SENATE BILL REPORT

SB 5620

BYSenators Gaspard and Smitherman; by request of Superintendent of Public Instruction

Revising provision governing special school levies.

Senate Committee on Education

Senate Hearing Date(s):February 24, 1987

Senate Staff:Don Bennett (786-7424)

AS OF FEBRUARY 24, 1987

BACKGROUND:

Current law requires a five year phase-down of local levies to 10 percent of prior year state basic education allocation, plus categorical funds for pupil transportation, handicapped education, and gifted and compensatory programs.  This phase-down is to begin in 1988, for levies to be collected in 1989.  By 1993 all districts are to be at 10 percent as a maximum levy rate.

Most school districts have been allowed to maintain previous levy percentages by grandfather provisions giving a district the ability to use its 1985 actual levy percentage, the average levy percentage for all school districts in the state, or the average levy for the educational service district in which the school district is located.  The average levy percentage statewide is approximately 18 percent.  Currently over 80 percent of the state's total enrollment is in districts where the levy percentage exceeds 10 percent.  One-third of the state's total enrollment is in districts where the levy percentage exceeds 20 percent.

Local property taxpayers in two similar school districts may pay different tax rates to support the same levy amount in dollars due to differences in assessed valuation of property in the districts.

SUMMARY:

The maximum levy amount in dollars authorized in 1986 or 1987, for collection in 1988, is set at 20 percent of the district's prior year basic education allocation; plus 20 percent of the prior year allocation, excluding federal funds, for pupil transportation, handicapped education, gifted, and compensatory education; plus a non-high district factor where applicable.

The maximum levy amount as calculated above is reduced by the maximum amount of local effort assistance moneys the district could receive for each levy collected in 1989 and beyond.

Local levy percentage is phased-down in even increments beginning in 1989 by one-fourth of the percentage in excess of the 1985 base year levy rate.  In 1992 no district may exceed the 20 percent limitation on excess levy percentages.

State funds are provided to districts with local property tax rates exceeding the state average tax rate.  Funds are provided up to the lesser of a 10 percent levy amount or the district's actual levy amount;  multiplied by the percent difference between the local tax rate and the state average rate.

Fiscal Note:      requested