SB 0658 - Fiscal Note

Fiscal Note - SB 0658 - Fund transfers and levy increases for capital projects for certain school districts

COMMITTEE ON LEGISLATIVE RESEARCH

OVERSIGHT DIVISION

FISCAL NOTE

L.R. NO. 2945-01

BILL NO. Truly Agreed To And Finally Passed SB 658

SUBJECT: Education, Elementary and Secondary: Capital Projects

TYPE: Original

DATE: April 29, 1998

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FISCAL SUMMARY

ESTIMATED NET EFFECT ON STATE FUNDS
FUND AFFECTED	FY 1999	FY 2000	FY 2001
None	$0	$0	$0
Total Estimated Net Effect on All State Funds	$0	$0	$0

ESTIMATED NET EFFECT ON FEDERAL FUNDS
FUND AFFECTED	FY 1999	FY 2000	FY 2001
None	$0	$0	$0
Total Estimated Net Effect on All Federal Funds	$0	$0	$0

ESTIMATED NET EFFECT ON LOCAL FUNDS
FUND AFFECTED	FY 1999	FY 2000	FY 2001
Local Government	$0	$0	$0

Numbers within parentheses: ( ) indicate costs or losses

This fiscal note contains 3 pages.

FISCAL ANALYSIS

ASSUMPTION

Officials from the State Tax Commission assume the proposal would have no fiscal impact on the agency.

Officials from the Department of Elementary and Secondary Education (DESE) assume the proposal would result in no fiscal impact to DESE. School districts could be impacted by the increase in the tax rate, but the impact is unknown.

Based on a response to a similar proposal from the prior year (SB 360), officials from the Department of Elementary and Secondary Education (DESE) assumed the various provisions related to the transfer of funds would increase the levy used on lines 1 and 2 of the foundation formula for certain districts. However, the language is so restrictive that any fiscal impact should be minimal.

FISCAL IMPACT - State Government	FY 1999	FY 2000	FY 2001
	0	0	0
FISCAL IMPACT - Local Government	FY 1999	FY 2000	FY 2001
	0	0	0
FISCAL IMPACT - Small Business

No direct fiscal impact to small businesses would be expected as a result of this proposal.

DESCRIPTION

For the 1997-98 school year and thereafter, prior to setting tax rates for the teachers' and incidental funds, the school boards meeting certain criteria annually would set the tax rate for the capital projects fund to meet the expenditures of the capital projects fund after all transfers allowed from the incidental fund for an obligation of the capital projects fund meeting certain conditions, not to exceed payments authorized under section 177.088 (facilities and equipment obtained by agreements with not for profit corporations) and after one hundred percent of the transfers allowed by section 165.011, RSMo.

DESCRIPTION (Continued)

School districts could borrow from the teachers' fund, incidental fund or capital projects fund to meet obligations in another of those funds, provided the full amount would be repaid to the lending fund in the same fiscal year.

A school district satisfying certain criteria could, on or before June 30, 1998, make a one-time combined transfer from the teachers' and incidental funds to the capital projects fund an amount no greater than the sum of specified amounts. Districts making the transfers would be subject to compliance with the requirements of section 165.016 (minimum amounts to be spent for tuition, retirement and compensation) for fiscal years 1999, 2000, and 2001, without the option to request a waiver or an adjustment of the base year certificated salary percentage. Transfers from the teachers' or incidental funds to the capital projects fund would not be considered expenditures from the funds for determining compliance with section 165.016.

The proposal contains an emergency clause.

This legislation is not federally mandated, would not duplicate any other program and would not require additional capital improvements or rental space.

SOURCES OF INFORMATION

State Tax Commission

Department of Elementary and Secondary Education

Jeanne Jarrett, CPA

Director

April 29, 1998