Senate File 166 - Introduced SENATE FILE 166 BY COMMITTEE ON EDUCATION (SUCCESSOR TO SSB 1028) A BILL FOR An Act relating to the state school foundation program, by 1 modifying requirements for the enactment of the state 2 percents of growth, establishing state percents of growth, 3 modifying provisions relating to school district property 4 tax replacement payments, and including effective date and 5 applicability provisions. 6 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 7 TLSB 2206SV (2) 87 md/sc

S.F. 166 Section 1. Section 257.8, subsections 1 and 2, Code 2017, 1 are amended to read as follows: 2 1. State percent of growth. The state percent of growth 3 for the budget year beginning July 1, 2014, is four percent. 4 The state percent of growth for the budget year beginning July 5 1, 2015, is one and twenty-five hundredths percent. The state 6 percent of growth for the budget year beginning July 1, 2016, 7 is two and twenty-five hundredths percent. The state percent 8 of growth for the budget year beginning July 1, 2017, is one 9 and eleven hundredths percent. The state percent of growth for 10 each subsequent budget year shall be established by statute 11 which shall be enacted within thirty days of the submission in 12 the year preceding the base year transmission of the governor’s 13 budget required by February 1 under section 8.21 during the 14 regular legislative session beginning in the base year . The 15 establishment of the state percent of growth for a budget year 16 shall be the only subject matter of the bill which enacts the 17 state percent of growth for a budget year. 18 2. Categorical state percent of growth. The categorical 19 state percent of growth for the budget year beginning July 20 1, 2014, is four percent. The categorical state percent of 21 growth for the budget year beginning July 1, 2015, is one and 22 twenty-five hundredths percent. The categorical state percent 23 of growth for the budget year beginning July 1, 2016, is two 24 and twenty-five hundredths percent. The categorical state 25 percent of growth for the budget year beginning July 1, 2017, 26 is one and eleven hundredths percent. The categorical state 27 percent of growth for each budget year shall be established 28 by statute which shall be enacted within thirty days of the 29 submission in the year preceding the base year transmission of 30 the governor’s budget required by February 1 under section 8.21 31 during the regular legislative session beginning in the base 32 year . The establishment of the categorical state percent of 33 growth for a budget year shall be the only subject matter of 34 the bill which enacts the categorical state percent of growth 35 -1- LSB 2206SV (2) 87 md/sc 1/ 4

S.F. 166 for a budget year. The categorical state percent of growth 1 may include state percents of growth for the teacher salary 2 supplement, the professional development supplement, the early 3 intervention supplement, and the teacher leadership supplement. 4 Sec. 2. Section 257.16B, subsection 2, paragraph d, 5 unnumbered paragraph 1, Code 2017, is amended to read as 6 follows: 7 For each the budget year beginning on or after July 1, 2016, 8 the department of management shall calculate for each school 9 district all of the following: 10 Sec. 3. Section 257.16B, subsection 2, paragraph d, 11 subparagraph (3), Code 2017, is amended to read as follows: 12 (3) The amount of each school district’s property tax 13 replacement payment. Each school district’s property tax 14 replacement payment equals the school district’s weighted 15 enrollment for the budget year beginning July 1, 2016, 16 multiplied by the remainder of the amount calculated for 17 the school district under subparagraph (2) minus the amount 18 calculated for the school district under subparagraph (1). 19 Sec. 4. Section 257.16B, subsection 2, Code 2017, is amended 20 by adding the following new paragraph: 21 NEW PARAGRAPH . e. For each budget year beginning on 22 or after July 1, 2017, the department of management shall 23 calculate for each school district all of the following: 24 (1) The regular program state cost per pupil for the budget 25 year beginning July 1, 2012, multiplied by one hundred percent 26 less the regular program foundation base per pupil percentage 27 pursuant to section 257.1. 28 (2) The regular program state cost per pupil for the budget 29 year beginning July 1, 2017, multiplied by one hundred percent 30 less the regular program foundation base per pupil percentage 31 pursuant to section 257.1. 32 (3) The amount of each school district’s property tax 33 replacement payment. Each school district’s property tax 34 replacement payment equals the school district’s weighted 35 -2- LSB 2206SV (2) 87 md/sc 2/ 4

S.F. 166 enrollment for the budget year multiplied by the remainder 1 of the amount calculated for the school district under 2 subparagraph (2) minus the amount calculated for the school 3 district under subparagraph (1). 4 Sec. 5. EFFECTIVE UPON ENACTMENT. This Act, being deemed of 5 immediate importance, takes effect upon enactment. 6 Sec. 6. APPLICABILITY. This Act applies to school budget 7 years beginning on or after July 1, 2017. 8 EXPLANATION 9 The inclusion of this explanation does not constitute agreement with 10 the explanation’s substance by the members of the general assembly. 11 This bill relates to the state school foundation program, by 12 modifying requirements for the enactment of the state percents 13 of growth, establishing state percents of growth, and modifying 14 provisions relating to school district property tax replacement 15 payments. 16 The bill establishes a state percent of growth of 1.11 17 percent for the budget year beginning July 1, 2017. The 18 state percent of growth is used to calculate the amount 19 of supplemental state aid for a budget year as part of the 20 state school foundation program. The bill also establishes 21 a categorical state percent of growth of 1.11 percent for 22 the budget year beginning July 1, 2017. The categorical 23 state percent of growth is used to calculate the amount of 24 supplemental state aid for each of the categorical funding 25 supplements. 26 Current Code section 257.8 requires bills establishing the 27 state percent of growth and the categorical state percent of 28 growth to be enacted within 30 days of the submission in the 29 year preceding the base year of the governor’s budget. Code 30 section 257.8 also requires the state percent of growth and the 31 categorical state percent of growth to be enacted in separate 32 bills and be the only subject matter of each bill. The bill 33 strikes the subject matter requirement for such bills and 34 specifies that the enactment deadline for bills establishing 35 -3- LSB 2206SV (2) 87 md/sc 3/ 4

S.F. 166 the state percent of growth and the categorical state percent 1 of growth is within 30 days of transmission of the governor’s 2 budget, which Code section 8.21 requires by February 1 of the 3 regular legislative session beginning in the base year. 4 Current Code section 257.16B provides for school district 5 property tax replacement payments. For each budget year 6 beginning on or after July 1, 2016, each school district’s 7 property tax replacement payment amount is equal to the school 8 district’s weighted enrollment for the budget year multiplied 9 by the difference of the following: (1) the regular program 10 state cost per pupil for the budget year beginning July 1, 11 2016, multiplied by 100 percent less the regular program 12 foundation base per pupil percentage; and (2) the regular 13 program state cost per pupil for the budget year beginning July 14 1, 2012, multiplied by 100 percent less the regular program 15 foundation base per pupil percentage. Under current law, the 16 regular program foundation base per pupil percentage is 87.5 17 percent. 18 The bill modifies the replacement payment calculation for 19 budget years beginning on or after July 1, 2017. For each 20 budget year beginning on or after July 1, 2017, each school 21 district’s property tax replacement payment amount is equal to 22 the school district’s weighted enrollment for the budget year 23 multiplied by the difference of the following: (1) the regular 24 program state cost per pupil for the budget year beginning July 25 1, 2017, multiplied by 100 percent less the regular program 26 foundation base per pupil percentage; and (2) the regular 27 program state cost per pupil for the budget year beginning July 28 1, 2012, multiplied by 100 percent less the regular program 29 foundation base per pupil percentage. 30 The bill takes effect upon enactment and applies to school 31 budget years beginning on or after July 1, 2017. 32 -4- LSB 2206SV (2) 87 md/sc 4/ 4