HOUSE SUBSTITUTE NO. 2
HOUSE BILL NO. 429
AN ACT TO AMEND CHAPTER 17, TITLE 14 OF THE DELAWARE CODE RELATING TO THE DIVISION III FORMULA AND FUNDING.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF DELAWARE:
Section 1. Amend Section 1707, Chapter 17, Title 14 of the Delaware Code by striking said section in its entirety and substituting in lieu thereof the following:
"§1707. Division III - Equalization Funding
Any school district which provides funds from local taxation for current operating expenses in excess of basic state appropriations, under Divisions I and II of this Chapter, shall be eligible for state funds on a matching basis in accordance with the provisions set out in this section.
In the application of the formula, the following definitions shall apply:
'School district ability' means the total full valuation of all taxable real property within the school district as of July 1 of the fiscal year for which Division III funds are appropriated, divided by the number of units of pupils, excluding those units in special schools administered by a school district which are supported by a tuition tax, in the public schools of the school district as of September 30 of the fiscal year for which Division III funds are appropriated. In the case of a vocational-technical school district, the school district ability shall be determined by dividing the total full valuation of all taxable real property located within the vocational-technical school district by the total number of units in the public schools located in the vocational-technical school district's attendance area, excluding those units assigned to special schools as defined herein and those units assigned to the vocational-technical school district, as of September 30 of the fiscal year for which Division III funds are appropriated.
'State average ability' means the total full valuation of all taxable real property in the state divided by the total number of units of pupils in the public schools of the state, excluding those units assigned to vocational-technical school districts and those assigned to special schools as defined in §1707 (b)(1), as of September 30 of the fiscal year for which Division III funds are appropriated.
'Authorized amount' means $7385 per unit for fiscal year 1985; $9600 per unit for fiscal year 1986; $13950 per unit for fiscal year 1987; and as established in the annual state Budget Act thereafter.
'Units of pupils' means the total number of Division I units as specified in §1703 of this Chapter.
'Total full valuation' means the total assessed valuation of taxable real property as divided by the aggregate assessment to sales price ratio for all types of realty for each county, as presented in the 1982 Taxable Property Values and Assessments Survey for Delaware conducted by the United States Bureau of Census, for fiscal year 1985 and subsequently as determined by the Budget Office by conducting, in accordance with nationally accepted standards and practices, assessment to sales price studies by school district at least every five years. Such studies shall be open to public review. In the event a county completes a general reassessment during the period between studies, the county's assessment to sales price ratio shall be equal to its rate of assessment, until a subsequent assessment to sales price study is completed.
'Total assessed valuation' means the official total assessed value of taxable real property appearing on the assessment rolls of appropriate county governing body or bodies as the case may be.
'Ability index' means the school district ability divided by the state average ability.
'School district current expense revenue' means the product of the school district's current operating expense real estate tax rate times the total assessed valuation as of July 1 of the fiscal year for which Division Ill funds are appropriated plus the product of the school district's capitation tax for current operating expense times the number of capitations as of July 1 of the fiscal year for which Division III funds are appropriated. 'School district effort' means the school district current expense revenue divided by the school district's total full valuation. In the case of a county vocational-technical school district, the school district effort means the school district current expense revenue divided by the total number of units of pupils in the district divided by the district ability.
'State average effort' means the authorized amount times 75% divided by the state average ability.
'Effort index' means the school district effort divided by the state average effort. The effort index for any school district shall not be greater than one (1).
The formula for determining the sums to be allocated in behalf of Division III shall be as provided in this subsection. The state share per unit is equal to the authorized amount times the effort index times the quantity of one (1) minus 75% times the ability index, provided that in no case shall the state share be less than the equivalent of 10% of the authorized amount times the effort index. The state share for special schools as defined in §1701 (b)(1) shall be equal to the state share for the local school district administering the special school. The state share per unit for any school district in fiscal year 1985 shall not be less than 130% of the state share per unit to which the school district was entitled during fiscal year 1984. The state share per unit for any school district in fiscal year 1986 shall not be less than 110% of the state share per unit to which the district was entitled during fiscal year 1985. The state share per unit for any school district in subsequent years shall not be less than the state share per unit to which the school district was entitled during fiscal year 1986.
Division III funds shall be utilized to supplement funds appropriated under Division I and II for the purpose of advancing education beyond the level authorized through the basic appropriations in Divisions I and II or through any other state or federal appropriation.
For the purpose of determining the combined local share of Division III, the districts created pursuant to §1028(k) of this Title shall be treated as one district for that portion of the local share attributed to the current operating expense monies generated by the common tax district. Such funds shall be distributed among those districts equally on a per unit basis. Such district shall be treated individually for that portion of the local share attributed to current operating expense monies generated by a school district beyond the tax rate established for current operating expense within the common tax district.
A committee, comprised of three local school board presidents, one from each county, appointed by the Speaker of the House and the President Pro Tempore of the Senate; the Superintendent of Public Instruction; the Controller General; and the Secretary of the Department of Finance; or their designees, shall be formed to monitor and review the implementation of this program, including the assessment to sales price ratio studies, and to recommend modifications as they are needed. The committee shall issue a report of its findings and recommendations by January 1 annually to the Governor and to members of the Joint Finance Committee, and such report shall be made available to members of the general public upon request."
Section 2. This Act shall become effective on July 1, 1984.
Approved July 2, 1984.