21.0769.03000
Sixty-seventh
Legislative Assembly SENATE BILL NO. 2327
of North Dakota
Introduced by
Senators Heitkamp, O. Larsen
Representatives Louser, Magrum, D. Ruby
1 A BILL for an Act to create and enact a new section to chapter 15.1-02 of the North Dakota
2 Century Code, relating to school district bonded indebtedness grants; to amend and reenact
3 sections 15.1-27-04.1, 15.1-27-35.3, 21-03-07, 57-15-01, 57-15-01.1, 57-15-14.2, 57-15-17,
4 and 57-15-30.2, subsection 1 of section 57-15-31, sections 57-15-32, 57-15-41, 57-19-01, and
5 57-20-07.1 of the North Dakota Century Code, relating to school district tax levies, bonding
6 authority, and determination of school state aid payments; to repeal sections 15-39.1-28,
7 15.1-09-47, 15.1-09-49, 15.1-12-16.1, 15.1-27-04.2, 15.1-27-04.3, 15.1-27-20.2, 15.1-29-15,
8 57-15-13, 57-15-14, 57-15-15.1, 57-15-16, 57-19-02, 57-19-03, 57-19-05, 57-19-09, and
9 57-19-11 of the North Dakota Century Code, relating to school district tax levies and school
10 district special reserve funds; and to provide an effective date.
11 BE IT ENACTED BY THE LEGISLATIVE ASSEMBLY OF NORTH DAKOTA:
12 SECTION 1. A new section to chapter 15.1-02 of the North Dakota Century Code is created
13 and enacted as follows:
14 School district bonded indebtedness grants.
15 The superintendent of public instruction shall provide a grant to each school district in the
16 amount necessary to retire the total outstanding principal and interest on school
17 construction-related indebtedness incurred before July 1, 2021, which was secured with school
18 district property tax revenue before the discontinuation of school district levy authority. The
19 superintendent of public instruction shall request the funds necessary to make the grant
20 payments required under this section from the general fund or from assets of the common
21 schools trust fund.
22 SECTION 2. AMENDMENT. Section 15.1-27-04.1 of the North Dakota Century Code is
23 amended and reenacted as follows:
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1 15.1-27-04.1. Baseline funding - Establishment - Determination of state aid. (Effective
2 through June 30, 2025)
3 1. To determine the amount of state aid payable to each district, the superintendent of
4 public instruction shall establish each district's baseline funding. A district's baseline
5 funding consists of:
6 a. All state aid received by the district in accordance with chapter 15.1-27 during the
7 2018-19 school year;
8 b. An amount equal to the property tax deducted by the superintendent of public
9 instruction to determine the 2018-19 state aid payment;
10 c. An amount equal to seventy-five percent of the revenue received by the school
11 district during the 2017-18 school year for the following revenue types:
12 (1) Revenue reported under code 2000 of the North Dakota school district
13 financial accounting and reporting manual, as developed by the
14 superintendent of public instruction in accordance with section 15.1-02-08;
15 (2) Mineral revenue received by the school district through direct allocation from
16 the state treasurer and not reported under code 2000 of the North Dakota
17 school district financial accounting and reporting manual, as developed by
18 the superintendent of public instruction in accordance with section
19 15.1-02-08;
20 (3) Tuition reported under code 1300 of the North Dakota school district
21 financial accounting and reporting manual, as developed by the
22 superintendent of public instruction in accordance with section 15.1-02-08,
23 with the exception of revenue received specifically for the operation of an
24 educational program provided at a residential treatment facility and tuition
25 received for the provision of an adult farm management program;
26 (4) Revenue from payments in lieu of taxes on the distribution and transmission
27 of electric power;
28 (5) Revenue from payments in lieu of taxes on electricity generated from
29 sources other than coal;
30 (6) Revenue from the leasing of land acquired by the United States for which
31 compensation is allocated to the state under 33 U.S.C. 701(c)(3);and
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1 d.c. An amount equal to the total revenue received by the school district during the
2 2017-18 school year for the following revenue types:
3 (1) Mobile home tax revenue;
4 (2) Telecommunicationstelecommunication tax revenue; and
5 (3) Revenue from payments in lieu of taxes and state reimbursement of the
6 homestead credit and disabled veterans credit; and
7 e.d. Beginning with the 2020-212022-23 school year, the superintendent shall reduce
8 the baseline funding for any school district that becomes an elementary district
9 pursuant to section 15.1-07-27 after the 2012-13 school year. The reduction must
10 be proportional to the number of weighted student units in the grades that are
11 offered through another school district relative to the total number of weighted
12 student units the school district offered in the year before the school district
13 became an elementary district. The reduced baseline funding applies to the
14 calculation of state aid for the first school year in which the school district
15 becomes an elementary district and for each year thereafter. For districts that
16 become an elementary district prior to the 2020-212022-23 school year, the
17 superintendent shall use the reduced baseline funding to calculate state aid for
18 the 2020-212022-23 school year and for each year thereafter.
19 2. a. The superintendent shall divide the district's baseline funding determined in
20 subsection 1 by the district's 2017-18 weighted student units to determine the
21 district's baseline funding per weighted student unit.
22 b. For any school district that becomes an elementary district pursuant to section
23 15.1-07-27 after the 2017-18 school year, the superintendent shall adjust the
24 district's baseline funding per weighted student unit used to calculate state aid.
25 The superintendent shall divide the district's baseline funding determined in
26 subsection 1 by the district's weighted student units after the school district
27 becomes an elementary district to determine the district's adjusted baseline
28 funding per weighted student unit. The superintendent shall use the district's
29 adjusted baseline funding per weighted student unit in the calculation of state aid
30 for the first school year in which the school district becomes an elementary
31 district and for each year thereafter.
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1 c. Beginning with the 2021-222023-24 school year and for each school year
2 thereafter, the superintendent shall reduce the district's baseline funding per
3 weighted student unit. Each year the superintendent shall calculate the amount
4 by which the district's baseline funding per weighted student unit exceeds the
5 payment per weighted student unit provided in subsection 3. The superintendent
6 shall reduce the district's baseline funding per weighted student unit by fifteen
7 percent of the amount by which the district's baseline funding per weighted
8 student unit exceeds the payment per weighted student unit for the
9 2021-222023-24 school year. For each year thereafter, the reduction percentage
10 is increased by an additional fifteen percent. However, the district's baseline
11 funding per weighted student unit, after the reduction, may not be less than the
12 payment per weighted student unit provided in subsection 3.
13 3. a. For the 2019-202021-22 school year, the superintendent shall calculate state aid
14 as the greater of:
15 (1) The district's weighted student units multiplied by nine thousand eight
16 hundred thirty-nine dollars;
17 (2) One hundred one percent of the district's baseline funding per weighted
18 student unit, as established in subsection 2, multiplied by the district's
19 weighted student units, not to exceed the district's 2017-18 baseline
20 weighted student units, plus any weighted student units in excess of the
21 2017-18 baseline weighted student units multiplied by nine thousand eight
22 hundred thirty-nine dollars; or
23 (3) The district's baseline funding as established in subsection 1.
24 b. For the 2020-212022-23 school year and each school year thereafter, the
25 superintendent shall calculate state aid as the greater of:
26 (1) The district's weighted student units multiplied by ten thousand thirty-six
27 dollars;
28 (2) One hundred two percent of the district's baseline funding per weighted
29 student unit, as established in subsection 2, multiplied by the district's
30 weighted student units, not to exceed the district's 2017-18 baseline
31 weighted student units, plus any weighted student units in excess of the
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1 2017-18 baseline weighted student units multiplied by ten thousand
2 thirty-six dollars; or
3 (3) The district's baseline funding as established in subsection 1 less the
4 amount in paragraph 1, with the difference reduced by fifteen percent for the
5 2021-222023-24 school year and fifteen percent each school year
6 thereafter, and then the difference added to the amount determined in
7 paragraph 1.
8 c. The superintendent also shall adjust state aid determined in this subsection:
9 (1) For the 2019-202021-22 school year, to ensure the amount does not exceed
10 one hundred five percent of the district's baseline funding per weighted
11 student unit, as established in subsection 2, multiplied by the district's
12 weighted student units from the previous school year.
13 (2) For the 2020-212022-23 school year and each school year thereafter, to
14 ensure the amount does not exceed one hundred ten percent of the
15 district's baseline funding per weighted student unit, as established in
16 subsection 2, multiplied by the district's weighted student units from the
17 previous school year.
18 4. After determining the product in accordance with subsection 3, the superintendent of
19 public instruction shall:
20 a. Subtract an amount equal to sixty mills multiplied by the taxable valuation of the
21 school district, except the amount in dollars subtracted for purposes of this
22 subdivision may not exceed the previous year's amount in dollars subtracted for
23 purposes of this subdivision by more than twelve percent, adjusted pursuant to
24 section 15.1-27-04.3; and
25 b. Subtract subtract an amount equal to seventy-five percent of all revenue types
26 listed in subdivisions cb and dc of subsection 1. Before determining the deduction
27 for seventy-five percent of all revenue types, the superintendent of public
28 instruction shall adjust revenues as follows:
29 (1)a. Tuition revenue shall be adjusted as follows:
30 (a)(1) In addition to deducting tuition revenue received specifically for the
31 operation of an educational program provided at a residential treatment
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1 facility and tuition revenue received for the provision of an adult farm
2 management program as directed in paragraph 3 of subdivision cb of
3 subsection 1, the superintendent of public instruction also shall reduce the
4 total tuition reported by the school district by the amount of tuition revenue
5 received for the education of students not residing in the state and for which
6 the state has not entered a cross-border education contract; and
7 (b)(2) The superintendent of public instruction also shall reduce the total tuition
8 reported by admitting school districts meeting the requirements of
9 subdivision e of subsection 2 of section 15.1-29-12 by the amount of tuition
10 revenue received for the education of students residing in an adjacent
11 school district.
12 (2)b. After adjusting tuition revenue as provided in paragraph 1subdivision a, the
13 superintendent shall reduce all remaining revenues from all revenue types by the
14 percentage of mills levied in 2018 by the school district for sinking and interest
15 relative to the total mills levied in 2018 by the school district for all purposes.
16 5. The amount remaining after the computation required under subsection 4 is the
17 amount of state aid to which a school district is entitled, subject to any other statutory
18 requirements or limitations.
19 6. On or before June thirtieth of each year, the school board shall certify to the
20 superintendent of public instruction the final average daily membership for the current
21 school year.
22 7. For purposes of the calculation in subsection 4, each county auditor, in collaboration
23 with the school districts, on an annual basis shall report the following to the
24 superintendent of public instruction on an annual basis:
25 a. Thethe amount of revenue received by each school district in the county during
26 the previous school year for each type of revenue identified in subdivisions cb
27 and dc of subsection 1;
28 b. The total number of mills levied in the previous calendar year by each school
29 district for all purposes; and
30 c. The number of mills levied in the previous calendar year by each school district
31 for sinking and interest fund purposes.
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 Sixty-seventh
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1 Baseline funding - Establishment - Determination of state aid. (Effective after
2 June 30, 2025)
3 1. To determine the amount of state aid payable to each district, the superintendent of
4 public instruction shall establish each district's baseline funding. A district's baseline
5 funding consists of:
6 a. All state aid received by the district in accordance with chapter 15.1-27 during the
7 2018-19 school year;
8 b. An amount equal to the property tax deducted by the superintendent of public
9 instruction to determine the 2018-19 state aid payment;
10 c. An amount equal to seventy-five percent of the revenue received by the school
11 district during the 2017-18 school year for the following revenue types:
12 (1) Revenue reported under code 2000 of the North Dakota school district
13 financial accounting and reporting manual, as developed by the
14 superintendent of public instruction in accordance with section 15.1-02-08;
15 (2) Mineral revenue received by the school district through direct allocation from
16 the state treasurer and not reported under code 2000 of the North Dakota
17 school district financial accounting and reporting manual, as developed by
18 the superintendent of public instruction in accordance with section
19 15.1-02-08;
20 (3) Tuition reported under code 1300 of the North Dakota school district
2