SJR 042 Enables the Legislature to issue bonds for education purposes
LR Number:3674S.02I Fiscal Note:3674-02
Last Action:01/26/04 - Second Read and Referred S Education Committee Journal page:S159
Effective Date:August 28, 2004
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Current Bill Summary

SJR 42 - This proposed constitutional amendment, if approved by the voters, authorizes the General Assembly to issue one series of bonds in an amount two billion dollars for the purpose of technology and infrastructure upgrading, repairing, remodeling, building, and rebuilding the elementary and secondary schools of this state. No more than 25% of the revenue derived from the bonds may be spent in any three-fiscal-year period.

The bonds will be for 20 years and will bear interest a rate to be set by law. The bonds will be issued by the State Board of Fund Commissioners. The interest on the bonds will be paid by corresponding sinking funds.

An income tax surcharge of 1/2 of one percent will be added to the state income tax to pay for the interest on the bonds. In the event that the income tax is insufficient to pay the interest, a statewide property tax will be levied in the following year to pay for such shortfall.

Any excess from the income tax surcharge will be deposited equally into two funds. One fund will be dedicated to two purposes:

(1) One-half to be used for grant programs to public schools to promote teacher recruitment, retention, and training, and;

(2) One-half to be used for grant programs to public schools to enhance student achievement with an emphasis on reading programs.

The monies in the other fund will be distributed to the public schools of this state on an equal per pupil basis.

At any time when a refund is triggered by the provisions of the Hancock Amendment, the monies to be refunded will first be used to pay the principal and interest of the debt serviceable during such fiscal year or any future fiscal year for which the bonds are outstanding. The income tax surcharge will be reduced in the next tax year to offset the additional money made available by the Hancock refund.

This act is similar to SJR 18 (2003).