Brief ⁽¹⁾

HB 2946 pertains to school finance and authorizes school district boards to adopt special needs local enhancement budgets.

Each school district board may adopt a special needs local enhancement budget of not more than 10 percent of the amount of state financial aid (general fund budget) of the district, subject to any one or more of the following conditions:

• enrollment in the district in the school year has declined from enrollment in the preceding school year; or



• the board has adopted a local option budget (LOB) and has budgeted therein the total amount authorized for the school year; or



• the board has determined that the amounts budgeted for operating expenses in the general fund and the supplemental general fund are insufficient to provide for any one or more of the following special needs of the district:

• implementation and maintenance of innovative programs and school reform efforts;



• maintenance of classes having a pupil/teacher ratio of not more than 17:1 for pupils enrolled in and attending kindergarten or any of the grades one through three;



• maintenance of early childhood education programs for prekindergarten-aged pupils; or



• implementation and maintenance of excellence academies in mathematics, science, and language arts.

In order for the school district to have authority to adopt a special needs local enhancement budget, the question must be approved by an election.

The bill establishes in the school district a special needs fund. The fund consists of all amounts deposited or credited to it under the law. Amounts in the special needs fund may be spent for any purpose for which expenditures from the general fund are authorized or may be transferred to any program weighted fund or categorical fund of the district. Any cash balances remaining in the fund at the conclusion of a school year may be maintained in the fund or may be transferred to the general fund or to any program weighted fund or categorical fund of the district.

School districts that adopt a special needs local enhancement budget will qualify for state aid to assist in the funding of the budget on the same basis as currently applies to the local option budget. School districts are authorized to levy property taxes to support the special needs local enhancement budget. Also, subject to voter approval, school district boards may impose a sales tax in the amount of .125 percent, .25 percent, .5 percent, .75 percent, or 1.0 percent to help finance this budget.

Background

HB 2946 was sponsored by Representatives Phill Kline and Robin Jennison. Representative Kline appeared as a proponent of the bill; written testimony in support of the bill was submitted on behalf of the Shawnee Mission school district (USD 512). Representative Kline explained that the bill helps correct a current imbalance in the school finance funding mechanism by providing school districts with more local school spending flexibility. It was noted that, if many of the school districts that have used the full amount of their LOB spending authority also were able to fully utilize the proposed special needs local enhancement budget, those districts still would have lower spending per full-time equivalent pupil than many other school districts. Both proponents discounted the validity of any questions that might be raised regarding constitutionality of the measure.

The fiscal note on HB 2946 explains that the State Department of Education has estimated school district use of HB 2946 would result in the inability of Kansas to legally deduct certain federal PL 874 receipts (impact aid associated with federal installations) under the school finance plan. The potential impact of this would be a cost to the state of about $7.4 million. The State Department of Education also estimated that use of the authority under the bill might total $19.0 million in FY 2001, about $950,000 of which would be from state aid. The State Department of Revenue has estimated implementation of the sales tax provisions of the bill would result in administrative costs of about $170,000.

1. *Supplemental notes are prepared by the Legislative Research Department and do not express legislative intent. The supplemental note and fiscal note for this bill may be accessed on the Internet at http://www.ink.org/public/legislative/bill_search.html