Senate File 455 - Introduced SENATE FILE 455 BY COMMITTEE ON EDUCATION (SUCCESSOR TO SSB 1124) A BILL FOR An Act relating to school district finance by modifying 1 provisions relating to the calculation of the regular 2 program state cost per pupil and the regular program 3 district cost per pupil, and by establishing a supplementary 4 weighting plan for certain mandatory school district 5 transportation costs and including effective date 6 provisions. 7 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 8 TLSB 1478SV (3) 87 md/jh/sc

S.F. 455 DIVISION I 1 STATE AND DISTRICT COSTS PER PUPIL 2 Section 1. Section 257.2, subsection 12, Code 2017, is 3 amended to read as follows: 4 12. “Supplemental state aid” means the amount by which state 5 cost per pupil and district cost per pupil will increase from 6 one budget year to the next as the result of the state percent 7 of growth . 8 Sec. 2. Section 257.8, subsection 5, Code 2017, is amended 9 to read as follows: 10 5. Alternate supplemental state aid —— definitions. 11 a. For budget years beginning July 1, 2000, and subsequent 12 budget years, references to the terms “supplemental state aid” , 13 “regular program state cost per pupil” , and “regular program 14 district cost per pupil” shall mean those terms as calculated 15 for those school districts that calculated regular program 16 supplemental state aid for the school budget year beginning 17 July 1, 1999, with the additional thirty-eight dollars 18 specified in section 257.8, subsection 4, Code 2013 . 19 b. For the budget year beginning July 1, 2017, and 20 subsequent budget years, references to “supplemental state 21 aid” and “regular program state cost per pupil” shall mean 22 those terms as calculated including the additional amounts 23 for specified budget years under section 257.9, subsection 24 2, paragraphs “b” and “c” , and references to “regular program 25 district cost per pupil” shall mean that term as calculated 26 including any adjustments made under section 257.10, subsection 27 2. 28 Sec. 3. Section 257.9, subsection 2, Code 2017, is amended 29 to read as follows: 30 2. Regular program state cost per pupil for 1992-1993 and 31 succeeding years. 32 a. For the budget year beginning July 1, 1992, and 33 succeeding budget years beginning before July 1, 2017 , the 34 regular program state cost per pupil for a budget year is the 35 -1- LSB 1478SV (3) 87 md/jh/sc 1/ 11

S.F. 455 regular program state cost per pupil for the base year plus the 1 regular program supplemental state aid for the budget year. 2 b. For the budget year beginning July 1, 2017, the regular 3 program state cost per pupil is the regular program state 4 cost per pupil for the base year plus the regular program 5 supplemental state aid for the budget year, plus five dollars. 6 c. For the budget year beginning July 1, 2018, the regular 7 program state cost per pupil is the regular program state 8 cost per pupil for the base year plus the regular program 9 supplemental state aid for the budget year, plus ten dollars. 10 d. For the budget year beginning July 1, 2019, and 11 succeeding budget years beginning before July 1, 2027, the 12 regular program state cost per pupil for a budget year is the 13 regular program state cost per pupil for the base year plus the 14 regular program supplemental state aid for the budget year, 15 plus twenty dollars. 16 e. For the budget year beginning July 1, 2027, and 17 succeeding budget years, the regular program state cost per 18 pupil for a budget year is the regular program state cost per 19 pupil for the base year plus the regular program supplemental 20 state aid for the budget year. 21 Sec. 4. Section 257.10, subsection 2, paragraph b, Code 22 2017, is amended to read as follows: 23 b. If the regular program district cost per pupil of a 24 school district for the budget year under paragraph “a” exceeds 25 one hundred five percent of the regular program state cost 26 per pupil for the budget year and the state percent of growth 27 for the budget year is greater than two percent, the regular 28 program district cost per pupil for the budget year for that 29 district shall be reduced to one hundred five percent of the 30 regular program state cost per pupil for the budget year. 31 However, under such conditions, if the difference between the 32 regular program district cost per pupil for the budget year and 33 the regular program state cost per pupil for the budget year 34 is greater than an amount equal to two percent multiplied by 35 -2- LSB 1478SV (3) 87 md/jh/sc 2/ 11

S.F. 455 the regular program state cost per pupil for the base year, the 1 regular program district cost per pupil for the budget year 2 shall be reduced by the amount equal to two percent multiplied 3 by the regular program state cost per pupil for the base year. 4 Sec. 5. Section 257.10, subsection 2, Code 2017, is amended 5 by adding the following new paragraph: 6 NEW PARAGRAPH . c. For the budget year beginning July 1, 7 2017, and succeeding budget years, if the regular program 8 district cost per pupil for the budget year calculated under 9 this subsection in any school district is less than the 10 regular program state cost per pupil for the budget year, the 11 department of management shall increase the regular program 12 district cost per pupil of that district to an amount equal to 13 the regular program state cost per pupil for the budget year. 14 Sec. 6. EFFECTIVE UPON ENACTMENT. This division of this 15 Act, being deemed of immediate importance, takes effect upon 16 enactment. 17 DIVISION II 18 SCHOOL DISTRICT SUPPLEMENTARY WEIGHTING 19 Sec. 7. Section 257.11, Code 2017, is amended by adding the 20 following new subsection: 21 NEW SUBSECTION . 7A. School district transportation costs. 22 a. In order to provide additional funds for school district 23 transportation costs resulting from the transportation of 24 resident pupils required by chapter 285 and paid from sources 25 other than the district’s physical plant and equipment levy 26 fund under section 298A.4 or revenue received from the secure 27 an advanced vision for education fund under section 423F.2, a 28 supplementary weighting plan for such pupils is adopted. 29 b. Each school district shall be assigned a supplementary 30 weighting amount as follows: 31 (1) For the budget year beginning July 1, 2017, ten percent 32 of the combined weighting amount calculated under paragraph 33 “c” , subparagraph (2), for that budget year. 34 (2) For the budget year beginning July 1, 2018, twenty 35 -3- LSB 1478SV (3) 87 md/jh/sc 3/ 11

S.F. 455 percent of the combined weighting amount calculated under 1 paragraph “c” , subparagraph (2), for that budget year. 2 (3) For the budget year beginning July 1, 2019, thirty 3 percent of the combined weighting amount calculated under 4 paragraph “c” , subparagraph (2), for that budget year. 5 (4) For the budget year beginning July 1, 2020, forty 6 percent of the combined weighting amount calculated under 7 paragraph “c” , subparagraph (2), for that budget year. 8 (5) For the budget year beginning July 1, 2021, fifty 9 percent of the combined weighting amount calculated under 10 paragraph “c” , subparagraph (2), for that budget year. 11 (6) For the budget year beginning July 1, 2022, sixty 12 percent of the combined weighting amount calculated under 13 paragraph “c” , subparagraph (2), for that budget year. 14 (7) For the budget year beginning July 1, 2023, seventy 15 percent of the combined weighting amount calculated under 16 paragraph “c” , subparagraph (2), for that budget year. 17 (8) For the budget year beginning July 1, 2024, eighty 18 percent of the combined weighting amount calculated under 19 paragraph “c” , subparagraph (2), for that budget year. 20 (9) For the budget year beginning July 1, 2025, ninety 21 percent of the combined weighting amount calculated under 22 paragraph “c” , subparagraph (2), for that budget year. 23 (10) For the budget year beginning July 1, 2026, and each 24 succeeding budget year, one hundred percent of the combined 25 weighting amount calculated under paragraph “c” , subparagraph 26 (2), for that budget year. 27 c. (1) (a) Transportation cost factor. For each budget 28 year beginning on or after July 1, 2017, the department of 29 management shall calculate for each school district all of the 30 following: 31 (i) The sum of the school district’s total transportation 32 costs incurred for the transportation of pupils required under 33 chapter 285, and paid from sources other than the district’s 34 physical plant and equipment levy fund under section 298A.4 35 -4- LSB 1478SV (3) 87 md/jh/sc 4/ 11

S.F. 455 or revenue received from the secure an advanced vision for 1 education fund under section 423F.2, for the three years 2 immediately preceding the base year. 3 (ii) The sum of the school district’s regular program 4 district cost for the three years immediately preceding the 5 base year, excluding amounts attributable to budget adjustments 6 received under section 257.14. 7 (iii) The school district’s budget enrollment multiplied by 8 the quotient of the school district’s amount under subparagraph 9 subdivision (i) divided by the school district’s amount under 10 subparagraph subdivision (ii). 11 (iv) The school district’s amount under subparagraph 12 subdivision (iii) divided by the sum of the amounts calculated 13 under subparagraph subdivision (iii) for all school districts. 14 (v) The amount calculated under subparagraph subdivision 15 (iv) multiplied by ninety percent of the sum of all school 16 districts’ transportation costs incurred for the transportation 17 of pupils required under chapter 285 for the year preceding 18 the base year and paid from sources other than the district’s 19 physical plant and equipment levy fund under section 298A.4 20 or revenue received from the secure an advanced vision for 21 education fund under section 423F.2. 22 (vi) The quotient of the amount calculated under 23 subparagraph subdivision (v) divided by the regular program 24 state cost per pupil for the budget year. 25 (b) Budget enrollment factor. For each budget year 26 beginning on or after July 1, 2017, the department of 27 management shall calculate for each school district all of the 28 following: 29 (i) The quotient of the school district’s budget enrollment 30 divided by the statewide total budget enrollment multiplied by 31 five percent of the sum of all school districts’ transportation 32 costs incurred for the transportation of pupils required under 33 chapter 285 for the year preceding the base year and paid from 34 sources other than the district’s physical plant and equipment 35 -5- LSB 1478SV (3) 87 md/jh/sc 5/ 11

S.F. 455 levy fund under section 298A.4 or revenue received from the 1 secure an advanced vision for education fund under section 2 423F.2. 3 (ii) The amount calculated under subparagraph subdivision 4 (i) divided by the regular program state cost per pupil for the 5 budget year. 6 (c) Route miles factor. For each budget year beginning 7 on or after July 1, 2017, the department of management shall 8 calculate for each school district all of the following: 9 (i) The quotient of the school district’s total route 10 miles traveled for the transportation of pupils required under 11 chapter 285 for the year preceding the base year divided by the 12 school district’s budget enrollment. 13 (ii) The school district’s amount under subparagraph 14 subdivision (i) divided by the sum of the amounts calculated 15 under subparagraph subdivision (i) for all school districts. 16 (iii) The amount calculated under subparagraph subdivision 17 (ii) multiplied by five percent of the sum of all school 18 districts’ transportation costs incurred for the transportation 19 of pupils required under chapter 285 for the year preceding 20 the base year and paid from sources other than the district’s 21 physical plant and equipment levy fund under section 298A.4 22 or revenue received from the secure an advanced vision for 23 education fund under section 423F.2. 24 (iv) The amount calculated under subparagraph subdivision 25 (iii) divided by the regular program state cost per pupil for 26 the budget year. 27 (2) The combined weighting amount for each school district 28 is the sum of the following: 29 (a) The amount calculated under subparagraph (1), 30 subparagraph division (a), subparagraph subdivision (vi). 31 (b) The amount calculated under subparagraph (1), 32 subparagraph division (b), subparagraph subdivision (ii). 33 (c) The amount calculated under subparagraph (1), 34 subparagraph division (c), subparagraph subdivision (iv). 35 -6- LSB 1478SV (3) 87 md/jh/sc 6/ 11

S.F. 455 d. Funding received by a school district as the result of 1 supplementary weighting under this subsection shall not affect 2 a school district’s eligibility for transportation assistance 3 under section 257.31, subsection 17. 4 e. Amounts received by a school district as the result 5 of supplementary weighting under this subsection shall be 6 deposited in the school district’s general fund and may be used 7 for any general fund purpose. 8 f. If a school district established as the result of a 9 reorganization under chapter 275 does not have sufficient 10 transportation cost data, regular program district cost per 11 pupil data, or enrollment data for the calculation of amounts 12 required under this subsection, the department of management 13 shall use estimated transportation cost data, regular program 14 district cost per pupil data, and enrollment data derived from 15 data for prior budget years from each district involved in 16 the reorganization until such amounts can be calculated using 17 actual data for the reorganized school district. 18 g. For the budget years beginning July 1, 2017, July 1, 19 2018, and July 1, 2019, and if necessary, any subsequent budget 20 years, if insufficient or incomplete transportation cost data 21 makes the implementation of this subsection impractical, the 22 department of management shall, in consultation with the 23 department of education and the legislative services agency, 24 establish procedures and modified methodologies for calculating 25 supplementary weighting and funding amounts under this 26 subsection. 27 Sec. 8. Section 257.11, subsection 8, Code 2017, is amended 28 to read as follows: 29 8. Pupils ineligible. A Except for transportation weighting 30 under subsection 7A, a pupil eligible for the weighting plan 31 provided in section 256B.9 is not eligible for supplementary 32 weighting pursuant to this section unless it is determined 33 that the course generating the supplemental weighting has no 34 relationship to the pupil’s disability. A pupil attending an 35 -7- LSB 1478SV (3) 87 md/jh/sc 7/ 11

S.F. 455 alternative program or an at-risk pupils’ program, including 1 alternative high school programs, is not eligible for 2 supplementary weighting under subsection 2 . 3 Sec. 9. Section 257.31, subsection 17, paragraphs a and d, 4 Code 2017, are amended to read as follows: 5 a. If a district’s average transportation costs per 6 pupil exceed the state average transportation costs per 7 pupil determined under paragraph “c” by one hundred fifty 8 percent, the committee may grant transportation assistance aid 9 to the district using exclusively the funds transferred to 10 the committee in accordance with section 321.34, subsection 11 22 . Such aid shall be miscellaneous income and shall not be 12 included in district cost. 13 d. Funds transferred to the committee in accordance with 14 section 321.34, subsection 22 , are appropriated to and may be 15 expended for the purposes of the committee, as described in 16 this section subsection . However, highest priority shall be 17 given to districts that meet the conditions described in this 18 subsection . Notwithstanding any other provision of the Code, 19 unencumbered or unobligated funds transferred to the committee 20 pursuant to section 321.34, subsection 22 , remaining on June 21 30 of the fiscal year for which the funds were transferred, 22 shall not revert but shall be available for expenditure for the 23 purposes of this subsection in subsequent fiscal years. 24 Sec. 10. EFFECTIVE UPON ENACTMENT. This division of this 25 Act, being deemed of immediate importance, takes effect upon 26 enactment. 27 EXPLANATION 28 The inclusion of this explanation does not constitute agreement with 29 the explanation’s substance by the members of the general assembly. 30 This bill relates to school district finance by modifying 31 provisions relating to the calculation of the regular program 32 state cost per pupil and the regular program district cost 33 per pupil and establishing a supplementary weighting plan for 34 certain mandatory school district transportation costs. 35 -8- LSB 1478SV (3) 87 md/jh/sc 8/ 11

S.F. 455 Division I of the bill relates to the determination of the 1 regular program state cost per pupil and the determination of 2 regular program district cost per pupil for school districts. 3 Those amounts are used to determine supplemental state aid 4 amounts for each school budget year, determining the budget 5 authority for each school district, and determining amounts 6 of preschool foundation aid for schools participating in the 7 statewide preschool program for four-year-old children under 8 Code chapter 256C. 9 Current Code section 257.9 provides that for the budget 10 year beginning July 1, 1992, and succeeding budget years, the 11 regular program state cost per pupil for a budget year is the 12 regular program state cost per pupil for the base year plus the 13 regular program supplemental state aid for the budget year. 14 Under the bill, for the budget year beginning July 1, 2017, 15 the regular program state cost per pupil is the regular program 16 state cost per pupil for the base year plus the regular program 17 supplemental state aid for the budget year, plus $5. For 18 the budget year beginning July 1, 2018, the regular program 19 state cost per pupil is the regular program state cost per 20 pupil for the base year plus the regular program supplemental 21 state aid for the budget year, plus $10. For the budget year 22 beginning July 1, 2019, and succeeding budget years beginning 23 before July 1, 2027, the regular program state cost per pupil 24 is the regular program state cost per pupil for the base 25 year plus the regular program supplemental state aid for the 26 budget year, plus $20. Then with the budget year beginning 27 July 1, 2027, and succeeding budget years, the regular program 28 state cost per pupil will again be calculated as the regular 29 program state cost per pupil for the base year plus the regular 30 program supplemental state aid for the budget year without any 31 additional amount added. 32 The bill amends Code section 257.10 to provide that if 33 the regular program district cost per pupil for the budget 34 year calculated in any school district is less than the 35 -9- LSB 1478SV (3) 87 md/jh/sc 9/ 11

S.F. 455 regular program state cost per pupil for the budget year, the 1 department of management shall increase the regular program 2 district cost per pupil of that district to an amount equal to 3 the regular program state cost per pupil for the budget year. 4 Division I of the bill takes effect upon enactment. 5 Division II of the bill establishes a supplementary 6 weighting plan for school district transportation costs 7 resulting from the transportation of pupils as required under 8 Code chapter 285. 9 The bill establishes a methodology for calculating the 10 amount of supplementary weighting assigned to each school 11 district. The calculation is made using school district 12 transportation cost data, school district enrollment data, 13 and school district transportation route mile data. The 14 amount of the supplementary weighting is phased in over a 15 period of 10 school budget years beginning with the budget 16 year beginning July 1, 2017. Under the bill, if a school 17 district established as the result of a reorganization does not 18 have sufficient data for the calculation of amounts required 19 under the bill, the department of management is required to 20 use estimated data derived from data for prior budget years 21 from each district involved in the reorganization until such 22 amounts can be calculated using actual data for the reorganized 23 school district. In addition, for specified budget years, 24 if insufficient or incomplete transportation cost data makes 25 the implementation of division II of the bill impractical, 26 the department of management is required to, in consultation 27 with the department of education and the legislative services 28 agency, establish procedures and modified methodologies for 29 calculating supplementary weighting and funding amounts under 30 division II of the bill. 31 The bill specifies that funding received by a school 32 district as the result of supplementary weighting in the 33 bill does not affect a school district’s eligibility for 34 transportation assistance granted by the school budget 35 -10- LSB 1478SV (3) 87 md/jh/sc 10/ 11

S.F. 455 review committee and specifies that transportation assistance 1 granted by the school budget review committee may only be 2 granted using funds transferred to the committee in accordance 3 with Code section 321.34(22). The bill also provides that 4 funding received by a school district as the result of the 5 supplementary weighting must be deposited in the school 6 district’s general fund and may be used for any general fund 7 purpose. 8 Division II of the bill takes effect upon enactment. 9 -11- LSB 1478SV (3) 87 md/jh/sc 11/ 11