HOUSE BILL No. 4418 March 5, 1997, Introduced by Rep. Hood and referred to the Committee on Appropriations. A bill to amend 1979 PA 94, entitled "The state school aid act of 1979," by amending sections 11 and 17b (MCL 388.1611 and 388.1617b), as amended by 1996 PA 300. THE PEOPLE OF THE STATE OF MICHIGAN ENACT: 1 Sec. 11. (1)There is appropriated for the public schools2of this state and certain other state purposes relating to educa-3tion from the state school aid fund established by section 11 of4article IX of the state constitution of 1963 the sum of5$7,618,289,000.00, and from the general fund the sum of6$594,052,000.00, for the fiscal year ending September 30, 1996.7In addition, available federal funds are appropriated for81995-96. Also, an additional $26,000,000.00 is appropriated for91995-96 from the uninsured employers' security fund to the state10school aid fund, and that $26,000,000.00 is then appropriated for02674'97 TAV 2 11995-96 from the state school aid fund to be used for the2purposes of this act.There is appropriated for the public 3 schools of this state and certain other state purposes relating 4 to education from the state school aid fund established by sec- 5 tion 11 of article IX of the state constitution of 1963 the sum 6 of$8,183,200,000.00$__________.00, and from the general fund 7 the sum of$299,900,000.00$__________.00, for the fiscal year 8 ending September 30,19971998.Also, there is appropriated9an additional $33,000,000.00 from the state school aid fund for10the fiscal year ending September 30, 1997. However, if the11director of the department of management and budget determines12that the federal government has failed to enact comprehensive13reforms in the federal cash welfare and medicaid programs by14October 1, 1996, and notifies the senate and house appropriations15committees of that determination, there is instead appropriated16for 1996-97 from the state school aid fund the sum of17$8,230,000,000.00, and from the general fund the sum of18$286,100,000.00. In addition, there is created in the state19school aid fund a separate contingency fund in an amount equal to20this $13,800,000.00 adjustment and there is created in the gen-21eral fund a separate contingency fund in an amount equal to this22$13,800,000.00 adjustment. Contingency fund transfers are autho-23rized for 1996-97 in an amount necessary to reverse these24adjustments. These transfers shall conform with the provisions25of section 393(2) of the management and budget act, Act No. 43126of the Public Acts of 1984, being section 18.1393 of the Michigan27Compiled Laws. Transfers may restore all or part of each02674'97 3 1adjustment.In addition, available federal funds are 2 appropriated for1996-971997-98. 3(2) In addition to the appropriations under subsection (1),4for the fiscal year ending September 30, 1996 there is appropri-5ated $174,500,000.00 from the reserve for health benefits for the6purposes of this act. From the general fund money appropriated7in subsection (1) for the fiscal year ending September 30, 1997,8there is appropriated from the general fund the sum of9$96,638,400.00 to the local government payment fund for the pur-10pose of maintaining the state spending to local units of govern-11ment as required by section 30 of article IX of the state consti-12tution of 1963 for the fiscal year ending September 30, 1993.13For the fiscal year ending September 30, 1997, there is appropri-14ated from the local government payment fund the sum of15$96,638,400.00 to the general fund for transfer to the state16school aid fund to support the purposes of this act for the171996-97 fiscal year.18 (2)(3)The appropriations under this section shall be 19 allocated as provided in this act. Money appropriated under this 20 section from the general fund, from the reserve for health21benefits,and from available federal funds shall be expended to 22 fund the purposes of this act before the expenditure of money 23 appropriated under this section from the state school aid fund. 24 If the maximum amount appropriated under this section from the 25 state school aid fund for a fiscal year exceeds the amount neces- 26 sary to fully fund allocations under this act from the state 27 school aid fund, that excess amount shall not be expended in that 02674'97 4 1 state fiscal year and shall not lapse to the general fund, but 2 instead shall remain in the state school aid fund. 3 (3)(4)If the maximum amount appropriated under this sec- 4 tion from the state school aid fund for a fiscal year exceeds the 5 amount available for expenditure from the state school aid fund 6 for that fiscal year, payments under each section of this act 7 shall be prorated on an equal percentage basis as necessary to 8 reflect the amount available for expenditure from the state 9 school aid fund for that fiscal year. However, beginning in 10 1996-97, if the department of treasury determines that proration 11 will be required under this subsection, the department of trea- 12 sury shall notify the director of the department of management 13 and budget, and the director of the department of management and 14 budget shall notify the legislature at least 30 calendar days or 15 6 legislative session days, whichever is more, before the depart- 16 ment reduces any payments under this act because of the 17 proration. During the 30 calendar day or 6 legislative session 18 day period after that notification by the director of the depart- 19 ment of management and budget, the department shall not reduce 20 any payments under this act because of proration under this 21 subsection. The legislature may prevent proration from occurring 22 by, within the 30 calendar day or 6 legislative session day 23 period after that notification by the department of management 24 and budget, enacting legislation appropriating additional funds 25 from the general fund, countercyclical budget and economic stabi- 26 lization fund, state school aid fund balance, or another source 27 to fund the amount of the projected shortfall. 02674'97 5 1 Sec. 17b. (1) Not later than October 20, November 20, 2 December 20, January 20, February 20, March 20, April 20, May 20, 3 and June 20, the department shall prepare a statement of the 4 amount to be distributed under this act in the installment to the 5 districts and intermediate districts and deliver the statement to 6 the state treasurer, and the state treasurer shall pay the 7 installments on each of those dates or on the next business day 8 following each of those dates. Except as otherwise provided in 9 this act, the portion of the district's or intermediate 10 district's state fiscal year entitlement to be included in each 11 installment shall be 1/9.However, the payments due to a dis-12trict in 1996-97 on April 20, May 20, and June 20 pursuant to13this section each shall be reduced by an amount equal to 1/3 of14the district's total additional payments in 1995-96 under section1520g.16 (2) The state treasurer shall make payment under this sec- 17 tion by drawing a warrant in favor of the treasurer of each dis- 18 trict or intermediate district for the amount payable to the dis- 19 trict or intermediate district according to the statement and 20 delivering the warrant to the treasurer of each district or 21 intermediate district, or if the state treasurer receives a writ- 22 ten request by the treasurer of the district or intermediate dis- 23 trict specifying an account, by electronic funds transfer to that 24 account of the amount payable to the district or intermediate 25 district according to the statement. The department may make 26 adjustments in payments made under this section through 27 additional payments when changes in law or errors in computation 02674'97 6 1 cause the regularly scheduled payment to be less than the amount 2 to which the district or intermediate district is entitled pursu- 3 ant to this act. 4 (3) Except as otherwise specified in this act, grant pay- 5 ments under this act shall be paid according to subsection (1). 6 (4) Upon the written request of a district or intermediate 7 district and the submission of proof satisfactory to the depart- 8 ment of a need of a temporary and nonrecurring nature, the super- 9 intendent, with the written concurrence of the state treasurer 10 and the director of management and budget, may authorize an 11 advance release of funds due a district or intermediate district 12 under this act. Such an advance shall not cause funds to be paid 13 to a district or intermediate district more than 30 days earlier 14 than the established payment date for those funds. 02674'97 Final page. TAV