1.1 	A bill for an act
1.2 	relating to education finance; increasing the basic
1.3 	formula allowance; restoring the special education
1.4 	growth factors; amending Minnesota Statutes 2004,
1.5 	sections 125A.76, subdivisions 1, 4; 125A.79,
1.6 	subdivisions 1, 6; 126C.10, subdivision 2.
1.7 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.8 	Section 1. Minnesota Statutes 2004, section 125A.76,
1.9 	subdivision 1, is amended to read:
1.10 		Subdivision 1.Definitions.  For the purposes of this
1.11 	section, the definitions in this subdivision apply.
1.12 	(a) "Base year" for fiscal year 1998 and later fiscal years
1.13 	means the second fiscal year preceding the fiscal year for which
1.14 	aid will be paid.
1.15 	(b) "Basic revenue" has the meaning given it in section
1.16 	126C.10, subdivision 2.  For the purposes of computing basic
1.17 	revenue pursuant to this section, each child with a disability
1.18 	shall be counted as prescribed in section 126C.05, subdivision 1.
1.19 	(c) "Essential personnel" means teachers, cultural
1.20 	liaisons, related services, and support services staff providing
1.21 	direct services to students.  Essential personnel may also
1.22 	include special education paraprofessionals or clericals
1.23 	providing support to teachers and students by preparing
1.24 	paperwork and making arrangements related to special education
1.25 	compliance requirements, including parent meetings and
1.26 	individual education plans.
2.1 	(d) "Average daily membership" has the meaning given it in
2.2 	section 126C.05.
2.3 	(e) "Program growth factor" means 1.046 for fiscal year
2.4 	2003, ~~and~~ 1.0 for fiscal year 2004 through fiscal year 2006, and
2.5 	1.046 for fiscal year 2007 and later.
2.6 	
EFFECTIVE DATE. This section is effective for revenue for
2.7 	fiscal year 2006.

2.8 	Sec. 2. Minnesota Statutes 2004, section 125A.76,
2.9 	subdivision 4, is amended to read:
2.10 		Subd. 4.State total special education aid.  The state
2.11 	total special education aid for fiscal year 2004 equals
2.12 	$530,642,000.  The state total special education aid for fiscal
2.13 	year 2005 equals $529,164,000. The state total special
2.14 	education aid for fiscal year 2006 equals $578,967,000.The
2.15 	state total special education aid for later fiscal years equals:
2.16 	(1) the state total special education aid for the preceding
2.17 	fiscal year; times
2.18 	(2) the program growth factor; times
2.19 	(3) the ratio of the state total average daily membership
2.20 	for the current fiscal year to the state total average daily
2.21 	membership for the preceding fiscal year.
2.22 	
EFFECTIVE DATE. This section is effective for revenue for
2.23 	fiscal year 2006.

2.24 	Sec. 3. Minnesota Statutes 2004, section 125A.79,
2.25 	subdivision 1, is amended to read:
2.26 		Subdivision 1.Definitions.  For the purposes of this
2.27 	section, the definitions in this subdivision apply.
2.28 	(a) "Unreimbursed special education cost" means the sum of
2.29 	the following:
2.30 	(1) expenditures for teachers' salaries, contracted
2.31 	services, supplies, equipment, and transportation services
2.32 	eligible for revenue under section 125A.76; plus
2.33 	(2) expenditures for tuition bills received under sections
2.34 	125A.03 to 125A.24 and 125A.65 for services eligible for revenue
2.35 	under section 125A.76, subdivision 2; minus
2.36 	(3) revenue for teachers' salaries, contracted services,
3.1 	supplies, and equipment under section 125A.76; minus
3.2 	(4) tuition receipts under sections 125A.03 to 125A.24 and
3.3 	125A.65 for services eligible for revenue under section 125A.76,
3.4 	subdivision 2.
3.5 	(b) "General revenue" means for fiscal year 1996, the sum
3.6 	of the general education revenue according to section 126C.10,
3.7 	subdivision 1, as adjusted according to section 127A.47,
3.8 	subdivision 7, plus the total referendum revenue according to
3.9 	section 126C.17, subdivision 4.  For fiscal years 1997 and
3.10 	later, "general revenue" means the sum of the general education
3.11 	revenue according to section 126C.10, subdivision 1, as adjusted
3.12 	according to section 127A.47, subdivisions 7 and 8, plus the
3.13 	total referendum revenue minus transportation sparsity revenue
3.14 	minus total operating capital revenue.
3.15 	(c) "Average daily membership" has the meaning given it in
3.16 	section 126C.05.
3.17 	(d) "Program growth factor" means 1.02 for fiscal year
3.18 	2003, ~~and~~ 1.0 for fiscal year 2004 through fiscal year 2006, and
3.19 	1.02 for fiscal year 2007 and later.
3.20 	
EFFECTIVE DATE. This section is effective for revenue for
3.21 	fiscal year 2006.

3.22 	Sec. 4. Minnesota Statutes 2004, section 125A.79,
3.23 	subdivision 6, is amended to read:
3.24 		Subd. 6.State total special education excess cost aid.
 3.25 	The state total special education excess cost aid for fiscal
3.26 	year 2004 equals $92,067,000.  The state total special education
3.27 	aid for fiscal year 2005 equals $91,811,000. The state total
3.28 	special education aid for fiscal year 2006 equals $95,520,000.
3.29 	The state total special education excess cost aid for fiscal
3.30 	year ~~2006~~ 2007 and later fiscal years equals:
3.31 	(1) the state total special education excess cost aid for
3.32 	the preceding fiscal year; times
3.33 	(2) the program growth factor; times
3.34 	(3) the ratio of the state total average daily membership
3.35 	for the current fiscal year to the state total average daily
3.36 	membership for the preceding fiscal year.
4.1 	
EFFECTIVE DATE. This section is effective for revenue for
4.2 	fiscal year 2006.

4.3 	Sec. 5. Minnesota Statutes 2004, section 126C.10,
4.4 	subdivision 2, is amended to read:
4.5 		Subd. 2.Basic revenue.  The basic revenue for each
4.6 	district equals the formula allowance times the adjusted
4.7 	marginal cost pupil units for the school year. ~~The formula~~
4.8 	~~allowance for fiscal year 2001 is $3,964.  The formula allowance~~
4.9 	~~for fiscal year 2002 is $4,068.~~The formula allowance for
4.10 	fiscal year 2003 through fiscal year 2005 is $4,601.  The
4.11 	formula allowance for fiscal year 2006 is $4,851.  The formula
4.12 	allowance for fiscal year 2007 and subsequent years is
4.13 	~~$4,601~~ $5,101.
4.14 	
EFFECTIVE DATE. This section is effective for revenue for
4.15 	fiscal year 2006.