SB-0183,As Passed Senate,May 14, 2003

SUBSTITUTE FOR

SENATE BILL NO. 183

                                                                             A bill to amend 1979 PA 94, entitled                                              

"The state school aid act of 1979,"                                         

by amending section 11 (MCL 388.1611), as amended by 2002                   

PA 521.                                                                     

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

1       Sec. 11.  (1)  For the fiscal year ending September 30,                     

2   2002, there is appropriated for the public schools of this state            

3   and certain other state purposes relating to education the sum of           

4   $10,990,148,200.00 from the state school aid fund established by            

5   section 11 of article IX of the state constitution of 1963 and              

6   the sum of $198,413,500.00 from the general fund.  For the fiscal           

7   year ending September 30, 2003, there is appropriated for the               

8   public schools of this state and certain other state purposes               

9   relating to education the sum of $11,259,441,400.00 from the                

10  state school aid fund established by section 11 of article IX of            

1   the state constitution of 1963, the sum of $198,413,500.00 from             

2   the general fund, and the sum of $700,000.00 from local                     

3   revenues.   However, if legislation authorizing the transfer of             

4   $79,500,000.00 from the Michigan employment security act                    

5   contingent fund, penalties and interest subaccount, is not                  

6   enacted and in effect on or before October 1, 2002, there is                

7   instead appropriated from the general fund for 2002-2003 the sum            

8   of $122,656,500.00.  For the fiscal year ending September 30,               

9   2004, there is appropriated for the public schools of this state            

10  and certain other state purposes relating to education the sum of           

11  $11,246,667,400.00 from the state school aid fund established by            

12  section 11 of article IX of the state constitution of 1963 and              

13  the sum of $198,413,500.00 from the general fund.  In addition,             

14  available federal funds are appropriated for each of those fiscal           

15  years.                                                                      

16      (2) The appropriations under this section shall be allocated                

17  as provided in this act.  Money appropriated under this section             

18  from the general fund and from available federal funds shall be             

19  expended to fund the purposes of this act before the expenditure            

20  of money appropriated under this section from the state school              

21  aid fund.  If the maximum amount appropriated under this section            

22  from the state school aid fund for a fiscal year exceeds the                

23  amount necessary to fully fund allocations under this act from              

24  the state school aid fund, that excess amount shall not be                  

25  expended in that state fiscal year and shall not lapse to the               

26  general fund, but instead shall remain in the state school aid              

27  fund.                                                                       

1       (3) This subsection applies for 2002-2003 only and is                       

2   subject to subsection (4). If the maximum amount appropriated               

3   under this section and section 11f from the state school aid fund           

4   for a fiscal year exceeds the amount available for expenditure              

5   from the state school aid fund for  that fiscal year 2002-2003,            

6   payments under sections 11f, 11g, 22a, 31d, 51a(2), and 51c shall           

7   be made in full.  In addition, for districts beginning operations           

8   after 1994-95 that qualify for payments under section 22b,                  

9   payments under section 22b shall be made so that the qualifying             

10  districts receive an amount equal to the 1994-95 foundation                 

11  allowance of the district in which the district beginning                   

12  operations after 1994-95 is located.  The amount of the payment             

13  to be made under section 22b for these qualifying districts shall           

14  be as calculated under section 22a, with the balance of the                 

15  payment under section 22b being subject to the proration                    

16  otherwise provided under this subsection.  State payments under             

17  each of the other sections of this act from all state funding               

18  sources shall be prorated on an equal percentage basis as                   

19  necessary to reflect the amount available for expenditure from              

20  the state school aid fund for  that fiscal year 2002-2003.                 

21  However, if the department of treasury determines that proration            

22  will be required under this subsection, the department of                   

23  treasury shall notify the state budget director, and the state              

24  budget director shall notify the legislature at least 30 calendar           

25  days or 6 legislative session days, whichever is more, before the           

26  department reduces any payments under this act because of the               

27  proration.  During the 30 calendar day or 6 legislative session             

Senate Bill No. 183 as amended May 14, 2003                                 

1   day period after that notification by the state budget director,            

2   the department shall not reduce any payments under this act                 

3   because of proration under this subsection.  The legislature may            

4   prevent proration from occurring by, within the 30 calendar day             

5   or 6 legislative session day period after that notification by              

6   the state budget director, enacting legislation appropriating               

7   additional funds from the general fund, countercyclical budget              

8   and economic stabilization fund, state school aid fund balance,             

9   or another source to fund the amount of the projected shortfall.            

10  (4) Subsection (3) does not apply to any incremental increase               

11  or decrease in proration determined to be necessary by the                  

12  department of treasury after April 28, 2003, as compared to the             

13  proration that has already occurred for 2002-2003 under                     

14  subsection (3) pursuant to the January 15, 2003 notification from           

15  the state budget director under subsection (3).

   <<(5) For the fiscal year ending September 30, 2003 only, in addition to the appropriations under subsection (1), the amount of $61,000,000.00 is transferred and appropriated from the general fund to the state school aid fund.  This transfer reflects the estimated net shortfall in state school aid fund revenue as determined at the May 2003 consensus revenue estimating conference and is appropriated to avoid any further proration under subsection (3) due to that estimated shortfall.>>

16  (6)  (4)  Except for the allocation under section 26a, any                  

17  general fund allocations under this act that are not expended by            

18  the end of the state fiscal year are transferred to the state               

19  school aid fund.