SS HCS HB 641 & 593 -- EDUCATION

This bill contains provisions relating to special education,
school administration and other education matters.

SPECIAL EDUCATION

The bill removes references to specific sums of state aid for
various services in educating handicapped and gifted children
and establishes a new formula for allocation of these funds.
The formula places equal emphasis on professional and
paraprofessional staff members providing educational services to
handicapped and severely handicapped children, whether during
the school day or an extended day, and on eligible pupils. An
additional category of aid is established based on pupils
domiciled in the district attending nonpublic schools.
Implementation for the staff- and pupil-based categories will
begin with funds distributed based on staff and will be complete
when balance is achieved between staff-based and pupil-based
funding. A hold-harmless clause prevents districts from
receiving less special education aid than they did before
implementation.

Aid is also established for services to homebound students or by
contract with a public or private agency, extended school year
services, and educational services provided by the Division of
Youth Services; these are to receive sufficient allocations
before funds are allocated for the staff- and pupil-based aid.
Aid for remedial reading classes and for gifted children is
established, with the proviso that such programs will not
receive special education funds allocable on the staff-pupil
basis. The percentage cap for cost recovery for administrative,
educational, and related services to handicapped children
between the ages of 3 and 5 is raised from 77% to 90%, with the
proviso that such programs will not receive special education
funding allocable on the staff-pupil basis.

Current law does not permit school districts to recover their
costs in excess of revenues for educating certain children when
public agencies place them in school districts other than the
parent's district of residence.  This bill permits education
costs which are not reimbursed by the sending school district or
state aid to be paid by the Department of Elementary and
Secondary Education (DESE), as soon as funds are appropriated,
for children placed by the Department of Social Services or a
court.  DESE will also cover such costs for children placed by
the Department of Mental Health (DMH) in facilities or programs
run by DMH.

SCHOOL ADMINISTRATION AND AID-RELATED PROVISIONS

The bill exempts the lease-purchase of school buses from the
January 1, 1997, moratorium on transfers of operating funds to
capital projects funds for such purchases.  Protested taxes will
be deducted from a district's entitlement at 90% of their value
in the year received, and current year's protested taxes held in
escrow will not be deducted.  A district with an estimated
current year assessed valuation that is more than 10% below the
previous year's equalized assessed valuation may use the
estimated figure, but must pay interest on overpaid aid. School
districts are required to include average per-pupil expenditures
for each building in their annual public report only when there
is more than one building housing a particular grade. Currently,
a principal must report to local law enforcement agencies any
act that would be a third degree assault if committed by an
adult.  Under this bill, if the superintendent has completed a
written agreement with local law enforcement, a principal who
knows of such an act will report in accordance with the
agreement. School districts do not have to follow the contested
case procedures of the administrative procedures act in
proceedings on a student's right to attend school or receive
academic credit, as long as appropriate due process is afforded
to the student, who has the right to a new trial in circuit
court.

OTHER PROVISIONS

School-related definitions are updated in terminology and the
definition of a school is changed so that it may encompass just
one grade, rather than the current requirement of at least 2
grades.  Any board or commission member may contribute the per
diem or expense reimbursement for service on that board or
commission to the Youth Services Treatment Fund, used for
counseling and treatment of abused children.

The bill also places any rule promulgated under its authority
under certain standards for withstanding a challenge, requires
the court to award reasonable fees and expenses to any
prevailing party in such a challenge, and requires that rules
promulgated pursuant to the bill expire on August 28th of the
year after they become effective unless extended by statute.
These rules provisions have a conditional termination date. In
addition, rulemaking authority delegated prior to the effective
date of the bill is repealed.  A statement of nonseverability
applies to this provision.

HCS HB 641 & 593 -- STATE AID FOR SPECIAL EDUCATION (Fitzwater)

The substitute removes references to specific sums of state aid
for various services in educating handicapped and gifted
children and establishes entitlement to state aid for certain
educational services.   A new formula for allocation places
equal emphasis on staff members and on eligible pupils, in
contrast to the current method which specifies an amount of
money per special education classroom with additional funding
based on staff.

The substitute establishes 2 main funding entitlements, based
upon: (1) professional and paraprofessional staff members who
provide educational services to handicapped and severely
handicapped children, whether during the school day or an
extended day; and (2) pupil count.  An additional entitlement,
at 50% of the pupil-based rate, is established based on pupils
domiciled in the district who attend nonpublic schools,
including home-schooled children.  Implementation for the staff-
and pupil-based entitlements will begin with funds distributed
based on staff and will be complete when balance is achieved
between staff-based and pupil-based funding. A hold-harmless
clause prevents districts from receiving less special education
aid than was received before implementation.

Entitlements are also established for services to homebound
students or by contract with a public or private agency,
extended school year services, and educational services provided
by the Division of Youth Services; these entitlements are to
receive sufficient allocations before funds are allocated for
the staff- and pupil-based entitlements.  Entitlements are
established for remedial reading classes and for gifted
children, with the proviso that such programs will not receive
special education funds allocable on the staff-pupil basis.

The percentage cap for cost recovery for administrative,
educational, and related services to handicapped children
between the ages of 3 and 5 is raised from 77% to 90% of
approved costs, with the proviso that such programs will not
receive special education funding allocable on the staff-pupil
basis.  Contractors providing special services must meet
licensing and certification requirements appropriate to their
duties.

Current law does not permit school districts to recover their
costs in excess of revenues for educating certain children when
public agencies place them in school districts other than the
parent's district of residence.  This substitute permits
education costs which are not reimbursed by the sending school
district or state aid to be paid by the Department of Elementary
and Secondary Education (DESE), as soon as funds are
appropriated, for children placed by the Department of Social
Services (DSS) or a court.  DESE will also cover such costs for
children placed by the Department of Mental Health (DMH) in
facilities or programs run by DMH.  Duplicative provisions
specifying how the costs of special education are allocated when
handicapped children have a domicile in one district but reside
and attend school in a different district are repealed.

The substitute also places any rule promulgated under its
authority under certain standards for withstanding a challenge,
requires the court to award reasonable fees and expenses to any
prevailing party in such a challenge, and requires that rules
promulgated pursuant to the substitute expire on August 28th of
the year after they become effective unless extended by
statute.  These rules provisions have a conditional termination
date.

FISCAL NOTE:  Estimated Net Cost to General Revenue Fund of
$1,933,500 in FY 1998, $1,933,500 to $7,733,500 in FY 1999, &
$1,933,500 to $7,733,500 in FY 2000.

HCS HB 641 & 593 -- STATE AID FOR SPECIAL EDUCATION

CO-SPONSORS:  Stoll (Fitzwater)

COMMITTEE ACTION:  Voted "do pass" by the Committee on Education
- Elementary and Secondary by a vote of 24 to 0.

The substitute removes references to specific sums of state aid
for various services in educating handicapped and gifted
children and establishes entitlement to state aid for certain
educational services.   A new formula for allocation places
equal emphasis on staff members and on eligible pupils, in
contrast to the current method which specifies an amount of
money per special education classroom with additional funding
based on staff.

The substitute establishes 2 main funding entitlements, based
upon: (1) professional and paraprofessional staff members who
provide educational services to handicapped and severely
handicapped children, whether during the school day or an
extended day; and (2) pupil count.  An additional entitlement,
at 50% of the pupil-based rate, is established based on pupils
domiciled in the district who attend nonpublic schools,
including home-schooled children.  Implementation for the staff-
and pupil-based entitlements will begin with funds distributed
based on staff and will be complete when balance is achieved
between staff-based and pupil-based funding. A hold-harmless
clause prevents districts from receiving less special education
aid than was received before implementation.

Entitlements are also established for services to homebound
students or by contract with a public or private agency,
extended school year services, and educational services provided
by the Division of Youth Services; these entitlements are to
receive sufficient allocations before funds are allocated for
the staff- and pupil-based entitlements.  Entitlements are
established for remedial reading classes and for gifted
children, with the proviso that such programs will not receive
special education funds allocable on the staff-pupil basis.

The percentage cap for cost recovery for administrative,
educational, and related services to handicapped children
between the ages of 3 and 5 is raised from 77% to 90% of
approved costs, with the proviso that such programs will not
receive special education funding allocable on the staff-pupil
basis.  Contractors providing special services must meet
licensing and certification requirements appropriate to their
duties.

Current law does not permit school districts to recover their
costs in excess of revenues for educating certain children when
public agencies place them in school districts other than the
parent's district of residence.  This substitute permits
education costs which are not reimbursed by the sending school
district or state aid to be paid by the Department of Elementary
and Secondary Education (DESE) for children placed by the
Department of Social Services (DSS) or a court.  DESE will also
cover such costs for children placed by the Department of Mental
Health (DMH) in facilities or programs run by DMH.  Duplicative
provisions specifying how the costs of special education are
allocated when handicapped children have a domicile in one
district but reside and attend school in a different district
are repealed.

FISCAL NOTE:  Estimated Net Cost to General Revenue Fund of
$1,933,500 for FY 1998, $1,933,500 to $7,733,500 for FY 1999,
and $1,933,500 to $7,733,500 for FY 2000.

PROPONENTS:  Supporters of HB 593 say that Districts have been
absorbing the excess costs of special education services to
children who are placed in the district by a court, DSS, or DMH.
The bill shifts the burden of paying for the excess costs from
the district to the state. Although DESE can be billed for
services to children in residential facilities, the lack of
these facilities means that more children are being placed in
other forms of care, often in districts far from their home; the
costs of services to these children are not currently
reimbursable.  Since education costs for some of these children
can easily reach over $10,000, it does not take many to stress a
district financially.  The bill also makes DESE the central
collection point, rather than having each district bill multiple
other districts.  This should eliminate collection problems.
The task force on special education costs and DMH supports this
bill.

Supporters of HB 641 say that this bill redesigns how special
education funds are allocated. A task force on special education
funding, begun in 1995, has recommended these changes. Special
education funding has been essentially frozen since Senate Bill
380 in order to implement the foundation formula.  The current
per-classroom basis for funding, which is not sensitive to
different levels of need, will be replaced with a balance
between an allocation based on staff and an allocation based on
pupils. Currently, only hired staff garners aid; contract staff
does not, so that smaller districts that are forced to contract
out services such as occupational or physical therapy must find
the funds elsewhere.  A census of pupils provides a basis for
funding that helps areas in which private schools absorb a
significant amount of the pupil base, leaving a disproportionate
number of special education students to the public school
system.  This bill will allow more flexibility to the districts
in how they use their special education funds in dealing with
all these situations.  Early childhood special education is
required by the federal government, but the Hancock amendment
prevents local districts from being forced to pay for it.
Raising the allowable percentage of recoverable costs to 90%
provides flexibility in case of a federal funding cutback.

Testifying for the both bills were School Administrators
Coalition; Missouri State Teachers Association; Council for
Exceptional Children; and Council for Administrators of Special
Education.

Testifying for HB 593 were Representatives Hartzler (123) and
Monaco; Department of Elementary and Secondary Education; Belton
School District; Missouri Child Care Association; Missouri
National Education Association; and Cooperating School Districts
of Greater Kansas City.

Testifying for HB 641 were Representatives McClelland and
Fitzwater; and Paraquad., Inc.

OPPONENTS:  There was no opposition voiced to the committee.

Becky DeNeve, Research Analyst

HB 641 -- State Aid for Special Education

Co-Sponsors:  Fitzwater, McClelland

This bill removes references to specific sums of state aid to
school districts and special school districts for various
services in educating handicapped and gifted children and
establishes the entitlement to state aid for certain educational
services.   A new formula for allocation places equal emphasis
on entitlement based on staff members and on eligible pupils, in
contrast to the current method which specifies an amount of
money per special education classroom with additional funding
based on staff.

The bill establishes 2 main funding entitlements: (1) based upon
professional and paraprofessional staff members who provide
educational services to handicapped and severely handicapped
children, whether during the school day or an extended day; and
(2) based on the eligible pupil count.  An additional
entitlement, at 50% of the pupil-based rate, is established for
pupils domiciled in the district who attend nonpublic schools,
including home-schooled children.  The bill also establishes an
implementation schedule for the staff- and pupil-based
entitlements, with a hold-harmless clause to prevent districts
from receiving less special education aid than was received in
the year before implementation was begun.   Implementation will
begin with funds distributed based on staff and will be complete
when balance is achieved between staff-based and pupil-based
funding.

Entitlements to aid are also established for services provided
to homebound students or by contract with a public or private
agency, extended school year services, and educational services
provided by the Division of Youth Services; these entitlements
are to receive sufficient allocations before funds are allocated
for the staff- and pupil-based entitlements.  Entitlements are
established for remedial reading classes and for education of
gifted children, with the proviso that such programs will not
receive special education funds allocable on the staff-pupil
basis.

The percentage cap for recovery of costs of administrative,
educational, and related services provided to handicapped
children between the ages of 3 and 5 is raised from 77% to 90%
of approved costs, with the proviso added that such programs
will not receive special education funding allocable on the
staff-pupil basis.  Contractors providing special services must
meet licensing and certification requirements appropriate to
their duties.