HOUSE APPROPRIATIONS AND FINANCE COMMITTEE SUBSTITUTE FOR
HOUSE BILL 672
54th legislature - STATE OF NEW MEXICO - first session, 2019
AN ACT
RELATING TO THE PUBLIC PEACE, HEALTH, SAFETY AND WELFARE; PROVIDING CAPITAL OUTLAY, MAINTENANCE AND EDUCATIONAL TECHNOLOGY FUNDING FOR IMPACT AID SCHOOL DISTRICTS AND CHARTER SCHOOLS; MAKING AN APPROPRIATION; PROVIDING FOR A DELAYED REPEAL.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
SECTION 1. A new section of the Severance Tax Bonding Act is enacted to read:
"[NEW MATERIAL] BONDING CAPACITY--AUTHORIZATION FOR SEVERANCE TAX BONDS--PRIORITY FOR IMPACT AID SCHOOL DISTRICT AND CHARTER SCHOOL PROJECTS.--
A. By January 15 of each year, the division shall estimate the amount of bonding capacity available for severance tax bonds to be authorized by the legislature.
B. The division shall allocate ten percent of the estimated bonding capacity each year for capital outlay projects for impact aid school districts and charter schools, and the legislature shall authorize the state board of finance to issue severance tax bonds in the annually allocated amount for use by the public school capital outlay council to fund impact aid school district and charter school capital outlay projects. The public school capital outlay council shall certify to the state board of finance the need for issuance of bonds for impact aid school district and charter school projects. The state board of finance may issue and sell the bonds in the same manner as other severance tax bonds in an amount not to exceed the authorized amount provided for in this subsection. If necessary, the state board of finance shall take the appropriate steps to comply with the federal Internal Revenue Code of 1986, as amended. Proceeds from the sale of the bonds are appropriated to the public school facilities authority for the purposes certified by the public school capital outlay council to the state board of finance.
C. Each impact aid school district shall provide the charter schools in its district the charter schools' proportionate share of severance tax bonding capacity based on its proportionate membership of the total membership in the district.
D. Each impact aid school district shall receive its proportionate share of severance tax bonding capacity based on the amount of its credited impact aid basic support payments from June 1 of the previous year to May 31 of the current year. If an impact aid school district or charter school has a particularly expensive capital improvement project for which the school district or charter school does not have enough bonding capacity to complete a functional phase or to complete the project, it may hold its bonding capacity until there is enough to issue bonds for a phase or the complete project.
E. An impact aid school district or charter school may use its bonding capacity as the required match for receiving funding from the public school capital outlay council pursuant to other sections of the Public School Capital Outlay Act.
F. Money from the severance tax bonds provided for in this section shall not be used to pay indirect project costs. Any unexpended balance from proceeds of severance tax bonds issued for an impact aid school district or charter school project shall revert to the severance tax bonding fund within six months of completion of the project. The public school facilities authority shall monitor and ensure proper reversions of the bond proceeds appropriated for impact aid school district and charter school projects.
G. The public school capital outlay council shall take project applications from impact aid school districts and shall rank the projects in order of importance based on the districts' five-year facilities plans.
H. As used in this section:
(1) "division" means the board of finance division of the department of finance and administration; and
(2) "impact aid school district and charter schools" means a school district that has applied for and received basic support payments from federal impact aid, also known as P.L. 874 funds, for the last three years and includes the charter schools in that district."
SECTION 2. A new Section 22-25-9.1 NMSA 1978 is enacted to read:
"22-25-9.1. [NEW MATERIAL] STATE DISTRIBUTION TO IMPACT AID SCHOOL DISTRICTS AND CHARTER SCHOOLS IMPOSING TAX UNDER CERTAIN CIRCUMSTANCES.--
A. As used in this section:
(1) "impact aid school district" means a school district, other than a large impact aid school district, that has applied for and received basic support payments from federal impact aid, also known as P.L. 874 funds, for the last three years; and
(2) "large impact aid school district" means a school district that receives federal impact aid, has a significant property tax base and has a districtwide full-time- equivalent student enrollment greater than thirty thousand.
B. A large impact aid school district shall receive a distribution pursuant to the Public School Capital Improvements Act under the calculation in Section 22-25-9 NMSA 1978.
C. For all other impact aid school districts and their charter schools, except as provided in Subsection D or H of this section, the secretary shall distribute to any school district that has imposed a tax pursuant to the Public School Capital Improvements Act an amount from the public school capital improvements fund that is equal to the amount by which the revenue estimated to be received from the imposed tax, using prior year valuations, at the rate certified by the department of finance and administration in accordance with Section 22-25-7 NMSA 1978, assuming a one-hundred-percent collection rate, is less than an amount calculated by multiplying an average of the school district's prior year second and third reporting dates' total program units by the amount specified in Subsection D of this section and further multiplying the product obtained by the tax rate approved by the qualified electors in the most recent election on the question of imposing a tax under the Public School Capital Improvements Act. The distribution shall be made each year that the tax is imposed in accordance with Section 22-25-7 NMSA 1978. In the event that sufficient funds are not available in the public school capital improvements fund to make the state distribution provided for in this section, the dollar per program unit figure shall be reduced as necessary.
D. In calculating the state distribution pursuant to Subsection C of this section, the following amounts shall be used:
(1) one hundred twenty-five dollars ($125) for fiscal year 2020 and in each subsequent fiscal year shall equal the amount for the previous fiscal year adjusted by the percentage increase between the next preceding calendar year and the preceding calendar year of the consumer price index for the United States, all items, as published by the United States department of labor;
(2) the minimum distribution of nine dollars fifty cents ($9.50) for fiscal year 2020 and in each subsequent fiscal year shall equal the amount for the previous fiscal year adjusted by the percentage increase between the next preceding calendar year and the preceding calendar year of the consumer price index for the United States, all items, as published by the United States department of labor; or
(3) every impact aid school district shall be guaranteed to receive a minimum distribution of one million dollars ($1,000,000) if the calculations for Paragraph (1) or (2) of this subsection result in a distribution of less than one million dollars ($1,000,000).
E. For any fiscal year, notwithstanding the amount calculated to be distributed pursuant to Paragraph (1) of Subsection D of this section, except as provided in Subsection G of this section, an impact aid school district, the voters of which have approved a tax pursuant to Section 22-25-3 NMSA 1978, shall not receive a distribution less than the amount calculated pursuant to Paragraph (2) of Subsection D of this section multiplied by the average of the impact aid school district's prior year second and third reporting dates' total program units and further multiplying the product obtained by the approved tax rate.
F. In expending distributions made pursuant to this section, impact aid school districts and charter schools shall give priority to maintenance projects, including payments under contracts with regional education cooperatives for maintenance support services. In addition, distributions made pursuant to this section may be expended by impact aid school districts and charter schools as follows:
(1) for the impact aid school district portion of the total project cost for roof repair or replacement required by Section 22-24-4.3 NMSA 1978; or
(2) for the impact aid school district portion of payments made under a financing agreement entered into by an impact aid school district or a charter school for the leasing of a building or other real property with an option to purchase for a price that is reduced according to the payments made, if the impact aid school district has received a grant for the state share of the payments pursuant to Subsection D of Section 22-24-5 NMSA 1978.
G. If a serious deficiency in a roof of a public school facility has been corrected pursuant to Section 22-24-4.4 NMSA 1978 and the impact aid school district or charter school has refused to pay its share of the cost as determined by that section, until the public school capital outlay fund is reimbursed in full for the share attributed to the impact aid school district or charter school, the distribution calculated pursuant to this section shall not be made to the impact aid school district or charter school but shall be made to the public school capital outlay fund.
H. A portion of each distribution made by the state pursuant to this section on or after July 1, 2019 shall be further distributed by the impact aid school district to each charter school located within the impact aid school district. The amount to be distributed to each charter school shall be in the same proportion as the average full-time-equivalent enrollment of the charter school on the second and third reporting dates of the prior school year is to the total such enrollment in the impact aid school district; provided that no distribution shall be made to an approved charter school that had not commenced classroom instruction in the prior school year. Each year, the department shall certify to the impact aid school district the amount to be distributed to each charter school. Distributions received by a charter school pursuant to this subsection shall be expended pursuant to the provisions of the Public School Capital Improvements Act; except that if capital improvements for the charter school were not identified in a resolution approved by the electors, the charter school may expend the distribution for any capital improvements, including those specified in Subsection F of this section.
I. In determining an impact aid school district's total program units pursuant to Subsections C and E of this section and an impact aid school district's total enrollment pursuant to Subsection H of this section, students attending a state-chartered charter school within the school district shall be included.
J. In making distributions pursuant to this section, the secretary shall include such reporting requirements and conditions as are required by rule of the public school capital outlay council. The council shall adopt such requirements and conditions as are necessary to ensure that the distributions are expended in the most prudent manner possible and are consistent with the original purpose as specified in the authorizing resolution. Copies of reports or other information received by the secretary in response to the requirements and conditions shall be forwarded to the council."
SECTION 3. APPROPRIATION.--Ten million dollars ($10,000,000) is appropriated from the general fund to the educational technology fund for expenditure in fiscal year 2020 and subsequent fiscal years to provide educational technology distributions to impact aid school districts and their charter schools. The public education department may use a portion of the appropriation provided for in this section to correct educational technology deficiencies in impact aid school districts. Any unexpended or unencumbered balance remaining at the end of a fiscal year shall not revert to the general fund.
SECTION 4. DELAYED REPEAL.--Section 1 of this act is repealed effective June 30, 2034.
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