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2011 Legislative Update

2011 Legislative Update. Denise Ulberg, Administrator OPI School Finance Division MASBO Summer Conference – Billings June 23, 2011. 2011 Legislative Update. SB 329 Generally Revise K-12 Laws HB123 Revise Budget Deadlines HB288 Students with Caretaker Relatives HB372 Business Equipment Tax

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2011 Legislative Update

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  1. 2011 Legislative Update Denise Ulberg, Administrator OPI School Finance Division MASBO Summer Conference – Billings June 23, 2011

  2. 2011 Legislative Update • SB 329 Generally Revise K-12 Laws • HB123 Revise Budget Deadlines • HB288 Students with Caretaker Relatives • HB372 Business Equipment Tax • Other Important Legislation

  3. SB 329 • K-12 BASE Aid • School District Block Grants • FY2012 General Fund Budgets • Fund Transfers • State and County Impacts from Oil and Natural Gas Production • Pathway to Excellence Program • Multidistrict Cooperatives • Montana Digital Academy

  4. K-12 BASE Aid - General Fund Entitlements

  5. School District Block Grants • School district block grants (20-9-630, MCA) are frozen at FY2011 amounts: • General Fund • Transportation Fund • Combined Block Grant in FY2013, SB372 Business Equipment Tax Reimbursements will be added to these payments • Countywide transportation block grants (20-9-632, MCA) will continue to increase by .76% annually

  6. FY2012 General Fund Budget • General Fund Balance Reappropriated (FBR) • Any unreserved fund balance in excess of 15% of a school district’s maximum general fund budget must be remitted to the state • FY2012 – 100% deposited to state general fund • FY2013 - deposited to: • 70% Guarantee account • 5% State school oil and natural gas impact account • 25% County school oil and natural gas impact fund • Note: This provision terminates June 30, 2016

  7. FY2012 General Fund Budget • Districts may permissively adopt an over-BASE levy that is equal to the higher of: • the highest over-BASE amount imposed (actually levied) in any of the previous 5 years (FY2007 – FY2011), OR • The highest over-BASE amount authorized by voters, up to the highest budget allowed, in any of the previous 5 years (FY2007 – FY2011)

  8. FY2012 General Fund Budget Distribution of oil and natural gas production taxes to taxing units (15-36-332, MCA) • Dept. of Revenue (DOR) allocates per 15-36-331, MCA • DOR distributes to Counties • County deposits to school districts’ funds

  9. FY2012 General Fund Budget • Limit on total oil and natural gas tax revenue • School district may receive 130% of its Maximum General Fund budget • DOR distributes until the limit is reached • Excess of the limitation is deposited to: • In FY2012, to the state general fund • Beginning in FY2013: • 70% to state guarantee account • 5% to state school oil and natural gas impact account • 25% to county school oil and natural gas impact fund Note: this provision terminates June 30, 2016

  10. FY2012 General Fund Budget • A school district must budget a minimum amount of oil and natural gas production tax revenue in the General Fund equal to the lesser of: • 25% (FY2012) of the total oil and gas revenue received in all funds in the prior year, OR • The general fund levy requirement (BASE and over-BASE) • Required minimum receipts to be budgeted: FY2012 25% FY2014 45% FY2013 35% FY2015 and after 55% Note: this provision terminates June 30, 2016

  11. Budget Amendments • Any budget amendment (s) adopted in the same fiscal year that exceed 10% of the district’s adopted general fund budget • Must be reported with an explanation of why the budget amendment is necessary to: • Board of Public Education • Education and Local Government Interim Committee

  12. Fund Transfers – One Time Transfer • Transfer $$ prior to June 30, 2011 • General Fund money in excess of 15% of 2011 GF budget • May transfer to any budgeted fund(s) • Notify OPI and county treasurer • Identify as “SB329 One-time transfer” • Amount transferred • Identify to which fund(s) $$ were transferred

  13. Fund Transfers • Budgeted Fund to Budgeted Fund • Tax money (voted and non-voted) transferred: • Use must be related to the purpose for which the tax was levied and the trustees hold a public hearing to accept public comment, OR • Can hold election to obtain voter approval of the transfer; funds can be spent for purpose approved on the ballot • Non-tax money transferred may be used for any purpose allowed by law • Counts against expenditure budget • Public hearing, resolution, notification required

  14. Fund Transfers • Note: if money is transferred from funds supported by a non-voted levy, cannot backfill in the next year to restore the amount transferred • Budgeted Funds Supported by a Non-Voted Levy • 10 Transportation • 11 Bus Depreciation Reserve • 13 Tuition • 17 Adult Education • 19 Non-operating ~ Transfers from Retirement and Debt Service are not allowed ~

  15. Fund Transfers- Closing Inactive Funds • 20-9-201, MCA • Inactive fund may be closed to any fund deemed appropriate by trustees • Removes restriction on closing inactive tuition fund to miscellaneous programs fund • Inactive fund must not have a deficit cash or fund balance • 20-10-147, MCA • SB329 removes restriction on transferring $$ from Bus Depreciation Reserve fund (11) • No longer have to sell all the buses and obtain voter approval to transfer

  16. Impacts From Oil and Natural Gas Production • State School Oil and Natural Gas Impact Account (effective July 1, 2013) • Purpose: to provide money to schools not receiving oil and natural gas tax revenue but are impacted by contiguous counties that are benefitting from oil and natural gas tax revenue • Funding sources (FY2013 – FY2016): • Excess fund balance available for reappropriation • Excess oil and natural gas production tax revenue • Amount in fund is limited to $7.5 million; excess is deposited in the state general fund • School applies to OPI for funds • Awards based on need, impacts and other criteria

  17. Impacts From Oil and Natural Gas Production • County School Oil and Natural Gas Impact Fund • County distributes 80% of the fund when: • A school district receives 30% or less of the district’s 4-year average oil and gas revenue, OR • The average price of oil is $50 or less for the fiscal year, OR • Production of oil in the county drops 50% or more below the county’s 5-year average production • County may retain 20% to: • Pay outstanding capital project bonds • Other expenses incurred prior to reduction in price, • Offset property taxes • Promote diversification and economic development in the county • Attract new industry • Provide cash incentives for expanding employment base in the impacted area

  18. Pathway to Excellence Program • Promote education excellence in Montana’s public schools through data-driven decision-making • Maintain a focus on continuous improvement and increased academic achievement for public school students

  19. Pathway to Excellence Program • OPI must develop an education data profile for each district • Each school district must annually report certain information to OPI and post the information on its website • OPI required to implement a data collection plan • OPI must gather, maintain and distribute longitudinal, actionable data

  20. Growth and Enhancement of Montana Students (GEMS) • The GEMS Data Warehouse Project is Montana’s Statewide Longitudinal Data System (SLDS). • GEMS is a data repository that will provide access to multiple years of longitudinal data in order to track school and student information across time • GEMS will remove barriers to obtaining data in a usable form for decision-makers • GEMS will develop a blueprint that will serve as the basis for organizing longitudinal data on each student • GEMS will store all data collected by the OPI to provide an effective, timely and efficient approach to analyze student and school performance

  21. Growth and Enhancement of Montana Students (GEMS) • The GEMS Project will help satisfy the Pathway to Excellence Program requirements. • GEMS will maintain a focus on continuous improvement and increased academic achievement for public school students • GEMS will allow for comparative data between schools and districts by developing an education data profile for each district • GEMS will measure state and local performance using criteria, which is more comprehensive than NCLB related reports • GEMS will utilize all of the pertinent and/or available data within the OPI and will manage data from a variety of sources • GEMS will promote education excellence in Montana’s public schools through data-driven decision-making by providing districts the ability to access data housed by the OPI

  22. Growth and Enhancement of Montana Students (GEMS) The OPI will be forming a GEMS User/ Stakeholder Committee to provide input on this project. Those interested in participating see sign up sheet or contact Jamey Ereth at jereth@mt.gov

  23. Multidistrict Cooperatives • Any two or more school districts • Multidistrict agreement creates a multidistrict cooperative • Perform any services, activities and undertakings of the participating districts • Provides for joint funding and operation and maintenance of all participating districts • Subject to terms and conditions mutually agreed upon by the districts

  24. Multidistrict Cooperatives • Trustees of all participating districts must approve the agreement annually by April 1 • If signed by April 1: • Effective retroactive back to July 1 of the current fiscal year, OR • Effective for the ensuing fiscal year • If signed after April 1, can only be effective for ensuing fiscal year

  25. Multidistrict Cooperatives “Multidistrict Cooperative” - created by a multidistrict agreement (two or more school districts) or by an interlocal agreement between a school district and other public entity under Title 20, chapter 9, part 7 Prime Agency (a.k.a. fiscal host or coordinating agency) Could be a school district or other public entity If the prime agency is a school district: Maintains Interlocal Agreement Fund (82) Financial reporting responsibilities: Trustees Financial Summary (TFS) Annual financial audit Cooperating Agency(participating district) Sends a warrant (funding) to Prime Agency

  26. Multi-District Cooperatives - Funding Sources • If the prime agency and cooperating agencies are school districts, they may: • Transfer from General Fund - limited to DSA • Transfer from other budgeted funds (except Retirement and Debt Service) • Transfers count against adopted budget • Transfers must be made by April 1 each year • No transfers from non-budgeted funds

  27. Multi-District Cooperatives • Note: if money is transferred from funds supported by a non-voted levy, you cannot backfill in the next year to restore the amount transferred. • This is true regardless of the source of the money transferred, i.e., whether it is tax or non-tax money Budgeted Funds Supported by a Non-Voted Levy: 10 Transportation 17 Adult Education 11 Bus Depreciation Reserve 19 Non-operating 13 Tuition ~ Transfers from Retirement and Debt Service are not allowed ~

  28. Multi-District Cooperatives • One-Time Payment for Districts Participating in Multi-District Cooperatives • Participating as of December 31, 2012 • SB329 and HB2 appropriated $2 million • Allocation is based on the proration of each district’s FY2013 BASE budget to the total BASE budgets for all districts participating in multi-district cooperatives • Payment to districts no later than Feb. 1, 2013 • $ may be used to fund cooperative efforts

  29. Cooperative Purchasing Contracts • 20-9-204(4), MCA • Two or more districts may enter into a cooperative purchasing contract for procurement of supplies or services • Can purchase supplies and services through a cooperative purchasing group • Group must have a publicly available master list of items available with pricing • Group must provide opportunity at least twice yearly for any vendor to compete for inclusion on the list • Advertisement for bids not required

  30. Montana Digital Academy • Montana Virtual Academy is now the Montana Digital Academy (MTDA)

  31. HB123 Revise Budget Deadlines • Effective with FY2012 Budgets • Significant changes: • ByJuly 20: County Treasurer provides cash balances • 3rd Friday in July: OPI allocates appropriation for technology fund • Between July 1 and August 10: Clerk publishes one notice of the final budget meeting • On or before August 20: Trustees meet to consider budgets

  32. HB123 Revise Budget Deadlines • Not later than August 25: Trustees adopt final budgets • Within 3 daysof final approval: Deliver adopted budgets to county superintendent • By1st Tuesday in September: County superintendent reports school district levy requirements to county commissioners • On or before September 15: Electronically submit TFS and Budgets to OPI

  33. HB288 Students with Caretaker Relatives • Amends 1-1-215, MCA Residency • The residence of an unmarried minor is the residence of : • the minor’s parents • the parent having legal custody (if parents don’t share the same residence or one parent is deceased) • the legal guardian or custodian appointed by a court of competent jurisdiction, or • the caretaker relative, if conditions in 20-5-502, MCA are met

  34. HB288 Students with Caretaker Relatives • Conditions in 20-5-502, MCA • Parent voluntarily gives custody to caretaker relative • Parent expressed no definite time period in which they would return for the child, • Child resides with the caretaker relative full-time • Caretaker unable to contact parent, or parent(s) unable or unwilling to regain custody of the child • No appointment of a guardian or power of attorney has been made for educational needs of the child • Caretaker completes an educational authorization affidavit

  35. HB288 Students with Caretaker Relatives • Students expelled or suspended through formal disciplinary action • New school may: • Implement the previous school district’s disciplinary action without further due process, • Hold a hearing and determine whether the student’s conduct in the previous district merits denial of enrollment, • New school may require compliance with a behavior contract as a condition of enrollment. Effective July 1, 2011

  36. SB372 Business Equipment Tax • Class 8 Property Tax rate reduced • Provides for full reimbursement for reduction in tax base to local governments, including school districts and tax increment financing (TIF) districts • School districts will be reimbursed through the school block grant payments • Reimbursement begins with FY2013 block grant payments

  37. Other Important Legislation • HB70 Revise PERS laws • HB86 Revise TRS laws • HB116 Actuarial Funding for TRS • SB219 Revise Property Tax Protest Laws • HB15 Quality Schools Facility Grant Program • HB182 Financing Energy Conservation Measures • HB538 Allow Sale of Bonds at Private Sale

  38. Other Important Legislation Election Bills - HB327 Revise School Election Laws - HB91 Revise Election Laws - HB99 Generally Revise Laws for Absentee Ballots and Mail Ballots - HB484 Absentee Ballot List

  39. OPI School Finance Division • Denise Ulberg 444-1960 dulberg@mt.gov • Nica Merala 444-4401 nmerala@mt.gov • Janelle Mickelson 444-3249 jmickelson@mt.gov • Rebecca Phillips 444-0783 rphillips2@mt.gov • Donell Rosenthal 444-3024 drosenthal@mt.gov • Paul Taylor 444-1257 ptaylor2@mt.gov • Brenda Thomas 444-4524 bthomas@mt.gov • Kathleen Wanner 444-9852 kwanner@mt.gov

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