This Fiscal Note is not an official copy and should not be quoted or cited.
This Fiscal Note is not an official copy and should not be quoted or cited.
Fiscal Note - SB 0512 - Revises "hold harmless" clause of state school aid formula
COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. NO.: 1689-02
BILL NO.: SB 512
SUBJECT: Education, Elementary and Secondary: State Aid
TYPE: Original
DATE: March 12, 1999
FISCAL SUMMARY
|
ESTIMATED NET EFFECT ON STATE FUNDS | |||
| FUND AFFECTED | FY 2000 | FY 2001 | FY 2002 |
| State School Monies | GREATER THAN ($40,000,000) | GREATER THAN ($40,000,000) | GREATER THAN ($40,000,000) |
| Total Estimated
Net Effect on All State Funds |
GREATER THAN ($40,000,000) | GREATER THAN ($40,000,000) | GREATER THAN ($40,000,000) |
|
ESTIMATED NET EFFECT ON FEDERAL FUNDS | |||
| FUND AFFECTED | FY 2000 | FY 2001 | FY 2002 |
| None | $0 | $0 | $0 |
| Total Estimated
Net Effect on All Federal Funds |
$0 | $0 | $0 |
|
ESTIMATED NET EFFECT ON LOCAL FUNDS | |||
| FUND AFFECTED | FY 2000 | FY 2001 | FY 2002 |
| Local Government | GREATER THAN $40,000,000 | GREATER THAN $40,000,000 | GREATER THAN $40,000,000 |
Numbers within parentheses: ( ) indicate costs or losses
This fiscal note contains 3 pages.
FISCAL ANALYSIS
ASSUMPTION
Officials from the State Tax Commission assume the proposal would help some "hold harmless" school districts by allowing some increase in the "at risk" category. They do not know which districts would be impacted.
Officials from the Department of Elementary and Secondary Education (DESE) assume hold harmless districts would receive the 1992-93 amount per eligible pupil plus line 14. Currently hold harmless districts receive the 1992-93 amount per eligible pupil and line 14 is included in that number. If this provision had been in place in the 1998-99 year, the additional payment for line 14 to the 51 hold harmless districts would have been approximately $24 million. It is likely that the actual additional payment would be greater than $24 million because this new calculation is likely to create more hold harmless districts. DESE estimates the increase in state aid to be greater than $40 million.
| FISCAL IMPACT - State Government | FY 2000 | FY 2001 | FY 2002 |
| (10 Mo.) | |||
| STATE SCHOOL MONIES FUND | |||
| Cost-Department of Elementary | |||
| and Secondary Education (DESE) | |||
| State Aid | GREATER | GREATER | GREATER |
| THAN | THAN | THAN | |
| ($40,000,000) | ($40,000,000) | ($40,000,000) | |
| FISCAL IMPACT - Local Government | FY 2000 | FY 2001 | FY 2002 |
| (10 Mo.) | |||
| SCHOOL DISTRICTS | |||
| Income-School Districts | |||
| State Aid | GREATER | GREATER | GREATER |
| THAN | THAN | THAN | |
| $40,000,000 | $40,000,000 | $40,000,000 | |
| FISCAL IMPACT - Small Business | |||
| No direct fiscal impact to small businesses would be expected as a result of this proposal. | |||
DESCRIPTION
The proposal would change the school foundation formula. The district entitlement of the school foundation formula would be changed to multiply eligible pupils by the lesser of the district's equalized operating levy for school purposes or $2.75 per one hundred dollars assessed valuation. The categorical add-on for free and reduced lunch eligible pupil count would be multiplied by .22 if the operating levy is not in excess of $2.75.
This legislation is not federally mandated, would not duplicate any other program and would not require additional capital improvements or rental space.
SOURCES OF INFORMATION
Department of Elementary and Secondary Education
State Tax Commission
Jeanne Jarrett, CPA
Director
March 12, 1999