Senate File 2405 - Enrolled
Senate File 2405
AN ACT
MODIFYING PROVISIONS RELATED TO THE DISTRIBUTION FORMULA
FOR GENERAL STATE FINANCIAL AID TO COMMUNITY COLLEGES AND
INCLUDING APPLICABILITY PROVISIONS.
4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1 Section 1. Section 260C.18C, Code 2024, is amended to read
2 as follows:
3 260C.18C State aid distribution formula.
4 1. Purpose. A distribution plan for general state financial
5 aid to Iowa’s community colleges is established for the fiscal
6 year commencing July 1, 2005 2025, and succeeding fiscal years.
7 Funds appropriated by the general assembly to the department
8 for general financial aid to community colleges shall be
9 allocated to each community college in the manner provided
10 under this section for the community colleges to provide
11 the highest quality educational opportunities and services,
12 as described in section 260C.1, to the greatest number of
13 students.
14 2. Definitions. As used in this section and section
15 260C.18D, unless the context otherwise requires:
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16 a. “Base funding allocation” means the amount of general
17 state financial aid all community colleges received in the base
18 year.
19 b. “Base year” means the fiscal year immediately preceding
20 the budget year.
21 c. “Below-average support per FTEE” for a community college
22 means the state-average combined support per FTEE minus the
23 combined support per FTEE for the community college if the
24 community college’s combined support per FTEE is less than the
25 state-average combined support per FTEE.
26 d. c. “Budget year” means the fiscal year for which moneys
27 are appropriated by the general assembly.
28 e. d. “Combined support” for a community college means
29 the total amount of moneys the community college received in
30 general state financial aid in the base year plus the community
31 college’s general fund property tax revenue, including utility
32 replacement, for the base year.
33 f. “Combined support per FTEE” for a community college
34 means the community college’s combined support divided by its
35 three-year rolling average full-time equivalent enrollment for
1 the three years prior to the base year.
2 g. “Contact hour” for a noncredit course equals fifty
3 minutes of contact between an instructor and students in a
4 scheduled course offering for which students are registered.
5 h. “Credit hour”, for purposes of community college funding
6 distribution, shall be as defined by the department by rule.
7 i. “Eligible credit courses” means all credit courses that
8 are eligible for general state financial aid which are part
9 of a department-approved program of study. The department
10 shall review and provide a determination should a question of
11 eligibility occur.
12 j. “Eligible growth support” for a community college is the
13 community college’s below-average support per FTEE multiplied
14 times its three-year rolling average full-time equivalent
15 enrollment.
16 k. “Eligible noncredit courses” means all noncredit courses
17 eligible for general state financial aid which fall under one
18 of the eligible categories for noncredit courses as defined
19 by rule of the department. The department shall review and
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20 provide a determination should a question of eligibility occur.
21 l. “Eligible student” means a student enrolled in eligible
22 credit or eligible noncredit courses. The department shall
23 review and provide a determination should a question of
24 eligibility occur.
25 m. e. “Fiscal year” means the period of twelve months
26 beginning on July 1 and ending on June 30.
27 n. One “full-time equivalent enrollment (FTEE)” equals
28 twenty-four credit hours for credit courses or six hundred
29 contact hours for noncredit courses generated by all eligible
30 students enrolled in eligible courses.
31 o. f. “General fund property tax revenue” means the amount
32 of moneys a community college raised or could have raised from
33 a property tax of twenty and one-fourth cents per thousand
34 dollars of assessed valuation on all taxable property in its
35 merged area collected for the base year.
1 p. g. “General state financial aid” means the amount of
2 general state financial aid the community college received from
3 the general fund.
4 q. “Inflation adjustment amount” means the inflation rate
5 minus two percentage points multiplied times the base funding
6 allocation. The inflation adjustment amount shall not be less
7 than zero.
8 r. “Inflation rate” means the average of the preceding
9 twelve-month percentage change, which shall be computed on
10 a monthly basis, in the consumer price index for all urban
11 consumers, not seasonally adjusted, published by the United
12 States department of labor, bureau of labor statistics,
13 calculated for the calendar year ending six months after the
14 beginning of the base year.
15 s. “State-average combined support per FTEE” means the
16 average of the combined support per FTEE for all community
17 colleges in the state in the base year.
18 t. “Three-year rolling average full-time equivalent
19 enrollment” means the average of the audited full-time
20 equivalent enrollment for a community college over the three
21 fiscal years prior to the base year as determined by the
22 department.
23 u. “Total growth support amount” means the sum of the
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24 eligible growth support for all the community colleges.
25 3. Distribution formula. Moneys appropriated by the general
26 assembly from the general fund to the department for community
27 college purposes for general state financial aid for a budget
28 year shall be allocated to each community college by the
29 department as follows:
30 a. If the inflation rate is equal to two percent or less:
31 (1) Base funding allocation. The moneys shall first
32 be allocated in the amount of general state financial aid
33 each community college received in the base year. If the
34 appropriation is less than the total of the amount of general
35 state financial aid each community college received in the base
1 year, the moneys shall be allocated in the same proportion as
2 the allocation of general state financial aid each community
3 college received in the base year.
4 (2) Marginal cost adjustment. After the base funding has
5 been allocated, each community college shall be allocated up to
6 an additional two percent of its base funding allocation. The
7 community college’s allocation shall be in the same proportion
8 as the allocation of general state financial aid each community
9 college received in the base year.
10 (3) Three-year rolling average of full-time equivalent
11 enrollment. If the increase in the total state general aid
12 exceeds two percent over the base funding allocation, an amount
13 up to an additional one percent of the base funding allocation
14 shall be distributed based upon each community college’s
15 proportional share of the three-year rolling average full-time
16 equivalent enrollments for all community colleges.
17 (4) Extraordinary growth adjustment. If the increase in
18 total state general aid exceeds three percent over the base
19 funding allocation, an amount up to an additional one percent
20 of the base funding allocation shall be distributed as follows:
21 (a) Forty percent of the moneys shall be allocated based
22 upon each community college’s proportional share of the
23 three-year rolling average full-time equivalent enrollments for
24 all community colleges.
25 (b) Sixty percent of the moneys shall be allocated to
26 community colleges that have eligible growth support. The
27 allocation shall be based upon the proportional share that each
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28 community college’s eligible growth support bears to the total
29 growth support amount. Once the moneys allocated under this
30 subparagraph division equal the total growth support amount,
31 the remaining moneys allocated under this subparagraph shall be
32 allocated as provided in subparagraph division (a).
33 (5) Additional three-year rolling average FTEE
34 allocation. If the increase in total state general aid
35 exceeds four percent over the base funding allocation, all
1 remaining moneys shall be distributed based upon each college’s
2 proportional share of the three-year rolling average full-time
3 equivalent enrollments for all community colleges Annually,
4 on or before October 31 of each year, the presidents of
5 the community colleges and the chancellors of the community
6 colleges who serve as the chief executive officers of such
7 community colleges shall establish a distribution formula for
8 general state aid to the community colleges for the succeeding
9 budget year. When determining the distribution formula
10 pursuant to this paragraph, the presidents and chancellors
11 shall consider the enrollment and combined support for each
12 community college, along with any other factor deemed relevant
13 by the presidents and chancellors. The distribution formula
14 shall not allocate funding to a community college that is below
15 the general state financial aid the community college received
16 in any previous budget year, unless there is a reduction in the
17 base funding allocation. The distribution formula requires the
18 approval of at least ten of the presidents and chancellors. If
19 the presidents and chancellors approve a distribution formula
20 pursuant to this paragraph, the presidents and chancellors
21 shall transmit the distribution formula to the department, and
22 the department shall implement the distribution formula.
23 b. If the inflation rate is greater than two percent but
24 less than four percent:
25 (1) Base funding allocation. The moneys shall first
26 be allocated in the amount of general state financial aid
27 each community college received in the base year. If the
28 appropriation is less than the total of the amount of general
29 state financial aid each community college received in the base
30 year, the moneys shall be allocated in the same proportion as
31 the allocation of general state financial aid each community
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32 college received in the base year.
33 (2) Marginal cost adjustment. After the base funding has
34 been allocated, each community college shall be allocated up to
35 an additional two percent of its base funding allocation. The
1 community college’s allocation shall be in the same proportion
2 as the allocation of general state financial aid each community
3 college received in the base year.
4 (3) Three-year rolling average of full-time equivalent
5 enrollment. If the increase in the total state general aid
6 exceeds two percent over the base funding allocation, an amount
7 up to an additional one percent of the base funding allocation
8 shall be distributed based upon each community college’s
9 proportional share of the three-year rolling average full-time
10 equivalent enrollments for all community colleges.
11 (4) Extraordinary growth adjustment. If the increase in
12 total state general aid exceeds three percent over the base
13 funding allocation, an amount up to an additional one percent
14 of the base funding allocation shall be based as follows:
15 (a) Forty percent of the moneys shall be allocated based
16 upon each community college’s proportional share of the
17 three-year rolling average full-time equivalent enrollments for
18 all community colleges.
19 (b) Sixty percent of the moneys shall be allocated to
20 community colleges that have eligible growth support. The
21 allocation shall be based upon the proportional share that each
22 community college’s eligible growth support bears to the total
23 growth support amount. Once the moneys allocated under this
24 subparagraph division equal the total growth support amount,
25 the remaining moneys allocated under this subparagraph shall be
26 allocated as provided in subparagraph division (a).
27 (5) Inflation adjustment. If the increase in total
28 state general aid exceeds four percent over the base funding
29 allocation, an amount up to the inflation adjustment amount
30 shall be distributed to each community college in the same
31 proportion as the allocation of general state financial aid
32 each community college received in the base year.
33 (6) Additional three-year rolling average FTEE
34 allocation. If there are remaining moneys to be distributed
35 under this paragraph after distributing moneys under
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1 subparagraph (5), all remaining moneys shall be distributed
2 based upon each community college’s proportional share of the
3 three-year rolling average full-time equivalent enrollments
4 for all community colleges If the presidents of the community
5 colleges and the chancellors of the community colleges who
6 serve as the chief executive officers of such community
7 colleges fail to approve a distribution formula on or before
8 October 31 pursuant to paragraph “a”, the department shall
9 establish the distribution formula for general state aid
10 to the community colleges for the succeeding budget year.
11 When determining the distribution formula pursuant to this
12 paragraph, the department shall consider the enrollment
13 and combined support for each community college, along with
14 any other factor deemed relevant by the department. The
15 distribution formula shall not allocate funding to a community
16 college that is below the general state financial aid the
17 community college received in any previous budget year, unless
18 there is a reduction in the base funding allocation.
19 c. If the inflation rate equals or exceeds four percent:
20 (1) Base funding allocation. The moneys shall first
21 be allocated in the amount of general state financial aid
22 each community college received in the base year. If the
23 appropriation is less than the total of the amount of general
24 state financial aid each community college received in the base
25 year, the moneys shall be allocated in the same proportion as
26 the allocation of general state financial aid each community
27 college received in the base year.
28 (2) Marginal cost adjustment. After the base funding has
29 been allocated, each community college shall be allocated up to
30 an additional two percent of its base funding allocation. The
31 community college’s allocation shall be in the same proportion
32 as the allocation of general state financial aid each community
33 college received in the base year.
34 (3) Three-year rolling average of full-time equivalent
35 enrollment. If the increase in the total state general aid
1 exceeds two percent over the base funding allocation, an amount
2 up to an additional one percent of the base funding allocation
3 shall be distributed based upon each community college’s
4 proportional share of the three-year rolling average full-time
 Senate File 2405, p. 8
5 equivalent enrollments for all community colleges.
6 (4) Inflation adjustment. If the increase in total state
7 general aid exceeds three percent over the base funding
8 allocation, an amount up to the inflation adjustment amount
9 shall be distributed to each community college in the same
10 proportion as the allocation of general state financial aid
11 each community college received in the base year.
12 (5) Extraordinary growth adjustment. If there are
13 remaining moneys to be distributed under this paragraph after
14 distributing moneys under subparagraph (4), an amount up to an
15 additional one percent of the base funding allocation shall be
16 based as follows:
17 (a) Forty percent of the moneys shall be allocated based
18 upon each community college’s proportional share of the
19 three-year rolling average full-time equivalent enrollments for
20 all community colleges.
21 (b) Sixty percent of the moneys shall be allocated to
22 community colleges that have eligible growth support. The
23 allocation shall be based upon the proportional share that each
24 community college’s eligible growth support bears to the total
25 growth support amount. Once the moneys allocated under this
26 subparagraph division equal the total growth support amount,
27 the remaining moneys allocated under this subparagraph shall be
28 allocated as provided in subparagraph division (a).
29 (6) Additional three-year rolling average FTEE
30 allocation. If there are remaining moneys to be distributed
31 under this paragraph after distributing moneys under
32 subparagraph (5), all remaining moneys shall be distributed
33 based upon each community college’s proportional share of the
34 three-year rolling average full-time equivalent enrollments for
35 all community colleges.
1 4. Information supplied by colleges and adoption of rules.
2 a. Each community college shall provide information in
3 the manner and form as determined by the department. If
4 a community college fails to provide the information as
5 requested, t