Senate File 53 - Reprinted SENATE FILE 53 BY COMMITTEE ON EDUCATION (SUCCESSOR TO SSB 1057) (As Amended and Passed by the Senate January 31, 2013 ) A BILL FOR An Act relating to school district funding from the taxpayers 1 trust fund by making transfers to the property tax equity 2 and relief fund, establishing a school district property 3 tax replacement fund and making transfers to the fund, 4 making appropriations, and including effective date and 5 applicability provisions. 6 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 7 SF 53 (3) 85 md/sc/jh

S.F. 53 Section 1. Section 8.57E, subsection 2, Code 2013, is 1 amended to read as follows: 2 2. Moneys in the taxpayers trust fund shall only be used 3 pursuant to appropriations or transfers made by the general 4 assembly for tax relief. 5 Sec. 2. Section 257.2, subsection 9, Code 2013, is amended 6 by adding the following new paragraph: 7 NEW PARAGRAPH . d. Property tax replacement payments 8 received under section 257.16B. 9 Sec. 3. Section 257.4, subsection 1, paragraph a, Code 2013, 10 is amended by adding the following new subparagraph: 11 NEW SUBPARAGRAPH . (8) The amount of the school district 12 property tax replacement payment received by the school 13 district under section 257.16B. 14 Sec. 4. Section 257.4, subsection 1, paragraph b, Code 2013, 15 is amended to read as follows: 16 b. For the budget year beginning July 1, 2008, and 17 succeeding budget years, the department of management shall 18 annually determine an adjusted additional property tax levy and 19 a statewide maximum adjusted additional property tax levy rate, 20 not to exceed the statewide average additional property tax 21 levy rate, calculated by dividing the total adjusted additional 22 property tax levy dollars statewide by the statewide total 23 net taxable valuation. For purposes of this paragraph, the 24 adjusted additional property tax levy shall be that portion of 25 the additional property tax levy corresponding to the state 26 cost per pupil multiplied by a school district’s weighted 27 enrollment, and then multiplied by one hundred percent less 28 the regular program foundation base per pupil percentage 29 pursuant to section 257.1 , and then reduced by the amount of 30 property tax replacement received under section 257.16B . The 31 district shall receive adjusted additional property tax levy 32 aid in an amount equal to the difference between the adjusted 33 additional property tax levy rate and the statewide maximum 34 adjusted additional property tax levy rate, as applied per 35 -1- SF 53 (3) 85 md/sc/jh 1/ 4

S.F. 53 thousand dollars of assessed valuation on all taxable property 1 in the district. The statewide maximum adjusted additional 2 property tax levy rate shall be annually determined by the 3 department taking into account amounts allocated pursuant to 4 section 257.15, subsection 4 . The statewide maximum adjusted 5 additional property tax levy rate shall be annually determined 6 by the department taking into account amounts allocated 7 pursuant to section 257.15, subsection 4 , and the balance of 8 the property tax equity and relief fund created in section 9 257.16A at the end of the calendar year. 10 Sec. 5. Section 257.15, subsection 4, paragraph b, Code 11 2013, is amended to read as follows: 12 b. After lowering all school district adjusted additional 13 property tax levy rates to the statewide maximum adjusted 14 additional property tax levy rate under paragraph “a” , the 15 department of management shall use any remaining funds at the 16 end of the calendar year to further lower additional property 17 taxes by increasing for the budget year beginning the following 18 July 1, the state foundation base percentage. Moneys used 19 pursuant to this paragraph shall supplant an equal amount of 20 the appropriation made from the general fund of the state 21 pursuant to section 257.16 that represents the increase in 22 state foundation aid. 23 Sec. 6. Section 257.16A, Code 2013, is amended by adding the 24 following new subsection: 25 NEW SUBSECTION . 1A. For each fiscal year beginning on or 26 after July 1, 2013, and after the transfer in section 257.16B, 27 there is transferred from the taxpayers trust fund created in 28 section 8.57E to the fund an amount necessary to lower all 29 school district adjusted additional property tax levy rates to 30 the statewide maximum adjusted additional property tax levy 31 rate pursuant to section 257.15, subsection 4, after taking 32 into account amounts allocated pursuant to section 257.15, 33 subsection 4, and amounts deposited in the fund under section 34 423F.2, subsection 3. 35 -2- SF 53 (3) 85 md/sc/jh 2/ 4

S.F. 53 Sec. 7. NEW SECTION . 257.16B School district property tax 1 replacement fund —— payments. 2 1. a. A school district property tax replacement fund 3 is created in the state treasury under the authority of the 4 department of education. For each fiscal year beginning on or 5 after July 1, 2013, there is transferred from the taxpayers 6 trust fund created in section 8.57E to the fund an amount 7 necessary to make all school district property tax replacement 8 payments under this section. 9 b. There is appropriated annually all moneys in the fund 10 to the department of education for purposes of providing 11 replacement payments to school districts pursuant to this 12 section. 13 2. For each budget year beginning on or after July 1, 14 2013, the amount of money in the school district property tax 15 replacement fund shall be used to provide school district 16 replacement payments to each school district in the state as 17 calculated in subsection 3, paragraph “c” , and subsection 4, if 18 applicable. 19 3. For each budget year beginning on or after July 1, 2013, 20 the department of management shall calculate for each school 21 district all of the following: 22 a. The state cost per pupil for the budget year beginning 23 July 1, 2012, multiplied by one hundred percent less the 24 regular program foundation base per pupil percentage pursuant 25 to section 257.1. 26 b. The state cost per pupil for the budget year beginning 27 July 1, 2013, multiplied by one hundred percent less the 28 regular program foundation base per pupil percentage pursuant 29 to section 257.1. 30 c. The amount of each school district’s property tax 31 replacement payment. Each school district’s property tax 32 replacement payment equals the school district’s weighted 33 enrollment for the budget year multiplied by the remainder of 34 the amount calculated for the school district under paragraph 35 -3- SF 53 (3) 85 md/sc/jh 3/ 4

S.F. 53 “b” minus the amount calculated for the school district under 1 paragraph “a” . 2 4. If an amount appropriated for a fiscal year is 3 insufficient to pay all school district replacement payments 4 for the budget year, the director of the department of 5 management shall prorate the amount of each school district’s 6 property tax replacement payment and notify the director of the 7 department of education of such prorated amounts. 8 5. School district replacement payments under this section 9 shall be paid by the department of education at the same time 10 and in the same manner as foundation aid is paid and may be 11 included in the monthly payment of state aid under section 12 257.16, subsection 2. 13 6. Notwithstanding section 12C.7, subsection 2, interest or 14 earnings on moneys deposited in the fund shall be credited to 15 the fund. Moneys in the fund are not subject to the provisions 16 of section 8.33 and shall not be transferred, used, obligated, 17 appropriated, or otherwise encumbered except as provided in 18 this section. 19 Sec. 8. EFFECTIVE UPON ENACTMENT. This Act, being deemed of 20 immediate importance, takes effect upon enactment. 21 Sec. 9. APPLICABILITY. This Act applies to school budget 22 years beginning on or after July 1, 2013. 23 -4- SF 53 (3) 85 md/sc/jh 4/ 4