HB612: (New Title) making certain changes to the allocation of catastrophic aid expenditures.

HB 612-FN-LOCAL - AS AMENDED BY THE HOUSE

15Jan2004... 2482h

2003 SESSION

03-0108

04/10

HOUSE BILL 612-FN-LOCAL

AN ACT making certain changes to the allocation of catastrophic aid expenditures.

SPONSORS: Rep. Itse, Rock 80; Rep. Boyce, Belk 31; Sen. Boyce, Dist 4

COMMITTEE: Education

AMENDED ANALYSIS

This bill changes the formula used to determine liability for catastrophic aid expenses.

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Explanation: Matter added to current law appears in bold italics.

Matter removed from current law appears [in brackets and struckthrough.]

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

15Jan2004... 2482h

03-0108

04/10

STATE OF NEW HAMPSHIRE

In the Year of Our Lord Two Thousand Three

AN ACT making certain changes to the allocation of catastrophic aid expenditures.

Be it Enacted by the Senate and House of Representatives in General Court convened:

1 Special Education; State Aid. Amend RSA 186-C:18, III-IV to read as follows:

III.(a) The state board of education through the commissioner, department of education, shall distribute aid available under this paragraph as entitlement to such school districts as have a special education pupil for whose costs they are responsible, for whom the costs of special education in the fiscal year [exceed 3 1/2] exceeds the sum of 3 times the estimated state average expenditure per pupil for the school year preceding the year of distribution plus any additional federal funds received by a school district for educationally disabled children, or court-ordered placements, or both. If in any year, the amount appropriated for distribution as catastrophic special education 186-C:18 aid in accordance with this section is insufficient therefor, the appropriation shall be prorated proportionally based on entitlement among the districts entitled to a grant. If there are unexpended funds appropriated under this paragraph at the end of any fiscal year, such funds shall be distributed for court-ordered placements under RSA 186-C:19-b. Any funds remaining after distribution for court-ordered placements shall be distributed to school districts in proportion to the number of educationally disabled pupils in each school district. The state may designate up to $250,000 of the funds which are appropriated as required by this paragraph, for each fiscal year, to assist those school districts which, under guidelines established by rules of the state board of education, may qualify for emergency assistance for special education costs. Upon application to the commissioner of education, and approval by the commissioner, such funds may be accepted and expended by school districts in accordance with this chapter; provided, however, that if a school district has received emergency assistance funds for certain educationally disabled children, it shall not receive catastrophic special education aid for those same educationally disabled children. If any of the funds designated for emergency assistance under this paragraph are not used for such emergency assistance purposes, the funds shall be used to assist school districts in meeting catastrophic cost increases in their special education programs as provided by this paragraph.

(b) The school district shall be liable for [3-1/2] 3 times the estimated state average expenditure per pupil for the school year preceding the year of distribution, plus any additional federal funds received by a school district for educationally disabled children, or court-ordered placements, or both plus 20 percent of the additional cost, up to [10] 8 times the estimated state average expenditure per pupil for the school year preceding the year of distribution.

(c) The department of education shall be liable for 80 percent of the cost above the [3 1/2] 3 times the estimated state average expenditure per pupil for the school year preceding the year of distribution, plus any additional federal funds received by a school district for educationally disabled children, or court-ordered placements, or both, up to [10] 8 times the estimated state average expenditure per pupil for the school year preceding the year of distribution. The department of education shall be liable for all costs in excess of [10] 8 times the estimated state average expenditure per pupil for the school year preceding the year of distribution.

(d) Upon the effective date of this subparagraph, any additional federal special education funds received by school districts shall be dedicated for distribution as catastrophic aid in accordance with this paragraph.

(e) Beginning November 1, 2004, and annually thereafter, the governing body of the school district shall submit a report to the house and senate finance committees detailing all federal special education funds received in the immediately preceding school year including an accounting of how such funds were expended.

IV. The state shall appropriate $300,000 for each fiscal year to assist special education programs that are statewide in their scope, and that meet the standards for such programs established by the state board of education. Funds under this paragraph shall be administered and distributed by the state board of education through the commissioner.

2 Special Education; State Aid. Amend RSA 186-C:18, VIII to read as follows:

VIII. A school district shall raise, appropriate and expend funds, reflecting the total cost in meeting catastrophic special education student costs as provided under RSA 186-C:18, including the school district and department of education liability. A school district may issue reimbursement anticipation notes as provided for in RSA 198:20-d to be redeemed upon receipt of reimbursement from the state. The department of education shall be liable for the cost of the school districts borrowing of any funds for special education student costs over [3 ½] 3 times the estimated state average expenditure per pupil for the school year preceding the year of distribution plus any additional federal funds received by a school district for educationally disabled children, or court-ordered placements, or both.

3 Effective Date. This act shall take effect 60 days after its passage.

LBAO

03-0108

Amended 2/2/04

HB 612 FISCAL NOTE

AN ACT making certain changes to the allocation of catastrophic aid expenditures.

FISCAL IMPACT:

The Department of Education indicates this bill, as amended by the House (Amendment #2003-2482h), will have an indeterminable fiscal impact on state general fund expenditures and local revenue in FY 2005 and each year thereafter. There will be no fiscal impact on state and county revenue or county and local expenditures.

METHODOLOGY:

The Department states this bill changes the current reimbursement guidelines for catastrophic aid. Currently, the state pays catastrophic aid to a district that has a special education student for whom the cost of special education exceeds 3½ times the estimated state average expenditure per pupil according to the following guidelines. For those costs that are greater than 3 ½ times but less than 10 times the state average, the state pays 80%, and for those costs that are greater than 10 times the state average, the state pays 100%.

The Department applied the new guidelines in this bill, 3½ was changed to 3 times and 10 times to 8 times, and federal funds received for educationally disabled children or court ordered placements were added to the estimated state average expenditure per pupil. The Department used the FY 2004 data to determine the impact of the first two changes. State general fund expenditures and local revenue will increase by $4,818,121. However, the Department could not interpret the language in this bill to determine the impact of the addition of federal funds received for educationally disabled children or court ordered placements to the estimated state average expenditure per pupil, and therefor, could not determine the total fiscal impact.