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AN ACT concerning school district finance; revising the definition of local
  effort; affecting the determination of general state aid; authorizing
  adoption of supplemental general fund budgets; amending K.S.A. 72-
  6416 and K.S.A. 1996 Supp. 72-6410, 72-6431 and 72-6438 and re-
  pealing the existing sections; also repealing K.S.A. 72-6434 and 72-
  6435 and K.S.A. 1996 Supp. 72-6431a, 72-6433 and 72-6433a.
Be it enacted by the Legislature of the State of Kansas:
  Section 1.  K.S.A. 1996 Supp. 72-6410 is hereby amended to read as
follows: 72-6410. (a) ``State financial aid'' means an amount equal to the
product obtained by multiplying base state aid per pupil by the adjusted
enrollment of a district.
  (b)  ``Base state aid per pupil'' means an amount of state financial aid
per pupil. Subject to the other provisions of this subsection, the amount
of base state aid per pupil is $3,648. The amount of base state aid per
pupil is subject to reduction commensurate with any reduction under
K.S.A. 1996 Supp. 75-6704, and amendments thereto, in the amount of
the appropriation from the state general fund for general state aid. If the
amount of appropriations for general state aid is insufficient to pay in full
the amount each district is entitled to receive for any school year, the
amount of base state aid per pupil for such school year is subject to
reduction commensurate with the amount of the insufficiency.
  (c)  ``Local effort'' means the sum of an amount equal to the proceeds
from the tax levied under authority of K.S.A. 72-6431, and amendments
thereto, and an amount equal to any unexpended and unencumbered
balance remaining in the general fund of the district, except amounts
received by the district and authorized to be expended for the purposes
specified in K.S.A. 72-6430, and amendments thereto, and an amount
equal to any unexpended and unencumbered balances remaining in the
program weighted funds of the district, except any amount in the voca-
tional education fund of the district if the district is operating an area
vocational school, and an amount equal to any remaining proceeds from
taxes levied under authority of K.S.A. 72-7056 and 72-7072, and amend-
ments thereto, prior to the repeal of such statutory sections, and an
amount equal to the amount deposited in the general fund in the current
school year from amounts received in such year by the district under the
provisions of subsection (a) of K.S.A. 72-1046a, and amendments thereto,
and an amount equal to the amount deposited in the general fund in the
current school year from amounts received in such year by the district
pursuant to contracts made and entered into under authority of K.S.A.
72-6757, and amendments thereto, and an amount equal to the amount
credited to the general fund in the current school year from amounts
distributed in such year to the district under the provisions of articles 17
and 34 of chapter 12 of Kansas Statutes Annotated and under the pro-
visions of articles 42 and 51 of chapter 79 of Kansas Statutes Annotated,
and an amount equal to the federal impact aid of a district.
  (d)  ``Federal impact aid'' means an amount equal to the federally
qualified percentage of the amount of moneys a district receives in the
current school year under the provisions of title I of public law 874 and
congressional appropriations therefor, excluding amounts received for as-
sistance in cases of major disaster and amounts received under the low-
rent housing program. The amount of federal impact aid defined herein
as an amount equal to the federally qualified percentage of the amount
of moneys provided for the district under title I of public law 874 shall
be determined by the state board in accordance with terms and conditions
imposed under the provisions of the public law and rules and regulations
thereunder.
  Sec. 2.  K.S.A. 72-6416 is hereby amended to read as follows: 72-
6416. (a) In each school year, the state board shall determine entitlement
of each district to general state aid for the school year as provided in this
section.
  (b)  The state board shall determine the amount of the district's local
effort for the school year. If the amount of the district's local effort is
greater than the amount of state financial aid determined for the district
for the school year, the district shall not be entitled to general state aid.
If the amount of the district's local effort is less than the amount of state
financial aid determined for the district for the school year, the state board
shall, subtract the amount of the district's local effort from the amount
of state financial aid determined for the district for the school year and
compute an amount equal to 2/3 of the amount of the remainder.  The
remainder computed amount is the amount of general state aid the district
is entitled to receive for the current school year.
  (c)  The provisions of this section shall take effect and be in force
from and after July 1, 1992.
  Sec. 3.  K.S.A. 1996 Supp. 72-6431 is hereby amended to read as
follows: 72-6431. (a) The board of each district shall is authorized to levy
an ad valorem tax upon the taxable tangible property of the district in the
each school years specified in subsection (b) year for the purpose of:
  (1)  Financing that portion of the district's general fund budget which
is not financed from any other source provided by law; and
  (2)  paying a portion of the costs of operating and maintaining public
schools in partial fulfillment of the constitutional obligation of the legis-
lature to finance the educational interests of the state; and
  (3)(2)  paying a portion of the principal and interest on bonds issued
by cities under authority of K.S.A. 12-1774, and amendments thereto, for
the financing of redevelopment projects upon property located within the
district.
  (b)  The tax required under subsection (a) shall be levied at a rate of
35 mills in the 1996-97 school year, 33 mills in the 1997-98 school year
and not exceeding 31 mills in the 1998-99 school year.
  (c)(b)  The proceeds from the tax levied by a district under authority
of this section, except the proceeds of such tax levied for the purpose of
paying a portion of the principal and interest on bonds issued by cities
under authority of K.S.A. 12-1774, and amendments thereto, for the fi-
nancing of redevelopment projects upon property located within the dis-
trict, shall be deposited in the general fund of the district.
  (d)  On June 1 of each year, the amount, if any, by which a district's
local effort exceeds the amount of the district's state financial aid, as
determined by the state board, shall be remitted to the state treasurer.
Upon receipt of any such remittance, the state treasurer shall deposit the
same in the state treasury to the credit of the state school district finance
fund.
  (e)(c)  No district shall proceed under K.S.A. 79-1964, 79-1964a or
79-1964b, and amendments to such sections.
  New Sec. 4.  (a) The board of any district may adopt a supplemental
general fund budget in each school year in an amount not to exceed 25%
of the amount of state financial aid determined for the district in the
school year if the board of the district determines that the amount budg-
eted for operating expenses in the general fund of the district is insuffi-
cient for such purposes and that adoption of a supplemental general fund
budget would be in the best interests of the pupils of the district. The
adoption of a supplemental general fund budget shall require a majority
vote of the members of the board and shall require no other procedure,
authorization or approval.
  (b)  There is hereby established in every district that adopts a supple-
mental general fund budget a fund which shall be called the supplemental
general fund.  The fund shall consist of all amounts deposited therein or
credited thereto according to law. Amounts in the supplemental general
fund may be expended for any purpose for which expenditures from the
general fund are authorized or may be transferred to the general fund of
the district or to any program weighted fund or categorical fund of the
district.
  (c) (1)  In each school year, each district that has adopted a supple-
mental general fund budget is eligible for entitlement to an amount of
supplemental general state aid. Entitlement of a district to supplemental
general state aid shall be determined by the state board as provided in
this subsection. The state board shall:
  (A)  Determine the amount of the assessed valuation per pupil in the
preceding school year of each district in the state;
  (B)  rank the districts from low to high on the basis of the amounts of
assessed valuation per pupil determined under (A);
  (C)  identify the amount of the assessed valuation per pupil located
at the 75th percentile of the amounts ranked under (B);
  (D)  divide the assessed valuation per pupil of the district in the pre-
ceding school year by the amount identified under (C);
  (E)  subtract the ratio obtained under (D) from 1.0. If the resulting
ratio equals or exceeds 1.0, the eligibility of the district for entitlement
to supplemental general state aid shall lapse. If the resulting ratio is less
than 1.0, the district is entitled to receive supplemental general state aid
in an amount which shall be determined by the state board by multiplying
the amount of the supplemental general fund budget of the district by
such ratio. The product is the amount of supplemental general state aid
the district is entitled to receive for the school year.
  (2)  If the amount of appropriations for supplemental general state
aid is less than the amount each district is entitled to receive for the school
year, the state board shall prorate the amount appropriated among the
districts in proportion to the amount each district is entitled to receive.
  (3)  Payments of supplemental general state aid shall be distributed
to districts at a time to be determined by the state board. The state board
shall certify to the director of accounts and reports the amount due each
district, and the director of accounts and reports shall draw a warrant on
the state treasurer payable to the treasurer of the district. Upon receipt
of the warrant, the treasurer of the district shall credit the amount thereof
to the supplemental general state fund of the district.
  (d) (1)  In each school year, the board of every district that has
adopted a supplemental general fund budget may levy an ad valorem tax
on the taxable tangible property of the district for the purpose of financing
that portion of the district's supplemental general fund budget which is
not financed from any other source provided by law and for the purpose
of paying a portion of the principal and interest on bonds issued by cities
under authority of K.S.A. 12-1774, and amendments thereto, for the fi-
nancing of redevelopment projects upon property located within the dis-
trict.
  (2)  The proceeds from the tax levied by a district under authority of
this section, except the proceeds of such tax levied for the purpose of
paying a portion of the principal and interest on bonds issued by cities
under authority of K.S.A. 12-1774, and amendments thereto, for the fi-
nancing of redevelopment projects upon property located within the dis-
trict, shall be deposited in the supplemental general fund of the district.
  (3)  No district shall proceed under K.S.A. 79-1964, 79-1964a or 79-
1964b, and amendments to such sections.
  Sec. 5.  K.S.A. 1996 Supp. 72-6438 is hereby amended to read as
follows: 72-6438. (a) The state school district finance fund, established by
K.S.A. 1991 Supp. 72-7081 prior to its repeal by this act, is hereby con-
tinued in existence and shall consist of (1) all moneys credited to such
fund under K.S.A. 72-6418 and 72-6431, and amendments thereto, and
  (2) all amounts transferred to such fund.
  (b)  The state school district finance fund shall be used for the purpose
of school district finance and for no other governmental purpose. It is the
intent of the legislature that the fund shall remain intact and inviolate for
such purpose, and moneys in the fund shall not be subject to the provi-
sions of K.S.A. 75-3722, 75-3725a and 75-3726a, and amendments
thereto.
  (c)  Amounts in the state school district finance fund shall be allocated
and distributed to school districts as a portion of general state aid enti-
tlements provided for under this act.
  Sec. 6.  K.S.A. 72-6416, 72-6434 and 72-6435 and K.S.A. 1996 Supp.
72-6410, 72-6431, 72-6431a, 72-6433, 72-6433a and 72-6438 are hereby
repealed.
  Sec. 7.  This act shall take effect and be in force from and after its
publication in the statute book.