SF 1352

as introduced - 89th Legislature (2015 - 2016) Posted on 03/05/2015 08:51am

A bill for an act
relating to education finance; adjusting the current year aid payment percentage;
adjusting the current year special education aid estimated entitlement percentage;
amending Minnesota Statutes 2014, sections 16A.152, subdivision 2; 124D.11,
subdivision 9; 127A.45, subdivisions 2, 13.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2014, section 16A.152, subdivision 2, is amended to read:

Subd. 2.

Additional revenues; priority.

(a) If on the basis of a forecast of general
fund revenues and expenditures, the commissioner of management and budget determines
that there will be a positive unrestricted budgetary general fund balance at the close of
the biennium, the commissioner of management and budget must allocate money to the
following accounts and purposes in priority order:

(1) the cash flow account established in subdivision 1 until that account reaches
$350,000,000;

(2) the budget reserve account established in subdivision 1a until that account
reaches $810,992,000;

(3) the amount necessary to increase the aid payment schedule for school district
aids and credits payments in section 127A.45 to not more than deleted text begin 90 deleted text end new text begin 95 new text end percent rounded
to the nearest tenth of a percent without exceeding the amount available and with any
remaining funds deposited in the budget reserve; and

(4) the amount necessary to restore all or a portion of the net aid reductions under
section 127A.441 and to reduce the property tax revenue recognition shift under section
123B.75, subdivision 5, by the same amount.

(b) The amounts necessary to meet the requirements of this section are appropriated
from the general fund within two weeks after the forecast is released or, in the case of
transfers under paragraph (a), clauses (3) and (4), as necessary to meet the appropriations
schedules otherwise established in statute.

(c) The commissioner of management and budget shall certify the total dollar
amount of the reductions under paragraph (a), clauses (3) and (4), to the commissioner of
education. The commissioner of education shall increase the aid payment percentage and
reduce the property tax shift percentage by these amounts and apply those reductions to
the current fiscal year and thereafter.

Sec. 2.

Minnesota Statutes 2014, section 124D.11, subdivision 9, is amended to read:

Subd. 9.

Payment of aids to charter schools.

(a) Notwithstanding section
127A.45, subdivision 3, if the current year aid payment percentage under section
127A.45, subdivision 2, paragraph (d), is deleted text begin 90 deleted text end new text begin 95 new text end or greater, aid payments for the current
fiscal year to a charter school shall be of an equal amount on each of the 24 payment
dates. Notwithstanding section 127A.45, subdivision 3, if the current year aid payment
percentage under section 127A.45, subdivision 2, paragraph (d), is less than deleted text begin 90 deleted text end new text begin 95 new text end , aid
payments for the current fiscal year to a charter school shall be of an equal amount on
each of the 16 payment dates in July through February.

(b) Notwithstanding paragraph (a) and section 127A.45, for a charter school ceasing
operation on or prior to June 30 of a school year, for the payment periods occurring after
the school ceases serving students, the commissioner shall withhold the estimated state aid
owed the school. The charter school board of directors and authorizer must submit to the
commissioner a closure plan under chapter 308A or 317A, and financial information about
the school's liabilities and assets. After receiving the closure plan, financial information,
an audit of pupil counts, documentation of lease expenditures, and monitoring of special
education expenditures, the commissioner may release cash withheld and may continue
regular payments up to the current year payment percentages if further amounts are
owed. If, based on audits and monitoring, the school received state aid in excess of the
amount owed, the commissioner shall retain aid withheld sufficient to eliminate the aid
overpayment. For a charter school ceasing operations prior to, or at the end of, a school
year, notwithstanding section 127A.45, subdivision 3, preliminary final payments may
be made after receiving the closure plan, audit of pupil counts, monitoring of special
education expenditures, documentation of lease expenditures, and school submission of
Uniform Financial Accounting and Reporting Standards (UFARS) financial data for the
final year of operation. Final payment may be made upon receipt of audited financial
statements under section 123B.77, subdivision 3.

(c) If a charter school fails to comply with the commissioner's directive to return,
for cause, federal or state funds administered by the department, the commissioner may
withhold an amount of state aid sufficient to satisfy the directive.

(d) If, within the timeline under section 471.425, a charter school fails to pay the state
of Minnesota, a school district, intermediate school district, or service cooperative after
receiving an undisputed invoice for goods and services, the commissioner may withhold
an amount of state aid sufficient to satisfy the claim and shall distribute the withheld
aid to the interested state agency, school district, intermediate school district, or service
cooperative. An interested state agency, school district, intermediate school district, or
education cooperative shall notify the commissioner when a charter school fails to pay an
undisputed invoice within 75 business days of when it received the original invoice.

(e) Notwithstanding section 127A.45, subdivision 3, and paragraph (a), 80 percent
of the start-up cost aid under subdivision 8 shall be paid within 45 days after the first day
of student attendance for that school year.

(f) In order to receive state aid payments under this subdivision, a charter school in
its first three years of operation must submit a school calendar in the form and manner
requested by the department and a quarterly report to the Department of Education. The
report must list each student by grade, show the student's start and end dates, if any,
with the charter school, and for any student participating in a learning year program,
the report must list the hours and times of learning year activities. The report must be
submitted not more than two weeks after the end of the calendar quarter to the department.
The department must develop a Web-based reporting form for charter schools to use
when submitting enrollment reports. A charter school in its fourth and subsequent year of
operation must submit a school calendar and enrollment information to the department in
the form and manner requested by the department.

(g) Notwithstanding sections 317A.701 to 317A.791, upon closure of a charter
school and satisfaction of creditors, cash and investment balances remaining shall be
returned to the state.

(h) A charter school must have a valid, signed contract under section 124D.10,
subdivision 6, on file at the Department of Education at least 15 days prior to the date of
first payment of state aid for the fiscal year.

(i) State aid entitlements shall be computed for a charter school only for the portion of
a school year for which it has a valid, signed contract under section 124D.10, subdivision 6.

Sec. 3.

Minnesota Statutes 2014, section 127A.45, subdivision 2, is amended to read:

Subd. 2.

Definitions.

(a) "Other district receipts" means payments by county
treasurers pursuant to section 276.10, apportionments from the school endowment fund
pursuant to section 127A.33, apportionments by the county auditor pursuant to section
127A.34, subdivision 2, and payments to school districts by the commissioner of revenue
pursuant to chapter 298.

(b) "Cumulative amount guaranteed" means the product of

(1) the cumulative disbursement percentage shown in subdivision 3; times

(2) the sum of

(i) the current year aid payment percentage of the estimated aid and credit
entitlements paid according to subdivision 13; plus

(ii) 100 percent of the entitlements paid according to subdivisions 11 and 12; plus

(iii) the other district receipts.

(c) "Payment date" means the date on which state payments to districts are made
by the electronic funds transfer method. If a payment date falls on a Saturday, a Sunday,
or a weekday which is a legal holiday, the payment shall be made on the immediately
preceding business day. The commissioner may make payments on dates other than
those listed in subdivision 3, but only for portions of payments from any preceding
payment dates which could not be processed by the electronic funds transfer method due
to documented extenuating circumstances.

(d) The current year aid payment percentage equals 90 new text begin in fiscal year 2015 and 95 in
fiscal year 2016 and later new text end .

Sec. 4.

Minnesota Statutes 2014, section 127A.45, subdivision 13, is amended to read:

Subd. 13.

Aid payment percentage.

Except as provided in subdivisions 11, 12,
12a, and 14, each fiscal year, all education aids and credits in this chapter and chapters
120A, 120B, 121A, 122A, 123A, 123B, 124D, 125A, 125B, 126C, 134, and section
273.1392, shall be paid at the current year aid payment percentage of the estimated
entitlement during the fiscal year of the entitlement. deleted text begin For the purposes of this subdivision, a
district's estimated entitlement for special education aid under section 125A.76 for fiscal
year 2014 and later equals 97.4 percent of the district's entitlement for the current fiscal
year. deleted text end The final adjustment payment, according to subdivision 9, must be the amount of
the actual entitlement, after adjustment for actual data, minus the payments made during
the fiscal year of the entitlement.