SR C.S.S.B. 1873 75(R) BILL ANALYSIS PUBLIC EDUCATION C.S.S.B. 1873 By: Bivins (Hochberg) 5-23-97 Committee Report (Substituted) BACKGROUND Currently, the Foundation School Fund Budget Committee (committee) functions to tell the comptroller how much to set aside for public education and to adopt the Legislative Budget Board's recommendations for funding amounts and funding elements in the school finance formulas. The legislature can override any committee actions and review the same issues for the appropriations bill. S.B. 1873 repeals the Foundation School Fund Budget Committee and cleans up matters regarding school finance. PURPOSE As proposed, S.B. 1873 repeals the Foundation School Fund Budget Committee and cleans up matters regarding school finance. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency or institution. SECTION BY SECTION ANALYSIS SECTION 1. Provides that the foundation school fund budget committee is abolished. Repealer: Section 42.256, Education Code (Foundation School Fund Budget Committee). SECTION 2. Amends Section 42.007, Education Code, to require the Legislative Budget Board (board) to compute qualified funding elements, in accordance with Subsection (c). Requires the board before, each regular session of the legislature, to report on qualified funding elements. Authorizes the funding elements to include certain matters. SECTION 3. Amends Section 13.285, Education Code, to delete text regarding the consideration of certain costs in estimating funds needed for the Foundation School Program. SECTION 4. Amends Section 19.007(b), Education Code, to delete text regarding the consideration of certain costs in estimating funds needed for the Foundation School Program. SECTION 5. Amends Section 29.256(c), Education Code, to delete text regarding the foundation school fund budget committee. SECTION 6. Amends Section 29.257(a), Education Code, to delete text regarding the foundation school fund budget committee. SECTION 7. Amends Section 41.002 (e) and (f), Education Code, to extend a current holdharmless provision by allowing districts to maintain revenue levels based on the 1992-93 biennium for the 1998-99 and the 1999-2000 biennium. SECTION 8. Amends Section 41.006, Education Code, to delete text regarding the foundation school fund budget committee. SECTION 9. Amends Section 42.005(a), Education Code, to conform the calculation of average daily attendance by deleting a portion of the calculation for the extended year program. SECTION 10. Amends Section 42.101, Education Code, to delete text regarding the foundation school fund budget committee. SECTION 11. Amends Section 42.102(b), Education Code, to delete text regarding the foundation school fund budget committee and to maintain the the cost of education index adjustment contained in Chapter 203, Title 19, Texas Administrative Code, as that chapter existed on January 1, 1997. SECTION 12. Amends Section 42.155(c), Education Code, to delete text regarding the foundation school fund budget committee. SECTION 13. Amends Section 42.252(e), Education Code, to authorize the commissioner of education (commissioner) to adjust a district's taxable values for local fund assignment, to the extent appropriations for that purpose are available. SECTION 14. Amends Sections 42.253(b) and (f), Education Code, to require the commissioner to base certain determinations on estimates from the General Appropriations Act. Makes conforming changes. SECTION 15. Amends Section 42.254, Education Code, to delete text regarding the foundation school fund budget committee. SECTION 16. Amends Section 42.302(a), Education Code, to redefine "GL" as the dollar amount guaranteed level of state and local funds per weighted student percent tax effort which is $21, rather than $20.55, or a greater amount for any year provided by appropriation. SECTION 17. Amends Section 42.303, Education Code, to prohibit the district enrichment and facilities tax rate from exceeding a certain amount for any year provided by appropriation. SECTION 18. Amends Section 45.003 (e), Education Code, to provide that a school district may not set a tax rate higher than the rate used in its filing with the attorney general except as necessary to compensate for declines in property value, state aid below the property value or state aid amounts used in the filing. SECTION 19. Amends Section 45.105(c), Education Code, to allow local funds to be expended for other purposes necessary in the conduct of the public schools. SECTION 20. Amends Section 74.066(b), Education Code, to delete text regarding the foundation school fund budget committee. SECTION 21. Amends Section 322.008(b), Government Code, to make conforming changes. SECTION 22. Amends Section 26.08(a) and (f), Tax Code to require a rollback election by the registered voters of a school district if the district adopts a tax rate that exceeds the district's rollback tax rate computed by Subsection (c). Makes a conforming change. SECTION 23. Repealer: Sections 42.102(c) and 56.208(d), Education Code (Funding). SECTION 24. Effective date: September 1, 1997. SECTION 25. Emergency clause. COMPARISON OF ORIGINAL TO SUBSTITUTE Much of the language in SB 1873 and CSSB 1873 is identical. However, the significant differences between SB 1873 and CSSB 1873 are that the substitute extends a current holdharmless provision by allowing districts to maintain revenue levels based on the 1992-93 biennium for the 1998-99 and the 1999-2000 biennium, retains certain rulemaking authority of the commissioner of education in regards to Chapter 41 and 42 of the Education Code which SB 1873 deleted, and retains the cost of education index adjustment as it existed on January 1, 1997 which SB 1873 had required the Legislative Budget Board to determine. CSSB 1873 also prohibits a school district from setting a tax rate higher than the rate used in its filing with the attorney general except as necessary to compensate for declines in property value, state aid below the property value or state aid amounts used in the filing. CSSB 1873 allows local funds to be expended for other purposes necessary in the conduct of public schools and requires a rollback election by the registered voters of a school district if the district adopts a tax rate that exceeds the district's rollback tax rate computed by Section 26.08(c), Tax Code. SB 1873 contains no language equivalent to any of these three provisions. SB 1873 does require school districts to submit to the Legislative Budget Board tax rate and student enrollment estimates which CSSB 1873 does not. Also, SB 1873 redefines "taxable value" to include market value less than the total dollar amount of any captured appraised value of property that is located in a reinvestment zone on August 31, 1997, generates a tax increment paid into a tax increment fund, and that is eligible for tax increment financing under Chapter 311, Tax code under a project plan or reinvestment zone financing plan approved under Section 311.011(d), Tax code, before September 1, 1997. CSSB 1873 has no equivalent provision. Finally, CSSB 1873 repeals Section 42.102(c) of the Education Code and SB 1873 does not.