AN ACT CONCERNING THE MINIMUM BUDGET REQUIREMENT.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. Section 10-262i of the 2010 supplement to the general statutes is repealed and the following is substituted in lieu thereof (Effective from passage):

(a) For the fiscal year ending June 30, 1990, and for each fiscal year thereafter, each town shall be paid a grant equal to the amount the town is entitled to receive under the provisions of section 10-262h, as amended by this act, as calculated using the data of record as of the December first prior to the fiscal year such grant is to be paid, adjusted for the difference between the final entitlement for the prior fiscal year and the preliminary entitlement for such fiscal year as calculated using the data of record as of the December first prior to the fiscal year when such grant was paid.

(b) The amount due each town pursuant to the provisions of subsection (a) of this section shall be paid by the Comptroller, upon certification of the Commissioner of Education, to the treasurer of each town entitled to such aid in installments during the fiscal year as follows: Twenty-five per cent of the grant in October, twenty-five per cent of the grant in January and the balance of the grant in April. The balance of the grant due towns under the provisions of this subsection shall be paid in March rather than April to any town which has not adopted the uniform fiscal year and which would not otherwise receive such final payment within the fiscal year of such town.

(c) All aid distributed to a town pursuant to the provisions of this section shall be expended for educational purposes only and shall be expended upon the authorization of the local or regional board of education. For the fiscal year ending June 30, 1999, and each fiscal year thereafter, if a town receives an increase in funds pursuant to this section over the amount it received for the prior fiscal year such increase shall not be used to supplant local funding for educational purposes. The budgeted appropriation for education in any town receiving an increase in funds pursuant to this section shall be not less than the amount appropriated for education for the prior year plus such increase in funds.

(d) For the fiscal years ending June 30, 2010, and June 30, 2011, the budgeted appropriation for education shall be no less than the budgeted appropriation for education for the fiscal year ending June 30, 2009, minus any reductions made pursuant to section 19 of public act 09-1 of the June 19 special session, except that those districts whose number of resident students for the school year commencing July 1, 2010, is lower than such district's number of resident students for the school year commencing July 1, 2009, may reduce such district's budgeted appropriation for education by the difference in number of resident students for such school years multiplied by two thousand.

(e) Notwithstanding the provisions of subsection (c) of this section, for the fiscal years ending June 30, 2008, and June 30, 2009, the budgeted appropriation for education in any town receiving an increase in funds pursuant to this section shall be not less than the amount appropriated for education for the prior year plus the percentage of such increase in funds as determined under subsection (f) of this section.

(f) (1) Except as provided for in subdivisions (2), (3) and (4) of this subsection, the percentage of the increase in aid pursuant to this section applicable under subsection (e) shall be the average of the results of (A) (i) a town's current program expenditures per resident student pursuant to subdivision (36) of section 10-262f, subtracted from the highest current program expenditures per resident student in this state, (ii) divided by the difference between the highest current program expenditures per resident student in this state and the lowest current program expenditures per resident student in this state, (iii) multiplied by thirty per cent, (iv) plus fifty percentage points, (B) (i) a town's wealth pursuant to subdivision (26) of section 10-262f, subtracted from the wealth of the town with the highest wealth of all towns in this state, (ii) divided by the difference between the wealth of the town with the highest wealth of all towns in this state and the wealth of the town with the lowest wealth of all towns in this state, (iii) multiplied by thirty per cent, (iv) plus fifty percentage points, and (C) (i) a town's grant mastery percentage pursuant to subdivision (12) of section 10-262f, subtracted from one, subtracted from one minus the grant mastery percentage of the town with the highest grant mastery percentage in this state, (ii) divided by the difference between one minus the grant mastery percentage of the town with the highest grant mastery percentage in this state and one minus the grant mastery percentage of the town with the lowest grant mastery percentage in this state, (iii) multiplied by thirty per cent, (iv) plus fifty percentage points.

(2) For the fiscal year ending June 30, 2009, any town whose school district is in its third year or more of being identified as in need of improvement pursuant to section 10-223e, and has failed to make adequate yearly progress in mathematics or reading at the whole district level, the percentage determined pursuant to subdivision (1) of this subsection for such town shall be increased by an additional twenty percentage points.

(3) For the fiscal year ending June 30, 2010, any town whose school district is in its third year or more of being identified as in need of improvement pursuant to section 10-223e, and has failed to make adequate yearly progress in mathematics or reading at the whole district level, the percentage of the increase in aid pursuant to this section applicable under subsection (e) of this section shall be the percentage of the increase determined under subdivision (1) of this section for such town, plus twenty percentage points, or eighty per cent, whichever is greater.

(4) Notwithstanding the provisions of this section, for the fiscal year ending June 30, 2008, and each fiscal year thereafter, any town that (A) is a member of a regional school district that serves only grades seven to twelve, inclusive, or grades nine to twelve, inclusive, (B) appropriates at least the minimum percentage of increase in aid pursuant to the provisions of this section, and (C) has a reduced assessment from the previous fiscal year for students enrolled in such regional school district, excluding debt service for such students, shall be considered to be in compliance with the provisions of this section.

(5) Notwithstanding any provision of the general statutes, charter, special act or home rule ordinance, on or before September 15, 2007, for the fiscal year ending June 30, 2008, a town may request the Commissioner of Education to defer a portion of the town's increase in aid over the prior fiscal year pursuant to this section to be expended in the subsequent fiscal year. If the commissioner approves such request, the deferred amount shall be credited to the increase in aid for the fiscal year ending June 30, 2009, rather than the fiscal year ending June 30, 2008. Such funds shall be expended in the fiscal year ending June 30, 2009, in accordance with the provisions of this section. In no case shall a town be allowed to defer increases in aid required to be spent for education as a result of failure to make adequate yearly progress in accordance with the provisions of subdivisions (2) and (3) of this subsection.

(g) Upon a determination by the State Board of Education that a town or kindergarten to grade twelve, inclusive, regional school district failed in any fiscal year to meet the requirements pursuant to subsection (c), (d) or (e) of this section, the town or kindergarten to grade twelve, inclusive, regional school district shall forfeit an amount equal to two times the amount of the shortfall. The amount so forfeited shall be withheld by the Department of Education from the grant payable to the town in the second fiscal year immediately following such failure by deducting such amount from the town's equalization aid grant payment pursuant to this section, except that in the case of a kindergarten to grade twelve, inclusive, regional school district, the amount so forfeited shall be withheld by the Department of Education from the grants payable pursuant to this section to the towns which are members of such regional school district. The amounts deducted from such grants to each member town shall be proportional to the number of resident students in each member town. Notwithstanding the provisions of this subsection, the State Board of Education may waive such forfeiture upon agreement with the town or kindergarten to grade twelve, inclusive, regional school district that the town or kindergarten to grade twelve, inclusive, regional school district shall increase its budgeted appropriation for education during the fiscal year in which the forfeiture would occur by an amount not less than the amount of said forfeiture or for other good cause shown. Any additional funds budgeted pursuant to such an agreement shall not be included in a district's budgeted appropriation for education for the purpose of establishing any future minimum budget requirement.

Sec. 2. Subdivision (3) of subsection (c) of section 10-262h of the 2010 supplement to the general statutes is repealed and the following is substituted in lieu thereof (Effective from passage):

(3) The town of East Hartford shall not receive less than its fixed entitlement [pursuant to this subsection] for the fiscal year ending June 30, 2009.

Statement of Purpose:

To allow school districts whose student population has declined to reduce the budgeted appropriation for education for purposes of the minimum budget requirement and to make a revision to the equalization aid grant for East Hartford.

[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not underlined.]