SUBSTITUTE FOR

 

SENATE BILL NO. 183

 

 

 

 

 

 

 

 

 

 

 

 

     A bill to amend 1979 PA 94, entitled

 

"The state school aid act of 1979,"

 

by amending sections 6, 11, 11a, 11g, 11j, 11k, 11m, 15, 18, 20,

 

20d, 22a, 22b, 22d, 22e, 24, 24a, 24c, 26a, 26b, 31a, 31d, 31f,

 

32b, 32d, 32j, 39, 39a, 40, 51a, 51c, 51d, 53a, 54, 56, 61a, 62,

 

74, 81, 93, 94a, 98, 99, 104, 107, 109, 147, and 152a (MCL

 

388.1606, 388.1611, 388.1611a, 388.1611g, 388.1611j, 388.1611k,

 

388.1611m, 388.1615, 388.1618, 388.1620, 388.1620d, 388.1622a,

 

388.1622b, 388.1622d, 388.1622e, 388.1624, 388.1624a, 388.1624c,

 

388.1626a, 388.1626b, 388.1631a, 388.1631d, 388.1631f, 388.1632b,

 

388.1632d, 388.1632j, 388.1639, 388.1639a, 388.1640, 388.1651a,

 

388.1651c, 388.1651d, 388.1653a, 388.1654, 388.1656, 388.1661a,

 

388.1662, 388.1674, 388.1681, 388.1693, 388.1694a, 388.1698,

 

388.1699, 388.1704, 388.1707, 388.1709, 388.1747, and 388.1752a),

 

sections 6, 11a, 11g, 11k, 15, 18, 20, 20d, 22b, 22d, 24, 24a, 26b,

 

31a, 31d, 31f, 32b, 32d, 32j, 39, 51c, 51d, 53a, 54, 61a, 62, 74,

 

98, 99, 107, and 147 as amended by 2010 PA 110, sections 11, 11m,

 

22a, 51a, and 56 as amended and section 152a as added by 2010 PA

 

217, sections 11j, 22e, 24c, 26a, 39a, 81, 94a, and 104 as amended

 

and section 93 as added by 2010 PA 204, section 40 as amended by

 

2000 PA 297, and section 109 as amended by 1994 PA 283, and by

 

adding sections 12, 22f, 147a, and 147b; and to repeal acts and

 

parts of acts.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

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

 

district or by an 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 .90 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 .10

 

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. For the purposes of this section and

 

section 6a, for a school of excellence that is a cyber school, as

 

defined in section 551 of the revised school code, MCL 380.551, and

 

is in compliance with section 553a of the revised school code, MCL

 

380.553a, a pupil's participation in the cyber school's educational

 

program is considered regular daily attendance. 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 career and technical 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 as follows:

 

     (i) A special education pupil who is enrolled and receiving

 

instruction in a special education program or service approved by

 

the department, who does not have a high school diploma, and who is

 

less than 26 years of age as of September 1 of the current school

 

year shall be counted in membership.

 

     (ii) A pupil who is determined by the department to meet all of

 

the following may be counted in membership:

 

     (A) Is enrolled in a public school academy or an alternative

 

education high school diploma program, that is primarily focused on

 

educating homeless pupils and that is located in a city with a

 

population of more than 750,000.500,000.

 

     (B) Had dropped out of school for more than 1 year and has re-

 

entered school.

 

     (C) Is less than 22 years of age as of September 1 of the

 

current school year.

 

     (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 unless the individual is a student with a

 

disability as defined in R 340.1702 of the Michigan administrative

 

code. 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 energy, 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 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. However, beginning in 2012-2013, 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 the same 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) 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 is

 

educating 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 .90 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 .10 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

 

early childhood special education 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.

 

     (dd) A district that educates a pupil who attends a United

 

States Olympic education center may count the pupil in membership

 

regardless of whether or not the pupil is a resident of this state.

 

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

 

district of residence pursuant to section 1148(2) of the revised

 

school code, MCL 380.1148, shall be counted in the educating

 

district.

 

     (5) "Public school academy" means that term as defined in 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 works at the

 

district or who is the child of a person who worked at the district

 

as of the time the pupil first enrolled in the district but who no

 

longer works at the district due to a workforce reduction. 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 middle college 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.

 

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

 

district of residence pursuant to section 1148(2) of the revised

 

school code, MCL 380.1148.

 

     (o) A pupil who enrolls in a district other than the pupil's

 

district of residence as a result of the pupil's school not making

 

adequate yearly progress under the no child left behind act of

 

2001, Public Law 107-110.

 

     However, if a district educates pupils who reside in another

 

district and if the primary instructional site for those pupils is

 

established by the educating district after 2009-2010 and is

 

located within the boundaries of that other district, the educating

 

district must have the approval of that other district to count

 

those pupils in membership.

 

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

 

district means:

 

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

 

Wednesday after Labor day in October 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 First Wednesday after Labor day.in October.

 

     (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" 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 (o). 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, electronic book, or other

 

instructional print or electronic resource 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) Subject to subsection (5), (3), for the fiscal

 

year ending September 30, 2011, there is appropriated for the

 

public schools of this state and certain other state purposes

 

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

 

$10,757,260,500.00 from the state school aid fund and the sum of

 

$18,642,400.00 from the general fund. For the fiscal year ending

 

September 30, 2011, there is also appropriated the remaining

 

balance of the federal funding awarded to this state under title

 

XIV of the American recovery and reinvestment act of 2009, Public

 

Law 111-5, estimated at $184,256,600.00, to be used solely for the

 

purpose of funding the primary funding formula calculated under

 

section 20, in accordance with federal law. Subject to subsection

 

(3), for the fiscal year ending September 30, 2012, there is

 

appropriated for the public schools of this state and certain other

 

state purposes relating to education the sum of $10,887,098,700.00

 

from the state school aid fund and the sum of $118,642,400.00 from

 

the general fund. In addition, all other available federal funds,

 

except those otherwise appropriated under section 11p, are

 

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

 

the fiscal year ending September 30, 2012.

 

     (2) The appropriations under this section shall be allocated

 

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

 

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

 

before the expenditure of money appropriated under this section

 

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

 

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

 

exceeds the amount necessary to fully fund allocations under this

 

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

 

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

 

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

 

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

 

the department determines before bookclosing for the 2009-2010

 

state fiscal year that the maximum amount appropriated under this

 

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

 

amount necessary to fully fund allocations under this act from the

 

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

 

elementary and secondary education for 2009-2010 will fall below

 

the level of support needed to comply with the maintenance of

 

effort provisions under title XIV of the American recovery and

 

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

 

appropriated for 2009-2010 from the school aid stabilization fund

 

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

 

determines is necessary for the state support for elementary and

 

secondary education to meet the level of support needed to comply

 

with the maintenance of effort provisions under title XIV of the

 

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

 

whichever is greater. The department shall use any funds

 

appropriated under this subsection as follows:

 

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

 

each intermediate district in an amount equal to the product of

 

14.75% multiplied by the amount of funding allocated to that

 

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

 

110.

 

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

 

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

 

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

 

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

 

a district under this subdivision is an amount equal to the

 

difference between $154.00 and the per-pupil funding amount

 

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

 

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

 

October 2010 payment.

 

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

 

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

 

2010.

 

     (3) If the combined total of the maximum amount appropriated

 

under this section from the state school aid fund and the school

 

aid stabilization fund and the maximum amounts appropriated under

 

the public acts making appropriations for community colleges and

 

state universities from the state school aid fund for a fiscal year

 

exceeds the amount available for expenditure from the state school

 

aid fund for that fiscal year, payments under sections 11f, 11g,

 

11j, 22a, 26a, 26b, 31d, 31f, 51a(2), 51a(12), 51c, 53a, 56, and

 

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

 

operations after 1994-95 that qualify for payments under section

 

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

 

qualifying districts receive the lesser of an amount equal to the

 

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

 

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

 

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

 

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

 

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

 

proration otherwise provided under this subsection and subsection

 

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

 

other sections of this act from all state funding sources and state

 

appropriations to community colleges and state universities from

 

the state school aid fund 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), and the department of treasury shall calculate the proration

 

in community college and state university payments that is required

 

under subsection (3), as follows:

 

     (a) The department and the department of treasury shall

 

calculate the percentage of total state school aid allocated under

 

this act and the public acts making appropriations for community

 

colleges and state universities for the affected fiscal year for

 

each of the following:

 

     (i) Districts.

 

     (ii) Intermediate districts.

 

     (iii) Entities other than districts or intermediate districts.

 

     (iv) Community colleges and state universities.

 

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

 

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

 

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

 

reducing payments to districts. This reduction shall be made by

 

calculating an equal dollar amount per pupil as necessary to

 

recover this percentage of the proration amount and reducing each

 

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

 

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

 

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

 

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

 

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

 

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

 

districts by reducing payments to intermediate districts. This

 

reduction shall be made by reducing the payments to each

 

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

 

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

 

percentage basis.

 

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

 

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

 

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

 

than districts and intermediate districts by reducing payments to

 

these entities. This reduction shall be made by reducing the

 

payments to each of these entities, other than payments under

 

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

 

     (e) The department of treasury shall recover a percentage of

 

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

 

the percentage calculated under subdivision (a)(iv) for community

 

colleges and state universities that receive funding from the state

 

school aid fund by reducing payments to these community colleges

 

and state universities on an equal percentage basis.

 

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

 

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

 

school aid stabilization fund created under section 11a.

 

     Sec. 11a. (1) The school aid stabilization fund is created as

 

a separate account within the state school aid fund established by

 

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

 

     (2) The state treasurer may receive money or other assets from

 

any source for deposit into the school aid stabilization fund. The

 

state treasurer shall deposit into the school aid stabilization

 

fund all of the following:

 

     (a) Unexpended and unencumbered state school aid fund revenue

 

for a fiscal year that remains in the state school aid fund as of

 

the bookclosing for that fiscal year.

 

     (b) Money statutorily dedicated to the school aid

 

stabilization fund.

 

     (c) Money appropriated to the school aid stabilization fund.

 

     (3) Money available in the school aid stabilization fund may

 

not be expended without a specific appropriation from the school

 

aid stabilization fund. Money in the school aid stabilization fund

 

shall be expended only for purposes for which state school aid fund

 

money may be expended.

 

     (4) The state treasurer shall direct the investment of the

 

school aid stabilization fund. The state treasurer shall credit to

 

the school aid stabilization fund interest and earnings from fund

 

investments.

 

     (5) Money in the school aid stabilization fund at the close of

 

a fiscal year shall remain in the school aid stabilization fund and

 

shall not lapse to the unreserved school aid fund balance or the

 

general fund.

 

     (6) If the maximum amount appropriated under section 11 from

 

the state school aid fund for a fiscal year exceeds the amount

 

available for expenditure from the state school aid fund for that

 

fiscal year, there is appropriated from the school aid

 

stabilization fund to the state school aid fund an amount equal to

 

the projected shortfall as determined by the department of

 

treasury, but not to exceed available money in the school aid

 

stabilization fund. If the money in the school aid stabilization

 

fund is insufficient to fully fund an amount equal to the projected

 

shortfall, the state budget director shall notify the legislature

 

as required under section 11(3) and state payments in an amount

 

equal to the remainder of the projected shortfall shall be prorated

 

in the manner provided under section 11(4).

 

     (7) For 2010-2011, 2011-2012, in addition to the

 

appropriations in section 11, there is appropriated from the school

 

aid stabilization fund to the state school aid fund the amount

 

necessary to fully fund the allocations under this act.

 

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

 

allocated for this section an amount not to exceed $39,000,000.00

 

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

 

succeeding fiscal year through the fiscal year ending September 30,

 

2015, after which these payments will cease. These allocations are

 

for paying the amounts described in subsection (3) to districts and

 

intermediate districts, other than those receiving a lump-sum

 

payment under section 11f(2), that were not plaintiffs in the

 

consolidated cases known as Durant v State of Michigan, Michigan

 

supreme court docket no. 104458-104492 and that, on or before March

 

2, 1998, submitted to the state treasurer a waiver resolution

 

described in section 11f. The amounts paid under this section

 

represent offers of settlement and compromise of any claim or

 

claims that were or could have been asserted by these districts and

 

intermediate districts, as described in this section.

 

     (2) This section does not create any obligation or liability

 

of this state to any district or intermediate district that does

 

not submit a waiver resolution described in section 11f. This

 

section and any other provision of this act are not intended to

 

admit liability or waive any defense that is or would be available

 

to this state or its agencies, employees, or agents in any

 

litigation or future litigation with a district or intermediate

 

district regarding these claims or potential claims.

 

     (3) The amount paid each fiscal year to each district or

 

intermediate district under this section shall be 1 of the

 

following:

 

     (a) If the district or intermediate district does not borrow

 

money and issue bonds under section 11i, 1/30 of the total amount

 

listed in section 11h for the district or intermediate district

 

through the fiscal year ending September 30, 2013.

 

     (b) If the district or intermediate district borrows money and

 

issues bonds under section 11i, an amount in each fiscal year

 

calculated by the department of treasury that is equal to the debt

 

service amount in that fiscal year on the bonds issued by that

 

district or intermediate district under section 11i and that will

 

result in the total payments made to all districts and intermediate

 

districts in each fiscal year under this section being no more than

 

the amount appropriated under this section in each fiscal year.

 

     (4) The entire amount of each payment under this section each

 

fiscal year shall be paid on May 15 of the applicable fiscal year

 

or on the next business day following that date. If a district or

 

intermediate district borrows money and issues bonds under section

 

11i, the district or intermediate district shall use funds received

 

under this section to pay debt service on bonds issued under

 

section 11i. If a district or intermediate district does not borrow

 

money and issue bonds under section 11i, the district or

 

intermediate district shall use funds received under this section

 

only for the following purposes, in the following order of

 

priority:

 

     (a) First, to pay debt service on voter-approved bonds issued

 

by the district or intermediate district before the effective date

 

of this section.

 

     (b) Second, to pay debt service on other limited tax

 

obligations.

 

     (c) Third, for deposit into a sinking fund established by the

 

district or intermediate district under the revised school code.

 

     (5) To the extent payments under this section are used by a

 

district or intermediate district to pay debt service on debt

 

payable from millage revenues, and to the extent permitted by law,

 

the district or intermediate district may make a corresponding

 

reduction in the number of mills levied for debt service.

 

     (6) A district or intermediate district may pledge or assign

 

payments under this section as security for bonds issued under

 

section 11i, but shall not otherwise pledge or assign payments

 

under this section.

 

     Sec. 11j. From the appropriation in section 11, there is

 

allocated an amount not to exceed $5,167,800.00 $93,575,300.00 for

 

2010-2011 2011-2012 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. 11k. For 2010-2011, 2011-2012, there is appropriated from

 

the general fund to the school loan revolving fund an amount equal

 

to the amount of school bond loans assigned to the Michigan finance

 

authority, not to exceed the total amount of school bond loans held

 

in reserve as long-term assets. As used in this section, "school

 

loan revolving fund" means that fund created in section 16c of the

 

shared credit rating act, 1985 PA 227, MCL 141.1066c.

 

     Sec. 11m. From the appropriations in section 11, there is

 

allocated for 2009-2010 an amount not to exceed $12,000,000.00 and

 

for 2010-2011 there is allocated an amount not to exceed

 

$45,000,000.00 $15,000,000.00 and there is allocated for 2011-2012

 

an amount not to exceed $20,000,000.00 for fiscal year cash-flow

 

borrowing costs solely related to the state school aid fund

 

established by section 11 of article IX of the state constitution

 

of 1963.

 

     Sec. 12. It is the intent of the legislature to appropriate

 

and allocate for the fiscal year ending September 30, 2013 the same

 

amounts of money from the same sources for the same purposes as are

 

appropriated and allocated under this act for the fiscal year

 

ending September 30, 2012, as adjusted for changes in pupil

 

membership, taxable values, special education costs, and available

 

revenue. These adjustments will be determined after the January

 

2012 consensus revenue estimating conference.

 

     Sec. 15. (1) If a district or intermediate district fails to

 

receive its proper apportionment, the department, upon satisfactory

 

proof that the district or intermediate district was entitled

 

justly, shall apportion the deficiency in the next apportionment.

 

Subject to subsections (2) and (3), if a district or intermediate

 

district has received more than its proper apportionment, the

 

department, upon satisfactory proof, shall deduct the excess in the

 

next apportionment. Notwithstanding any other provision in this

 

act, state aid overpayments to a district, other than overpayments

 

in payments for special education or special education

 

transportation, may be recovered from any payment made under this

 

act other than a special education or special education

 

transportation payment. State aid overpayments made in special

 

education or special education transportation payments may be

 

recovered from subsequent special education or special education

 

transportation payments.

 

     (2) If the result of an audit conducted by or for the

 

department affects the current fiscal year membership, affected

 

payments shall be adjusted in the current fiscal year. A deduction

 

due to an adjustment made as a result of an audit conducted by or

 

for the department, or as a result of information obtained by the

 

department from the district, an intermediate district, the

 

department of treasury, or the office of auditor general, shall be

 

deducted from the district's apportionments when the adjustment is

 

finalized. At the request of the district and upon the district

 

presenting evidence satisfactory to the department of the hardship,

 

the department may grant up to an additional 4 years for the

 

adjustment if the district would otherwise experience a significant

 

hardship.

 

     (3) If, because of the receipt of new or updated data, the

 

department determines during a fiscal year that the amount paid to

 

a district or intermediate district under this act for a prior

 

fiscal year was incorrect under the law in effect for that year,

 

the department may make the appropriate deduction or payment in the

 

district's or intermediate district's allocation for the fiscal

 

year in which the determination is made. The deduction or payment

 

shall be calculated according to the law in effect in the fiscal

 

year in which the improper amount was paid.

 

     (4) Expenditures made by the department under this act that

 

are caused by the write-off of prior year accruals may be funded by

 

revenue from the write-off of prior year accruals.

 

     (5) In addition to funds appropriated in section 11 for all

 

programs and services, there is appropriated for 2010-2011 2011-

 

2012 for obligations in excess of applicable appropriations an

 

amount equal to the collection of overpayments, but not to exceed

 

amounts available from overpayments.

 

     Sec. 18. (1) Except as provided in another section of this

 

act, each district or other entity shall apply the money received

 

by the district or entity under this act to salaries and other

 

compensation of teachers and other employees, tuition,

 

transportation, lighting, heating, ventilation, water service, the

 

purchase of textbooks which are designated by the board to be used

 

in the schools under the board's charge, other supplies, and any

 

other school operating expenditures defined in section 7. However,

 

not more than 20% of the total amount received by a district under

 

article 2 or intermediate district under article 8 may be

 

transferred by the board to either the capital projects fund or to

 

the debt retirement fund for debt service. The money shall not be

 

applied or taken for a purpose other than as provided in this

 

section. The department shall determine the reasonableness of

 

expenditures and may withhold from a recipient of funds under this

 

act the apportionment otherwise due upon a violation by the

 

recipient.

 

     (2) Within 30 days after a board adopts its annual operating

 

budget for the following school fiscal year, or after a board

 

adopts a subsequent revision to that budget, the district shall

 

make all of the following available through a link on its website

 

home page, or may make the information available through a link on

 

its intermediate district's website home page, in a form and manner

 

prescribed by the department:

 

     (a) The annual operating budget and subsequent budget

 

revisions.

 

     (b) Using data that have already been collected and submitted

 

to the department, a summary of district expenditures for the most

 

recent fiscal year for which they are available, expressed in the

 

following 2 pie charts:

 

     (i) A chart of personnel expenditures, broken into the

 

following subcategories:

 

     (A) Salaries and wages.

 

     (B) Employee benefit costs, including, but not limited to,

 

medical, dental, vision, life, disability, and long-term care

 

benefits.

 

     (C) Retirement benefit costs.

 

     (D) All other personnel costs.

 

     (ii) A chart of all district expenditures, broken into the

 

following subcategories:

 

     (A) Instruction.

 

     (B) Support services.

 

     (C) Business and administration.

 

     (D) Operations and maintenance.

 

     (c) Links to all of the following:

 

     (i) The current collective bargaining agreement for each

 

bargaining unit.

 

     (ii) Each health care benefits plan, including, but not limited

 

to, medical, dental, vision, disability, long-term care, or any

 

other type of benefits that would constitute health care services,

 

offered to any bargaining unit or employee in the district.

 

     (iii) The audit report of the audit conducted under subsection

 

(4) for the most recent fiscal year for which it is available.

 

     (iv) The bids required under section 5 of the public employee

 

health benefits act, 2007 PA 106, MCL 124.75.

 

     (d) The total salary and a description and cost of each fringe

 

benefit included in the compensation package for the superintendent

 

of the district and for each employee of the district whose salary

 

exceeds $100,000.00.

 

     (e) The annual amount spent on dues paid to associations.

 

     (f) The annual amount spent on lobbying or lobbying services.

 

As used in this subdivision, "lobbying" means that term as defined

 

in section 5 of 1978 PA 472, MCL 4.415.

 

     (3) For the information required under subsection (2)(a),

 

(2)(b)(i), and (2)(c), an intermediate district shall provide the

 

same information in the same manner as required for a district

 

under subsection (2).

 

     (4) For the purpose of determining the reasonableness of

 

expenditures and whether a violation of this act has occurred, all

 

of the following apply:

 

     (a) The department shall require that each district and

 

intermediate district have an audit of the district's or

 

intermediate district's financial and pupil accounting records

 

conducted at least annually at the expense of the district or

 

intermediate district, as applicable, by a certified public

 

accountant or by the intermediate district superintendent, as may

 

be required by the department, or in the case of a district of the

 

first class by a certified public accountant, the intermediate

 

superintendent, or the auditor general of the city.

 

     (b) If a district operates in a single building with fewer

 

than 700 full-time equated pupils, if the district has stable

 

membership, and if the error rate of the immediately preceding 2

 

pupil accounting field audits of the district is less than 2%, the

 

district may have a pupil accounting field audit conducted

 

biennially but must continue to have desk audits for each pupil

 

count. The auditor must document compliance with the audit cycle in

 

the pupil auditing manual. As used in this subdivision, "stable

 

membership" means that the district's membership for the current

 

fiscal year varies from the district's membership for the

 

immediately preceding fiscal year by less than 5%.

 

     (c) An intermediate district's annual financial audit shall be

 

accompanied by the intermediate district's pupil accounting

 

procedures report.

 

     (c) (d) A district's or intermediate district's annual

 

financial audit shall include an analysis of the financial and

 

pupil accounting data used as the basis for distribution of state

 

school aid.

 

     (d) (e) The pupil and financial accounting records and

 

reports, audits, and management letters are subject to requirements

 

established in the auditing and accounting manuals approved and

 

published by the department.

 

     (e) (f) Except as otherwise provided in this subsection, a All

 

of the following shall be done not later than November 15 each

 

year:

 

     (i) A district shall file the annual financial audit reports

 

with the intermediate district not later than 120 days after the

 

end of each school fiscal year and the department.

 

     (ii) The intermediate district shall file the annual financial

 

audit reports for the intermediate district with the department.

 

     (iii) The intermediate district shall forward the annual

 

financial enter the pupil membership audit reports for its

 

constituent districts and for the intermediate district, and the

 

pupil accounting procedures report for the pupil membership count

 

day and supplemental count day, to the department not later than

 

November 15 of each year.in the Michigan student data system.

 

     (f) (g) The annual financial audit reports and pupil

 

accounting procedures reports shall be available to the public in

 

compliance with the freedom of information act, 1976 PA 442, MCL

 

15.231 to 15.246.

 

     (g) (h) Not later than December January 31 of each year, the

 

department shall notify the state budget director and the

 

legislative appropriations subcommittees responsible for review of

 

the school aid budget of districts and intermediate districts that

 

have not filed an annual financial audit and pupil accounting

 

procedures report required under this section for the school year

 

ending in the immediately preceding fiscal year.

 

     (5) By November 15 of each year, each district and

 

intermediate district shall submit to the center, in a manner

 

prescribed by the center, annual comprehensive financial data

 

consistent with accounting manuals and charts of accounts approved

 

and published by the department. For an intermediate district, the

 

report shall also contain the website address where the department

 

can access the report required under section 620 of the revised

 

school code, MCL 380.620. The department shall ensure that the

 

prescribed Michigan public school accounting manual chart of

 

accounts includes standard conventions to distinguish expenditures

 

by allowable fund function and object. The functions shall include

 

at minimum categories for instruction, pupil support, instructional

 

staff support, general administration, school administration,

 

business administration, transportation, facilities operation and

 

maintenance, facilities acquisition, and debt service; and shall

 

include object classifications of salary, benefits, including

 

categories for active employee health expenditures, purchased

 

services, supplies, capital outlay, and other. Districts shall

 

report the required level of detail consistent with the manual as

 

part of the comprehensive annual financial report. The department

 

shall make this information available online to districts and

 

intermediate districts, and shall include per-pupil amounts spent

 

on instruction and instructional support service functions, and

 

indicate how much of those costs were attributable to salaries.

 

Districts and intermediate districts shall include a link on their

 

websites to the website where the department posts this

 

information.

 

     (6) By September 30 of each year, each district and

 

intermediate district shall file with the department the special

 

education actual cost report, known as "SE-4096", on a form and in

 

the manner prescribed by the department.

 

     (7) By October 7 of each year, each district and intermediate

 

district shall file with the center the transportation expenditure

 

report, known as "SE-4094", on a form and in the manner prescribed

 

by the center.

 

     (8) The department shall review its pupil accounting and pupil

 

auditing manuals at least annually and shall periodically update

 

those manuals to reflect changes in this act.

 

     (9) If a district that is a public school academy purchases

 

property using money received under this act, the public school

 

academy shall retain ownership of the property unless the public

 

school academy sells the property at fair market value.

 

     (10) If a district or intermediate district does not comply

 

with subsections (4), (5), (6), and (7), the department shall

 

withhold all state school aid due to the district or intermediate

 

district under this act, beginning with the next payment due to the

 

district or intermediate district, until the district or

 

intermediate district complies with subsections (4), (5), (6), and

 

(7). If the district or intermediate district does not comply with

 

subsections (4), (5), (6), and (7) by the end of the fiscal year,

 

the district or intermediate district forfeits the amount withheld.

 

     Sec. 20. (1) For 2009-2010 and for 2010-2011, 2011-2012, the

 

basic foundation allowance is $8,489.00.$8,019.00.

 

     (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 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]. For 2009-2010 and for 2010-2011, 2011-2012, 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 district's foundation allowance for the

 

immediately preceding state fiscal year. 2010-2011, minus $470.00.

 

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, 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 for

 

2011-2012 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.2010-2011, minus $470.00.

 

     (c) Except as otherwise provided in subdivision (d), 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. Except as otherwise provided

 

in subdivision (d), for 2011-2012, for a district that in the 1994-

 

1995 state fiscal year had a foundation allowance greater than

 

$6,500.00, the district's foundation allowance is an amount equal

 

to the district's foundation allowance for the 2010-2011 fiscal

 

year minus $470.00.

 

     (d) If House Bill No. 6212 of the 95th Legislature is enacted

 

into law, then beginning in 2011-2012, for For a district that in

 

the 1994-95 state fiscal year had a foundation allowance greater

 

than $6,500.00 and that had a foundation allowance for the 2009-

 

2010 state fiscal year, as otherwise calculated under this section,

 

that was less than the basic foundation allowance, the district's

 

foundation allowance for 2011-2012 and each succeeding fiscal year

 

shall be considered to be an amount equal to the basic foundation

 

allowance.

 

     (e) 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.

 

     (f) 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.

 

     (g) 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), (15), the allocation calculated under this section

 

shall not include the adjustment described in subsection (19).(15).

 

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) Subject to subsection (7) 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 foundation

 

allowance of the district in which the public school academy or

 

university school is located or the state maximum public school

 

academy allocation, whichever is less. However, a public school

 

academy or university school that had an allocation under this

 

subsection before 2009-2010 that was 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 shall not have that allocation

 

reduced as a result of the 2010 amendment to this subsection.

 

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, supportive housing 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, supportive housing 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, supportive

 

housing 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, supportive housing 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.

 

     (8) (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).

 

     (9) (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.

 

     (10) (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.

 

     (11) (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

 

2009-2010 and for 2010-2011, 2011-2012, the index shall be 1.00.

 

0.93575. 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.

 

     (12) (14) If the principals at the revenue estimating

 

conference reach a consensus on the index described in subsection

 

(13)(c), (11)(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.

 

     (13) (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. A district receiving an adjustment under this

 

subsection shall not receive as a result of this adjustment an

 

amount that exceeds 50% of the amount the district received as a

 

result of this adjustment for 2010-2011. This adjustment shall not

 

be made after 2011-2012.

 

     (14) (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. A district receiving

 

an adjustment under this subsection shall not receive as a result

 

of this adjustment an amount that exceeds 50% of the amount the

 

district received as a result of this adjustment for 2010-2011.

 

This adjustment shall not be made after 2011-2012.

 

     (15) (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. A district receiving an adjustment

 

under this subsection shall not receive as a result of this

 

adjustment an amount that exceeds 68.5% of the amount the district

 

received as a result of this adjustment for 2010-2011. This

 

adjustment shall not be made after 2011-2012.

 

     (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.

 

     (16) (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. A district receiving an adjustment under this

 

subsection shall not receive as a result of this adjustment an

 

amount that exceeds 50% of the amount the district received as a

 

result of this adjustment for 2010-2011. This adjustment shall not

 

be made after 2011-2012.

 

     (17) (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. A district receiving an adjustment under this

 

subsection shall not receive as a result of this adjustment an

 

amount that exceeds 50% of the amount the district received as a

 

result of this adjustment for 2010-2011. This adjustment shall not

 

be made after 2011-2012.

 

     (18) (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.

 

     (19) (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.

 

     (20) (26) 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", except as

 

otherwise provided in this subdivision, 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]. For 2009-2010 and 2010-2011, 2011-2012, maximum

 

public school academy allocation means $7,580.00.$7,110.00.

 

     (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, supportive housing property, industrial personal

 

property, or commercial personal property.

 

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

 

"qualified forest property", "supportive housing property",

 

"industrial personal property", and "commercial personal property"

 

mean those terms as defined in 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. 20d. In making the final determination required under

 

former section 20a of a district's combined state and local revenue

 

per membership pupil in 1993-94 and in making calculations under

 

section 20 for 2010-2011, 2011-2012, the department and the

 

department of treasury shall comply with all of the following:

 

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

 

per membership pupil in the 1994-95 state fiscal year of $6,500.00

 

or more and served as a fiscal agent for a state board designated

 

area vocational education center in the 1993-94 school year, total

 

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

 

pursuant to this act in 1993-94 shall exclude payments made under

 

former section 146 and under section 147 on behalf of the

 

district's employees who provided direct services to the area

 

vocational education center. Not later than June 30, 1996, the

 

department shall make an adjustment under this subdivision to the

 

district's combined state and local revenue per membership pupil in

 

the 1994-95 state fiscal year and the department of treasury shall

 

make a final certification of the number of mills that may be

 

levied by the district under section 1211 of the revised school

 

code, MCL 380.1211, as a result of the adjustment under this

 

subdivision.

 

     (b) If a district had an adjustment made to its 1993-94 total

 

state school aid that excluded payments made under former section

 

146 and under section 147 on behalf of the district's employees who

 

provided direct services for intermediate district center programs

 

operated by the district under article 5, if nonresident pupils

 

attending the center programs were included in the district's

 

membership for purposes of calculating the combined state and local

 

revenue per membership pupil for 1993-94, and if there is a signed

 

agreement by all constituent districts of the intermediate district

 

that an adjustment under this subdivision shall be made, the

 

foundation allowances for 1995-96 and 1996-97 of all districts that

 

had pupils attending the intermediate district center program

 

operated by the district that had the adjustment shall be

 

calculated as if their combined state and local revenue per

 

membership pupil for 1993-94 included resident pupils attending the

 

center program and excluded nonresident pupils attending the center

 

program.

 

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

 

allocated an amount not to exceed $5,796,241,000.00 for 2009-2010

 

and an amount not to exceed $5,764,000,000.00 $5,737,000,000.00 for

 

2010-2011 and an amount not to exceed $5,691,000,000.00 for 2011-

 

2012 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