SESSION OF 2020
SUPPLEMENTAL NOTE ON HOUSE BILL NO. 2465
As Further Amended by House Committee on K-
12 Education Budget
Brief*
HB 2465, as amended, would amend the Tax Credit for
Low Income Students Scholarship Program (Program) by
expanding student eligibility. The bill would also require the
Kansas State Department of Education (KSDE) to publish
one-page accountability reports for accredited nonpublic
schools. Finally, the bill would amend the state aid schedule
for Capital Improvement State Aid.
Student Eligibility for the Tax Credit for Low Income
Students Scholarship Program
The bill would amend the Program to expand student
eligibility in two ways. First, the bill would amend the definition
of “eligible student” to include students who are eligible for
free or reduced-priced meals under the National School
Lunch Program, reside in Kansas, and are enrolled in a public
school or are eligible to be enrolled in a public school. Current
law limits eligibility to students who are eligible for free meals.
Second, the bill would amend the definition of “public
school” for the purposes of determining student eligibility for
the Program. The bill would define “public school” as any
school operated by a unified school district in Kansas.
Current law limits eligibility to those students enrolled or
eligible to be enrolled in the lowest 100 performing
elementary schools, as identified by the State Board of
Education (State Board).
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*Supplemental notes are prepared by the Legislative Research
Department and do not express legislative intent. The supplemental
note and fiscal note for this bill may be accessed on the Internet at
http://www.kslegislature.org
The bill would also make technical amendments and
retain a provision in current law that allows any student who
has previously received a scholarship under the Program and
has not graduated high school or is not 21 years old to
remain eligible for the Program.
Accountability Reports
The bill would require KSDE to prepare one-page
accountability reports for all accredited nonpublic schools in
the state. The bill would also require KSDE to include
accredited nonpublic schools in the longitudinal achievement
report submitted to the Governor and Legislature each year.
The bill would require the websites of accredited
nonpublic schools participating in the Program to include a
prominent link to KSDE’s website where the one-page
accountability reports are published.
Capital Improvement State Aid
The bill would amend the Capital Improvement State Aid
schedule for general obligation bonds issued by school
districts. The bill would exclude Unified School District (USD)
207 (Fort Leavenworth) from the state aid schedule for
general obligation bond issuances approved at an election
held on or after July 1, 2020.
Under current law, Capital Improvement State Aid for
bonds approved at an election held on or after July 1, 2015, is
calculated as follows:
● School districts are ranked according to their
assessed valuation per pupil (AVPP), as rounded
to the nearest $1,000;
● The school district with the lowest AVPP receives
75.0 percent state aid; and
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● For every $1,000 in AVPP above the lowest AVPP,
state aid is decreased by 1.0 percent.
The bill would revise the calculation of Capital
Improvement State Aid for bonds approved at an election
held on or after July 1, 2020, as follows:
● School districts would be ranked according to their
AVPP, as rounded to the nearest $1,000;
● The school district, other than USD 207, with the
lowest AVPP would receive 75.0 percent state aid;
and
● For every $1,000 in AVPP above the lowest AVPP
(excluding USD 207), state aid would be
decreased by 1.0 percent.
Background
The bill, as further amended by the House Committee,
includes the contents of HB 2465 and HB 2526.
HB 2465 (Student Eligibility for the Tax Credit for Low
Income Students Scholarship Program and
Accountability Reports)
The bill was introduced by the House Committee on
Education at the request of Representative Huebert.
In the House Committee on K-12 Education Budget
hearing, proponent testimony was provided by
representatives of ACE Scholarships, All Saints Catholic
School, Bishop Ward High School, the Catholic Education
Foundation, EdChoice, ExcelinEd, Hayden High School, Holy
Savior Catholic Academy, Kansas Policy Institute, Support for
Catholic Schools, and the Urban Preparatory Academy and
by a private citizen. The proponents favored expanding
student eligibility for the Program due to the impact of the
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Program on current scholarship recipients, and generally
favored expanding school choice programs in Kansas as a
way to help low-performing students. Written-only proponent
testimony was provided by representatives of Americans for
Prosperity–Kansas and the Kansas Catholic Conference.
Neutral testimony was provided by a representative of
the State Board. The representative indicated the State Board
had not determined an official position on the bill and
encouraged the Legislature to ensure that performance data
for accredited nonpublic schools be made available to
parents.
Opponent testimony was provided by representatives of
Game On for Kansas Schools, the Kansas National
Education Association, the Kansas Association of School
Boards (KASB), the Kansas School Superintendents’
Association, Stand Up Blue Valley, and United School
Administrators of Kansas. Opponents generally opposed
providing public funding to private schools and favored
funding for public schools to help low-performing students.
Written-only opponent testimony was provided by
representatives of Education First Shawnee Mission,
Mainstream Coalition, the Olathe Public Education Network,
One United Voice, the Overland Park Chamber of Commerce,
and USD 512 (Shawnee Mission), and by a private citizen.
On February 10, 2020, the House Committee amended
the bill as follows:
● Deleted language that specified student eligibility
for free or reduced meals would be based on the
requirements of the National School Lunch
Program as it existed on January 1, 2020; and
● Added language to require KSDE to include
accredited nonpublic schools in accountability
reporting and to require nonpublic schools
participating in the Program to include a link to the
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one-page accountability reports produced by KSDE
on the school’s website.
On February 26, 2020, the bill, as amended by the
House Committee, was withdrawn from the House Calendar
and referred to the House Committee on Appropriations.
On March 4, 2020, the bill was withdrawn from the
Committee on Appropriations and rereferred to the House
Committee on K-12 Education Budget. On the same day, the
House Committee further amended the bill to insert the
contents of HB 2526, as recommended by the House
Committee.
According to the fiscal note prepared by the Division of
the Budget on the bill as introduced, the bill would increase
the number of students eligible for scholarships under the
Program. However, the additional number of contributions to
scholarship granting organizations cannot be estimated.
Additionally, any additional tax credits claimed would reduce
revenues to the State General Fund. The total amount of tax
credits for contributions is capped at $10.0 million per tax
year. Any fiscal effect associated with enactment of the bill is
not reflected in The FY 2021 Governor’s Budget Report.
HB 2526 (Capital Improvement State Aid)
The bill was introduced by the House Committee on K-
12 Education Budget at the request of Representative
Thomas.
In the House Committee hearing on the bill, proponent
testimony was provided by Representative Thomas and
representatives of the KASB, USD 230 (Spring Hill), USD 261
(Haysville), and USD 333 (Concordia). Proponents stated the
bill would provide more equitable funding for capital
improvements and would provide some property tax relief to
local taxpayers. In addition, proponents stated USD 207 (Fort
Leavenworth) is an outlier because of its low AVPP and the
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prohibition in state law preventing the school district from
issuing general obligation bonds. Written-only proponent
testimony was provided by representatives of USD 202
(Turner-Kansas City), USD 203 (Piper-Kansas City), USD
233 (Olathe), USD 253 (Emporia), USD 266 (Maize), and
USD 393 (Solomon).
Neutral testimony was provided by a representative of
Piper Sandler Companies. The representative stated the
equalization formula for capital improvements should be
amended to increase the number of school districts eligible to
receive state aid, but also stated several options exist for
amending the equalization formula.
No opponent testimony was provided.
According to the fiscal note prepared by the Division of
the Budget on HB 2526, the KSDE indicates the state aid
rates for school districts would increase by removing USD
207 from the AVPP schedule for calculating Capital
Improvement State Aid. According to the KSDE, much of the
real property located in USD 207 is owned by the federal
government and, therefore, exempt from property taxes. As a
result, USD 207 is always the lowest ranked district based on
AVPP. Under current law, USD 207 would theoretically be
entitled to 75.0 percent state aid for capital improvements;
however, KSA 72-1210(b) prohibits USD 207 from issuing
general obligation bonds and, therefore, the district cannot
receive state aid.
According to the fiscal note prepared by the Division of
the Budget on the bill, the short-term fiscal effect of the bill
would be negligible. The KSDE indicates few, if any, school
districts would pass a bond issuance after July 1, 2020, and
then issue bonds in time to qualify for state aid for FY 2021.
The long-term fiscal effect of the bill would be to increase
Capital Improvement State Aid expenditures due to the
increase in state aid rates caused by the removal of USD 207
from the state aid schedule. However, the KSDE cannot
estimate the increase in state aid without knowing which
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school districts would approve bond issuances and how much
bonding authority would be authorized. Any fiscal effect
associated with the bill is not reflected in The FY 2021
Governor’s Budget Report.
According to analysis of HB 2526 performed by the
Kansas Legislative Research Department and presented to
the House Committee in the hearing on the bill, removing
USD 207 from the Capital Improvement State Aid schedule
would increase state aid rates for Capital Improvement State
Aid by approximately 24.0 percent and increase the number
of school districts eligible to receive state aid by 53 (from 126
to 179). This analysis was conducted using the AVPP for the
2018-2019 school year. Any analysis using the AVPP for the
2019-2020 school year would produce different results.
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Statutes affected: As introduced: 72-4352, 72-5132
As Amended by House Committee: 72-4352, 72-5132, 72-4354, 72-5178, 72-1181
As Further Amended by House Committee: 72-4352, 72-5132, 72-4354, 72-5178, 72-1181, 72-5462