SENATE BILL REPORT

SB 6914

BYSenators Moore, Smitherman, Owen, Bender, Niemi, Rasmussen, Rinehart, Madsen, McMullen, Conner, Hansen, Talmadge, Murray, Fleming, Williams, Gaspard, Stratton, Bauer, Vognild and Warnke

Providing funds for school drop-out prevention programs.

Senate Staff:Ken Kanikeberg (786-7715)

AS OF JUNE 5, 1990

BACKGROUND:

A 1988 federal audit determined the SPI had violated federal law by supplanting state funds with federal funds for administrative purposes.  In response to this finding, the Legislature moved the funds from the administrative budget to the Schools for the 21st Century budget.

Subsequently the OFM, SPI, and the U.S. Department of Education determined federal funds could not be expended for the current 21st Century Schools program.  The funds were once again moved in 1990, this time a transfer of funds from the Schools for the 21st Century program to the State Dropout Retention and Retrieval program.

The SPI has determined this transfer of funds is also inappropriate as it violates federal supplant requirements.  On May 7, 1990, districts were notified that state funds were no longer available for the state dropout program.  Further, the SPI contends that the use of these federal funds for any existing state program is a violation of federal law.

The SPI has requested a supplemental state general fund appropriation to continue the current state dropout programs.  Absent this action, districts who received state funding in 1990 are not assured federal funding in 1991.

SUMMARY:

A $1,516,000 general fund-state appropriation is made to continue current dropout programs.  Intent language giving high priority to dropout programs when awarding federal grants is added.

Appropriation:  yes

Revenue:   none

Fiscal Note:    none requested

Effective Date:The bill contains an emergency clause and takes effect immediately.