Colorado Legislative Council Staff

STATE and LOCAL

CONDITIONAL FISCAL NOTE

TABOR Refund Impact

State Cash Fund Revenue and Expenditure Impact

School District Revenue Impact


Drafting Number:

Prime Sponsor(s):

LLS 98-069

Rep. Tool

Sen. J. Johnson

Date:

Bill Status:

Fiscal Analyst:

January 25, 1998

House Education

Harry Zeid (866-4753)

 

TITLE:            CONCERNING AN ASSISTANCE PROGRAM FOR SCHOOL DISTRICT CAPITAL CONSTRUCTION.


Summary of Legislation



STATE FISCAL IMPACT SUMMARY

FY 1998/99

FY 1999/2000

FY 2000/2001

State Revenues

General Fund

School Const. & Renovation Fund



 



*



*

State Expenditures

General Fund

School Const. & Renovation Fund - Admin.

School Const. & Renovation Fund - Grants


 



$145,986

*



$139,986

*

FTE Position Change - Contract Labor

None

2.0 FTE Contract

2.0 FTE Contract

Local Government ImpactSchool districts would be eligible to apply to the State Board of Education for loans for qualified capital construction projects. Moneys would be awarded beginning in FY 2000-01.

             *The amount of the transfer from the State Excess Revenue Trust Fund to the School Construction and Renovation Fund would be annually determined by the General Assembly.


            This bill would establish the School Construction and Renovation Fund in the State Treasury to consist of moneys transferred to the fund from the State Excess Revenue Trust Fund pursuant to Section 24-75-1102 (1) (a), as enacted by HB 98-1256. Moneys in the School Construction and Renovation Fund would be used to provide matching grants to school districts that are undertaking qualified capital construction projects and for the expenses incurred by the State Board of Education in the administration of the program. All interest derived from the deposit and investment of moneys in the fund would be credited to the fund.


            Matching grants of moneys from the School Construction and Renovation Fund would be used for school district capital construction projects involving instructional facilities including classrooms, libraries, physical plants, and associated administrative areas. The matching grants could not be used for a school district capital construction project involving athletic, recreational, or other non-instructional facilities.


            Applications would be submitted to the State Board of Education annually beginning in 1999, but no later than July 1. School districts would give consideration to the needs of both traditional public schools and charter schools. Applications would be evaluated and prioritized based on the following criteria in descending order:

 

               projects designed for immediate safety hazards or health concerns at existing school facilities;

               projects in a school district that has a lower relative wealth compared to other school districts in the state;

               projects that address enrollment growth issues within a school district;

               projects in school districts that have previously demonstrated consistent efforts to allocate moneys to the district’s capital reserve fund in excess of the minimum amounts required;

               projects designed to incorporate technology into the educational environment; and

               all other capital construction projects.


            The State Board of Education would submit a prioritized list of eligible capital construction projects to the Joint Budget Committee (JBC) no later than December 1 of each year for consideration for inclusion in the General Appropriation bill for the following budget year beginning with the 2000-01 fiscal year. The JBC would have the responsibility to determine the number of capital construction projects on the list that may receive matching grants from available moneys in the fund. The amount of the matching grant would be no more than the difference between the valuation for assessment per pupil within the school district proposing the capital construction project and the average valuation for assessment per pupil statewide, expressed as a percentage of the statewide average, multiplied by the cost of the capital construction project.


            The amount of annual transfer from the State Excess Revenue Trust Fund to the School Construction and Renovation Fund would be determined annually by the General Assembly. However, this would only occur upon the approval by the voters of HB 98-1256. Therefore, this bill is assessed as having conditional state and local fiscal impact.


            The bill will become effective at 12:01 a.m. on the day following the ninety-day period after adjournment sine die of the General Assembly, or on the date of the official declaration of the vote of the people as proclaimed by the Governor, if a referendum petition is filed pursuant to Article V, Section 1 (3) of the State Constitution.



TABOR Refund Impact


            Section 20 of Article X of the Colorado Constitution, limits the maximum annual percentage increase in state fiscal year spending. Once total state revenue from all sources that are not specifically excluded from fiscal year spending exceeds these limits for the fiscal year, the state constitution requires that the excess shall be refunded in the next fiscal year unless voters approve a revenue change as an offset. Based on the current Legislative Council economic forecast, it is projected that the state will be in a TABOR refund position during each of the next five fiscal years. Any increase or decrease in state revenue from changes in fees, fines, licenses, or other revenue sources will affect the amount of the state revenue to be refunded.



State Revenues


            The amount of annual transfer from the State Excess Revenue Trust Fund to the School Construction and Renovation Fund would be determined annually by the General Assembly. Moneys would be transferred in such a way that over a five-year period, approximately one-third of the aggregate amount transferred from the General Fund to the State Excess Revenue Trust Fund would be transferred to the School Construction and Renovation Fund.



State Expenditures


            The Department of Education will incur administrative expenses beginning in FY 1999-00 in order to provide staff support to the State Board of Education in prioritizing the grant awards from moneys in the School Construction and Renovation Fund. The Department of Education indicates that 2.0 FTE Contract Labor, Principal Consultant, would be required in order to provide staff support to the State Board of Education for prioritizing grant awards from moneys in the fund. Expenses associated with administration of the program are identified in the table below.


HB 98-1231 Department of Education Administrative Expenses

Expenditure Category

FY 1999-00

FY 2000-01

Personal Services

Operating Expenses

Travel

State Board Expenses

Capital Outlay

    Total

$121,986

6,000

6,000

6,000

       6,000

$145,986

$121,986

6,000

6,000

6,000

              --

$139,986



Expenditures Not Included


            Pursuant to the Joint Budget Committee’s budget policies, the following expenditures have not been included in this fiscal note:

 

               health and life insurance costs;

               short-term disability costs;

               inflationary cost factors;

               leased space; and

               indirect costs.


School District Impact


          School districts would be eligible to apply to the State Board of Education for matching grants to be used for qualified school district capital construction projects if moneys are made available by the General Assembly. Grants would be awarded beginning in FY 2000-01.



Spending Authority


          The fiscal note would imply that no appropriations or spending authority are required in FY 1998-99 to implement the provisions of the bill.



Departments Contacted

 

          Legislative Council                Education       Treasury