First Regular Session Sixty-eighth General Assembly STATE OF COLORADO INTRODUCED LLS NO. 11-0622.01 Julie Pelegrin SENATE BILL 11-001 SENATE SPONSORSHIP Bacon, Shaffer B. HOUSE SPONSORSHIP Kerr A., Senate Committees House Committees Education A BILL FOR AN ACT Concerning funding for public education, and, in connection therewith, creating the knowledge-based economy fund. Bill Summary (Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://www.leg.state.co.us/billsummaries.) In the bill, the general assembly recognizes the preeminent importance of funding public education and the need to prioritize funding for public education. The bill creates the knowledge-based economy fund (fund) that will consist of an amount of money equal to the amount by which the state general fund beginning balance for the 2011-12 fiscal year, as estimated in December 2011, exceeds the estimate of the beginning state general fund balance in March 2011, moneys received as a result of certain audits, and any additional moneys the general assembly may appropriate to the fund. The moneys credited to the fund as of January 1, 2012, are appropriated to the department of education for distribution to school districts and institute charter schools through a reduction in the state budget stabilization factor. Any moneys credited to the fund after January 1, 2012, but prior to June 30, 2012, may be used as supplemental appropriations to the department of education for school districts and charter schools. The fund repeals on July 1, 2012. Be it enacted by the General Assembly of the State of Colorado: SECTION 1. Article 75 of title 24, Colorado Revised Statutes, is amended BY THE ADDITION OF A NEW PART to read: PART 14 KNOWLEDGE-BASED ECONOMY FUND 24-75-1401. Legislative declaration. (1) The general assembly finds that: (a) In difficult economic times, the general assembly must be exceptionally vigilant in prioritizing the appropriation of public moneys to fund those services that most directly influence the success of the state and its citizens; (b) Of all of the services provided by state and local government, public education exercises the most widespread, direct influence on the citizens of the state, ensuring them a wider range of opportunities and a greater likelihood of economic success; (c) In providing a well-educated citizenry, a well-funded, effective public education system also increases the likelihood that the state will enjoy a strong economy that attracts investment by businesses and industries that further improve the standard of living for the people of the state; and (d) During periods of budgetary reductions, it is crucial that the state maintains funding for public education to the greatest extent possible. In considering funding for services and programs other than education, the general assembly should specifically balance the necessity of funding that service or program against the necessity of funding the state's public education system. (2) The general assembly finds, therefore, that it is in the best interests of the state to create the knowledge-based economy fund that may receive any amount of state moneys that exceeds the amount anticipated for the 2011-12 fiscal year or that the general assembly finds would be most appropriately spent to enhance the public education system in the state. 24-75-1402. Knowledge-based economy fund - created - revenues - repeal. (1) There is hereby created in the state treasury the knowledge-based economy fund, referred to in this part 14 as the "fund", that shall consist of the moneys specified in subsection (2) of this section. Any moneys in the fund not expended for the purpose of this part 14 may be invested by the state treasurer as provided by law. All interest and income derived from the investment and deposit of moneys in the fund shall be credited to the fund. Any unexpended and unencumbered moneys remaining in the fund at the end of a fiscal year shall remain in the fund and shall not be credited or transferred to the general fund or another fund; except that any moneys remaining in the fund as of June 30, 2012, shall be transferred to the general fund. (2) (a) The state treasurer shall credit the following amounts of moneys to the fund: (I) Any amount required to be credited pursuant to section 24-75-220; and (II) Any amounts received through audits of state programs, including but not limited to recovery audits conducted pursuant to section 24-30-203.5, less any amounts paid to the entity conducting the audits, less any amounts retained by the state controller pursuant to section 24-30-203.5 (5), and less any federal moneys that may be recovered; except that the provisions of this subparagraph (II) do not apply to audits conducted by the department of education pursuant to section 22-54-114, C.R.S.; (b) The fund shall also include any moneys the general assembly may appropriate to the fund. (3) (a) The amount of moneys credited to the fund as of January 1, 2012, is appropriated for the 2011-12 fiscal year to the department of education for distribution to school districts and institute charter schools through a reduction in the state budget stabilization factor calculated pursuant to section 22-54-104 (5) (g), C.R.S. (b) The general assembly may appropriate the amount of moneys that the state treasurer may credit to the fund after January 1, 2012, but prior to June 30, 2012, as supplemental appropriations to the department of education for distribution to school districts and institute charter schools. 24-75-1403. Repeal of part. This part 14 is repealed, effective July 1, 2012. SECTION 2. Part 2 of article 75 of title 24, Colorado Revised Statutes, is amended BY THE ADDITION OF A NEW SECTION to read: 24-75-220. Transfers - education - repeal. (1) No later than January 1, 2012, the state treasurer shall transfer from the general fund to the knowledge-based economy fund created in part 14 of this article the amount, if any, by which the estimate of total moneys available for the 2011-12 fiscal year specified in the economic and revenue forecast prepared by the legislative council staff in December 2011 exceeds the estimate of the total moneys available for the 2011-12 fiscal year specified in the economic and revenue forecast prepared by the legislative council staff in March 2011. (2) This section is repealed, effective July 1, 2012. SECTION 3. 22-54-104 (5), Colorado Revised Statutes, is amended BY THE ADDITION OF A NEW PARAGRAPH to read: 22-54-104. District total program. (5) For purposes of the formulas used in this section: (h) Notwithstanding any provision of paragraph (g) of this subsection (5) to the contrary, for the 2011-12 budget year, the department of education shall use any amount of moneys appropriated to the department pursuant to section 24-75-1402 (3), C.R.S., to reduce the state budget stabilization factor calculated pursuant to paragraph (g) of this subsection (5). SECTION 4. Safety clause. The general assembly hereby finds, determines, and declares that this act is necessary for the immediate preservation of the public peace, health, and safety.