation is made.

 

     (h) "Nonexempt property" means property that is not a

 

principal residence, qualified agricultural property, qualified

 

forest property, industrial personal property, or commercial

 

personal property.

 

     (i) "Qualified agricultural property" means that term as

 

defined in section 1211 of the revised school code, MCL 380.1211.

 

     (j) "Qualifying public school academy" means a public school

 

academy that was in operation in the 1994-95 school year and is in

 

operation in the current state fiscal year.

 

     (k) "Qualifying university school" means a university school

 

that was in operation in the 1994-95 school year and is in

 

operation in the current fiscal year.

 

     (l) "School operating taxes" means local ad valorem property

 

taxes levied under section 1211 of the revised school code, MCL

 

380.1211, and retained for school operating purposes.

 

     (m) "Tax increment financing acts" means 1975 PA 197, MCL

 

125.1651 to 125.1681, the tax increment finance authority act, 1980

 

PA 450, MCL 125.1801 to 125.1830, the local development financing

 

act, 1986 PA 281, MCL 125.2151 to 125.2174, the brownfield

 

redevelopment financing act, 1996 PA 381, MCL 125.2651 to 125.2672,

 

or the corridor improvement authority act, 2005 PA 280, MCL

 

125.2871 to 125.2899.

 

     (n) "Taxable value per membership pupil" means each of the

 

following divided by the district's membership:

 

     (i) For the number of mills by which the exemption from the

 

levy of school operating taxes on a homestead, qualified

 

agricultural property, qualified forest property, industrial

 

personal property, and commercial personal property may be reduced

 

as provided in section 1211 of the revised school code, MCL

 

380.1211, the taxable value of homestead, qualified agricultural

 

property, qualified forest property, industrial personal property,

 

and commercial personal property for the calendar year ending in

 

the current state fiscal year.

 

     (ii) For the number of mills of school operating taxes that may

 

be levied on all property as provided in section 1211(2) of the

 

revised school code, MCL 380.1211, the taxable value of all

 

property for the calendar year ending in the current state fiscal

 

year.

 

     Sec. 22b. (1) From the appropriation in section 11, there is

 

allocated an amount not to exceed $3,683,275,000.00 for 2007-2008

 

and for 2008-2009 an amount not to exceed $3,796,750,000.00 for

 

2008-2009 $3,198,000,000.00 for discretionary nonmandated payments

 

to districts under this section. Funds allocated under this section

 

that are not expended in the state fiscal year for which they were

 

allocated, as determined by the department, may be used to

 

supplement the allocations under sections 22a and 51c in order to

 

fully fund those calculated allocations for the same fiscal year.

 

     (2) In addition to the funds allocated in subsection (1),

 

there is allocated an amount estimated at $600,000,000.00 from the

 

federal funds awarded to this state under title XIV of the American

 

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

 

funds shall be distributed in a form and manner determined by the

 

department based on an equal dollar amount per the number of

 

membership pupils used to calculate the May 20, 2009 state aid

 

payment and shall be expended in a manner prescribed by federal

 

law.

 

     (3) (2) Subject to subsection (3) (4) and section 11, the

 

allocation to a district under this section shall be an amount

 

equal to the sum of the amounts calculated under sections 20, 20j,

 

51a(2), 51a(3), and 51a(12), minus the sum of the allocations to

 

the district under sections 22a and 51c.

 

     (4) (3) In order to receive an allocation under this section

 

subsection (1), each district shall do all of the following:

 

     (a) Administer in each grade level that it operates in grades

 

1 to 5 a standardized assessment approved by the department of

 

grade-appropriate basic educational skills. A district may use the

 

Michigan literacy progress profile to satisfy this requirement for

 

grades 1 to 3. Also, if the revised school code is amended to

 

require annual assessments at additional grade levels, in order to

 

receive an allocation under this section each district shall comply

 

with that requirement.

 

     (b) Comply with sections 1278a and 1278b of the revised school

 

code, MCL 380.1278a and 380.1278b.

 

     (c) Furnish data and other information required by state and

 

federal law to the center and the department in the form and manner

 

specified by the center or the department, as applicable.

 

     (d) Comply with section 1230g of the revised school code, MCL

 

380.1230g.

 

     (5) (4) Districts are encouraged to use funds allocated under

 

this section for the purchase and support of payroll, human

 

resources, and other business function software that is compatible

 

with that of the intermediate district in which the district is

 

located and with other districts located within that intermediate

 

district.

 

     (6) (5) From the allocation in subsection (1), the department

 

shall pay up to $1,000,000.00 in litigation costs incurred by this

 

state associated with lawsuits filed by 1 or more districts or

 

intermediate districts against this state. If the allocation under

 

this section is insufficient to fully fund all payments required

 

under this section, the payments under this subsection shall be

 

made in full before any proration of remaining payments under this

 

section.

 

     (7) (6) It is the intent of the legislature that all

 

constitutional obligations of this state have been fully funded

 

under sections 22a, 31d, 51a, and 51c. If a claim is made by an

 

entity receiving funds under this act that challenges the

 

legislative determination of the adequacy of this funding or

 

alleges that there exists an unfunded constitutional requirement,

 

the state budget director may escrow or allocate from the

 

discretionary funds for nonmandated payments under this section the

 

amount as may be necessary to satisfy the claim before making any

 

payments to districts under subsection (2) (3). If funds are

 

escrowed, the escrowed funds are a work project appropriation and

 

the funds are carried forward into the following fiscal year. The

 

purpose of the work project is to provide for any payments that may

 

be awarded to districts as a result of litigation. The work project

 

shall be completed upon resolution of the litigation.

 

     (8) (7) If the local claims review board or a court of

 

competent jurisdiction makes a final determination that this state

 

is in violation of section 29 of article IX of the state

 

constitution of 1963 regarding state payments to districts, the

 

state budget director shall use work project funds under subsection

 

(6) (7) or allocate from the discretionary funds for nonmandated

 

payments under this section the amount as may be necessary to

 

satisfy the amount owed to districts before making any payments to

 

districts under subsection (2) (3).

 

     (9) (8) If a claim is made in court that challenges the

 

legislative determination of the adequacy of funding for this

 

state's constitutional obligations or alleges that there exists an

 

unfunded constitutional requirement, any interested party may seek

 

an expedited review of the claim by the local claims review board.

 

If the claim exceeds $10,000,000.00, this state may remove the

 

action to the court of appeals, and the court of appeals shall have

 

and shall exercise jurisdiction over the claim.

 

     (10) (9) If payments resulting from a final determination by

 

the local claims review board or a court of competent jurisdiction

 

that there has been a violation of section 29 of article IX of the

 

state constitution of 1963 exceed the amount allocated for

 

discretionary nonmandated payments under this section, the

 

legislature shall provide for adequate funding for this state's

 

constitutional obligations at its next legislative session.

 

     (11) (10) If a lawsuit challenging payments made to districts

 

related to costs reimbursed by federal title XIX medicaid funds is

 

filed against this state, then, for the purpose of addressing

 

potential liability under such a lawsuit, the state budget director

 

may place funds allocated under this section in escrow or allocate

 

money from the funds otherwise allocated under this section, up to

 

a maximum of 50% of the amount allocated in subsection (1). If

 

funds are placed in escrow under this subsection, those funds are a

 

work project appropriation and the funds are carried forward into

 

the following fiscal year. The purpose of the work project is to

 

provide for any payments that may be awarded to districts as a

 

result of the litigation. The work project shall be completed upon

 

resolution of the litigation. In addition, this state reserves the

 

right to terminate future federal title XIX medicaid reimbursement

 

payments to districts if the amount or allocation of reimbursed

 

funds is challenged in the lawsuit. As used in this subsection,

 

"title XIX" means title XIX of the social security act, 42 USC 1396

 

to 1396v.

 

     Sec. 26a. From the state school aid fund appropriation in

 

section 11, there is allocated an amount not to exceed

 

$41,400,000.00 $26,300,000.00 for 2008-2009, and from the general

 

fund appropriation in section 11, there is allocated an amount not

 

to exceed $16,100,000.00 $9,200,000.00 for 2008-2009 to reimburse

 

districts, intermediate districts, and the state school aid fund

 

pursuant to section 12 of the Michigan renaissance zone act, 1996

 

PA 376, MCL 125.2692, for taxes levied in 2008. The allocations

 

shall be made not later than 60 days after the department of

 

treasury certifies to the department and to the state budget

 

director that the department of treasury has received all necessary

 

information to properly determine the amounts due to each eligible

 

recipient.

 

     Sec. 31a. (1) From the state school aid fund money

 

appropriated in section 11, there is allocated for 2008-2009 an

 

amount not to exceed $320,350,000.00 for payments to eligible

 

districts and eligible public school academies under this section.

 

Subject to subsection (14), the amount of the additional allowance

 

under this section, other than funding under subsection (6) or (7),

 

shall be based on the number of actual pupils in membership in the

 

district or public school academy who met the income eligibility

 

criteria for free breakfast, lunch, or milk in the immediately

 

preceding state fiscal year, as determined under the Richard B.

 

Russell national school lunch act, 42 USC 1751 to 1769i, and

 

reported to the department by October 31 of the immediately

 

preceding fiscal year and adjusted not later than December 31 of

 

the immediately preceding fiscal year. However, for a public school

 

academy that began operations as a public school academy after the

 

pupil membership count day of the immediately preceding school

 

year, the basis for the additional allowance under this section

 

shall be the number of actual pupils in membership in the public

 

school academy who met the income eligibility criteria for free

 

breakfast, lunch, or milk in the current state fiscal year, as

 

determined under the Richard B. Russell national school lunch act.

 

     (2) To be eligible to receive funding under this section,

 

other than funding under subsection (6) or (7), a district or

 

public school academy that has not been previously determined to be

 

eligible shall apply to the department, in a form and manner

 

prescribed by the department, and a district or public school

 

academy must meet all of the following:

 

     (a) The sum of the district's or public school academy's

 

combined state and local revenue per membership pupil in the

 

current state fiscal year, as calculated under section 20, plus the

 

amount of the district's per pupil allocation under section 20j(2),

 

is less than or equal to the basic foundation allowance under

 

section 20 for the current state fiscal year.

 

     (b) The district or public school academy agrees to use the

 

funding only for purposes allowed under this section and to comply

 

with the program and accountability requirements under this

 

section.

 

     (3) Except as otherwise provided in this subsection, an

 

eligible district or eligible public school academy shall receive

 

under this section for each membership pupil in the district or

 

public school academy who met the income eligibility criteria for

 

free breakfast, lunch, or milk, as determined under the Richard B.

 

Russell national school lunch act and as reported to the department

 

by October 31 of the immediately preceding fiscal year and adjusted

 

not later than December 31 of the immediately preceding fiscal

 

year, an amount per pupil equal to 11.5% of the sum of the

 

district's foundation allowance or public school academy's per

 

pupil amount calculated under section 20, plus the amount of the

 

district's per pupil allocation under section 20j(2), not to exceed

 

the basic foundation allowance under section 20 for the current

 

state fiscal year, or of the public school academy's per membership

 

pupil amount calculated under section 20 for the current state

 

fiscal year. A public school academy that began operations as a

 

public school academy after the pupil membership count day of the

 

immediately preceding school year shall receive under this section

 

for each membership pupil in the public school academy who met the

 

income eligibility criteria for free breakfast, lunch, or milk, as

 

determined under the Richard B. Russell national school lunch act

 

and as reported to the department by October 31 of the current

 

fiscal year and adjusted not later than December 31 of the current

 

fiscal year, an amount per pupil equal to 11.5% of the public

 

school academy's per membership pupil amount calculated under

 

section 20 for the current state fiscal year.

 

     (4) Except as otherwise provided in this section, a district

 

or public school academy receiving funding under this section shall

 

use that money only to provide instructional programs and direct

 

noninstructional services, including, but not limited to, medical

 

or counseling services, for at-risk pupils; for school health

 

clinics; and for the purposes of subsection (5), (6), or (7). In

 

addition, a district that is a school district of the first class

 

or a district or public school academy in which at least 50% of the

 

pupils in membership met the income eligibility criteria for free

 

breakfast, lunch, or milk in the immediately preceding state fiscal

 

year, as determined and reported as described in subsection (1),

 

may use not more than 15% 20% of the funds it receives under this

 

section for school security. A district or public school academy

 

shall not use any of that money for administrative costs or to

 

supplant another program or other funds, except for funds allocated

 

to the district or public school academy under this section in the

 

immediately preceding year and already being used by the district

 

or public school academy for at-risk pupils. The instruction or

 

direct noninstructional services provided under this section may be

 

conducted before or after regular school hours or by adding extra

 

school days to the school year and may include, but are not limited

 

to, tutorial services, early childhood programs to serve children

 

age 0 to 5, and reading programs as described in former section 32f

 

as in effect for 2001-2002. A tutorial method may be conducted with

 

paraprofessionals working under the supervision of a certificated

 

teacher. The ratio of pupils to paraprofessionals shall be between

 

10:1 and 15:1. Only 1 certificated teacher is required to supervise

 

instruction using a tutorial method. As used in this subsection,

 

"to supplant another program" means to take the place of a

 

previously existing instructional program or direct

 

noninstructional services funded from a funding source other than

 

funding under this section.

 

     (5) Except as otherwise provided in subsection (12), a

 

district or public school academy that receives funds under this

 

section and that operates a school breakfast program under section

 

1272a of the revised school code, MCL 380.1272a, shall use from the

 

funds received under this section an amount, not to exceed $10.00

 

per pupil for whom the district or public school academy receives

 

funds under this section, necessary to pay for costs associated

 

with the operation of the school breakfast program.

 

     (6) From the funds allocated under subsection (1), there is

 

allocated for 2008-2009 an amount not to exceed $4,743,000.00 to

 

support child and adolescent health centers. These grants shall be

 

awarded for 5 consecutive years beginning with 2003-2004 in a form

 

and manner approved jointly by the department and the department of

 

community health. Each grant recipient shall remain in compliance

 

with the terms of the grant award or shall forfeit the grant award

 

for the duration of the 5-year period after the noncompliance.

 

Beginning in 2004-2005, to continue to receive funding for a child

 

and adolescent health center under this section a grant recipient

 

shall ensure that the child and adolescent health center has an

 

advisory committee and that at least one-third of the members of

 

the advisory committee are parents or legal guardians of school-

 

aged children. A child and adolescent health center program shall

 

recognize the role of a child's parents or legal guardian in the

 

physical and emotional well-being of the child. Funding under this

 

subsection shall be used to support child and adolescent health

 

center services provided to children up to age 21. If any funds

 

allocated under this subsection are not used for the purposes of

 

this subsection for the fiscal year in which they are allocated,

 

those unused funds shall be used that fiscal year to avoid or

 

minimize any proration that would otherwise be required under

 

subsection (14) for that fiscal year.

 

     (7) From the funds allocated under subsection (1), there is

 

allocated for 2008-2009 an amount not to exceed $5,150,000.00 for

 

the state portion of the hearing and vision screenings as described

 

in section 9301 of the public health code, 1978 PA 368, MCL

 

333.9301. A local public health department shall pay at least 50%

 

of the total cost of the screenings. The frequency of the

 

screenings shall be as required under R 325.13091 to R 325.13096

 

and R 325.3271 to R 325.3276 of the Michigan administrative code.

 

Funds shall be awarded in a form and manner approved jointly by the

 

department and the department of community health. Notwithstanding

 

section 17b, payments to eligible entities under this subsection

 

shall be paid on a schedule determined by the department.

 

     (8) Each district or public school academy receiving funds

 

under this section shall submit to the department by July 15 of

 

each fiscal year a report, not to exceed 10 pages, on the usage by

 

the district or public school academy of funds under this section,

 

which report shall include at least a brief description of each

 

program conducted by the district or public school academy using

 

funds under this section, the amount of funds under this section

 

allocated to each of those programs, the number of at-risk pupils

 

eligible for free or reduced price school lunch who were served by

 

each of those programs, and the total number of at-risk pupils

 

served by each of those programs. If a district or public school

 

academy does not comply with this subsection, the department shall

 

withhold an amount equal to the August payment due under this

 

section until the district or public school academy complies with

 

this subsection. If the district or public school academy does not

 

comply with this subsection by the end of the state fiscal year,

 

the withheld funds shall be forfeited to the school aid fund.

 

     (9) In order to receive funds under this section, a district

 

or public school academy shall allow access for the department or

 

the department's designee to audit all records related to the

 

program for which it receives those funds. The district or public

 

school academy shall reimburse the state for all disallowances

 

found in the audit.

 

     (10) Subject to subsections (5), (6), (7), (12), and (13), any

 

district may use up to 100% of the funds it receives under this

 

section to reduce the ratio of pupils to teachers in grades K-6, or

 

any combination of those grades, in school buildings in which the

 

percentage of pupils described in subsection (1) exceeds the

 

district's aggregate percentage of those pupils. Subject to

 

subsections (5), (6), (7), (12), and (13), if a district obtains a

 

waiver from the department, the district may use up to 100% of the

 

funds it receives under this section to reduce the ratio of pupils

 

to teachers in grades K-6, or any combination of those grades, in

 

school buildings in which the percentage of pupils described in

 

subsection (1) is at least 60% of the district's aggregate

 

percentage of those pupils and at least 30% of the total number of

 

pupils enrolled in the school building. To obtain a waiver, a

 

district must apply to the department and demonstrate to the

 

satisfaction of the department that the class size reductions would

 

be in the best interests of the district's at-risk pupils.

 

     (11) A district or public school academy may use funds

 

received under this section for adult high school completion,

 

general educational development (G.E.D.) test preparation, adult

 

English as a second language, or adult basic education programs

 

described in section 107.

 

     (12) For an individual school or schools operated by a

 

district or public school academy receiving funds under this

 

section that have been determined by the department to meet the

 

adequate yearly progress standards of the federal no child left

 

behind act of 2001, Public Law 107-110, in both mathematics and

 

English language arts at all applicable grade levels for all

 

applicable subgroups, the district or public school academy may

 

submit to the department an application for flexibility in using

 

the funds received under this section that are attributable to the

 

pupils in the school or schools. The application shall identify the

 

affected school or schools and the affected funds and shall contain

 

a plan for using the funds for specific purposes identified by the

 

district that are designed to benefit at-risk pupils in the school,

 

but that may be different from the purposes otherwise allowable

 

under this section. The department shall approve the application if

 

the department determines that the purposes identified in the plan

 

are reasonably designed to benefit at-risk pupils in the school. If

 

the department does not act to approve or disapprove an application

 

within 30 days after it is submitted to the department, the

 

application is considered to be approved. If an application for

 

flexibility in using the funds is approved, the district may use

 

the funds identified in the application for any purpose identified

 

in the plan.

 

     (13) A district or public school academy that receives funds

 

under this section may use funds it receives under this section to

 

implement and operate an early intervening program for pupils in

 

grades K to 3 that meets either or both of the following:

 

     (a) Monitors individual pupil learning and provides specific

 

support or learning strategies to pupils as early as possible in

 

order to reduce the need for special education placement. The

 

program shall include literacy and numeracy supports, sensory motor

 

skill development, behavior supports, instructional consultation

 

for teachers, and the development of a parent/school learning plan.

 

Specific support or learning strategies may include support in or

 

out of the general classroom in areas including reading, writing,

 

math, visual memory, motor skill development, behavior, or language

 

development. These would be provided based on an understanding of

 

the individual child's learning needs.

 

     (b) Provides early intervening strategies using school-wide

 

systems of academic and behavioral supports and is scientifically

 

research-based. The strategies to be provided shall include at

 

least pupil performance indicators based upon response to

 

intervention, instructional consultation for teachers, and ongoing

 

progress monitoring. A school-wide system of academic and

 

behavioral support should be based on a support team available to

 

the classroom teachers. The members of this team could include the

 

principal, special education staff, reading teachers, and other

 

appropriate personnel who would be available to systematically

 

study the needs of the individual child and work with the teacher

 

to match instruction to the needs of the individual child.

 

     (14) If necessary, and before any proration required under

 

section 11, the department shall prorate payments under this

 

section by reducing the amount of the per pupil payment under this

 

section by a dollar amount calculated by determining the amount by

 

which the amount necessary to fully fund the requirements of this

 

section exceeds the maximum amount allocated under this section and

 

then dividing that amount by the total statewide number of pupils

 

who met the income eligibility criteria for free breakfast, lunch,

 

or milk in the immediately preceding fiscal year, as described in

 

subsection (1).

 

     (15) If a district is formed by consolidation after June 1,

 

1995, and if 1 or more of the original districts was not eligible

 

before the consolidation for an additional allowance under this

 

section, the amount of the additional allowance under this section

 

for the consolidated district shall be based on the number of

 

pupils described in subsection (1) enrolled in the consolidated

 

district who reside in the territory of an original district that

 

was eligible before the consolidation for an additional allowance

 

under this section.

 

     (16) A district or public school academy that does not meet

 

the eligibility requirement under subsection (2)(a) is eligible for

 

funding under this section if at least 1/4 of the pupils in

 

membership in the district or public school academy met the income

 

eligibility criteria for free breakfast, lunch, or milk in the

 

immediately preceding state fiscal year, as determined and reported

 

as described in subsection (1), and at least 4,500 of the pupils in

 

membership in the district or public school academy met the income

 

eligibility criteria for free breakfast, lunch, or milk in the

 

immediately preceding state fiscal year, as determined and reported

 

as described in subsection (1). A district or public school academy

 

that is eligible for funding under this section because the

 

district meets the requirements of this subsection shall receive

 

under this section for each membership pupil in the district or

 

public school academy who met the income eligibility criteria for

 

free breakfast, lunch, or milk in the immediately preceding fiscal

 

year, as determined and reported as described in subsection (1), an

 

amount per pupil equal to 11.5% of the sum of the district's

 

foundation allowance or public school academy's per pupil

 

allocation under section 20, plus the amount of the district's per

 

pupil allocation under section 20j(2), not to exceed the basic

 

foundation allowance under section 20 for the current state fiscal

 

year.

 

     (17) A district that does not meet the eligibility requirement

 

under subsection (2)(a) is eligible for funding under this section

 

if at least 75% of the pupils in membership in the district met the

 

income eligibility criteria for free breakfast, lunch, or milk in

 

the immediately preceding state fiscal year, as determined and

 

reported as described in subsection (1), the district receives an

 

adjustment under section 20(19), and the district does not receive

 

any state portion of its foundation allowance as calculated under

 

section 20. A district that is eligible for funding under this

 

section because the district meets the requirements of this

 

subsection shall receive under this section for each membership

 

pupil in the district who met the income eligibility criteria for

 

free breakfast, lunch, or milk in the immediately preceding fiscal

 

year, as determined and reported as described in subsection (1), an

 

amount per pupil equal to 11.5% of the sum of the district's

 

foundation allowance under section 20, not to exceed the basic

 

foundation allowance under section 20 for the current state fiscal

 

year.

 

     (18) As used in this section, "at-risk pupil" means a pupil

 

for whom the district has documentation that the pupil meets at

 

least 2 of the following criteria: is a victim of child abuse or

 

neglect; is below grade level in English language and communication

 

skills or mathematics; is a pregnant teenager or teenage parent; is

 

eligible for a federal free or reduced-price lunch subsidy; has

 

atypical behavior or attendance patterns; or has a family history

 

of school failure, incarceration, or substance abuse. For pupils

 

for whom the results of at least the applicable Michigan education

 

assessment program (MEAP) test have been received, at-risk pupil

 

also includes a pupil who does not meet the other criteria under

 

this subsection but who did not achieve at least a score of level 2

 

on the most recent MEAP English language arts, mathematics, or

 

science test for which results for the pupil have been received.

 

For pupils for whom the results of the Michigan merit examination

 

have been received, at-risk pupil also includes a pupil who does

 

not meet the other criteria under this subsection but who did not

 

achieve proficiency on the reading component of the most recent

 

Michigan merit examination for which results for the pupil have

 

been received, did not achieve proficiency on the mathematics

 

component of the most recent Michigan merit examination for which

 

results for the pupil have been received, or did not achieve basic

 

competency on the science component of the most recent Michigan

 

merit examination for which results for the pupil have been

 

received. For pupils in grades K-3, at-risk pupil also includes a

 

pupil who is at risk of not meeting the district's core academic

 

curricular objectives in English language arts or mathematics.

 

     Sec. 51a. (1) From the appropriation in section 11, there is

 

allocated for 2008-2009 an amount not to exceed $1,023,783,000.00

 

$1,016,933,000.00 from state sources and all available federal

 

funding under sections 611 to 619 of part B of the individuals with

 

disabilities education act, 20 USC 1411 to 1419, estimated at

 

$350,700,000.00, plus any carryover federal funds from previous

 

year appropriations. The allocations under this subsection are for

 

the purpose of reimbursing districts and intermediate districts for

 

special education programs, services, and special education

 

personnel as prescribed in article 3 of the revised school code,

 

MCL 380.1701 to 380.1766; net tuition payments made by intermediate

 

districts to the Michigan schools for the deaf and blind; and

 

special education programs and services for pupils who are eligible

 

for special education programs and services according to statute or

 

rule. For meeting the costs of special education programs and

 

services not reimbursed under this article, a district or

 

intermediate district may use money in general funds or special

 

education funds, not otherwise restricted, or contributions from

 

districts to intermediate districts, tuition payments, gifts and

 

contributions from individuals, or federal funds that may be

 

available for this purpose, as determined by the intermediate

 

district plan prepared pursuant to article 3 of the revised school

 

code, MCL 380.1701 to 380.1766. All federal funds allocated under

 

this section in excess of those allocated under this section for

 

2002-2003 may be distributed in accordance with the flexible

 

funding provisions of the individuals with disabilities education

 

act, Public Law 108-446, including, but not limited to, 34 CFR

 

300.206 and 300.208. Notwithstanding section 17b, payments of

 

federal funds to districts, intermediate districts, and other

 

eligible entities under this section shall be paid on a schedule

 

determined by the department.

 

     (2) From the funds allocated under subsection (1), there is

 

allocated the amount necessary, estimated at $224,800,000.00

 

$228,500,000.00 for 2008-2009, for payments toward reimbursing

 

districts and intermediate districts for 28.6138% of total approved

 

costs of special education, excluding costs reimbursed under

 

section 53a, and 70.4165% of total approved costs of special

 

education transportation. Allocations under this subsection shall

 

be made as follows:

 

     (a) The initial amount allocated to a district under this

 

subsection toward fulfilling the specified percentages shall be

 

calculated by multiplying the district's special education pupil

 

membership, excluding pupils described in subsection (12), times

 

the sum of the foundation allowance under section 20 of the pupil's

 

district of residence plus the amount of the district's per pupil

 

allocation under section 20j(2), not to exceed the basic foundation

 

allowance under section 20 for the current fiscal year, or, for a

 

special education pupil in membership in a district that is a

 

public school academy or university school, times an amount equal

 

to the amount per membership pupil calculated under section 20(6).

 

For an intermediate district, the amount allocated under this

 

subdivision toward fulfilling the specified percentages shall be an

 

amount per special education membership pupil, excluding pupils

 

described in subsection (12), and shall be calculated in the same

 

manner as for a district, using the foundation allowance under

 

section 20 of the pupil's district of residence, not to exceed the

 

basic foundation allowance under section 20 for the current fiscal

 

year, and that district's per pupil allocation under section

 

20j(2).

 

     (b) After the allocations under subdivision (a), districts and

 

intermediate districts for which the payments under subdivision (a)

 

do not fulfill the specified percentages shall be paid the amount

 

necessary to achieve the specified percentages for the district or

 

intermediate district.

 

     (3) From the funds allocated under subsection (1), there is

 

allocated for 2008-2009 the amount necessary, estimated at

 

$1,600,000.00 $1,700,000.00, to make payments to districts and

 

intermediate districts under this subsection. If the amount

 

allocated to a district or intermediate district for a fiscal year

 

under subsection (2)(b) is less than the sum of the amounts

 

allocated to the district or intermediate district for 1996-97

 

under sections 52 and 58, there is allocated to the district or

 

intermediate district for the fiscal year an amount equal to that

 

difference, adjusted by applying the same proration factor that was

 

used in the distribution of funds under section 52 in 1996-97 as

 

adjusted to the district's or intermediate district's necessary

 

costs of special education used in calculations for the fiscal

 

year. This adjustment is to reflect reductions in special education

 

program operations or services between 1996-97 and subsequent

 

fiscal years. Adjustments for reductions in special education

 

program operations or services shall be made in a manner determined

 

by the department and shall include adjustments for program or

 

service shifts.

 

     (4) If the department determines that the sum of the amounts

 

allocated for a fiscal year to a district or intermediate district

 

under subsection (2)(a) and (b) is not sufficient to fulfill the

 

specified percentages in subsection (2), then the shortfall shall

 

be paid to the district or intermediate district during the fiscal

 

year beginning on the October 1 following the determination and

 

payments under subsection (3) shall be adjusted as necessary. If

 

the department determines that the sum of the amounts allocated for

 

a fiscal year to a district or intermediate district under

 

subsection (2)(a) and (b) exceeds the sum of the amount necessary

 

to fulfill the specified percentages in subsection (2), then the

 

department shall deduct the amount of the excess from the

 

district's or intermediate district's payments under this act for

 

the fiscal year beginning on the October 1 following the

 

determination and payments under subsection (3) shall be adjusted

 

as necessary. However, if the amount allocated under subsection

 

(2)(a) in itself exceeds the amount necessary to fulfill the

 

specified percentages in subsection (2), there shall be no

 

deduction under this subsection.

 

     (5) State funds shall be allocated on a total approved cost

 

basis. Federal funds shall be allocated under applicable federal

 

requirements, except that an amount not to exceed $3,500,000.00 may

 

be allocated by the department for 2008-2009 to districts,

 

intermediate districts, or other eligible entities on a competitive

 

grant basis for programs, equipment, and services that the

 

department determines to be designed to benefit or improve special

 

education on a statewide scale.

 

     (6) From the amount allocated in subsection (1), there is

 

allocated an amount not to exceed $2,200,000.00 for 2008-2009 to

 

reimburse 100% of the net increase in necessary costs incurred by a

 

district or intermediate district in implementing the revisions in

 

the administrative rules for special education that became

 

effective on July 1, 1987. As used in this subsection, "net

 

increase in necessary costs" means the necessary additional costs

 

incurred solely because of new or revised requirements in the

 

administrative rules minus cost savings permitted in implementing

 

the revised rules. Net increase in necessary costs shall be

 

determined in a manner specified by the department.

 

     (7) For purposes of this article, all of the following apply:

 

     (a) "Total approved costs of special education" shall be

 

determined in a manner specified by the department and may include

 

indirect costs, but shall not exceed 115% of approved direct costs

 

for section 52 and section 53a programs. The total approved costs

 

include salary and other compensation for all approved special

 

education personnel for the program, including payments for social

 

security and medicare and public school employee retirement system

 

contributions. The total approved costs do not include salaries or

 

other compensation paid to administrative personnel who are not

 

special education personnel as defined in section 6 of the revised

 

school code, MCL 380.6. Costs reimbursed by federal funds, other

 

than those federal funds included in the allocation made under this

 

article, are not included. Special education approved personnel not

 

utilized full time in the evaluation of students or in the delivery

 

of special education programs, ancillary, and other related

 

services shall be reimbursed under this section only for that

 

portion of time actually spent providing these programs and

 

services, with the exception of special education programs and

 

services provided to youth placed in child caring institutions or

 

juvenile detention programs approved by the department to provide

 

an on-grounds education program.

 

     (b) Beginning with the 2004-2005 fiscal year, a district or

 

intermediate district that employed special education support

 

services staff to provide special education support services in

 

2003-2004 or in a subsequent fiscal year and that in a fiscal year

 

after 2003-2004 receives the same type of support services from

 

another district or intermediate district shall report the cost of

 

those support services for special education reimbursement purposes

 

under this act. This subdivision does not prohibit the transfer of

 

special education classroom teachers and special education

 

classroom aides if the pupils counted in membership associated with

 

those special education classroom teachers and special education

 

classroom aides are transferred and counted in membership in the

 

other district or intermediate district in conjunction with the

 

transfer of those teachers and aides.

 

     (c) If the department determines before bookclosing for 2007-

 

2008 that the amounts allocated for 2007-2008 under subsections

 

(2), (3), (6), (8), and (12) and sections 53a, 54, and 56 will

 

exceed expenditures for 2007-2008 under subsections (2), (3), (6),

 

(8), and (12) and sections 53a, 54, and 56, then for 2007-2008

 

only, for a district or intermediate district whose reimbursement

 

for 2007-2008 would otherwise be affected by subdivision (b),

 

subdivision (b) does not apply to the calculation of the

 

reimbursement for that district or intermediate district and

 

reimbursement for that district or intermediate district shall be

 

calculated in the same manner as it was for 2003-2004. If the

 

amount of the excess allocations under subsections (2), (3), (6),

 

(8), and (12) and sections 53a, 54, and 56 is not sufficient to

 

fully fund the calculation of reimbursement to those districts and

 

intermediate districts under this subdivision, then the

 

calculations and resulting reimbursement under this subdivision

 

shall be prorated on an equal percentage basis.

 

     (d) Reimbursement for ancillary and other related services, as

 

defined by R 340.1701c of the Michigan administrative code, shall

 

not be provided when those services are covered by and available

 

through private group health insurance carriers or federal

 

reimbursed program sources unless the department and district or

 

intermediate district agree otherwise and that agreement is

 

approved by the state budget director. Expenses, other than the

 

incidental expense of filing, shall not be borne by the parent. In

 

addition, the filing of claims shall not delay the education of a

 

pupil. A district or intermediate district shall be responsible for

 

payment of a deductible amount and for an advance payment required

 

until the time a claim is paid.

 

     (e) Beginning with calculations for 2004-2005, if an

 

intermediate district purchases a special education pupil

 

transportation service from a constituent district that was

 

previously purchased from a private entity; if the purchase from

 

the constituent district is at a lower cost, adjusted for changes

 

in fuel costs; and if the cost shift from the intermediate district

 

to the constituent does not result in any net change in the revenue

 

the constituent district receives from payments under sections 22b

 

and 51c, then upon application by the intermediate district, the

 

department shall direct the intermediate district to continue to

 

report the cost associated with the specific identified special

 

education pupil transportation service and shall adjust the costs

 

reported by the constituent district to remove the cost associated

 

with that specific service.

 

     (8) From the allocation in subsection (1), there is allocated

 

for 2008-2009 an amount not to exceed $15,313,900.00 to

 

intermediate districts. The payment under this subsection to each

 

intermediate district shall be equal to the amount of the 1996-97

 

allocation to the intermediate district under subsection (6) of

 

this section as in effect for 1996-97.

 

     (9) A pupil who is enrolled in a full-time special education

 

program conducted or administered by an intermediate district or a

 

pupil who is enrolled in the Michigan schools for the deaf and

 

blind shall not be included in the membership count of a district,

 

but shall be counted in membership in the intermediate district of

 

residence.

 

     (10) Special education personnel transferred from 1 district

 

to another to implement the revised school code shall be entitled

 

to the rights, benefits, and tenure to which the person would

 

otherwise be entitled had that person been employed by the

 

receiving district originally.

 

     (11) If a district or intermediate district uses money

 

received under this section for a purpose other than the purpose or

 

purposes for which the money is allocated, the department may

 

require the district or intermediate district to refund the amount

 

of money received. Money that is refunded shall be deposited in the

 

state treasury to the credit of the state school aid fund.

 

     (12) From the funds allocated in subsection (1), there is

 

allocated the amount necessary, estimated at $7,100,000.00

 

$8,000,000.00 for 2008-2009, to pay the foundation allowances for

 

pupils described in this subsection. The allocation to a district

 

under this subsection shall be calculated by multiplying the number

 

of pupils described in this subsection who are counted in

 

membership in the district times the sum of the foundation

 

allowance under section 20 of the pupil's district of residence

 

plus the amount of the district's per pupil allocation under

 

section 20j(2), not to exceed the basic foundation allowance under

 

section 20 for the current fiscal year, or, for a pupil described

 

in this subsection who is counted in membership in a district that

 

is a public school academy or university school, times an amount

 

equal to the amount per membership pupil under section 20(6). The

 

allocation to an intermediate district under this subsection shall

 

be calculated in the same manner as for a district, using the

 

foundation allowance under section 20 of the pupil's district of

 

residence, not to exceed the basic foundation allowance under

 

section 20 for the current fiscal year, and that district's per

 

pupil allocation under section 20j(2). This subsection applies to

 

all of the following pupils:

 

     (a) Pupils described in section 53a.

 

     (b) Pupils counted in membership in an intermediate district

 

who are not special education pupils and are served by the

 

intermediate district in a juvenile detention or child caring

 

facility.

 

     (c) Emotionally impaired pupils counted in membership by an

 

intermediate district and provided educational services by the

 

department of community health.

 

     (13) If it is determined that funds allocated under subsection

 

(2) or (12) or under section 51c will not be expended, funds up to

 

the amount necessary and available may be used to supplement the

 

allocations under subsection (2) or (12) or under section 51c in

 

order to fully fund those allocations. After payments under

 

subsections (2) and (12) and section 51c, the remaining

 

expenditures from the allocation in subsection (1) shall be made in

 

the following order:

 

     (a) 100% of the reimbursement required under section 53a.

 

     (b) 100% of the reimbursement required under subsection (6).

 

     (c) 100% of the payment required under section 54.

 

     (d) 100% of the payment required under subsection (3).

 

     (e) 100% of the payment required under subsection (8).

 

     (f) 100% of the payments under section 56.

 

     (14) The allocations under subsections (2), (3), and (12)

 

shall be allocations to intermediate districts only and shall not

 

be allocations to districts, but instead shall be calculations used

 

only to determine the state payments under section 22b.

 

     (15) If a public school academy enrolls pursuant to this

 

section a pupil who resides outside of the intermediate district in

 

which the public school academy is located and who is eligible for

 

special education programs and services according to statute or

 

rule, or who is a child with disabilities, as defined under the

 

individuals with disabilities education act, Public Law 108-446,

 

the provision of special education programs and services and the

 

payment of the added costs of special education programs and

 

services for the pupil are the responsibility of the district and

 

intermediate district in which the pupil resides unless the

 

enrolling district or intermediate district has a written agreement

 

with the district or intermediate district in which the pupil

 

resides or the public school academy for the purpose of providing

 

the pupil with a free appropriate public education and the written

 

agreement includes at least an agreement on the responsibility for

 

the payment of the added costs of special education programs and

 

services for the pupil.

 

     Sec. 51c. As required by the court in the consolidated cases

 

known as Durant v State of Michigan, Michigan supreme court docket

 

no. 104458-104492, from the allocation under section 51a(1), there

 

is allocated for 2008-2009 the amount necessary, estimated at

 

$721,400,000.00 $709,150,000.00, for payments to reimburse

 

districts for 28.6138% of total approved costs of special education

 

excluding costs reimbursed under section 53a, and 70.4165% of total

 

approved costs of special education transportation. Funds allocated

 

under this section that are not expended in the state fiscal year

 

for which they were allocated, as determined by the department, may

 

be used to supplement the allocations under sections 22a and 22b in

 

order to fully fund those calculated allocations for the same

 

fiscal year.

 

     Sec. 53a. (1) For districts, reimbursement for pupils

 

described in subsection (2) shall be 100% of the total approved

 

costs of operating special education programs and services approved

 

by the department and included in the intermediate district plan

 

adopted pursuant to article 3 of the revised school code, MCL

 

380.1701 to 380.1766, minus the district's foundation allowance

 

calculated under section 20, and minus the amount calculated for

 

the district under section 20j. For intermediate districts,

 

reimbursement for pupils described in subsection (2) shall be

 

calculated in the same manner as for a district, using the

 

foundation allowance under section 20 of the pupil's district of

 

residence, not to exceed the basic foundation allowance under

 

section 20 for the current fiscal year, and under section 20j.

 

     (2) Reimbursement under subsection (1) is for the following

 

special education pupils:

 

     (a) Pupils assigned to a district or intermediate district

 

through the community placement program of the courts or a state

 

agency, if the pupil was a resident of another intermediate

 

district at the time the pupil came under the jurisdiction of the

 

court or a state agency.

 

     (b) Pupils who are residents of institutions operated by the

 

department of community health.

 

     (c) Pupils who are former residents of department of community

 

health institutions for the developmentally disabled who are placed

 

in community settings other than the pupil's home.

 

     (d) Pupils enrolled in a department-approved on-grounds

 

educational program longer than 180 days, but not longer than 233

 

days, at a residential child care institution, if the child care

 

institution offered in 1991-92 an on-grounds educational program

 

longer than 180 days but not longer than 233 days.

 

     (e) Pupils placed in a district by a parent for the purpose of

 

seeking a suitable home, if the parent does not reside in the same

 

intermediate district as the district in which the pupil is placed.

 

     (3) Only those costs that are clearly and directly

 

attributable to educational programs for pupils described in

 

subsection (2), and that would not have been incurred if the pupils

 

were not being educated in a district or intermediate district, are

 

reimbursable under this section.

 

     (4) The costs of transportation shall be funded under this

 

section and shall not be reimbursed under section 58.

 

     (5) Not more than $12,800,000.00 $13,500,000.00 of the

 

allocation for 2008-2009 in section 51a(1) shall be allocated under

 

this section.

 

     Sec. 94a. (1) There is created within the office of the state

 

budget director in the department of management and budget the

 

center for educational performance and information. The center

 

shall do all of the following:

 

     (a) Coordinate the collection of all data required by state

 

and federal law from all entities receiving funds under this act.

 

     (b) Collect data in the most efficient manner possible in

 

order to reduce the administrative burden on reporting entities.

 

     (c) Establish procedures to ensure the reasonable validity and

 

reliability of the data and the collection process.

 

     (d) Develop state and model local data collection policies,

 

including, but not limited to, policies that ensure the privacy of

 

individual student data. State privacy policies shall ensure that

 

student social security numbers are not released to the public for

 

any purpose.

 

     (e) Provide data in a useful manner to allow state and local

 

policymakers to make informed policy decisions.

 

     (f) Provide reports to the citizens of this state to allow

 

them to assess allocation of resources and the return on their

 

investment in the education system of this state.

 

     (g) Assist all entities receiving funds under this act in

 

complying with audits performed according to generally accepted

 

accounting procedures.

 

     (h) To the extent funding is available, coordinate the

 

electronic exchange of student records using a unique

 

identification numbering system among entities receiving funds

 

under this act and postsecondary institutions for students

 

participating in public education programs from preschool through

 

postsecondary education.

 

     (i) Other functions as assigned by the state budget director.

 

     (2) Each state department, officer, or agency that collects

 

information from districts or intermediate districts as required

 

under state or federal law shall make arrangements with the center,

 

and with the districts or intermediate districts, to have the

 

center collect the information and to provide it to the department,

 

officer, or agency as necessary. To the extent that it does not

 

cause financial hardship, the center shall arrange to collect the

 

information in a manner that allows electronic submission of the

 

information to the center. Each affected state department, officer,

 

or agency shall provide the center with any details necessary for

 

the center to collect information as provided under this

 

subsection. This subsection does not apply to information collected

 

by the department of treasury under the uniform budgeting and

 

accounting act, 1968 PA 2, MCL 141.421 to 141.440a; the revised

 

municipal finance act, 2001 PA 34, MCL 141.2101 to 141.2821; the

 

school bond qualification, approval, and loan act, 2005 PA 92, MCL

 

388.1921 to 388.1939; or section 1351a of the revised school code,

 

MCL 380.1351a.

 

     (3) The state budget director shall appoint a CEPI advisory

 

committee, consisting of the following members:

 

     (a) One representative from the house fiscal agency.

 

     (b) One representative from the senate fiscal agency.

 

     (c) One representative from the office of the state budget

 

director.

 

     (d) One representative from the state education agency.

 

     (e) One representative each from the department of labor and

 

economic growth and the department of treasury.

 

     (f) Three representatives from intermediate school districts.

 

     (g) One representative from each of the following educational

 

organizations:

 

     (i) Michigan association of school boards.

 

     (ii) Michigan association of school administrators.

 

     (iii) Michigan school business officials.

 

     (h) One representative representing private sector firms

 

responsible for auditing school records.

 

     (i) Other representatives as the state budget director

 

determines are necessary.

 

     (4) The CEPI advisory committee appointed under subsection (3)

 

shall provide advice to the director of the center regarding the

 

management of the center's data collection activities, including,

 

but not limited to:

 

     (a) Determining what data is necessary to collect and maintain

 

in order to perform the center's functions in the most efficient

 

manner possible.

 

     (b) Defining the roles of all stakeholders in the data

 

collection system.

 

     (c) Recommending timelines for the implementation and ongoing

 

collection of data.

 

     (d) Establishing and maintaining data definitions, data

 

transmission protocols, and system specifications and procedures

 

for the efficient and accurate transmission and collection of data.

 

     (e) Establishing and maintaining a process for ensuring the

 

reasonable accuracy of the data.

 

     (f) Establishing and maintaining state and model local

 

policies related to data collection, including, but not limited to,

 

privacy policies related to individual student data.

 

     (g) Ensuring the data is made available to state and local

 

policymakers and citizens of this state in the most useful format

 

possible.

 

     (h) Other matters as determined by the state budget director

 

or the director of the center.

 

     (5) The center may enter into any interlocal agreements

 

necessary to fulfill its functions.

 

     (6) From the general fund appropriation in section 11, there

 

is allocated an amount not to exceed $4,935,400.00 $3,435,400.00

 

for 2008-2009 to the department of management and budget to support

 

the operations of the center and the development and implementation

 

of a comprehensive longitudinal data collection management and

 

reporting system that includes student-level data. The center shall

 

cooperate with the state education agency to ensure that this state

 

is in compliance with federal law and is maximizing opportunities

 

for increased federal funding to improve education in this state.

 

In addition, from the federal funds appropriated in section 11 for

 

2008-2009, there is allocated the amount necessary, estimated at

 

$2,793,200.00, in order to fulfill federal reporting requirements.

 

     (7) From the federal funds allocated in subsection (6), there

 

is allocated for 2008-2009 an amount not to exceed $750,000.00

 

funded from the competitive grants of DED-OESE, title II,

 

educational technology funds for the purposes of this subsection.

 

Not later than November 30, 2008, the department shall award a

 

single grant to an eligible partnership that includes an

 

intermediate district with at least 1 high-need local school

 

district and the center.

 

     (8) The center and the department shall work cooperatively to

 

develop a cost allocation plan that pays for center expenses from

 

the appropriate federal fund revenues.

 

     (9) Funds allocated under this section that are not expended

 

in the fiscal year in which they were allocated may be carried

 

forward to a subsequent fiscal year.

 

House Bill No. 4721 as amended June 24, 2009

 

     (10) The center may bill departments as necessary in order to

 

fulfill reporting requirements of state and federal law. The center

 

may also enter into agreements to supply custom data, analysis, and

 

reporting to other principal executive departments, state agencies,

 

local units of government, and other individuals and organizations.

 

The center may receive and expend funds in addition to those

 

authorized in subsection (6) to cover the costs associated with

 

salaries, benefits, supplies, materials, and equipment necessary to

 

provide such data, analysis, and reporting services.

 

     (11) As used in this section:

 

     (a) "DED-OESE" means the United States department of education

 

office of elementary and secondary education.

 

     (b) "High-need local school district" means a local

 

educational agency as defined in the enhancing education through

 

technology part of the no child left behind act of 2001, Public Law

 

107-110.

 

     (c) "State education agency" means the department.

 

     Sec. 98a. (1) It is the intent of the legislature that for

 

2009-2010 there will be allocated an amount not to exceed

 

$11,500,000.00 from the competitive education technology grant

 

funds awarded under title <<VIII>> of the American recovery and

 

reinvestment act of 2009, Public Law 111-5, to be used for the 21st

 

century learning environment initiative described in this section.

 

     (2) The department shall use the allocations in subsection (1)

 

to make competitive grants to local education agencies and eligible

 

partnerships for the 21st century learning environment initiative

 

in accordance with section 2412(A)(2)(B) of the enhancing education

 

through technology part of the no child left behind act of 2001,

 

Public Law 107-110, 20 USC 6762(A)(2)(B).

 

     (3) The program funded under this section shall focus on ways

 

to use 21st century learning environments that include high access

 

to mobile technology to enable innovative teaching and learning

 

strategies that help accelerate achievement in core academic

 

subject areas, close achievement gaps, and prepare Michigan

 

students for 21st century jobs.

 

     (4) The department shall fund at least 1 grant in each of the

 

following areas:

 

     (a) Research-based dropout prevention and reengagement

 

initiatives that utilize digital environments to enable project-

 

based learning, nontraditional instructional methods,

 

cyberlearning, and other methods aimed at engaging students who

 

have dropped out or who are at-risk of dropping out. Wherever

 

possible, the department shall take the necessary steps to remove

 

regulatory barriers to allow local education agencies or eligible

 

partnerships to receive grants under this subsection.

 

     (b) Research-based ubiquitous digital learning environment

 

programs acting as a school improvement or intervention technique

 

to enable learning transformations and proven strategies for

 

accelerating achievement for schools not meeting adequate yearly

 

progress or with high concentrations of at-risk students. These

 

strategies may include project-based learning or individualized and

 

student-centered instruction enabled by using laptops and other

 

mobile technology.

 

     (c) Programs aimed at preparing high school students for

 

Michigan's 21st century jobs in the digital media arts, film

 

production, or creative arts fields. These projects shall include

 

programs that combine instruction in core subject areas with

 

instruction and industry certification in digital media production

 

technologies.

 

     (d) Full-time online learning opportunity sponsored by a

 

consortium or partnership that is established by an organization

 

dedicated to online learning and at least 1 intermediate district.

 

These programs shall use strategies that use multiple education

 

delivery systems including internet-based online approaches. All of

 

the following apply to an online education program receiving a

 

grant under this subdivision:

 

     (i) Notwithstanding any rule to the contrary, an online

 

education program receiving a grant under this subdivision is not

 

required to comply with any rule that would require a pupil's

 

physical presence or attendance in a classroom or that is otherwise

 

inconsistent with a pupil's participation in an online, remote

 

education program, including, but not limited to, R 340.10 and R

 

340.11 of the Michigan administrative code, the pupil instruction

 

time requirements of section 101, and section 109. Further, the

 

superintendent may waive any other provision of this act, of the

 

revised school code, or of the Michigan administrative code that

 

would otherwise interfere with the operation or funding of an

 

online education program receiving a grant under this subdivision.

 

     (ii) Program goals shall include increasing the number of

 

online enrollments and completions by at-risk students.

 

     (iii) An online education program receiving a grant under this

 

subdivision shall ensure all of the following:

 

     (A) That a teacher who holds appropriate certification

 

according to state board rule, who is employed by a district

 

participating in the consortium or partnership, and who is a member

 

of a collective bargaining unit of a district participating in the

 

consortium or partnership will be responsible for improving

 

learning by planned instruction, diagnosing learning needs,

 

assessing learning, and reporting outcomes to administrators and

 

parents or legal guardians for each course in which a pupil is

 

enrolled. Notwithstanding any other provision of this act or any

 

rule, if these requirements are met, any other adult assisting with

 

the oversight of a pupil during the pupil's participation in the

 

online education program is not required to be a certificated

 

teacher or an employee of a participating district.

 

     (B) That the online education program will make educational

 

services available to pupils for a minimum of 1,098 hours during a

 

school year and will ensure that each pupil participates in the

 

educational program for at least 1,098 hours during a school year.

 

     (5) A grant recipient shall use 25% of grant funds for

 

professional development that focuses on utilizing digital

 

environments to enable new teaching and learning methods such as

 

individualizing instruction and project-based learning.

 

     (6) The department shall limit the number of grants awarded

 

under this section to not more than 10 so that each grant recipient

 

receives an amount that is sufficient to create large-scale

 

learning environment changes that facilitate the goals of this

 

section.

 

     (7) The department shall assist grant recipients and other

 

districts that do not receive awards but that want to achieve the

 

goals of this section in ways to utilize other state, local, and

 

federal funds to purchase or lease technology that creates 21st

 

century learning environments that enable the goals and types of

 

projects described in this section.

 

     Enacting section 1. In accordance with section 30 of article

 

IX of the state constitution of 1963, total state spending in this

 

amendatory act and in 2008 PA 268 from state sources for fiscal

 

year 2008-2009 is estimated at $11,097,798,200.00 and state

 

appropriations to be paid to local units of government for fiscal

 

year 2008-2009 are estimated at $10,890,765,900.00.