HB-4229, As Passed House, September 19, 2013

SUBSTITUTE FOR

HOUSE BILL NO. 4229

(As amended September 19, 2013)

[A bill to amend 1979 PA 94, entitled

"The state school aid act of 1979,"

by amending sections 6, 20, 21f, 24c, 25e, 26a, 74, 95, 107, and 147a

(MCL 388.1606, 388.1620, 388.1621f, 388.1624c, 388.1625e,

388.1626a, 388.1674, 388.1695, 388.1707, and 388.1747a), sections 6, 24c,

26a, 74, 95, 107, and 147a as amended and sections 21f and 25e as added

by 2013 PA 60 and section 20 as amended by 2013 PA 97.]

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

     Sec. 6. (1) "Center program" means a program operated by a

district or by an intermediate district for special education

pupils from several districts in programs for pupils with autism

spectrum disorder, pupils with severe cognitive impairment, pupils

with moderate cognitive impairment, pupils with severe multiple

impairments, pupils with hearing impairment, pupils with visual

impairment, and pupils with physical impairment or other health

impairment. Programs for pupils with emotional impairment housed in

buildings that do not serve regular education pupils also qualify.

Unless otherwise approved by the department, a center program

either shall serve all constituent districts within an intermediate

district or shall serve several districts with less than 50% of the

pupils residing in the operating district. In addition, special

education center program pupils placed part-time in noncenter

programs to comply with the least restrictive environment

provisions of section 612 of part B of the individuals with

disabilities education act, 20 USC 1412, may be considered center

program pupils for pupil accounting purposes for the time scheduled

in either a center program or a noncenter program.

     (2) "District and high school graduation rate" means the

annual completion and pupil dropout rate that is calculated by the

center pursuant to nationally recognized standards.

     (3) "District and high school graduation report" means a

report of the number of pupils, excluding adult participants, in

the district for the immediately preceding school year, adjusted

for those pupils who have transferred into or out of the district

or high school, who leave high school with a diploma or other

credential of equal status.

     (4) "Membership", except as otherwise provided in this

article, means for a district, a public school academy, the

education achievement system, or an intermediate district the sum

of the product of .90 times the number of full-time equated pupils

in grades K to 12 actually enrolled and in regular daily attendance

on the pupil membership count day for the current school year, plus

the product of .10 times the final audited count from the

supplemental count day for the current school year. A district's,

public school academy's, or intermediate district's membership

shall be adjusted as provided under section 25 for pupils who

enroll in the district, public school academy, or intermediate

district after the pupil membership count day. All pupil counts

used in this subsection are as determined by the department and

calculated by adding the number of pupils registered for attendance

plus pupils received by transfer and minus pupils lost as defined

by rules promulgated by the superintendent, and as corrected by a

subsequent department audit. For the purposes of this section and

section 6a, for a school of excellence that is a cyber school, as

defined in section 551 of the revised school code, MCL 380.551, and

is in compliance with section 553a of the revised school code, MCL

380.553a, a pupil's participation in the cyber school's educational

program is considered regular daily attendance; for the education

achievement system, a pupil's participation in an online

educational program of the education achievement system or of an

achievement school is considered regular daily attendance; and for

a district a pupil's participation in an online course as defined

in section 21f is considered regular daily attendance. The amount

of the foundation allowance for a pupil in membership is determined

under section 20. In making the calculation of membership, all of

the following, as applicable, apply to determining the membership

of a district, a public school academy, the education achievement

system, or an intermediate district:

     (a) Except as otherwise provided in this subsection, and

pursuant to subsection (6), a pupil shall be counted in membership

in the pupil's educating district or districts. An individual pupil

shall not be counted for more than a total of 1.0 full-time equated

membership.

     (b) If a pupil is educated in a district other than the

pupil's district of residence, if the pupil is not being educated

as part of a cooperative education program, if the pupil's district

of residence does not give the educating district its approval to

count the pupil in membership in the educating district, and if the

pupil is not covered by an exception specified in subsection (6) to

the requirement that the educating district must have the approval

of the pupil's district of residence to count the pupil in

membership, the pupil shall not be counted in membership in any

district.

     (c) A special education pupil educated by the intermediate

district shall be counted in membership in the intermediate

district.

     (d) A pupil placed by a court or state agency in an on-grounds

program of a juvenile detention facility, a child caring

institution, or a mental health institution, or a pupil funded

under section 53a, shall be counted in membership in the district

or intermediate district approved by the department to operate the

program.

     (e) A pupil enrolled in the Michigan schools for the deaf and

blind shall be counted in membership in the pupil's intermediate

district of residence.

     (f) A pupil enrolled in a career and technical education

program supported by a millage levied over an area larger than a

single district or in an area vocational-technical education

program established pursuant to section 690 of the revised school

code, MCL 380.690, shall be counted only in the pupil's district of

residence.

     (g) A pupil enrolled in a public school academy shall be

counted in membership in the public school academy.

     (h) A pupil enrolled in an achievement school shall be counted

in membership in the education achievement system.

     (i) For a new district or public school academy beginning its

operation after December 31, 1994, or for the education achievement

system or an achievement school, membership for the first 2 full or

partial fiscal years of operation shall be determined as follows:

     (i) If operations begin before the pupil membership count day

for the fiscal year, membership is the average number of full-time

equated pupils in grades K to 12 actually enrolled and in regular

daily attendance on the pupil membership count day for the current

school year and on the supplemental count day for the current

school year, as determined by the department and calculated by

adding the number of pupils registered for attendance on the pupil

membership count day plus pupils received by transfer and minus

pupils lost as defined by rules promulgated by the superintendent,

and as corrected by a subsequent department audit, plus the final

audited count from the supplemental count day for the current

school year, and dividing that sum by 2.

     (ii) If operations begin after the pupil membership count day

for the fiscal year and not later than the supplemental count day

for the fiscal year, membership is the final audited count of the

number of full-time equated pupils in grades K to 12 actually

enrolled and in regular daily attendance on the supplemental count

day for the current school year.

     (j) If a district is the authorizing body for a public school

academy, then, in the first school year in which pupils are counted

in membership on the pupil membership count day in the public

school academy, the determination of the district's membership

shall exclude from the district's pupil count for the immediately

preceding supplemental count day any pupils who are counted in the

public school academy on that first pupil membership count day who

were also counted in the district on the immediately preceding

supplemental count day.

     (k) In a district, a public school academy, the education

achievement system, or an intermediate district operating an

extended school year program approved by the superintendent, a

pupil enrolled, but not scheduled to be in regular daily attendance

on a pupil membership count day, shall be counted.

     (l) To be counted in membership, a pupil shall meet the minimum

age requirement to be eligible to attend school under section 1147

of the revised school code, MCL 380.1147, or shall be enrolled

under subsection (3) of that section, and shall be less than 20

years of age on September 1 of the school year except as follows:

     (i) A special education pupil who is enrolled and receiving

instruction in a special education program or service approved by

the department, who does not have a high school diploma, and who is

less than 26 years of age as of September 1 of the current school

year shall be counted in membership.

     (ii) A pupil who is determined by the department to meet all of

the following may be counted in membership:

     (A) Is enrolled in a public school academy or an alternative

education high school diploma program, that is primarily focused on

educating homeless pupils and that is located in a city with a

population of more than 175,000.

     (B) Had dropped out of school for more than 1 year and has re-

entered school.

     (C) Is less than 22 years of age as of September 1 of the

current school year.

     (iii) If a child becomes a resident of a district and the child

does not meet the minimum age requirement to be eligible to attend

school for that school year under section 1147 of the revised

school code, MCL 380.1147, but will be 5 years of age not later

than December 1 of that school year, the district may count the

child in membership for that school year if the parent or legal

guardian has notified the district in writing that he or she

intends to enroll the child in kindergarten for that school year.

     (m) An individual who has obtained a high school diploma shall

not be counted in membership. An individual who has obtained a

general educational development (G.E.D.) certificate shall not be

counted in membership unless the individual is a pupil with a

disability as defined in R 340.1702 of the Michigan administrative

code. An individual participating in a job training program funded

under former section 107a or a jobs program funded under former

section 107b, administered by the Michigan strategic fund, or

participating in any successor of either of those 2 programs, shall

not be counted in membership.

     (n) If a pupil counted in membership in a public school

academy or the education achievement system is also educated by a

district or intermediate district as part of a cooperative

education program, the pupil shall be counted in membership only in

the public school academy or the education achievement system

unless a written agreement signed by all parties designates the

party or parties in which the pupil shall be counted in membership,

and the instructional time scheduled for the pupil in the district

or intermediate district shall be included in the full-time equated

membership determination under subdivision (q). However, for pupils

receiving instruction in both a public school academy or the

education achievement system and in a district or intermediate

district but not as a part of a cooperative education program, the

following apply:

     (i) If the public school academy or the education achievement

system provides instruction for at least 1/2 of the class hours

specified in subdivision (q), the public school academy or the

education achievement system shall receive as its prorated share of

the full-time equated membership for each of those pupils an amount

equal to 1 times the product of the hours of instruction the public

school academy or the education achievement system provides divided

by the number of hours specified in subdivision (q) for full-time

equivalency, and the remainder of the full-time membership for each

of those pupils shall be allocated to the district or intermediate

district providing the remainder of the hours of instruction.

     (ii) If the public school academy or the education achievement

system provides instruction for less than 1/2 of the class hours

specified in subdivision (q), the district or intermediate district

providing the remainder of the hours of instruction shall receive

as its prorated share of the full-time equated membership for each

of those pupils an amount equal to 1 times the product of the hours

of instruction the district or intermediate district provides

divided by the number of hours specified in subdivision (q) for

full-time equivalency, and the remainder of the full-time

membership for each of those pupils shall be allocated to the

public school academy or the education achievement system.

     (o) An individual less than 16 years of age as of September 1

of the current school year who is being educated in an alternative

education program shall not be counted in membership if there are

also adult education participants being educated in the same

program or classroom.

     (p) The department shall give a uniform interpretation of

full-time and part-time memberships.

     (q) The number of class hours used to calculate full-time

equated memberships shall be consistent with section 101(3). In

determining full-time equated memberships for pupils who are

enrolled in a postsecondary institution, a pupil shall not be

considered to be less than a full-time equated pupil solely because

of the effect of his or her postsecondary enrollment, including

necessary travel time, on the number of class hours provided by the

district to the pupil.

     (r) Beginning in 2012-2013, full-time equated memberships for

pupils in kindergarten shall be determined by dividing the number

of instructional hours scheduled and provided per year per

kindergarten pupil by the same number used for determining full-

time equated memberships for pupils in grades 1 to 12. However, to

the extent allowable under federal law, for a district or public

school academy that provides evidence satisfactory to the

department that it used federal title I money in the 2 immediately

preceding school fiscal years to fund full-time kindergarten, full-

time equated memberships for pupils in kindergarten shall be

determined by dividing the number of class hours scheduled and

provided per year per kindergarten pupil by a number equal to 1/2

the number used for determining full-time equated memberships for

pupils in grades 1 to 12. The change in the counting of full-time

equated memberships for pupils in kindergarten that took effect for

2012-2013 is not a mandate.

     (s) For a district, a public school academy, or the education

achievement system that has pupils enrolled in a grade level that

was not offered by the district, the public school academy, or the

education achievement system in the immediately preceding school

year, the number of pupils enrolled in that grade level to be

counted in membership is the average of the number of those pupils

enrolled and in regular daily attendance on the pupil membership

count day and the supplemental count day of the current school

year, as determined by the department. Membership shall be

calculated by adding the number of pupils registered for attendance

in that grade level on the pupil membership count day plus pupils

received by transfer and minus pupils lost as defined by rules

promulgated by the superintendent, and as corrected by subsequent

department audit, plus the final audited count from the

supplemental count day for the current school year, and dividing

that sum by 2.

     (t) A pupil enrolled in a cooperative education program may be

counted in membership in the pupil's district of residence with the

written approval of all parties to the cooperative agreement.

     (u) If, as a result of a disciplinary action, a district

determines through the district's alternative or disciplinary

education program that the best instructional placement for a pupil

is in the pupil's home or otherwise apart from the general school

population, if that placement is authorized in writing by the

district superintendent and district alternative or disciplinary

education supervisor, and if the district provides appropriate

instruction as described in this subdivision to the pupil at the

pupil's home or otherwise apart from the general school population,

the district may count the pupil in membership on a pro rata basis,

with the proration based on the number of hours of instruction the

district actually provides to the pupil divided by the number of

hours specified in subdivision (q) for full-time equivalency. For

the purposes of this subdivision, a district shall be considered to

be providing appropriate instruction if all of the following are

met:

     (i) The district provides at least 2 nonconsecutive hours of

instruction per week to the pupil at the pupil's home or otherwise

apart from the general school population under the supervision of a

certificated teacher.

     (ii) The district provides instructional materials, resources,

and supplies that are comparable to those otherwise provided in the

district's alternative education program.

     (iii) Course content is comparable to that in the district's

alternative education program.

     (iv) Credit earned is awarded to the pupil and placed on the

pupil's transcript.

     (v) A pupil enrolled in an alternative or disciplinary

education program described in section 25 shall be counted in

membership in the district, the public school academy, or the

education achievement system that is educating the pupil.

     (w) If a pupil was enrolled in a public school academy on the

pupil membership count day, if the public school academy's contract

with its authorizing body is revoked or the public school academy

otherwise ceases to operate, and if the pupil enrolls in a district

or the education achievement system within 45 days after the pupil

membership count day, the department shall adjust the district's or

the education achievement system's pupil count for the pupil

membership count day to include the pupil in the count.

     (x) For a public school academy that has been in operation for

at least 2 years and that suspended operations for at least 1

semester and is resuming operations, membership is the sum of the

product of .90 times the number of full-time equated pupils in

grades K to 12 actually enrolled and in regular daily attendance on

the first pupil membership count day or supplemental count day,

whichever is first, occurring after operations resume, plus the

product of .10 times the final audited count from the most recent

pupil membership count day or supplemental count day that occurred

before suspending operations, as determined by the superintendent.

     (y) If a district's membership for a particular fiscal year,

as otherwise calculated under this subsection, would be less than

1,550 pupils and the district has 4.5 or fewer pupils per square

mile, as determined by the department, and if the district does not

receive funding under section 22d(2), the district's membership

shall be considered to be the membership figure calculated under

this subdivision. If a district educates and counts in its

membership pupils in grades 9 to 12 who reside in a contiguous

district that does not operate grades 9 to 12 and if 1 or both of

the affected districts request the department to use the

determination allowed under this sentence, the department shall

include the square mileage of both districts in determining the

number of pupils per square mile for each of the districts for the

purposes of this subdivision. The membership figure calculated

under this subdivision is the greater of the following:

     (i) The average of the district's membership for the 3-fiscal-

year period ending with that fiscal year, calculated by adding the

district's actual membership for each of those 3 fiscal years, as

otherwise calculated under this subsection, and dividing the sum of

those 3 membership figures by 3.

     (ii) The district's actual membership for that fiscal year as

otherwise calculated under this subsection.

House Bill No. 4229 (H-1) as amended September 19, 2013

     (z) If a public school academy that is not in its first or

second year of operation closes at the end of a school year and

does not reopen for the next school year, the department shall

adjust the membership count of the district or the education

achievement system in which a former pupil of the public school

academy enrolls and is in regular daily attendance for the next

school year to ensure that the district or the education

achievement system receives the same amount of membership aid for

the pupil as if the pupil were counted in the district or the

education achievement system on the supplemental count day of the

preceding school year.

     (aa) Full-time equated memberships for special education

pupils who are not enrolled in kindergarten but are enrolled in a

classroom program under R 340.1754 of the Michigan administrative

code shall be determined by dividing the number of class hours

scheduled and provided per year by 450. Full-time equated

memberships for special education pupils who are not enrolled in

kindergarten but are receiving early childhood special education

services under R 340.1755 [or 340.1682] of the Michigan administrative

 code shall

be determined by dividing the number of hours of service scheduled

and provided per year per pupil by 180.

     (bb) A pupil of a district that begins its school year after

Labor day who is enrolled in an intermediate district program that

begins before Labor day shall not be considered to be less than a

full-time pupil solely due to instructional time scheduled but not

attended by the pupil before Labor day.

     (cc) For the first year in which a pupil is counted in

membership on the pupil membership count day in a middle college

program, the membership is the average of the full-time equated

membership on the pupil membership count day and on the

supplemental count day for the current school year, as determined

by the department. If a pupil was counted by the operating district

on the immediately preceding supplemental count day, the pupil

shall be excluded from the district's immediately preceding

supplemental count for purposes of determining the district's

membership.

     (dd) A district, a public school academy, or the education

achievement system that educates a pupil who attends a United

States Olympic education center may count the pupil in membership

regardless of whether or not the pupil is a resident of this state.

     (ee) A pupil enrolled in a district other than the pupil's

district of residence pursuant to section 1148(2) of the revised

school code, MCL 380.1148, shall be counted in the educating

district or the education achievement system.

     (ff) For a pupil enrolled in a dropout recovery program that

meets the requirements of section 23a, the pupil shall be counted

as 1/12 of a full-time equated membership for each month that the

district operating the program reports that the pupil was enrolled

in the program and was in full attendance. However, a pupil counted

under this subdivision shall not be counted as more than 1.0 FTE in

a fiscal year. The district operating the program shall report to

the center the number of pupils who were enrolled in the program

and were in full attendance for a month not later than the tenth

day of the next month. A district shall not report a pupil as being

in full attendance for a month unless both of the following are

met:

     (i) A personalized learning plan is in place on or before the

first school day of the month for the first month the pupil

participates in the program.

     (ii) The pupil meets the district's definition under section

23a of satisfactory monthly progress for that month or, if the

pupil does not meet that definition of satisfactory monthly

progress for that month, the pupil did meet that definition of

satisfactory monthly progress in the immediately preceding month

and appropriate interventions are implemented within 10 school days

after it is determined that the pupil does not meet that definition

of satisfactory monthly progress.

     (5) "Public school academy" means that term as defined in the

revised school code.

     (6) "Pupil" means a person in membership in a public school. A

district must have the approval of the pupil's district of

residence to count the pupil in membership, except approval by the

pupil's district of residence is not required for any of the

following:

     (a) A nonpublic part-time pupil enrolled in grades 1 to 12 in

accordance with section 166b.

     (b) A pupil receiving 1/2 or less of his or her instruction in

a district other than the pupil's district of residence.

     (c) A pupil enrolled in a public school academy or the

education achievement system.

     (d) A pupil enrolled in a district other than the pupil's

district of residence under an intermediate district schools of

choice pilot program as described in section 91a or former section

91 if the intermediate district and its constituent districts have

been exempted from section 105.

     (e) A pupil enrolled in a district other than the pupil's

district of residence if the pupil is enrolled in accordance with

section 105 or 105c.

     (f) A pupil who has made an official written complaint or

whose parent or legal guardian has made an official written

complaint to law enforcement officials and to school officials of

the pupil's district of residence that the pupil has been the

victim of a criminal sexual assault or other serious assault, if

the official complaint either indicates that the assault occurred

at school or that the assault was committed by 1 or more other

pupils enrolled in the school the pupil would otherwise attend in

the district of residence or by an employee of the district of

residence. A person who intentionally makes a false report of a

crime to law enforcement officials for the purposes of this

subdivision is subject to section 411a of the Michigan penal code,

1931 PA 328, MCL 750.411a, which provides criminal penalties for

that conduct. As used in this subdivision:

     (i) "At school" means in a classroom, elsewhere on school

premises, on a school bus or other school-related vehicle, or at a

school-sponsored activity or event whether or not it is held on

school premises.

     (ii) "Serious assault" means an act that constitutes a felony

violation of chapter XI of the Michigan penal code, 1931 PA 328,

MCL 750.81 to 750.90h, or that constitutes an assault and

infliction of serious or aggravated injury under section 81a of the

Michigan penal code, 1931 PA 328, MCL 750.81a.

     (g) A pupil whose district of residence changed after the

pupil membership count day and before the supplemental count day

and who continues to be enrolled on the supplemental count day as a

nonresident in the district in which he or she was enrolled as a

resident on the pupil membership count day of the same school year.

     (h) A pupil enrolled in an alternative education program

operated by a district other than his or her district of residence

who meets 1 or more of the following:

     (i) The pupil has been suspended or expelled from his or her

district of residence for any reason, including, but not limited

to, a suspension or expulsion under section 1310, 1311, or 1311a of

the revised school code, MCL 380.1310, 380.1311, and 380.1311a.

     (ii) The pupil had previously dropped out of school.

     (iii) The pupil is pregnant or is a parent.

     (iv) The pupil has been referred to the program by a court.

     (v) The pupil is enrolled in an alternative or disciplinary

education program described in section 25.

     (i) A pupil enrolled in the Michigan virtual school, for the

pupil's enrollment in the Michigan virtual school.

     (j) A pupil who is the child of a person who works at the

district or who is the child of a person who worked at the district

as of the time the pupil first enrolled in the district but who no

longer works at the district due to a workforce reduction. As used

in this subdivision, "child" includes an adopted child, stepchild,

or legal ward.

     (k) An expelled pupil who has been denied reinstatement by the

expelling district and is reinstated by another school board under

section 1311 or 1311a of the revised school code, MCL 380.1311 and

380.1311a.

     (l) A pupil enrolled in a district other than the pupil's

district of residence in a middle college program if the pupil's

district of residence and the enrolling district are both

constituent districts of the same intermediate district.

     (m) A pupil enrolled in a district other than the pupil's

district of residence who attends a United States Olympic education

center.

     (n) A pupil enrolled in a district other than the pupil's

district of residence pursuant to section 1148(2) of the revised

school code, MCL 380.1148.

     (o) A pupil who enrolls in a district other than the pupil's

district of residence as a result of the pupil's school not making

adequate yearly progress under the no child left behind act of

2001, Public Law 107-110.

     (p) An online learning pupil enrolled in a district other than

the pupil's district of residence as an eligible pupil under

section 21f.

     However, if a district educates pupils who reside in another

district and if the primary instructional site for those pupils is

established by the educating district after 2009-2010 and is

located within the boundaries of that other district, the educating

district must have the approval of that other district to count

those pupils in membership.

     (7) "Pupil membership count day" of a district or intermediate

district means:

     (a) Except as provided in subdivision (b), the first Wednesday

in October each school year or, for a district or building in which

school is not in session on that Wednesday due to conditions not

within the control of school authorities, with the approval of the

superintendent, the immediately following day on which school is in

session in the district or building.

     (b) For a district or intermediate district maintaining school

during the entire school year, the following days:

     (i) Fourth Wednesday in July.

     (ii) First Wednesday in October.

     (iii) Second Wednesday in February.

     (iv) Fourth Wednesday in April.

     (8) "Pupils in grades K to 12 actually enrolled and in regular

daily attendance" means pupils in grades K to 12 in attendance and

receiving instruction in all classes for which they are enrolled on

the pupil membership count day or the supplemental count day, as

applicable. Except as otherwise provided in this subsection, a

pupil who is absent from any of the classes in which the pupil is

enrolled on the pupil membership count day or supplemental count

day and who does not attend each of those classes during the 10

consecutive school days immediately following the pupil membership

count day or supplemental count day, except for a pupil who has

been excused by the district, shall not be counted as 1.0 full-time

equated membership. A pupil who is excused from attendance on the

pupil membership count day or supplemental count day and who fails

to attend each of the classes in which the pupil is enrolled within

30 calendar days after the pupil membership count day or

supplemental count day shall not be counted as 1.0 full-time

equated membership. In addition, a pupil who was enrolled and in

attendance in a district, an intermediate district, a public school

academy, or the education achievement system before the pupil

membership count day or supplemental count day of a particular year

but was expelled or suspended on the pupil membership count day or

supplemental count day shall only be counted as 1.0 full-time

equated membership if the pupil resumed attendance in the district,

intermediate district, public school academy, or education

achievement system within 45 days after the pupil membership count

day or supplemental count day of that particular year. Pupils not

counted as 1.0 full-time equated membership due to an absence from

a class shall be counted as a prorated membership for the classes

the pupil attended. For purposes of this subsection, "class" means

a period of time in 1 day when pupils and a certificated teacher or

legally qualified substitute teacher are together and instruction

is taking place.

     (9) "Rule" means a rule promulgated pursuant to the

administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to

24.328.

     (10) "The revised school code" means 1976 PA 451, MCL 380.1 to

380.1852.

     (11) "School district of the first class", "first class school

district", and "district of the first class" mean a district that

had at least 60,000 pupils in membership for the immediately

preceding fiscal year.

     (12) "School fiscal year" means a fiscal year that commences

July 1 and continues through June 30.

     (13) "State board" means the state board of education.

     (14) "Superintendent", unless the context clearly refers to a

district or intermediate district superintendent, means the

superintendent of public instruction described in section 3 of

article VIII of the state constitution of 1963.

     (15) "Supplemental count day" means the day on which the

supplemental pupil count is conducted under section 6a.

     (16) "Tuition pupil" means a pupil of school age attending

school in a district other than the pupil's district of residence

for whom tuition may be charged to the district of residence.

Tuition pupil does not include a pupil who is a special education

pupil, a pupil described in subsection (6)(c) to (p), or a pupil

whose parent or guardian voluntarily enrolls the pupil in a

district that is not the pupil's district of residence. A pupil's

district of residence shall not require a high school tuition

pupil, as provided under section 111, to attend another school

district after the pupil has been assigned to a school district.

     (17) "State school aid fund" means the state school aid fund

established in section 11 of article IX of the state constitution

of 1963.

     (18) "Taxable value" means the taxable value of property as

determined under section 27a of the general property tax act, 1893

PA 206, MCL 211.27a.

     (19) "Textbook" means a book, electronic book, or other

instructional print or electronic resource that is selected and

approved by the governing board of a district or, for an

achievement school, by the chancellor of the achievement authority

and that contains a presentation of principles of a subject, or

that is a literary work relevant to the study of a subject required

for the use of classroom pupils, or another type of course material

that forms the basis of classroom instruction.

     (20) "Total state aid" or "total state school aid" means the

total combined amount of all funds due to a district, intermediate

district, or other entity under all of the provisions of this

article.

     Sec. 20. (1) For 2013-2014, the basic foundation allowance is

$8,049.00.

     (2) The amount of each district's foundation allowance shall

be calculated as provided in this section, using a basic foundation

allowance in the amount specified in subsection (1).

     (3) Except as otherwise provided in this section, the amount

of a district's foundation allowance shall be calculated as

follows, using in all calculations the total amount of the

district's foundation allowance as calculated before any proration:

     (a) For a district that had a foundation allowance for the

immediately preceding state fiscal year that was at least equal to

the sum of $7,108.00 plus the total dollar amount of all

adjustments made from 2006-2007 to the immediately preceding state

fiscal year in the lowest foundation allowance among all districts,

but less than the basic foundation allowance for the immediately

preceding state fiscal year, the district shall receive a

foundation allowance in an amount equal to the sum of the greater

of $6,966.00 or the district's foundation allowance for the

immediately preceding state fiscal year plus the difference between

twice the dollar amount of the adjustment from the immediately

preceding state fiscal year to the current state fiscal year made

in the basic foundation allowance and [(the dollar amount of the

adjustment from the immediately preceding state fiscal year to the

current state fiscal year made in the basic foundation allowance

minus $10.00) times (the difference between the district's

foundation allowance for the immediately preceding state fiscal

year and the sum of $7,108.00 plus the total dollar amount of all

adjustments made from 2006-2007 to the immediately preceding state

fiscal year in the lowest foundation allowance among all districts)

divided by the difference between the basic foundation allowance

for the current state fiscal year and the sum of $7,108.00 plus the

total dollar amount of all adjustments made from 2006-2007 to the

immediately preceding state fiscal year in the lowest foundation

allowance among all districts]. For 2011-2012, for a district that

had a foundation allowance for the immediately preceding state

fiscal year that was at least equal to the sum of $7,108.00 plus

the total dollar amount of all adjustments made from 2006-2007 to

the immediately preceding state fiscal year in the lowest

foundation allowance among all districts, but less than the basic

foundation allowance for the immediately preceding state fiscal

year, the district shall receive a foundation allowance in an

amount equal to the district's foundation allowance for 2010-2011,

minus $470.00. Except as otherwise provided in subdivision (h), for

2013-2014, for a district that had a foundation allowance for the

immediately preceding state fiscal year that was at least equal to

the sum of $7,108.00 plus the total dollar amount of all

adjustments made from 2006-2007 to the immediately preceding state

fiscal year in the lowest foundation allowance among all districts,

but less than the basic foundation allowance for the immediately

preceding state fiscal year, the district shall receive a

foundation allowance in an amount equal to the district's

foundation allowance for the immediately preceding state fiscal

year. However, the foundation allowance for a district that had

less than the basic foundation allowance for the immediately

preceding state fiscal year shall not exceed the basic foundation

allowance for the current state fiscal year.

     (b) Except as otherwise provided in this subsection, for a

district that in the immediately preceding state fiscal year had a

foundation allowance in an amount at least equal to the amount of

the basic foundation allowance for the immediately preceding state

fiscal year, the district shall receive a foundation allowance for

2011-2012 in an amount equal to the district's foundation allowance

for 2010-2011, minus $470.00. For 2013-2014, except as otherwise

provided in this subsection, for a district that in the immediately

preceding state fiscal year had a foundation allowance in an amount

at least equal to the amount of the basic foundation allowance for

the immediately preceding state fiscal year, the district shall

receive a foundation allowance in an amount equal to the district's

foundation allowance for the immediately preceding state fiscal

year.

     (c) Except as otherwise provided in subdivision (d), for a

district that in the 1994-95 state fiscal year had a foundation

allowance greater than $6,500.00, the district's foundation

allowance is an amount equal to the sum of the district's

foundation allowance for the immediately preceding state fiscal

year plus the lesser of the increase in the basic foundation

allowance for the current state fiscal year, as compared to the

immediately preceding state fiscal year, or the product of the

district's foundation allowance for the immediately preceding state

fiscal year times the percentage increase in the United States

consumer price index in the calendar year ending in the immediately

preceding fiscal year as reported by the May revenue estimating

conference conducted under section 367b of the management and

budget act, 1984 PA 431, MCL 18.1367b. Except as otherwise provided

in subdivision (d), for 2011-2012, for a district that in the 1994-

1995 state fiscal year had a foundation allowance greater than

$6,500.00, the district's foundation allowance is an amount equal

to the district's foundation allowance for the 2010-2011 fiscal

year minus $470.00. For 2013-2014, except as otherwise provided in

subdivision (d), for a district that in the 1994-1995 state fiscal

year had a foundation allowance greater than $6,500.00, the

district's foundation allowance is an amount equal to the

district's foundation allowance for the immediately preceding state

fiscal year.

     (d) For a district that in the 1994-95 state fiscal year had a

foundation allowance greater than $6,500.00 and that had a

foundation allowance for the 2009-2010 state fiscal year, as

otherwise calculated under this section, that was less than the

basic foundation allowance, the district's foundation allowance for

2011-2012 and each succeeding fiscal year shall be considered to be

an amount equal to the basic foundation allowance.

     (e) For a district that has a foundation allowance that is not

a whole dollar amount, the district's foundation allowance shall be

rounded up to the nearest whole dollar.

     (f) For a district that received a payment under section 22c

as that section was in effect for 2001-2002, the district's 2001-

2002 foundation allowance shall be considered to have been an

amount equal to the sum of the district's actual 2001-2002

foundation allowance as otherwise calculated under this section

plus the per pupil amount of the district's equity payment for

2001-2002 under section 22c as that section was in effect for 2001-

2002.

     (g) For a district that received a payment under section 22c

as that section was in effect for 2006-2007, the district's 2006-

2007 foundation allowance shall be considered to have been an

amount equal to the sum of the district's actual 2006-2007

foundation allowance as otherwise calculated under this section

plus the per pupil amount of the district's equity payment for

2006-2007 under section 22c as that section was in effect for 2006-

2007.

     (h) For 2012-2013, for a district that had a foundation

allowance for the 2011-2012 state fiscal year of less than

$6,966.00, the district's foundation allowance is an amount equal

to $6,966.00.

     (4) Except as otherwise provided in this subsection, the state

portion of a district's foundation allowance is an amount equal to

the district's foundation allowance or the basic foundation

allowance for the current state fiscal year, whichever is less,

minus the difference between the sum of the product of the taxable

value per membership pupil of all property in the district that is

nonexempt property times the district's certified mills and, for a

district with certified mills exceeding 12, the product of the

taxable value per membership pupil of property in the district that

is commercial personal property times the certified mills minus 12

mills and the quotient of the ad valorem property tax revenue of

the district captured under tax increment financing acts divided by

the district's membership excluding special education pupils. For a

district described in subsection (3)(c), the state portion of the

district's foundation allowance is an amount equal to $6,962.00

plus the difference between the district's foundation allowance for

the current state fiscal year and the district's foundation

allowance for 1998-99, minus the difference between the sum of the

product of the taxable value per membership pupil of all property

in the district that is nonexempt property times the district's

certified mills and, for a district with certified mills exceeding

12, the product of the taxable value per membership pupil of

property in the district that is commercial personal property times

the certified mills minus 12 mills and the quotient of the ad

valorem property tax revenue of the district captured under tax

increment financing acts divided by the district's membership

excluding special education pupils. For a district that has a

millage reduction required under section 31 of article IX of the

state constitution of 1963, the state portion of the district's

foundation allowance shall be calculated as if that reduction did

not occur. For a receiving district, if school operating taxes

continue to be levied on behalf of a dissolved district that has

been attached in whole or in part to the receiving district to

satisfy debt obligations of the dissolved district under section 12

of the revised school code, MCL 380.12, the taxable value per

membership pupil of property in the receiving district used for the

purposes of this subsection, does not include the taxable value of

property within the geographic area of the dissolved district.

     (5) The allocation calculated under this section for a pupil

shall be based on the foundation allowance of the pupil's district

of residence. For a pupil enrolled pursuant to section 105 or 105c

in a district other than the pupil's district of residence, the

allocation calculated under this section shall be based on the

lesser of the foundation allowance of the pupil's district of

residence or the foundation allowance of the educating district.

For a pupil in membership in a K-5, K-6, or K-8 district who is

enrolled in another district in a grade not offered by the pupil's

district of residence, the allocation calculated under this section

shall be based on the foundation allowance of the educating

district if the educating district's foundation allowance is

greater than the foundation allowance of the pupil's district of

residence.

     (6) Except as otherwise provided in this subsection, for

pupils in membership, other than special education pupils, in a

public school academy, the allocation calculated under this section

is an amount per membership pupil other than special education

pupils in the public school academy equal to the foundation

allowance of the district in which the public school academy is

located or the state maximum public school academy allocation,

whichever is less. However, a public school academy that had an

allocation under this subsection before 2009-2010 that was equal to

the sum of the local school operating revenue per membership pupil

other than special education pupils for the district in which the

public school academy is located and the state portion of that

district's foundation allowance shall not have that allocation

reduced as a result of the 2010 amendment to this subsection.

Notwithstanding section 101, for a public school academy that

begins operations after the pupil membership count day, the amount

per membership pupil calculated under this subsection shall be

adjusted by multiplying that amount per membership pupil by the

number of hours of pupil instruction provided by the public school

academy after it begins operations, as determined by the

department, divided by the minimum number of hours of pupil

instruction required under section 101(3). The result of this

calculation shall not exceed the amount per membership pupil

otherwise calculated under this subsection.

     (7) Except as otherwise provided in this subsection, for

pupils attending an achievement school and in membership in the

education achievement system, other than special education pupils,

the allocation calculated under this section is an amount per

membership pupil other than special education pupils equal to the

foundation allowance of the district in which the achievement

school is located, not to exceed the basic foundation allowance.

Notwithstanding section 101, for an achievement school that begins

operation after the pupil membership count day, the amount per

membership pupil calculated under this subsection shall be adjusted

by multiplying that amount per membership pupil by the number of

hours of pupil instruction provided by the achievement school after

it begins operations, as determined by the department, divided by

the minimum number of hours of pupil instruction required under

section 101(3). The result of this calculation shall not exceed the

amount per membership pupil otherwise calculated under this

subsection. For the purposes of this subsection, if a public school

is transferred from a district to the state school reform/redesign

district or the achievement authority under section 1280c of the

revised school code, MCL 380.1280c, that public school is

considered to be an achievement school within the education

achievement system and not a school that is part of a district, and

a pupil attending that public school is considered to be in

membership in the education achievement system and not in

membership in the district that operated the school before the

transfer.

     (8) Subject to subsection (4), for a district that is formed

or reconfigured after June 1, 2002 by consolidation of 2 or more

districts or by annexation, the resulting district's foundation

allowance under this section beginning after the effective date of

the consolidation or annexation shall be the lesser of the sum of

the average of the foundation allowances of each of the original or

affected districts, calculated as provided in this section,

weighted as to the percentage of pupils in total membership in the

resulting district who reside in the geographic area of each of the

original or affected districts plus $100.00 or the highest

foundation allowance among the original or affected districts. This

subsection does not apply to a receiving district unless there is a

subsequent consolidation or annexation that affects the district.

     (9) Each fraction used in making calculations under this

section shall be rounded to the fourth decimal place and the dollar

amount of an increase in the basic foundation allowance shall be

rounded to the nearest whole dollar.

     (10) State payments related to payment of the foundation

allowance for a special education pupil are not calculated under

this section but are instead calculated under section 51a.

     (11) To assist the legislature in determining the basic

foundation allowance for the subsequent state fiscal year, each

revenue estimating conference conducted under section 367b of the

management and budget act, 1984 PA 431, MCL 18.1367b, shall

calculate a pupil membership factor, a revenue adjustment factor,

and an index as follows:

     (a) The pupil membership factor shall be computed by dividing

the estimated membership in the school year ending in the current

state fiscal year, excluding intermediate district membership, by

the estimated membership for the school year ending in the

subsequent state fiscal year, excluding intermediate district

membership. If a consensus membership factor is not determined at

the revenue estimating conference, the principals of the revenue

estimating conference shall report their estimates to the house and

senate subcommittees responsible for school aid appropriations not

later than 7 days after the conclusion of the revenue conference.

     (b) The revenue adjustment factor shall be computed by

dividing the sum of the estimated total state school aid fund

revenue for the subsequent state fiscal year plus the estimated

total state school aid fund revenue for the current state fiscal

year, adjusted for any change in the rate or base of a tax the

proceeds of which are deposited in that fund and excluding money

transferred into that fund from the countercyclical budget and

economic stabilization fund under the management and budget act,

1984 PA 431, MCL 18.1101 to 18.1594, by the sum of the estimated

total school aid fund revenue for the current state fiscal year

plus the estimated total state school aid fund revenue for the

immediately preceding state fiscal year, adjusted for any change in

the rate or base of a tax the proceeds of which are deposited in

that fund. If a consensus revenue factor is not determined at the

revenue estimating conference, the principals of the revenue

estimating conference shall report their estimates to the house and

senate subcommittees responsible for school aid appropriations not

later than 7 days after the conclusion of the revenue conference.

     (c) The index shall be calculated by multiplying the pupil

membership factor by the revenue adjustment factor. If a consensus

index is not determined at the revenue estimating conference, the

principals of the revenue estimating conference shall report their

estimates to the house and senate subcommittees responsible for

school aid appropriations not later than 7 days after the

conclusion of the revenue conference.

     (12) For a district that received a grant under former section

32e for 2001-2002, the district's foundation allowance for 2002-

2003 and each succeeding fiscal year shall be adjusted to be an

amount equal to the sum of the district's foundation allowance, as

otherwise calculated under this section, plus the quotient of 100%

of the amount of the grant award to the district for 2001-2002

under former section 32e divided by the number of pupils in the

district's membership for 2001-2002 who were residents of and

enrolled in the district. All of the following apply to districts

receiving a foundation allowance adjustment under this subsection:

     (a) Except as otherwise provided in this subdivision, a

district qualifying for a foundation allowance adjustment under

this subsection shall use the funds resulting from this adjustment

for at least 1 of grades K to 3 for purposes allowable under former

section 32e as in effect for 2001-2002. For an individual school or

schools operated by a district qualifying for a foundation

allowance adjustment under this subsection that have been

determined by the department to meet the adequate yearly progress

standards of the federal no child left behind act of 2001, Public

Law 107-110, in both mathematics and English language arts at all

applicable grade levels for all applicable subgroups, the district

may submit to the department an application for flexibility in

using the funds resulting from this adjustment that are

attributable to the pupils in the school or schools. The

application shall identify the affected school or schools and the

affected funds and shall contain a plan for using the funds for

specific purposes identified by the district that are designed to

reduce class size, but that may be different from the purposes

otherwise allowable under this subdivision. The department shall

approve the application if the department determines that the

purposes identified in the plan are reasonably designed to reduce

class size. If the department does not act to approve or disapprove

an application within 30 days after it is submitted to the

department, the application is considered to be approved. If an

application for flexibility in using the funds is approved, the

district may use the funds identified in the application for any

purpose identified in the plan.

     (b) A district receiving an adjustment under this subsection

shall not receive as a result of this adjustment an amount that

exceeds 68.5% of the amount the district received as a result of

this adjustment for 2010-2011.

     (c) Notwithstanding subsection (8), for a district that is

formed or reconfigured by consolidation of 2 or more districts, 1

of which received an adjustment under this subsection for 2012-

2013, the resulting district's foundation allowance for 2013-2014

and each succeeding fiscal year shall be adjusted to be an amount

equal to the sum of the resulting district's foundation allowance

as calculated under subsection (8) excluding any adjustment

calculated under this subsection plus [(the original district's

adjustment under this subsection in 2012-2013 times the number of

pupils in the original district's membership for 2012-2013) divided

by the number of pupils in the resulting district's membership for

2013-2014].

     (d) Beginning in 2013-2014, for a district that received an

adjustment for the immediately preceding fiscal year and that had a

foundation allowance as adjusted by this subsection for the

immediately preceding fiscal year equal to $6,966.00, the district

shall not receive an adjustment under this section for the current

fiscal year.

     (13) Payments to districts, public school academies, or the

education achievement system shall not be made under this section.

Rather, the calculations under this section shall be used to

determine the amount of state payments under section 22b.

     (14) If an amendment to section 2 of article VIII of the state

constitution of 1963 allowing state aid to some or all nonpublic

schools is approved by the voters of this state, each foundation

allowance or per pupil payment calculation under this section may

be reduced.

     (15) As used in this section:

     (a) "Certified mills" means the lesser of 18 mills or the

number of mills of school operating taxes levied by the district in

1993-94.

     (b) "Combined state and local revenue" means the aggregate of

the district's state school aid received by or paid on behalf of

the district under this section and the district's local school

operating revenue.

     (c) "Combined state and local revenue per membership pupil"

means the district's combined state and local revenue divided by

the district's membership excluding special education pupils.

     (d) "Current state fiscal year" means the state fiscal year

for which a particular calculation is made.

     (e) "Dissolved district" means a district that loses its

organization, has its territory attached to 1 or more other

districts, and is dissolved as provided under section 12 of the

revised school code, MCL 380.12.

     (f) "Immediately preceding state fiscal year" means the state

fiscal year immediately preceding the current state fiscal year.

     (g) "Local school operating revenue" means school operating

taxes levied under section 1211 of the revised school code, MCL

380.1211. For a receiving district, if school operating taxes are

to be levied on behalf of a dissolved district that has been

attached in whole or in part to the receiving district to satisfy

debt obligations of the dissolved district under section 12 of the

revised school code, MCL 380.12, local school operating revenue

does not include school operating taxes levied within the

geographic area of the dissolved district.

     (h) "Local school operating revenue per membership pupil"

means a district's local school operating revenue divided by the

district's membership excluding special education pupils.

     (i) "Maximum public school academy allocation", except as

otherwise provided in this subdivision, means the maximum per-pupil

allocation as calculated by adding the highest per-pupil allocation

among all public school academies for the immediately preceding

state fiscal year plus the difference between twice the dollar

amount of the adjustment from the immediately preceding state

fiscal year to the current state fiscal year made in the basic

foundation allowance and [(the dollar amount of the adjustment from

the immediately preceding state fiscal year to the current state

fiscal year made in the basic foundation allowance minus $10.00)

times (the difference between the highest per-pupil allocation

among all public school academies for the immediately preceding

state fiscal year and the sum of $7,108.00 plus the total dollar

amount of all adjustments made from 2006-2007 to the immediately

preceding state fiscal year in the lowest per-pupil allocation

among all public school academies) divided by the difference

between the basic foundation allowance for the current state fiscal

year and the sum of $7,108.00 plus the total dollar amount of all

adjustments made from 2006-2007 to the immediately preceding state

fiscal year in the lowest per-pupil allocation among all public

school academies].

     (j) "Membership" means the definition of that term under

section 6 as in effect for the particular fiscal year for which a

particular calculation is made.

     (k) "Nonexempt property" means property that is not a

principal residence, qualified agricultural property, qualified

forest property, supportive housing property, industrial personal

property, or commercial personal property.

     (l) "Principal residence", "qualified agricultural property",

"qualified forest property", "supportive housing property",

"industrial personal property", and "commercial personal property"

mean those terms as defined in section 1211 of the revised school

code, MCL 380.1211.

     (m) "Receiving district" means a district to which all or part

of the territory of a dissolved district is attached under section

12 of the revised school code, MCL 380.12.

     (n) "School operating purposes" means the purposes included in

the operation costs of the district as prescribed in sections 7 and

18 and purposes authorized under section 1211 of the revised school

code, MCL 380.1211.

     (o) "School operating taxes" means local ad valorem property

taxes levied under section 1211 of the revised school code, MCL

380.1211, and retained for school operating purposes.

     (p) "Tax increment financing acts" means 1975 PA 197, MCL

125.1651 to 125.1681, the tax increment finance authority act, 1980

PA 450, MCL 125.1801 to 125.1830, the local development financing

act, 1986 PA 281, MCL 125.2151 to 125.2174, the brownfield

redevelopment financing act, 1996 PA 381, MCL 125.2651 to 125.2672,

or the corridor improvement authority act, 2005 PA 280, MCL

125.2871 to 125.2899.

     (q) "Taxable value per membership pupil" means taxable value,

as certified by the department of treasury, for the calendar year

ending in the current state fiscal year divided by the district's

membership excluding special education pupils for the school year

ending in the current state fiscal year.

     Sec. 21f. (1) A pupil enrolled in a district in any of grades

5 to 12 is eligible to enroll in an online course as provided for

in this section. However, this section does not apply to a pupil

enrolled in a school of excellence that is a cyber school, as

defined in section 551 of the revised school code, MCL 380.551.

     (2) With the consent of the pupil's parent or legal guardian,

a district shall enroll an eligible pupil in up to 2 online courses

as requested by the pupil during an academic term, semester, or

trimester. It is the intent of the legislature to consider

increasing the limit on the number of online courses that a pupil

may enroll in beginning in 2014-2015 for pupils who have

demonstrated previous success with online courses. Consent of the

pupil's parent or legal guardian is not required if the pupil is at

least age 18 or is an emancipated minor.

     (3) An eligible pupil may enroll in an online course published

in the pupil's educating district's catalog of online courses

described in subsection (7)(a) or the statewide catalog of online

courses maintained by the Michigan virtual university pursuant to

section 98.

     (4) A district shall determine whether or not it has capacity

to accept applications for enrollment from nonresident applicants

in online courses and may use that limit as the reason for refusal

to enroll an applicant. If the number of nonresident applicants

eligible for acceptance in an online course does not exceed the

capacity of the district to provide the online course, the district

shall accept for enrollment all of the nonresident applicants

eligible for acceptance. If the number of nonresident applicants

exceeds the district's capacity to provide the online course, the

district shall use a random draw system, subject to the need to

abide by state and federal antidiscrimination laws and court

orders.

     (5) A district may deny a pupil enrollment in an online course

if any of the following apply, as determined by the district:

     (a) The pupil has previously gained the credits provided from

the completion of the online course.

     (b) The online course is not capable of generating academic

credit.

     (c) The online course is inconsistent with the remaining

graduation requirements or career interests of the pupil.

     (d) The pupil does not possess the prerequisite knowledge and

skills to be successful in the online course or has demonstrated

failure in previous online coursework in the same subject.

     (e) The online course is of insufficient quality or rigor. A

district that denies a pupil enrollment for this reason shall make

a reasonable effort to assist the pupil to find an alternative

course in the same or a similar subject that is of acceptable rigor

and quality.

     (6) If a pupil is denied enrollment in an online course by a

district, the pupil may appeal the denial by submitting a letter to

the superintendent of the intermediate district in which the

pupil's educating district is located. The letter of appeal shall

include the reason provided by the district for not enrolling the

pupil and the reason why the pupil is claiming that the enrollment

should be approved. The intermediate district superintendent or

designee shall respond to the appeal within 5 days after it is

received. If the intermediate district superintendent or designee

determines that the denial of enrollment does not meet 1 or more of

the reasons specified in subsection (5), the district shall allow

the pupil to enroll in the online course.

     (7) To offer or provide an online course, a district shall do

all of the following:

     (a) Provide the Michigan virtual university with the course

syllabus in a form and method prescribed by the department Michigan

virtual university for inclusion in a statewide online course

catalog. The district shall also provide on its publicly accessible

website a link to the course syllabi for all of the online courses

offered by the district and a link to the statewide catalog of

online courses maintained by the Michigan virtual university.

     (b) Offer the online course on an open entry and exit method,

or aligned to a semester, trimester, or accelerated academic term

format.

     (8) For a pupil enrolled in 1 or more online courses published

in the pupil's educating district's catalog of online courses under

subsection (7) or in the statewide catalog of online courses

maintained by the Michigan virtual university, the district shall

use foundation allowance or per pupil funds calculated under

section 20 to pay for the expenses associated with the online

course or courses. The district shall pay 80% of the cost of the

online course upon enrollment and 20% upon completion as determined

by the district. A district is not required to pay toward the cost

of an online course an amount that exceeds 1/12 of the district's

foundation allowance or per pupil payment as calculated under

section 20 per semester or an amount that exceeds 1/18 of the

district's foundation allowance or per pupil payment as calculated

under section 20 per trimester.

     (9) An online learning pupil shall have the same rights and

access to technology in his or her educating district's school

facilities as all other pupils enrolled in the educating district.

     (10) If a pupil successfully completes an online course, as

determined by the district, the pupil's district shall grant

appropriate academic credit for completion of the course and shall

count that credit toward completion of graduation and subject area

requirements. A pupil's school record and transcript shall identify

the online course title as it appears in the online course

syllabus.

     (11) The enrollment of a pupil in 1 or more online courses

shall not result in a pupil being counted as more than 1.0 full-

time equivalent pupils under this act.

     (12) As used in this section:

     (a) "Online course" means a course of study that is capable of

generating a credit or a grade, that is provided in an interactive

internet-connected learning environment, in which pupils are

separated from their teachers by time or location, or both, and in

which a teacher who holds a valid Michigan teaching certificate is

responsible for determining appropriate instructional methods for

each pupil, diagnosing learning needs, assessing pupil learning,

prescribing intervention strategies, reporting outcomes, and

evaluating the effects of instruction and support strategies.

     (b) "Online course syllabus" means a document that includes

all of the following:

     (i) The state academic standards addressed in an online course.

     (ii) The online course content outline.

     (iii) The online course required assessments.

     (iv) The online course prerequisites.

     (v) Expectations for actual instructor contact time with the

online learning pupil and other pupil-to-instructor communications.

     (vi) Academic support available to the online learning pupil.

     (vii) The online course learning outcomes and objectives.

     (viii) The name of the institution or organization providing the

online content.

     (ix) The name of the institution or organization providing the

online instructor.

     (x) The course titles assigned by the district and the course

titles and course codes from the national center for education

statistics (NCES) school codes for the exchange of data (SCED).

     (xi) The number of eligible nonresident pupils that will be

accepted by the district in the online course.

     (xii) The results of the online course quality review using the

guidelines and model review process published by the Michigan

virtual university.

     (c) "Online learning pupil" means a pupil enrolled in 1 or

more online courses.

     Sec. 24c. From the appropriation in section 11, there is

allocated an amount not to exceed $1,500,000.00 for 2013-2014 for

payments to districts for pupils who are enrolled in a nationally

administered community-based education and youth mentoring program,

known as the youth challenge program, that is located within the

district and is administered by the department of military and

veterans affairs. Both of the following apply to a district

receiving payments under this section:

     (a) The district shall contract with the department of

military and veterans affairs to ensure that all funding allocated

under this section is utilized by the district and the department

of military and veterans affairs for the youth challenge program.

     (b) The district may retain for its administrative expenses an

amount not to exceed 3% of the amount of the payment the district

receives under this section.

     Sec. 25e. (1) The center shall work with the department,

districts, and intermediate districts to develop a pupil membership

transfer application modeled on the graduation and dropout

application and to develop and a pupil transfer process under this

section. The center shall complete development of this pupil

membership transfer application not later than November 1, 2013.

     (2) If a pupil counted in membership for the pupil membership

count day transfers from a district or intermediate district to

enroll in another district or intermediate district after the pupil

membership count day and before the supplemental count day and, due

to the pupil's enrollment and attendance status as of the pupil

membership count day, the pupil was not counted in membership in

the educating district or intermediate district, the educating

district or intermediate district may report the enrollment and

attendance information to the center through the pupil transfer

process within 30 days after the transfer to the center through the

pupil transfer application until the supplemental count day. or

within 30 days after the sixth Wednesday after the pupil membership

count day, whichever is later. Pupil transfers may be submitted no

earlier than the first day after the certification deadline for the

pupil membership count day and before the supplemental count day.

Upon receipt of the transfer information under this subsection

indicating that a pupil has enrolled and is in attendance in an

educating district or intermediate district as described in this

subsection, the pupil transfer application process shall do the

following:

     (a) Notify the district in which the pupil was previously

enrolled. The district shall provide pupil exit dates and other

information as required by the center and the department.

     (b) Notify both the pupil auditing staff of the intermediate

district in which the educating district is located and the pupil

auditing staff of the intermediate district in which the district

that previously enrolled the pupil is located. The pupil auditing

staff shall edit, if necessary, and approve or deny the pupil

membership transfer.

     (c) Aggregate the districtwide changes and notify the

department for use in adjusting the state aid payment system.

     (3) The department shall do all of the following:

     (a) Adjust the membership calculation for each district or

intermediate district in which the pupil was previously counted in

membership or that previously received an adjustment in its

membership calculation under this section due to a change in the

pupil's enrollment and attendance , if any, so that the district's

or intermediate district's membership is prorated to allow the

district or intermediate district to receive for each school day,

as determined by the financial calendar furnished by the center, in

which the pupil was enrolled and in attendance in the district or

intermediate district an amount equal to 1/180 of 1/105 of a full-

time equated membership claimed in the fall pupil membership count.

The district or intermediate district shall receive a prorated

foundation allowance in an amount equal to the product of the

adjustment under this subdivision for the district or intermediate

district multiplied by the foundation allowance or per pupil

payment as calculated under section 20 for the district or

intermediate district. The foundation allowance or per pupil

payment shall be adjusted by the pupil's full-time equated status

as affected by the membership definition under section 6(4).

     (b) Adjust the membership calculation for the educating

district or intermediate district for each school day in which the

pupil is enrolled and is in attendance in the educating district or

intermediate district so that the district's or intermediate

district's membership is increased to allow the district or

intermediate district to receive , for each school day between the

day the pupil enrolled in the educating district and the

supplemental count day, an amount equal to 1/180 of an amount equal

to the difference between the full-time equated membership claimed

in the fall pupil membership count and the sum of the adjustments

calculated under subdivision (a) for each district or intermediate

district in which the pupil was previously enrolled and in

attendance. The educating district or intermediate district shall

receive a prorated foundation allowance in an amount equal to the

product of the adjustment under this subdivision for the educating

district or intermediate district multiplied by the foundation

allowance or per pupil payment as calculated under section 20 for

the educating district or intermediate district. The foundation

allowance or per pupil payment shall be adjusted by the pupil's

full-time equated status as affected by the membership definition

under section 6(4).

     (4) The changes in calculation of state school aid required

under subsection (3) shall take effect as of the date that the

pupil becomes enrolled and in attendance in the educating district

or intermediate district, and the department shall base all

subsequent payments under this article for the fiscal year to the

affected districts or intermediate districts on this recalculation

of state school aid.

     (5) If a pupil enrolls in an educating district or

intermediate district as described in subsection (2), the district

or intermediate district in which the pupil is counted in

membership or another educating district or intermediate district

that received an adjustment in its membership calculation under

subsection (3), if any, and the educating district or intermediate

district shall provide to the center and the department all

information they require to comply with this section.

     (6) As used in this section, "educating district or

intermediate district" means the district or intermediate district

in which a pupil enrolls after the pupil membership count day or

after an adjustment was made in another district's or intermediate

district's membership calculation under this section due to the

pupil's enrollment and attendance.

     Sec. 26a. (1) From the state school aid fund appropriation in

section 11, there is allocated an amount not to exceed

$26,300,000.00 for 2013-2014 to reimburse districts and

intermediate districts pursuant to section 12 of the Michigan

renaissance zone act, 1996 PA 376, MCL 125.2692, for taxes levied

in 2013. The allocations shall be made not later than 60 days after

the department of treasury certifies to the department and to the

state budget director that the department of treasury has received

all necessary information to properly determine the amounts due to

each eligible recipient.

     (2) In addition to the allocation under subsection (1), from

the general fund money appropriated under section 11, there is

allocated an amount not to exceed $3,200,000.00 for 2013-2014 to

reimburse public libraries pursuant to section 12 of the Michigan

renaissance zone act, 1996 PA 376, MCL 125.2692, for taxes levied

in 2012. 2013. The allocations shall be made not later than 60 days

after the department of treasury certifies to the department and to

the state budget director that the department of treasury has

received all necessary information to properly determine the

amounts due to each eligible recipient.

     Sec. 74. (1) From the amount appropriated in section 11, there

is allocated an amount not to exceed $3,299,000.00 for 2013-2014

for the purposes of this section.

     (2) From the allocation in subsection (1), there is allocated

for each fiscal year the amount necessary for payments to state

supported colleges or universities and intermediate districts

providing school bus driver safety instruction pursuant to section

51 of the pupil transportation act, 1990 PA 187, MCL 257.1851. The

payments shall be in an amount determined by the department not to

exceed 75% of the actual cost of instruction and driver

compensation for each public or nonpublic school bus driver

attending a course of instruction. For the purpose of computing

compensation, the hourly rate allowed each school bus driver shall

not exceed the hourly rate received for driving a school bus.

Reimbursement compensating the driver during the course of

instruction shall be made by the department to the college or

university or intermediate district providing the course of

instruction.

     (3) From the allocation in subsection (1), there is allocated

each fiscal year the amount necessary to pay the reasonable costs

of nonspecial education auxiliary services transportation provided

pursuant to section 1323 of the revised school code, MCL 380.1323.

Districts funded under this subsection shall not receive funding

under any other section of this article for nonspecial education

auxiliary services transportation.

     (4) From the funds allocated in subsection (1), there is

allocated an amount not to exceed $1,674,000.00 for 2013-2014 for

reimbursement to districts and intermediate districts for costs

associated with the inspection of school buses and pupil

transportation vehicles by the department of state police as

required under section 715a of the Michigan vehicle code, 1949 PA

300, MCL 257.715a, and section 39 of the pupil transportation act,

1990 PA 187, MCL 257.1839. The department of state police shall

prepare a statement of costs attributable to each district for

which bus inspections are provided and submit it to the department

and to an intermediate district serving as fiduciary in a time and

manner determined jointly by the department and the department of

state police. Upon review and approval of the statement of cost,

the department shall forward to the designated intermediate

district serving as fiduciary the amount of the reimbursement on

behalf of each district and intermediate district for costs

detailed on the statement within 45 days after receipt of the

statement. The designated intermediate district shall make payment

in the amount specified on the statement to the department of state

police within 45 days after receipt of the statement. The total

reimbursement of costs under this subsection shall not exceed the

amount allocated under this subsection. Notwithstanding section

17b, payments to eligible entities under this subsection shall be

paid on a schedule prescribed by the department.

[Sec. 95. (1) From the funds appropriated in section 11, there is allocated an amount not to exceed $1,750,000.00 for 2012-2013 and there is allocated an amount not to exceed $500,000.00 for 2013-2014 for grants to districts and intermediate districts to support professional development for principals and assistant principals boards, district and intermediate district administrators, and certified district and intermediate district staff, as determined by the department, in a department-approved training program for implementing educator evaluations as required under section 1249 of the revised school code, MCL 380.1249.

     (2) The funds allocated under this section are a work project appropriation, and any unexpended funds for 2012-2013 are carried forward into 2013-2014. The purpose of the work project is to continue to implement the projects described under subsection (1). The estimated completion date of the work project is September 30, 2014.

     (3) For 2012-2013, all districts may apply for funding under this section by a date determined by the department. Beginning in 2013-2014, in a form and manner determined by the department, priority will be given to districts and intermediate districts that have new building administrators board members, administrators, and certified staff, as determined by the department, who have not previously received training in programs funded under this section.

     (4) The department shall approve training programs for the purpose of this section. The department shall approve all training programs recommended by the council on educator effectiveness and may approve other training programs that meet department criteria. At a minimum, these other programs shall meet all of the following criteria:

     (a) Contain instructional content on methods of evaluating teachers and administrators consistently across multiple grades and subjects and across multiple administrative roles.

     (b) Include training on evaluation observation that is focused on reliability and bias awareness and that instills skills needed for consistent, evidence-based observations.

     (c) Incorporate the use of videos of actual lessons for applying rubrics and consistent scoring for teacher evaluations.

     (d) Align with recommendations of the council on educator effectiveness.

     (e) Provide ongoing support to maintain inter-rater reliability and implementation fidelity. As used in this subdivision, "inter-rater reliability" means a consistency of measurement from different evaluators independently applying the same evaluation criteria to the same classroom observation or the same body of evidence regarding a teacher's or administrator's practice.

     (5) The department shall award grants to eligible districts and intermediate districts in an amount determined by the department, but not to exceed $350.00 per participant.

     (6) A district or intermediate district receiving funds under this section shall use the funds only for department-approved training programs under this section.]

     Sec. 107. (1) From the appropriation in section 11, there is

allocated an amount not to exceed $22,000,000.00 for 2013-2014 for

adult education programs authorized under this section. Funds

allocated under this section are restricted for adult education

programs as authorized under this section only. A recipient of

funds under this section shall not use those funds for any other

purpose.

     (2) To be eligible for funding under this section, a program

shall employ certificated teachers and qualified administrative

staff and shall offer continuing education opportunities for

teachers to allow them to maintain certification.

     (3) To be eligible to be a participant funded under this

section, a person shall be enrolled in an adult basic education

program, an adult English as a second language program, a general

educational development (G.E.D.) test preparation program, a job-

or employment-related program, or a high school completion program,

that meets the requirements of this section, and shall meet either

of the following, as applicable:

     (a) If the individual has obtained a high school diploma or a

general educational development (G.E.D.) certificate, the

individual meets 1 of the following:

     (i) Is less than 20 years of age on September 1 of the school

year and is enrolled in the Michigan career and technical

institute.

     (ii) Is less than 20 years of age on September 1 of the school

year, is not attending an institution of higher education, and is

enrolled in a job- or employment-related program through a referral

by an employer.

     (iii) Is enrolled in an English as a second language program.

     (iv) Is enrolled in a high school completion program.

     (b) If the individual has not obtained a high school diploma

or G.E.D. certificate, the individual meets 1 of the following:

     (i) Is at least 20 years of age on September 1 of the school

year.

     (ii) Is at least 16 years of age on September 1 of the school

year, has been permanently expelled from school under section

1311(2) or 1311a of the revised school code, MCL 380.1311 and

380.1311a, and has no appropriate alternative education program

available through his or her district of residence.

     (4) Except as otherwise provided in subsection (5), the money

allocated under this section shall be distributed as follows:

     (a) For districts and consortia that received payments for

2012-2013 under this section, the amount allocated to each for

2013-2014 shall be based on the number of participants served by

the district or consortium for 2012-2013, 2013-2014, using the

amount allocated per full-time equated participant under subsection

(7), up to a maximum total allocation under this subsection in an

amount equal to the amount the district or consortium received for

2012-2013 under this section before any reallocations made for

2012-2013 under subsection (5).

     (b) A district or consortium that received funding in 2012-

2013 under this section may operate independently of a consortium

or join or form a consortium for 2013-2014. The allocation for

2013-2014 to the district or the newly formed consortium under this

subsection shall be determined by the department and shall be based

on the proportion of the amounts that are attributable to the

district or consortium that received funding in 2012-2013. A

district or consortium described in this subdivision shall notify

the department of its intention with regard to 2013-2014 by October

1, 2013.

     (5) A district that operated an adult education program in

2012-2013 and does not intend to operate a program in 2013-2014

shall notify the department by October 1, 2013 of its intention.

The money intended to be allocated under this section to a district

that does not operate a program in 2013-2014 and the unspent money

originally allocated under this section to a district or consortium

that subsequently operates a program at less than the level of

funding allocated under subsection (4) and any other unallocated

money under this section shall instead be proportionately

reallocated to the other districts described in subsection (4)(a)

that are operating an adult education program in 2013-2014 under

this section.

     (6) The amount allocated under this section per full-time

equated participant is $2,850.00 for a 450-hour program. The amount

shall be proportionately reduced for a program offering less than

450 hours of instruction.

     (7) An adult basic education program or an adult English as a

second language program operated on a year-round or school year

basis may be funded under this section, subject to all of the

following:

     (a) The program enrolls adults who are determined by a

department-approved assessment, in a form and manner prescribed by

the department, to be below ninth grade level in reading or

mathematics, or both, or to lack basic English proficiency.

     (b) The program tests individuals for eligibility under

subdivision (a) before enrollment and upon completion of the

program in compliance with the state-approved assessment policy.

     (c) A participant in an adult basic education program is

eligible for reimbursement until 1 of the following occurs:

     (i) The participant's reading and mathematics proficiency are

assessed at or above the ninth grade level.

     (ii) The participant fails to show progress on 2 successive

assessments after having completed at least 450 hours of

instruction.

     (d) A funding recipient enrolling a participant in an English

as a second language program is eligible for funding according to

subsection (11) until the participant meets 1 of the following:

     (i) The participant is assessed as having attained basic

English proficiency as determined by a department-approved

assessment.

     (ii) The participant fails to show progress on 2 successive

department-approved assessments after having completed at least 450

hours of instruction. The department shall provide information to a

funding recipient regarding appropriate assessment instruments for

this program.

     (8) A general educational development (G.E.D.) test

preparation program operated on a year-round or school year basis

may be funded under this section, subject to all of the following:

     (a) The program enrolls adults who do not have a high school

diploma.

     (b) The program shall administer a G.E.D. pre-test approved by

the department before enrolling an individual to determine the

individual's potential for success on the G.E.D. test, and shall

administer a post-test upon completion of the program in compliance

with the state-approved assessment policy.

     (c) A funding recipient shall receive funding according to

subsection (11) for a participant, and a participant may be

enrolled in the program until 1 of the following occurs:

     (i) The participant passes the G.E.D. test.

     (ii) The participant fails to show progress on 2 successive

department-approved assessments used to determine readiness to take

the G.E.D. test after having completed at least 450 hours of

instruction.

     (9) A high school completion program operated on a year-round

or school year basis may be funded under this section, subject to

all of the following:

     (a) The program enrolls adults who do not have a high school

diploma.

     (b) The program tests participants described in subdivision

(a) before enrollment and upon completion of the program in

compliance with the state-approved assessment policy.

     (c) A funding recipient shall receive funding according to

subsection (11) for a participant in a course offered under this

subsection until 1 of the following occurs:

     (i) The participant passes the course and earns a high school

diploma.

     (ii) The participant fails to earn credit in 2 successive

semesters or terms in which the participant is enrolled after

having completed at least 900 hours of instruction.

     (10) A job- or employment-related adult education program

operated on a year-round or school year basis may be funded under

this section, subject to all of the following:

     (a) The program enrolls adults referred by their employer who

are less than 20 years of age, have a high school diploma, are

determined to be in need of remedial mathematics or communication

arts skills and are not attending an institution of higher

education.

     (b) The program tests participants described in subdivision

(a) before enrollment and upon completion of the program in

compliance with the department-approved assessment policy.

     (c) An individual may be enrolled in this program and the

grant recipient shall receive funding according to subsection (11)

until 1 of the following occurs:

     (i) The individual achieves the requisite skills as determined

by department-approved assessment instruments.

     (ii) The individual fails to show progress on 2 successive

assessments after having completed at least 450 hours of

instruction.

     (11) A funding recipient shall receive payments under this

section in accordance with the following:

     (a) Ninety percent for enrollment of eligible participants.

     (b) Ten percent for completion of the adult basic education

objectives by achieving an increase of at least 1 grade level of

proficiency in reading or mathematics; for achieving basic English

proficiency, as defined by the department in the adult education

guidebook; for obtaining a G.E.D. or passage of 1 or more

individual G.E.D. tests; for attainment of a high school diploma or

passage of a course required for a participant to attain a high

school diploma; or for completion of the course and demonstrated

proficiency in the academic skills to be learned in the course, as

applicable.

     (12) As used in this section, "participant" means the sum of

the number of full-time equated individuals enrolled in and

attending a department-approved adult education program under this

section, using quarterly participant count days on the schedule

described in section 6(7)(b).

     (13) A person who is not eligible to be a participant funded

under this section may receive adult education services upon the

payment of tuition. In addition, a person who is not eligible to be

served in a program under this section due to the program

limitations specified in subsection (7), (8), (9), or (10) may

continue to receive adult education services in that program upon

the payment of tuition. The tuition level shall be determined by

the local or intermediate district conducting the program.

     (14) An individual who is an inmate in a state correctional

facility shall not be counted as a participant under this section.

     (15) A district shall not commingle money received under this

section or from another source for adult education purposes with

any other funds of the district. A district receiving adult

education funds shall establish a separate ledger account for those

funds. This subsection does not prohibit a district from using

general funds of the district to support an adult education or

community education program.

     (16) A district or intermediate district receiving funds under

this section may establish a sliding scale of tuition rates based

upon a participant's family income. A district or intermediate

district may charge a participant tuition to receive adult

education services under this section from that sliding scale of

tuition rates on a uniform basis. The amount of tuition charged per

participant shall not exceed the actual operating cost per

participant minus any funds received under this section per

participant. A district or intermediate district may not charge a

participant tuition under this section if the participant's income

is at or below 200% of the federal poverty guidelines published by

the United States department of health and human services.

     (17) In order to receive funds under this section, a district

shall furnish to the department, in a form and manner determined by

the department, all information needed to administer this program

and meet federal reporting requirements; shall allow the department

or the department's designee to review all records related to the

program for which it receives funds; and shall reimburse the state

for all disallowances found in the review, as determined by the

department.

     (18) All intermediate district participant audits of adult

education programs shall be performed pursuant to the adult

education participant auditing and accounting manuals published by

the department.

     (19) It is the intent of the legislature to study allocating

funds under this section on a competitive basis beginning for 2014-

2015.

     (20) As used in this section, "department" means the Michigan

strategic fund.

     Sec. 147a. From the appropriation in section 11, there is

allocated for 2013-2014 an amount not to exceed $100,000,000.00 for

payments to participating districts. A district that receives money

under this section shall use that money solely for the purpose of

offsetting a portion of the retirement contributions owed by the

district for the fiscal year in which it is received. The amount

allocated to each participating district under this section shall

be based on each participating district's percentage of the total

statewide payroll for all participating districts for the

immediately preceding school fiscal year. As used in this section,

"participating district" means a district that is a reporting unit

of the Michigan public school employees' retirement system under

the public school employees retirement act of 1979, 1980 PA 300,

MCL 38.1301 to 38.1408, and that reports employees to the Michigan

public school employees' retirement system for the applicable

fiscal year.

     Enacting section 1. This amendatory act takes effect October

1, 2013.