1.1                          A bill for an act 
  1.2             relating to education funding; increasing equity in 
  1.3             Minnesota's school finance system; increasing the 
  1.4             general education formula allowance; appropriating 
  1.5             money; amending Minnesota Statutes 1998, sections 
  1.6             126C.10, subdivisions 1, 2, and by adding a 
  1.7             subdivision; and 127A.51. 
  1.8   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.9      Section 1.  Minnesota Statutes 1998, section 126C.10, 
  1.10  subdivision 1, is amended to read: 
  1.11     Subdivision 1.  [GENERAL EDUCATION REVENUE.] For fiscal 
  1.12  year 1999 2000 and thereafter, the general education revenue for 
  1.13  each district equals the sum of the district's basic revenue, 
  1.14  basic skills revenue, training and experience revenue, secondary 
  1.15  sparsity revenue, elementary sparsity revenue, transportation 
  1.16  sparsity revenue, total operating capital revenue, graduation 
  1.17  standards implementation revenue, equity revenue, transition 
  1.18  revenue, and supplemental revenue. 
  1.19     Sec. 2.  Minnesota Statutes 1998, section 126C.10, 
  1.20  subdivision 2, is amended to read: 
  1.21     Subd. 2.  [BASIC REVENUE.] The basic revenue for each 
  1.22  district equals the formula allowance times the resident pupil 
  1.23  units for the school year.  The formula allowance for fiscal 
  1.24  year 1997 is $3,505.  The formula allowance for fiscal year 1998 
  1.25  is $3,581 and the formula allowance for fiscal year 1999 and 
  1.26  fiscal year 2000 is $3,530.  The formula allowance for fiscal 
  2.1   year 2000 is $3,706 and the formula allowance for 2001 and 
  2.2   subsequent fiscal years is $3,597 $3,962. 
  2.3      Sec. 3.  Minnesota Statutes 1998, section 126C.10, is 
  2.4   amended by adding a subdivision to read: 
  2.5      Subd. 23.  [EQUITY REVENUE.] (a) A school district 
  2.6   qualifies for equity revenue if the school district's per pupil 
  2.7   unit amount of basic revenue, supplemental revenue, transition 
  2.8   revenue, and referendum revenue is less than the 95th percentile 
  2.9   of school districts in those revenue categories. 
  2.10     (b) Equity revenue for a qualifying school district equals 
  2.11  the product of:  (1) the district's resident pupil units for 
  2.12  that year; times (2) the sum of (i) $25, plus (ii) $75, times 
  2.13  the school district's equity index computed under section 
  2.14  127A.51. 
  2.15     Sec. 4.  Minnesota Statutes 1998, section 127A.51, is 
  2.16  amended to read: 
  2.17     127A.51 [STATEWIDE AVERAGE REVENUE.] 
  2.18     Subdivision 1.  [DISPARITY IN REVENUE.] By October 1 of 
  2.19  each year the commissioner must estimate the statewide average 
  2.20  adjusted general revenue per resident pupil unit and the 
  2.21  disparity in adjusted general revenue among pupils and districts 
  2.22  by computing the ratio of the ninety-fifth percentile to the 
  2.23  fifth percentile of adjusted general revenue.  The commissioner 
  2.24  must provide that information to all districts. 
  2.25     If the disparity in adjusted general revenue as measured by 
  2.26  the ratio of the ninety-fifth percentile to the fifth percentile 
  2.27  increases in any year, the commissioner shall recommend to the 
  2.28  legislature options for change in the general education formula 
  2.29  that will limit the disparity in adjusted general revenue to no 
  2.30  more than the disparity for the previous school year.  The 
  2.31  commissioner must submit the recommended options to the 
  2.32  education committees of the legislature by January 15. 
  2.33     For purposes of this section, adjusted general revenue 
  2.34  means the sum of basic revenue under section 126C.10, 
  2.35  subdivision 2; supplemental revenue under section 126C.10, 
  2.36  subdivisions 9 and 12; transition revenue under section 126C.10, 
  3.1   subdivision 20; and referendum revenue under section 126C.17. 
  3.2      Subd. 2.  [STATEWIDE EQUITY GAP.] The statewide equity gap 
  3.3   equals the difference between the fifth and the 95th percentile 
  3.4   of adjusted general revenue per resident pupil unit. 
  3.5      Subd. 3.  [DISTRICT EQUITY GAP.] A district's equity gap 
  3.6   equals the greater of zero or the difference between the 
  3.7   district's adjusted general revenue and the statewide 95th 
  3.8   percentile of adjusted general revenue per resident pupil unit. 
  3.9      Subd. 4.  [DISTRICT EQUITY INDEX.] A district's equity 
  3.10  index equals the ratio of the sum of the district equity gap 
  3.11  amount to the statewide equity gap amount. 
  3.12     Sec. 5.  [EFFECTIVE DATE.] 
  3.13     Sections 1 to 4 are effective for revenue for fiscal year 
  3.14  2000 and later.