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A BILL TO BE ENTITLED
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AN ACT
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relating to public school finance and the formation of school |
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finance districts. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subtitle I, Title 2, Education Code, is amended |
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by adding Chapter 42A to read as follows: |
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CHAPTER 42A. PUBLIC SCHOOL FINANCE SYSTEM |
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SUBCHAPTER A. GENERAL PROVISIONS |
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Sec. 42A.001. STATE POLICY. (a) It is the policy of this |
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state that the provision of public education is a state |
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responsibility and that a thorough and efficient system be provided |
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and substantially financed through state revenue sources so that |
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each student enrolled in the public school system shall have access |
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to programs and services that are appropriate to the student's |
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educational needs and that are substantially equal to those |
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available to any similar student, notwithstanding varying local |
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economic factors. |
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(b) The public school finance system of this state shall |
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adhere to a standard of neutrality that provides for substantially |
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equal access to similar revenue per student at similar tax effort, |
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considering all state and local tax revenues of districts after |
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acknowledging all legitimate student and district cost |
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differences. |
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Sec. 42A.002. PUBLIC SCHOOL FINANCE SYSTEM. (a) The public |
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school finance system consists of state funding as provided by |
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Subchapter C and local funding as provided by Subchapter D, with |
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each source of funding distributed on the basis of weighted average |
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daily attendance, as determined under Section 42A.102. |
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(b) Additional amounts of funding are made available |
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through the public school finance system for specified purposes as |
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provided by law. |
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Sec. 42A.003. STUDENT ELIGIBILITY. (a) A student is |
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entitled to the benefits of the public school finance system if, on |
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September 1 of the school year, the student: |
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(1) is 5 years of age or older and under 21 years of age |
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and has not graduated from high school, or is at least 21 years of |
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age and under 26 years of age and has been admitted by a school |
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district to complete the requirements for a high school diploma; or |
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(2) is at least 19 years of age and under 26 years of |
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age and is enrolled in an adult high school diploma and industry |
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certification charter school pilot program under Section 29.259. |
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(b) A student to whom Subsection (a) does not apply is |
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entitled to the benefits of the public school finance system if the |
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student is enrolled in a prekindergarten class under Section |
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29.153. |
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(c) A child may be enrolled in the first grade if the child |
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is at least six years of age at the beginning of the school year of |
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the district or has been enrolled in the first grade or has |
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completed kindergarten in the public schools in another state |
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before transferring to a public school in this state. |
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(d) Notwithstanding Subsection (a), a student younger than |
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five years of age is entitled to the benefits of the public school |
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finance system if: |
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(1) the student performs satisfactorily on the |
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assessment instrument administered under Section 39.023(a) to |
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students in the third grade; and |
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(2) the district has adopted a policy for admitting |
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students younger than five years of age. |
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Sec. 42A.004. AVERAGE DAILY ATTENDANCE. (a) In this |
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chapter, average daily attendance is: |
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(1) the quotient of the sum of attendance for each day |
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of the minimum number of days of instruction as described under |
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Section 25.081(a) divided by the minimum number of days of |
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instruction; |
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(2) for a district that operates under a flexible year |
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program under Section 29.0821, the quotient of the sum of |
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attendance for each actual day of instruction as permitted by |
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Section 29.0821(b)(1) divided by the number of actual days of |
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instruction as permitted by Section 29.0821(b)(1); or |
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(3) for a district that operates under a flexible |
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school day program under Section 29.0822, the average daily |
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attendance as calculated by the commissioner in accordance with |
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Section 29.0822(d). |
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(b) For purposes of this chapter, the average daily |
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attendance of a school district that experiences a decline of two |
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percent or more in average daily attendance is considered to be: |
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(1) the actual average daily attendance of the |
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preceding school year, if the decline is the result of the closing |
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or reduction in personnel of a military base; or |
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(2) subject to Subsection (e), an average daily |
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attendance not to exceed 98 percent of the actual average daily |
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attendance of the preceding school year, if the decline is not the |
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result of the closing or reduction in personnel of a military base. |
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(c) The commissioner shall adjust the average daily |
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attendance of a school district that has a significant percentage |
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of students who are migratory children as defined by 20 U.S.C. |
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Section 6399. |
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(d) The commissioner may adjust the average daily |
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attendance of a school district in which a disaster, flood, extreme |
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weather condition, fuel curtailment, or other calamity has a |
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significant effect on the district's attendance. |
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(e) For each school year, the commissioner shall adjust the |
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average daily attendance of school districts that are considered to |
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have an adjusted average daily attendance under Subsection (b)(2) |
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so that: |
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(1) all districts are considered to have the same |
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percentage of the preceding year's actual average daily attendance; |
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and |
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(2) the total cost to the state does not exceed the |
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amount specifically appropriated for that year for purposes of |
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Subsection (b)(2). |
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(f) An open-enrollment charter school is not entitled to an |
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adjustment under Subsection (b)(2). |
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(g) If a student may receive course credit toward the |
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student's high school academic requirements and toward the |
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student's higher education academic requirements for a single |
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course, including a course provided under Section 28.009 by a |
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public institution of higher education, the time during which the |
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student attends the course shall be counted as part of the minimum |
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number of instructional hours required for a student to be |
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considered a full-time student in average daily attendance for |
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purposes of this section. |
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Sec. 42A.005. AVERAGE DAILY ATTENDANCE FOR DISTRICTS IN |
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DISASTER AREA. (a) From funds specifically appropriated for the |
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purpose or other funds available to the commissioner for that |
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purpose, the commissioner shall adjust the average daily attendance |
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of a school district all or part of which is located in an area |
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declared a disaster area by the governor under Chapter 418, |
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Government Code, if the district experiences a decline in average |
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daily attendance that is reasonably attributable to the impact of |
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the disaster. |
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(b) The adjustment must be sufficient to ensure that the |
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district receives funding comparable to the funding that the |
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district would have received if the decline in average daily |
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attendance reasonably attributable to the impact of the disaster |
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had not occurred. |
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(c) The commissioner shall make the adjustment required by |
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this section for the two-year period following the date of the |
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governor's initial proclamation or executive order declaring the |
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state of disaster. |
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(d) Section 42A.004(b)(2) does not apply to a district that |
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receives an adjustment under this section. |
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(e) A district that receives an adjustment under this |
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section may not receive any additional adjustment under Section |
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42A.004(d) for the decline in average daily attendance on which the |
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adjustment under this section is based. |
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(f) For purposes of this title, a district's adjusted |
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average daily attendance under this section is considered to be the |
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district's average daily attendance as determined under Section |
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42A.004. |
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Sec. 42A.006. REFERENCES TO FOUNDATION SCHOOL PROGRAM. A |
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reference in law to the Foundation School Program means the public |
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school finance system under this chapter. |
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SUBCHAPTER B. PERMISSIBLE WEALTH LEVEL AND SCHOOL FINANCE |
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DISTRICTS |
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Sec. 42A.051. DEFINITIONS. In this subchapter: |
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(1) "Wealth per weighted student" means the taxable |
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value of property, as determined under Subchapter M, Chapter 403, |
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Government Code, divided by the number of students in weighted |
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average daily attendance. |
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(2) "Weighted average daily attendance" means the |
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number of students in total weighted average daily attendance in a |
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school district as determined under Section 42A.102 and as adjusted |
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under Subchapter C, if applicable. |
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Sec. 42A.052. PERMISSIBLE RANGE OF WEALTH. (a) Using the |
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most current information available, the commissioner shall |
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determine the statewide average total property tax rate imposed by |
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school districts in this state, the statewide average wealth per |
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weighted student of school districts in this state, and the tax |
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revenue per weighted student that would result from imposing the |
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average tax rate against the average wealth per weighted student. |
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(b) A school district's wealth per weighted student is |
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required to be: |
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(1) at least the wealth that, at the average tax rate |
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determined under Subsection (a), would result in revenue per |
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weighted student that is $300 less than the amount of revenue per |
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weighted student determined by the commissioner under Subsection |
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(a); and |
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(2) not more than the wealth that, at the average tax |
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rate determined under Subsection (a), would result in revenue per |
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weighted student that is $300 more than the amount of revenue per |
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weighted student determined by the commissioner under Subsection |
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(a). |
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(c) The commissioner shall notify each school district |
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determined to have a wealth per weighted student that is not within |
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the permissible range of wealth under this section. The |
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commissioner shall also publish the permissible range of wealth on |
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the agency's Internet website. |
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(d) The commissioner shall revise the determination of |
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permissible wealth level and provide the notification required by |
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this section every 10 years. |
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Sec. 42A.053. CREATION OF SCHOOL FINANCE DISTRICT. (a) If |
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the wealth per weighted student of a school district is not within |
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the permissible range under Section 42A.052, the district must form |
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a school finance district with one or more other school districts in |
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accordance with this subchapter or be subject to consolidation by |
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the commissioner under Section 42A.062. |
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(b) The board of trustees of each school district proposing |
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to form a school finance district must execute an agreement to |
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conduct an election on the creation of the district for the purpose |
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of consolidating the tax bases of the component school districts. |
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(c) The boards of trustees may not proceed with the election |
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unless the proposed agreement is approved by the commissioner as |
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provided by Section 42A.054. |
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(d) The agreement must provide that: |
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(1) each component school district will receive from |
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the maintenance tax revenue of the school finance district an equal |
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amount of money per student in weighted average daily attendance; |
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and |
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(2) the school finance district will assume all the |
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indebtedness of the component school districts. |
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Sec. 42A.054. APPROVAL BY COMMISSIONER. The commissioner |
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shall approve a proposed school finance district agreement if: |
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(1) the board of trustees of each component school |
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district has approved the proposed school finance district; and |
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(2) the proposed school finance district's wealth per |
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weighted student will be within the permissible range under Section |
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42A.052. |
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Sec. 42A.055. ELECTION REQUIRED. (a) An agreement under |
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this subchapter must provide for the ordering of an election to be |
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held on the same date in each component school district. The |
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election must be held on a Tuesday or Saturday, and Section 41.001, |
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Election Code, does not apply to the election. |
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(b) The ballot shall be printed to permit voting for or |
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against the proposition: "Creation of a school finance district |
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composed of the consolidated territory for taxing purposes of |
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_________________________ school districts, and authorizing the |
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levy, assessment, and collection of annual ad valorem taxes for the |
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maintenance of the public free schools within that territory at a |
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rate not to exceed $_________ on the $100 valuation of taxable |
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property; and further to create a consolidated tax base for the |
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repayment of all bonded indebtedness issued by the joint board of |
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the school finance district or previously issued by the component |
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school districts and to authorize the joint board of the school |
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finance district to levy, pledge, and collect ad valorem taxes at a |
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rate sufficient to pay the principal of and interest on those |
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bonds." |
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(c) The rate of the tax for maintenance of the public free |
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schools to be included in the proposition shall be provided by the |
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agreement among the component school districts. |
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(d) The proposition is approved only if the proposition |
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receives a favorable vote of the majority of the votes cast within |
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each component school district. |
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Sec. 42A.056. STATUS OF SCHOOL FINANCE DISTRICT. (a) A |
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school finance district is a school district established for the |
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limited purpose of exercising the taxing power authorized by |
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Section 3, Article VII, Texas Constitution, and distributing the |
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revenue to its component school districts as provided by this |
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chapter. |
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(b) A school finance district may issue bonds as provided by |
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Chapter 45. |
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(c) A school finance district is subject to any provision of |
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law applicable to a school district that relates to imposition of |
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taxes, issuance of bonds, collection and distribution of tax |
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revenue, or the determination of a school district's entitlement to |
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funding under this chapter. |
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Sec. 42A.057. GOVERNANCE. (a) A school finance district is |
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governed by the boards of trustees of the component school |
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districts acting jointly. |
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(b) Any action taken by the joint board must receive a |
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favorable vote of a majority of each component school district's |
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board of trustees. |
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Sec. 42A.058. MAINTENANCE AND BOND TAXES. (a) The joint |
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board shall levy a maintenance tax for the benefit of the component |
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school districts not later than September 1 of each year or as soon |
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thereafter as practicable. |
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(b) The joint board shall levy a bond tax if necessary to pay |
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principal and interest on bonds issued by the joint board or to pay |
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indebtedness of component school districts assumed by the school |
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finance district. |
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(c) Each component school district shall bear a share of the |
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costs of assessing and collecting taxes in proportion to the |
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component school district's share of weighted average daily |
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attendance in the school finance district. |
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(d) A component school district may not levy maintenance or |
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bond taxes. |
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(e) A school finance district is entitled to assistance with |
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payment of existing debt under Subchapter B, Chapter 46. |
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Sec. 42A.059. DISSOLUTION OF SCHOOL FINANCE DISTRICT. (a) |
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A school finance district formed under this subchapter exists for |
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10 years after the date the district was created. On the expiration |
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of the 10-year period, a school finance district is dissolved. |
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(b) Each component school district that remains, after the |
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commissioner's revision of the permissible range of wealth, subject |
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to the requirement to form a school finance district under Section |
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42A.053(a) shall form a new school finance district or seek |
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continuation of the former school finance district, as provided by |
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Section 42A.060. |
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Sec. 42A.060. CONTINUED MEMBERSHIP IN SCHOOL FINANCE |
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DISTRICT. (a) A school district shall form a new school finance |
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district in the manner provided by this subchapter or continue an |
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existing school finance district if the school district continues |
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to have a wealth per weighted student that is not within the most |
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recently determined permissible range of wealth. |
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(b) The board of trustees of each component school district |
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that seeks to continue an existing school finance district shall |
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seek the commissioner's approval to continue the school finance |
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district for another 10-year period. |
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(c) The commissioner shall approve the continuation of a |
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school finance district for a succeeding 10-year period if: |
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(1) the board of trustees of each component school |
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district petitions the commissioner for the continuation of the |
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school finance district; and |
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(2) the school finance district's wealth per weighted |
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student is within the most recently determined permissible range of |
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wealth. |
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(d) An existing school finance district that obtains the |
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commissioner's approval for a succeeding 10-year period is not |
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required to obtain renewed voter approval. |
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Sec. 42A.061. OPTIONAL FORMATION OR CONTINUATION OF SCHOOL |
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FINANCE DISTRICT. The board of trustees of a school district not |
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required to form or continue a school finance district under this |
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subchapter may elect to do so by satisfying the requirements for |
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formation or continuation provided by this subchapter. |
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Sec. 42A.062. CONSOLIDATION BY COMMISSIONER. (a) A school |
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district required to form a school finance district under Section |
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42A.053 is subject to consolidation under this section if the |
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district has not, before the date specified by the commissioner: |
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(1) agreed to be a member of a school finance district; |
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(2) obtained approval of the commissioner as required |
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by Section 42A.053; and |
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(3) received the approval of the voters in each |
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component school district regarding the formation of the school |
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finance district and the imposition of taxes. |
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(b) The commissioner shall order the consolidation of a |
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school district described by Subsection (a) with one or more other |
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school districts. The commissioner shall consolidate school |
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districts so that the projected wealth per weighted student of the |
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consolidated school district is within the permissible range of |
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wealth. |
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Sec. 42A.063. GOVERNANCE OF CONSOLIDATED DISTRICT. (a) |
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Until the initial trustees elected as provided by Subsection (b) |
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have qualified and taken office, a district consolidated under |
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Section 42A.062 is governed by a transitional board of trustees |
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consisting of the board of trustees of the district having the |
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greatest student membership on the last day of the school year |
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preceding the consolidation plus one member of the board of |
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trustees of each other consolidating district selected by that |
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board. |
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(b) The transitional board of trustees shall divide the |
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consolidated district into nine single-member trustee districts in |
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accordance with the procedures provided by Section 11.052. The |
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transitional board shall order an election for the initial board of |
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trustees to be held on the first May uniform election date after the |
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effective date of a consolidation order. |
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(c) Members of the board of trustees of a consolidated |
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district serve staggered terms of office for four years. |
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(d) Section 13.156 applies to districts consolidated under |
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this subchapter. |
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Sec. 42A.064. FUND BALANCES OF CONSOLIDATED DISTRICT. Fund |
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balances of a school district consolidated under Section 42A.062 |
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may be used only for the benefit of the schools within the district |
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that generated the funds. |
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Sec. 42A.065. EMPLOYMENT CONTRACTS OF CONSOLIDATED |
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DISTRICT. A consolidated district created under Section 42A.062 |
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shall honor an employment contract entered into by a consolidating |
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district. |
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Sec. 42A.066. COMMISSIONER TO APPROVE SUBSEQUENT BOUNDARY |
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CHANGES. A school district that is involved in an action under this |
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chapter that results in boundary changes to the district or in the |
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consolidation of tax bases into a school finance district is |
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subject to consolidation, detachment, or annexation under Chapter |
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13 only if the commissioner certifies that the change under Chapter |
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13 will not result in a district with a wealth per weighted student |
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that is not within the permissible range of wealth. |
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Sec. 42A.067. HOMESTEAD EXEMPTIONS. (a) The governing |
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board of a school district that results from consolidation under |
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this chapter, including consolidation of tax bases into a school |
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finance district, for the tax year in which the consolidation |
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occurs may determine whether to adopt a homestead exemption |
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provided by Section 11.13, Tax Code, and may set the amount of the |
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exemption, if adopted, at any time before the governing board |
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adopts a tax rate for that tax year. This section applies only to an |
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exemption that the governing board of a school district is |
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authorized to adopt or change in amount under Section 11.13, Tax |
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Code. |
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(b) This section prevails over any inconsistent provision |
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of Section 11.13, Tax Code, or other law. |
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Sec. 42A.068. TAX ABATEMENTS. (a) A tax abatement |
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agreement executed by a school district that is involved in |
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consolidation under this chapter is not affected and applies to the |
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taxation of the property covered by the agreement as if executed by |
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the district within which the property is included. |
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(b) The commissioner shall determine the wealth per |
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weighted student of a school district under this chapter as if any |
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tax abatement agreement executed by a school district on or after |
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May 31, 1993, had not been executed. |
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Sec. 42A.069. TAX INCREMENT OBLIGATIONS. The payment of |
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tax increments under Chapter 311, Tax Code, is not affected by the |
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consolidation of territory or tax bases under this chapter. In each |
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tax year a school district paying a tax increment from taxes on |
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property over which the district has assumed taxing power is |
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entitled to retain the same percentage of the tax increment from |
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that property that the district in which the property was located |
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before the consolidation could have retained for the respective tax |
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year. |
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Sec. 42A.070. REQUIRED NUMBER OF SCHOOL FINANCE DISTRICTS. |
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In approving the formation or continuation of school finance |
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districts under this subchapter, the commissioner shall ensure the |
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formation of not fewer than 30 school finance districts in the |
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state. |
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SUBCHAPTER C. STATE FUNDING |
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Sec. 42A.101. STATE FUNDS. (a) Each biennium, the |
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legislature shall set by appropriation the amount of state funds to |
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be distributed each school year for public education in accordance |
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with this chapter. |
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(b) The amount appropriated shall be distributed to school |
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districts on the basis of each district's total weighted average |
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daily attendance, as computed under this subchapter, with each |
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district entitled to receive the same amount of state funds per |
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student in weighted average daily attendance. |
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(c) Distributions shall be made in accordance with the |
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payment schedule adopted under Section 42A.204. |
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Sec. 42A.102. DETERMINATION OF WEIGHTED AVERAGE DAILY |
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ATTENDANCE. (a) The total weighted average daily attendance of a |
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school district is the sum of the weighted average daily attendance |
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for each educational program for which a student multiplier is |
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provided under Subsection (b), as determined by the formula: |
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EPWADA = S X SM X CEI |
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where: |
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"EPWADA" is the weighted average daily attendance for the |
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educational program; |
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"S" is the number of students in average daily attendance, |
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number of full-time equivalent students, or number of students |
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enrolled, as appropriate, in the educational program for which the |
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computation is made; |
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"SM" is the student multiplier for the educational program, |
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as provided by Subsection (b); and |
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"CEI" is 50 percent of the cost of education index adjustment |
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for the school district adopted by the foundation school fund |
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budget committee to reflect the geographic variation in known |
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resource costs and costs of education due to factors beyond the |
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control of the school district contained in Chapter 203, Title 19, |
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Texas Administrative Code, as that chapter existed on January 1, |
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1997. |
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(b) The student multipliers are: |
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(1) 1.0 for a student in average daily attendance, not |
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including time the student spends each day in a special education |
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program in an instructional arrangement other than mainstream or in |
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a career and technology education program; |
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(2) 1.1 for a student in a special education program in |
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a mainstream instructional arrangement; |
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(3) 5.0 for a full-time equivalent student in a |
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special education program in a homebound instructional |
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arrangement; |
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(4) 3.0 for a full-time equivalent student in a |
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special education program in a hospital class instructional |
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arrangement; |
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(5) 5.0 for a full-time equivalent student in a |
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special education program in a speech therapy instructional |
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arrangement; |
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(6) 3.0 for a full-time equivalent student in a |
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special education program in a resource room instructional |
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arrangement; |
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(7) 3.0 for a full-time equivalent student in a |
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special education program in a self-contained, mild and moderate, |
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regular campus instructional arrangement; |
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(8) 3.0 for a full-time equivalent student in a |
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special education program in a self-contained, severe, regular |
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campus instructional arrangement; |
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(9) 2.7 for a full-time equivalent student in a |
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special education program in an off-home campus instructional |
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arrangement; |
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(10) 1.7 for a full-time equivalent student in a |
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special education program in a nonpublic day school; |
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(11) 2.3 for a full-time equivalent student in a |
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special education program vocational adjustment class; |
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(12) 4.0 for a student in a special education program |
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who resides in a care and treatment facility, other than a state |
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supported living center, whose parent or guardian does not reside |
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in the district, and who receives educational services from the |
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district campus; |
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(13) 2.8 for a student in a special education program |
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who resides in a state supported living center; |
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(14) 0.2 for a student who is educationally |
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disadvantaged or who is a student who does not have a disability and |
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resides in a residential placement facility in a district in which |
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the student's parent or guardian does not reside; |
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(15) 2.41 for a full-time equivalent student who is in |
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a remedial and support program under Section 29.081 because the |
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student is pregnant; |
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(16) 0.1 for a student who is in a bilingual education |
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or special language program under Subchapter B, Chapter 29; |
|
(17) 1.35 for a full-time equivalent student in an |
|
approved career and technology education program in grades nine |
|
through 12 or in a career and technology education program for |
|
students with disabilities in grades seven through 12; |
|
(18) 0.12 for a student in a program for gifted and |
|
talented students that the district certifies to the commissioner |
|
as complying with Subchapter D, Chapter 29; and |
|
(19) except as provided by Section 42A.256, 0.1 for a |
|
student in average daily attendance who is using a public education |
|
grant under Subchapter G, Chapter 29, to attend school in a district |
|
other than the district in which the student resides. |
|
(c) In this section: |
|
(1) "Career and technology education program" means a |
|
program under Subchapter F, Chapter 29. |
|
(2) "Full-time equivalent student" means 30 hours of |
|
contact a week between a student and program personnel. |
|
(3) "Special education program" means a program under |
|
Subchapter A, Chapter 29. |
|
Sec. 42A.103. SMALL AND MID-SIZED DISTRICT ADJUSTMENT. (a) |
|
The adjusted weighted average daily attendance of certain small and |
|
mid-sized districts is computed in accordance with this section. |
|
In this section: |
|
(1) "AWADA" is the adjusted weighted average daily |
|
attendance; |
|
(2) "ADA" is the number of students in average daily |
|
attendance in the district; and |
|
(3) "WADA" is the total number of students in weighted |
|
average daily attendance determined under Section 42A.102. |
|
(b) The adjusted weighted average daily attendance of a |
|
school district that contains at least 300 square miles and has not |
|
more than 1,600 students in average daily attendance is determined |
|
by the formula: |
|
AWADA = (1 + ((1,600 - ADA) X .0004)) X WADA |
|
(c) The adjusted weighted average daily attendance of a |
|
school district that contains less than 300 square miles and has not |
|
more than 1,600 students in average daily attendance is determined |
|
by the formula: |
|
AWADA = (1 + ((1,600 - ADA) X .00025)) X WADA |
|
(d) The adjusted weighted average daily attendance of a |
|
school district that offers a kindergarten through grade 12 program |
|
and has less than 5,000 students in average daily attendance is |
|
determined by the formula, of the following formulas, that results |
|
in the greatest weighted average daily attendance: |
|
(1) the formula in Subsection (b) or (c) for which the |
|
district is eligible; or |
|
(2) AWADA = (1 + ((5,000 - ADA) X .000025)) X WADA |
|
(e) A school district's adjusted weighted average daily |
|
attendance computed under this section is used in determining the |
|
amount of funding to which the district is entitled under this |
|
chapter on the basis of weighted average daily attendance. |
|
Sec. 42A.104. SPARSITY ADJUSTMENT. Notwithstanding |
|
Sections 42A.102 and 42A.103, the weighted average daily attendance |
|
of a school district that has fewer than 130 students in average |
|
daily attendance is 130 students in weighted average daily |
|
attendance if the district offers a kindergarten through grade 12 |
|
program and has preceding or current year's average daily |
|
attendance of at least 90 students or is 30 miles or more by bus |
|
route from the nearest high school district. The weighted average |
|
daily attendance of a district offering a kindergarten through |
|
grade 8 program whose preceding or current year's average daily |
|
attendance was at least 50 students or that is 30 miles or more by |
|
bus route from the nearest high school district is 75 students in |
|
weighted average daily attendance. A weighted average daily |
|
attendance of 60 students shall be used if a district offers a |
|
kindergarten through grade 6 program and has preceding or current |
|
year's average daily attendance of at least 40 students or is 30 |
|
miles or more by bus route from the nearest high school district. |
|
SUBCHAPTER D. LOCAL FUNDING |
|
Sec. 42A.151. DEPOSIT WITH COMPTROLLER; DISTRIBUTION OF |
|
SCHOOL FINANCE DISTRICT LOCAL FUNDS. (a) Each school finance |
|
district shall submit to the comptroller the local tax revenue |
|
collected by the school finance district. The comptroller shall |
|
hold the money for the school finance district in a numbered account |
|
outside the treasury for distribution to the component school |
|
districts as provided by this section. |
|
(b) For each school year, the comptroller shall determine |
|
the total amount available for distribution from a school finance |
|
district's account to the component school districts. |
|
(c) In accordance with the payment schedule adopted under |
|
Section 42A.204, the comptroller shall distribute the amount |
|
determined under Subsection (b) to the component school districts |
|
on the basis of the total weighted average daily attendance of each |
|
school district, with each school district in the school finance |
|
district receiving the same amount of local funding per student in |
|
total weighted average daily attendance. |
|
(d) The commissioner shall certify the total weighted |
|
average daily attendance of each school district for purposes of |
|
this section. |
|
Sec. 42A.152. SCHOOL DISTRICT LOCAL FUNDS. A school |
|
district that is not a member of a school finance district shall |
|
retain control and possession of all local tax revenue, subject to |
|
other law applicable to public education funds. |
|
SUBCHAPTER E. ADMINISTRATION |
|
Sec. 42A.201. ADMINISTRATION BY COMMISSIONER. The |
|
commissioner, in accordance with the rules of the State Board of |
|
Education, shall take such action and require such reports |
|
consistent with this chapter as may be necessary to implement and |
|
administer the public school finance system. |
|
Sec. 42A.202. PUBLIC EDUCATION INFORMATION MANAGEMENT |
|
SYSTEM (PEIMS). (a) Each school district shall participate in the |
|
Public Education Information Management System (PEIMS) and shall |
|
provide through that system information required for the |
|
administration of this chapter and of other appropriate provisions |
|
of this code. |
|
(b) The commissioner by rule shall require each school |
|
district and open-enrollment charter school to report through the |
|
Public Education Information Management System information |
|
regarding the number of students enrolled in the district or school |
|
who are identified as having dyslexia. The agency shall maintain |
|
the information provided in accordance with this subsection. |
|
(c) Each school district shall use a uniform accounting |
|
system adopted by the commissioner for the data required to be |
|
reported for the Public Education Information Management System. |
|
(d) Annually, the commissioner shall review the Public |
|
Education Information Management System and shall repeal or amend |
|
rules that require school districts to provide information through |
|
the Public Education Information Management System that is not |
|
necessary. In reviewing and revising the Public Education |
|
Information Management System, the commissioner shall develop |
|
rules to ensure that the system: |
|
(1) provides useful, accurate, and timely information |
|
on student demographics and academic performance, personnel, and |
|
school district finances; |
|
(2) contains only the data necessary for the |
|
legislature and the agency to perform their legally authorized |
|
functions in overseeing the public education system; and |
|
(3) does not contain any information related to |
|
instructional methods, except as provided by Section 29.066 or |
|
required by federal law. |
|
(e) The commissioner's rules must ensure that the Public |
|
Education Information Management System links student performance |
|
data to other related information for purposes of efficient and |
|
effective allocation of scarce school resources, to the extent |
|
practicable using existing agency resources and appropriations. |
|
Sec. 42A.203. ESTIMATE REQUIRED. (a) Not later than |
|
October 1 of each even-numbered year, the agency shall submit to the |
|
legislature an estimate of the student enrollment and a projection |
|
of the weighted average daily attendance of each school district |
|
for the following biennium. |
|
(b) The agency shall update the information provided to the |
|
legislature under Subsection (a) not later than March 1 of each |
|
odd-numbered year. |
|
Sec. 42A.204. PAYMENT SCHEDULE. In coordination with the |
|
comptroller and the Legislative Budget Board, the commissioner by |
|
rule shall determine a schedule for payment of funds under this |
|
chapter. |
|
Sec. 42A.205. RECOVERY OF OVERALLOCATED FUNDS. (a) If a |
|
school district has received an overallocation of funds, the agency |
|
shall, by withholding from subsequent allocations of funds for the |
|
current or subsequent school year or by requesting and obtaining a |
|
refund, recover from the district an amount equal to the |
|
overallocation. |
|
(b) Notwithstanding Subsection (a), the agency may recover |
|
an overallocation of funds over a period not to exceed the |
|
subsequent five school years if the commissioner determines that |
|
the overallocation was the result of exceptional circumstances |
|
reasonably caused by statutory changes to this chapter or Chapter |
|
46 and related reporting requirements. |
|
(c) If a district fails to comply with a request for a refund |
|
under Subsection (a), the agency shall certify to the comptroller |
|
that the amount constitutes a debt for purposes of Section 403.055, |
|
Government Code. The agency shall provide to the comptroller the |
|
amount of the overallocation and any other information required by |
|
the comptroller. The comptroller may certify the amount of the debt |
|
to the attorney general for collection. |
|
(d) Any amounts recovered under this section shall be |
|
deposited to the credit of the available school fund. |
|
Sec. 42A.206. FALSIFICATION OF RECORDS; REPORT. When, in |
|
the opinion of the agency's director of school audits, audits or |
|
reviews of accounting, enrollment, or other records of a school |
|
district reveal deliberate falsification of the records, or |
|
violation of the provisions of this chapter, through which the |
|
district's share of funds allocated under the authority of this |
|
chapter would be, or has been, illegally increased, the director |
|
shall promptly and fully report the fact to the State Board of |
|
Education, the state auditor, and the appropriate county attorney, |
|
district attorney, or criminal district attorney. |
|
SUBCHAPTER F. CONDITIONS APPLICABLE TO FUNDING BASED ON STUDENT |
|
MULTIPLIERS |
|
Sec. 42A.251. SPECIAL EDUCATION PROGRAMS. (a) For funding |
|
purposes, the number of contact hours credited per day for each |
|
student in the off-home campus instructional arrangement may not |
|
exceed the contact hours credited per day for the multidistrict |
|
class instructional arrangement in the 1992-1993 school year. |
|
(b) For funding purposes, the number of contact hours |
|
credited per day for each student in the resource room; |
|
self-contained, mild and moderate; and self-contained, severe, |
|
instructional arrangements may not exceed the average of the |
|
statewide total contact hours credited per day for those three |
|
instructional arrangements in the 1992-1993 school year. |
|
(c) The State Board of Education by rule shall prescribe the |
|
qualifications an instructional arrangement must meet in order to |
|
be funded as a particular instructional arrangement under this |
|
chapter. In prescribing the qualifications that a mainstream |
|
instructional arrangement must meet, the board shall establish |
|
requirements that students with disabilities and their teachers |
|
receive the direct, indirect, and support services that are |
|
necessary to enrich the regular classroom and enable student |
|
success. |
|
(d) Funds received by a school district as a result of the |
|
district's weighted average daily attendance of students described |
|
by Sections 42A.102(b)(2)-(13), other than an indirect cost |
|
allowance established under State Board of Education rule, must be |
|
used in the special education program under Subchapter A, Chapter |
|
29. |
|
(e) The agency shall encourage the placement of students in |
|
special education programs, including students in residential |
|
instructional arrangements, in the least restrictive environment |
|
appropriate for their educational needs. |
|
(f) The State Board of Education shall adopt rules and |
|
procedures governing contracts for residential placement of |
|
special education students. The legislature shall provide by |
|
appropriation for the state's share of the costs of those |
|
placements. |
|
(g) A school district that provides an extended year program |
|
required by federal law for special education students who may |
|
regress is entitled to receive funds in an amount equal to 75 |
|
percent, or a lesser percentage determined by the commissioner, of |
|
the amount of state funds provided per student in weighted average |
|
daily attendance under Section 42A.101(b) for each full-time |
|
equivalent student in average daily attendance, multiplied by the |
|
amount designated for the student's instructional arrangement |
|
under Section 42A.102(b) for each day the program is provided |
|
divided by the number of days in the minimum school year. The total |
|
amount of state funding for extended year services under this |
|
subsection may not exceed $10 million per year. A school district |
|
may use funds received under this subsection only in providing an |
|
extended year program. |
|
(h) From the total amount of funds appropriated for weighted |
|
average daily attendance of students described by Sections |
|
42A.102(b)(2)-(13), the commissioner shall withhold an amount |
|
specified in the General Appropriations Act and distribute that |
|
amount to school districts for programs under Section 29.014. The |
|
program established under that section is required only in school |
|
districts in which the program is financed by funds distributed |
|
under this subsection and any other funds available for the |
|
program. After deducting the amount withheld under this subsection |
|
from the total amount appropriated for weighted average daily |
|
attendance of students described by Sections 42A.102(b)(2)-(13), |
|
the commissioner shall reduce each district's allocation |
|
proportionately. |
|
Sec. 42A.252. COMPENSATORY EDUCATION PROGRAMS. (a) In |
|
this section, "compensatory education funds" means funds received |
|
by a school district as a result of the district's weighted average |
|
daily attendance of students described by Sections 42A.102(b)(14) |
|
and (15). |
|
(b) For purposes of Section 42A.102(b)(14), the number of |
|
educationally disadvantaged students is determined: |
|
(1) by averaging the best six months' enrollment in the |
|
national school lunch program of free or reduced-price lunches for |
|
the preceding school year; or |
|
(2) in the manner provided by commissioner rule, if no |
|
campus in the district participated in the national school lunch |
|
program of free or reduced-price lunches during the preceding |
|
school year. |
|
(c) Compensatory education funds, other than an indirect |
|
cost allowance established under State Board of Education rule, |
|
which may not exceed 48 percent, shall be used to fund supplemental |
|
programs and services designed to eliminate any disparity in |
|
performance on assessment instruments administered under |
|
Subchapter B, Chapter 39, or disparity in the rates of high school |
|
completion between students at risk of dropping out of school, as |
|
defined by Section 29.081, and all other students. Specifically, |
|
the funds may be used to meet the costs of providing a compensatory, |
|
intensive, or accelerated instruction program under Section 29.081 |
|
or a disciplinary alternative education program established under |
|
Section 37.008, to pay the costs associated with placing students |
|
in a juvenile justice alternative education program established |
|
under Section 37.011, or to support a program eligible under Title I |
|
of the Elementary and Secondary Education Act of 1965, as provided |
|
by Pub. L. No. 103-382 and its subsequent amendments, and by |
|
federal regulations implementing that Act, at a campus at which at |
|
least 40 percent of the students are educationally disadvantaged. |
|
In meeting the costs of providing a compensatory, intensive, or |
|
accelerated instruction program under Section 29.081, compensatory |
|
education funds shall be used for costs supplementary to the |
|
regular education program, such as costs for program and student |
|
evaluation, instructional materials and equipment and other |
|
supplies required for quality instruction, supplemental staff |
|
expenses, salary for teachers of at-risk students, smaller class |
|
size, and individualized instruction. A home-rule school district |
|
or an open-enrollment charter school must use compensatory |
|
education funds for a purpose authorized in this subsection but is |
|
not otherwise subject to Subchapter C, Chapter 29. For purposes of |
|
this subsection, a program specifically designed to serve students |
|
at risk of dropping out of school, as defined by Section 29.081, is |
|
considered to be a program supplemental to the regular education |
|
program, and a district may use compensatory education funds for |
|
such a program. |
|
(d) Notwithstanding Subsection (c), compensatory education |
|
funds may be used to fund in proportion to the percentage of |
|
students served by the program that meet the criteria in Section |
|
29.081(d) or (g): |
|
(1) an accelerated reading instruction program under |
|
Section 28.006(g); or |
|
(2) a program for treatment of students who have |
|
dyslexia or a related disorder as required by Section 38.003. |
|
(e) Notwithstanding Subsection (c), compensatory education |
|
funds may be used to fund a district's mentoring services program |
|
under Section 29.089. |
|
(f) The agency shall evaluate the effectiveness of |
|
accelerated instruction and support programs provided under |
|
Section 29.081 for students at risk of dropping out of school. |
|
(g) The State Board of Education, with the assistance of the |
|
comptroller, shall develop and implement by rule reporting and |
|
auditing systems for district and campus expenditures of |
|
compensatory education funds to ensure that compensatory education |
|
funds are spent only to supplement the regular education program as |
|
required by Subsection (c). The reporting requirements shall be |
|
managed electronically to minimize local administrative costs. A |
|
district shall submit the report required by this subsection not |
|
later than the 150th day after the last day permissible for |
|
resubmission of information required under Section 42A.202. |
|
(h) The commissioner shall develop a system to identify |
|
school districts that are at high risk of having used compensatory |
|
education funds other than in compliance with Subsection (c) or of |
|
having inadequately reported compensatory education expenditures. |
|
If a review of the report submitted under Subsection (g), using the |
|
risk-based system, indicates that a district is not at high risk of |
|
having misused compensatory education funds or of having |
|
inadequately reported compensatory education expenditures, the |
|
district may not be required to perform a local audit of |
|
compensatory education expenditures and is not subject to on-site |
|
monitoring under this section. |
|
(i) If a review of the report submitted under Subsection |
|
(g), using the risk-based system, indicates that a district is at |
|
high risk of having misused compensatory education funds, the |
|
commissioner shall notify the district of that determination. The |
|
district must respond to the commissioner not later than the 30th |
|
day after the date the commissioner notifies the district of the |
|
commissioner's determination. If the district's response does not |
|
change the commissioner's determination that the district is at |
|
high risk of having misused compensatory education funds or if the |
|
district does not respond in a timely manner, the commissioner |
|
shall: |
|
(1) require the district to conduct a local audit of |
|
compensatory education expenditures for the current or preceding |
|
school year; |
|
(2) order agency staff to conduct on-site monitoring |
|
of the district's compensatory education expenditures; or |
|
(3) both require a local audit and order on-site |
|
monitoring. |
|
(j) If a review of the report submitted under Subsection |
|
(g), using the risk-based system, indicates that a district is at |
|
high risk of having inadequately reported compensatory education |
|
expenditures, the commissioner may require agency staff to assist |
|
the district in following the proper reporting methods or amending |
|
a district or campus improvement plan under Subchapter F, Chapter |
|
11. If the district does not take appropriate corrective action |
|
before the 45th day after the date the agency staff notifies the |
|
district of the action the district is expected to take, the |
|
commissioner may: |
|
(1) require the district to conduct a local audit of |
|
the district's compensatory education expenditures; or |
|
(2) order agency staff to conduct on-site monitoring |
|
of the district's compensatory education expenditures. |
|
(k) The commissioner, in the year following a local audit of |
|
compensatory education expenditures, shall withhold from a |
|
district's payment of funds under Section 42A.204 an amount equal |
|
to the amount of compensatory education funds the agency determines |
|
were not used in compliance with Subsection (c). The commissioner |
|
shall release to a district funds withheld under this subsection |
|
when the district provides to the commissioner a detailed plan to |
|
spend those funds in compliance with Subsection (c). |
|
(l) The commissioner shall grant a one-year exemption from |
|
the requirements of Subsections (g)-(k) to a school district in |
|
which the group of students who have failed to perform |
|
satisfactorily in the preceding school year on an assessment |
|
instrument required under Section 39.023(a), (c), or (l) |
|
subsequently performs on those assessment instruments at a level |
|
that meets or exceeds a level prescribed by commissioner rule. Each |
|
year the commissioner, based on the most recent information |
|
available, shall determine if a school district is entitled to an |
|
exemption for the following school year and notify the district of |
|
that determination. |
|
Sec. 42A.253. BILINGUAL EDUCATION OR SPECIAL LANGUAGE |
|
PROGRAMS. (a) Funds received by a school district as a result of |
|
the district's weighted average daily attendance of students |
|
described by Section 42A.102(b)(16), other than an indirect cost |
|
allowance established under State Board of Education rule, must be |
|
used in providing bilingual education or special language programs |
|
under Subchapter B, Chapter 29, and must be accounted for under |
|
existing agency reporting and auditing procedures. |
|
(b) Funds described by Subsection (a) may be used only for |
|
program and student evaluation, instructional materials and |
|
equipment, staff development, supplemental staff expenses, salary |
|
supplements for teachers, and other supplies required for quality |
|
instruction and smaller class size. |
|
Sec. 42A.254. CAREER AND TECHNOLOGY EDUCATION. (a) Funds |
|
received by a school district as a result of the district's weighted |
|
average daily attendance of students described by Section |
|
42A.102(b)(17), other than an indirect cost allowance established |
|
under State Board of Education rule, must be used in providing |
|
career and technology education programs in grades nine through 12 |
|
or career and technology education programs for students with |
|
disabilities in grades seven through 12 under Sections 29.182, |
|
29.183, and 29.184. |
|
(b) The commissioner shall conduct a cost-benefit |
|
comparison between career and technology education programs and |
|
mathematics and science programs. |
|
(c) Out of the total amount of funds appropriated for |
|
weighted average daily attendance of students described by Section |
|
42A.102(b)(17), the commissioner shall set aside an amount |
|
specified in the General Appropriations Act, which may not exceed |
|
an amount equal to one percent of the total amount appropriated, to |
|
support regional career and technology education planning. After |
|
deducting the amount set aside under this subsection from the total |
|
amount appropriated, the commissioner shall reduce each district's |
|
allocation proportionately. |
|
Sec. 42A.255. GIFTED AND TALENTED STUDENT PROGRAMS. (a) |
|
Funds received by a school district as a result of the district's |
|
weighted average daily attendance of students described by Section |
|
42A.102(b)(18), other than the amount that represents the program's |
|
share of general administrative costs, must be used in providing |
|
programs for gifted and talented students under Subchapter D, |
|
Chapter 29, including programs sanctioned by International |
|
Baccalaureate and Advanced Placement, or in developing programs for |
|
gifted and talented students. Each district must account for the |
|
expenditure of state funds as provided by rule of the State Board of |
|
Education. If by the end of the 12th month after receiving funds |
|
under this chapter for gifted and talented student programs for |
|
developing a program a district has failed to implement a program, |
|
the district must refund the funds received for gifted and talented |
|
student programs to the agency within 30 days. |
|
(b) Not more than five percent of a district's students in |
|
average daily attendance are eligible for funding under this |
|
chapter for attendance in a gifted and talented student program. |
|
(c) After each district has received allocated funds for |
|
this program, the State Board of Education may use up to $500,000 of |
|
the funds allocated under this chapter for programs such as |
|
MATHCOUNTS, Future Problem Solving, Odyssey of the Mind, and |
|
Academic Decathlon, as long as these funds are used to train |
|
personnel and provide program services. To be eligible for funding |
|
under this subsection, a program must be determined by the State |
|
Board of Education to provide services that are effective and |
|
consistent with the state plan for gifted and talented education. |
|
Sec. 42A.256. PUBLIC EDUCATION GRANTS. The total number of |
|
students for whom a student multiplier is applied under Section |
|
42A.102(b)(19) for a district may not exceed the number by which the |
|
number of students using public education grants to attend school |
|
in the district exceeds the number of students who reside in the |
|
district and use public education grants to attend school in |
|
another district. |
|
Sec. 42A.257. APPLICABILITY OF CONDITIONS TO SCHOOL |
|
DISTRICTS NOT INCLUDED IN SCHOOL FINANCE DISTRICT. The conditions |
|
prescribed by this subchapter apply to local tax revenue retained |
|
by a school district in the same manner that the conditions apply to |
|
state and local money distributed under this chapter. |
|
SECTION 2. Section 12.106(a), Education Code, as effective |
|
September 1, 2017, is amended to read as follows: |
|
(a) A charter holder is entitled to receive for the |
|
open-enrollment charter school funding under Chapter 42A [42] equal |
|
to the amount of state funding per student in weighted average daily |
|
attendance provided under that chapter to [, excluding enrichment
|
|
funding under Section 42.302(a), to which the charter holder would
|
|
be entitled for the school under Chapter 42 if the school were] a |
|
school district [without a tier one local share for purposes of
|
|
Section 42.253]. |
|
SECTION 3. Section 45.003(d), Education Code, is amended to |
|
read as follows: |
|
(d) A proposition submitted to authorize the levy of |
|
maintenance taxes must include the question of whether the |
|
governing board or commissioners court may levy, assess, and |
|
collect annual ad valorem taxes for the further maintenance of |
|
public schools, at a rate not to exceed the rate stated in the |
|
proposition. [For any year, the maintenance tax rate per $100 of
|
|
taxable value adopted by the district may not exceed the rate equal
|
|
to the sum of $0.17 and the product of the state compression
|
|
percentage, as
determined
under Section 42.2516, multiplied by
|
|
$1.50.] |
|
SECTION 4. The following provisions of the Education Code |
|
are repealed: |
|
(1) Sections 12.106(a-1) and (a-2); |
|
(2) Chapter 41; |
|
(3) Chapter 42; and |
|
(4) Sections 45.003(e) and (f). |
|
SECTION 5. (a) As soon as practicable and not later than |
|
October 1, 2015, the commissioner of education, as required by |
|
Section 42A.052, Education Code, as added by this Act, shall: |
|
(1) make the initial determination of permissible |
|
range of wealth; and |
|
(2) notify each school district with a wealth per |
|
weighted student that is not within the permissible range of |
|
wealth. |
|
(b) Each school district proposing to form a school finance |
|
district must submit the proposed agreement to the commissioner of |
|
education for approval not later than April 1, 2016. |
|
(c) The commissioner of education shall approve or |
|
disapprove each proposed agreement not later than May 1, 2016. |
|
(d) An election for voter approval of each proposed |
|
agreement approved by the commissioner of education must occur not |
|
later than December 1, 2016. |
|
(e) Not later than May 1, 2017, the commissioner of |
|
education, as required by Section 42A.062, Education Code, as added |
|
by this Act, shall order the consolidation of each school district |
|
with a wealth per weighted student not within the permissible range |
|
of wealth that failed to obtain voter approval of the formation of a |
|
school finance district. |
|
(f) Notwithstanding any other provision of this section, |
|
the commissioner of education may modify the dates specified in |
|
this section or provide for additional deadlines as necessary to |
|
ensure that the system of public school funding provided by this Act |
|
is fully implemented beginning with the 2017 tax year and the |
|
2017-2018 school year. |
|
SECTION 6. An obligation or entitlement of a school |
|
district in connection with state funding for the 2016-2017 or an |
|
earlier school year under Chapters 41 and 42, Education Code, as |
|
those chapters existed before repeal by this Act, is not affected by |
|
this Act, and the prior law is continued in effect for that purpose. |
|
SECTION 7. (a) Subject to Subsection (b) of this section, |
|
this Act applies beginning with the 2017-2018 school year. |
|
(b) Section 42A.058, Education Code, as added by this Act, |
|
applies beginning with the 2017 tax year. |
|
SECTION 8. This Act takes effect immediately if it receives |
|
a vote of two-thirds of all the members elected to each house, as |
|
provided by Section 39, Article III, Texas Constitution. If this |
|
Act does not receive the vote necessary for immediate effect, this |
|
Act takes effect September 1, 2015. |