SB 64: "An Act repealing state aid for costs of school construction debt; and providing for an effective date."

00 SENATE BILL NO. 64 01 "An Act repealing state aid for costs of school construction debt; and providing for an 02 effective date." 03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 04 * Section 1. AS 14.11.014(a) is amended to read: 05 (a) The commissioner shall establish a [BOND REIMBURSEMENT AND] 06 grant review committee for the purpose described in (b) of this section. In making 07 selections to the committee, the commissioner shall seek to maintain a regional 08 statewide balance on the committee. The committee shall consist of the commissioner 09 or the commissioner's designee, two members of the legislature selected by the 10 presiding officers of the house and senate, and six other people selected by the 11 commissioner as follows: 12 (1) two persons shall have professional degrees and experience in 13 school construction; 14 (2) two persons shall have experience in urban or rural school facilities

01 management; 02 (3) two persons shall represent the public. 03 * Sec. 2. AS 14.11.014(b) is amended to read: 04 (b) The committee shall 05 (1) review the department's priorities among projects for which school 06 construction grants are requested; 07 (2) make recommendations to the board concerning school 08 construction grants [AND MAKE RECOMMENDATIONS TO THE 09 COMMISSIONER CONCERNING PROJECTS FOR WHICH BOND 10 REIMBURSEMENT IS REQUESTED]; 11 (3) develop criteria for construction of schools in the state; criteria 12 developed under this paragraph must include requirements intended to achieve cost- 13 effective school construction ,including consideration of multipurpose function 14 and designs to reduce overall facility costs for the affected community; 15 (4) analyze existing prototypical designs for school construction 16 projects; 17 (5) establish a form for grant applications; 18 (6) establish a method of ranking grant projects; 19 (7) recommend to the board necessary changes to the approval process 20 for school construction grants [AND FOR PROJECTS FOR WHICH BOND 21 REIMBURSEMENT IS REQUESTED]; 22 (8) set standards for energy efficiency for school construction and 23 major maintenance to provide energy efficiency benefits for all school locations in the 24 state and that address energy efficiency in design and energy systems that minimize 25 long-term energy and operating costs. 26 * Sec. 3. AS 14.11.025(b) is amended to read: 27 (b) The amount of money available each fiscal year for expenditure under (a) 28 of this section shall be the annual debt service on the projected liability for debt 29 incurred and funded for reimbursement before July 1, 2019, under former 30 AS 14.11.100(a) divided by the percentage of all schools that are located in a city or 31 borough school district that is not a small municipal school district, the quotient of

01 which is to be multiplied by .244. 02 * Sec. 4. AS 14.11.035 is amended to read: 03 Sec. 14.11.035. Report on school construction and major maintenance 04 funding. Every February, the department shall provide to the governor and the 05 legislature an annual report on the effectiveness of the school construction and major 06 maintenance grants and [,] state aid for school construction and major maintenance in 07 regional educational attendance areas [, AND STATE AID FOR COSTS OF 08 SCHOOL CONSTRUCTION DEBT] under this chapter. The report must include an 09 analysis of funding sources and the short-term and long-term fiscal effects of the 10 funding on the state. Copies of the report shall be made available to the public and to 11 the legislature. 12 * Sec. 5. AS 14.11.135(3) is amended to read: 13 (3) "costs of school construction" means the cost of acquiring, 14 constructing, enlarging, repairing, remodeling, equipping, or furnishing of public 15 elementary and secondary schools that are owned or operated by the state, a 16 municipality, or a district and includes the sum total of all costs of financing and 17 carrying out the project; these include the costs of all necessary studies, surveys, plans 18 and specifications, architectural, engineering, or other special services, acquisition of 19 real property, site preparation and development, purchase, construction, 20 reconstruction, and improvement of real property and the acquisition of machinery and 21 equipment that may be necessary in connection with the project; an allocable portion 22 of the administrative and operating expenses of the grantee; the cost of financing the 23 project [, INCLUDING INTEREST ON BONDS ISSUED TO FINANCE THE 24 PROJECT;] and the cost of other items, including indemnity and surety bonds and 25 premiums on insurance, legal fees, fees and expenses of trustees, depositaries, and 26 financial advisors [, AND PAYING AGENTS FOR THE BONDS ISSUED AS THE 27 ISSUER CONSIDERS NECESSARY]; 28 * Sec. 6. AS 29.45.020(a) is amended to read: 29 Sec. 29.45.020. Taxpayer notice. (a) If a municipality levies and collects 30 property taxes, the governing body shall provide the following notice: 31 "NOTICE TO TAXPAYER

01 For the current fiscal year the (city) (borough) has been allocated the 02 following amount of state aid for school and municipal purposes under 03 the applicable financial assistance Acts: 04 PUBLIC SCHOOL FUNDING PROGRAM (AS 14.17) $ 05 [STATE AID FOR RETIREMENT OF SCHOOL $ 06 CONSTRUCTION DEBT (AS 14.11.100)] 07 COMMUNITY ASSISTANCE PROGRAM 08 (AS 29.60.850 - 29.60.879) $ 09 TOTAL AID $ 10 The millage equivalent of this state aid, based on the dollar value of a 11 mill in the municipality during the current assessment year and for the 12 preceding assessment year, is: 13 MILLAGE EQUIVALENT 14 PREVIOUS YEAR THIS YEAR 15 PUBLIC SCHOOL FUNDING . . . .MILLS . . . .MILLS 16 PROGRAM ASSISTANCE 17 [STATE AID FOR RETIREMENT OF . . . .MILLS . . . .MILLS 18 SCHOOL CONSTRUCTION 19 DEBT] 20 COMMUNITY ASSISTANCE . . . .MILLS . . . .MILLS 21 PROGRAM 22 TOTAL MILLAGE EQUIVALENT . . . .MILLS . . . .MILLS" 23 Notice shall be provided by 24 (1) furnishing a copy of the notice with tax statements mailed for the 25 fiscal year for which aid is received; or 26 (2) publishing in a newspaper of general circulation in the municipality 27 a copy of the notice once each week for a period of three successive weeks, with 28 publication to occur not later than 45 days after the final adoption of the municipality's 29 budget. 30 * Sec. 7. AS 37.06.030(a) is amended to read: 31 (a) For each draw made by a municipality under AS 37.06.010, the

01 municipality shall contribute a local share to the cost of the capital project for which 02 the draw is made. The amount of the local share equals the local share percentage as 03 calculated under (1) of this subsection, divided by the state share percentage as 04 calculated under (2) of this subsection, multiplied by the amount of the draw. For 05 purposes of this subsection, 06 (1) the local share percentage is 07 (A) 30 percent for a municipality with a population of 5,000 or 08 more; 09 (B) for a municipality with a population of 1,000 - 4,999, the 10 greater of 11 (i) 15 percent; or 12 (ii) the percentage obtained by dividing the amount that 13 would be received by the municipality from a property tax levy of 14 1/1000th of a mill for each $1,000 of grant funds received by the sum 15 of that first amount plus the amount of the grant or draw, but not more 16 than 30 percent; 17 (C) for a municipality with a population of under 1,000, the 18 greater of 19 (i) five percent; or 20 (ii) the percentage obtained by dividing the amount that 21 would be received by the municipality from a property tax levy of 22 1/1000th of a mill for each $1,000 of grant funds received by the sum 23 of that first amount plus the amount of the grant or draw, but not more 24 than 30 percent; 25 (2) the state share percentage equals one minus the local share 26 percentage; 27 (3) the local share to be contributed by a municipality may be satisfied 28 with (A) federal, municipal, or local money; (B) labor, materials, or equipment used 29 directly in the construction of the project, or land, including land transferred by the 30 state to the municipality; the department shall determine the value of a contribution 31 under this subparagraph; (C) money from another nonstate source; (D) money

01 received by the municipality under AS 29.60.850 - 29.60.879; (E) state taxes refunded 02 or reimbursed to the municipality whose use for the purposes of this subsection is not 03 prohibited; and (F) [ALLOCATIONS OF STATE AID FOR THE COSTS OF 04 SCHOOL CONSTRUCTION DEBT UNDER AS 14.11.100; AND (G)] money 05 obtained from the sale or lease of land or other assets transferred by the state to the 06 municipality; except as provided in this paragraph, the local share may not be satisfied 07 with money from, or with the portion of an asset that was obtained with money from, 08 an appropriation, allocation, entitlement, grant, or other payment from the state. 09 * Sec. 8. AS 37.15.170(a) is amended to read: 10 (a) Before December 1 of each year after bonds are issued, the state bond 11 committee shall certify to the commissioner of administration the amount needed for 12 the following calendar year to meet principal, interest, and reserve requirements on all 13 bonds or issues or series of bonds then outstanding [, INCLUDING 14 REIMBURSEMENTS AUTHORIZED UNDER AS 14.11.100]. 15 * Sec. 9. AS 14.11.014(d), 14.11.100, 14.11.102, and AS 37.15.011(b)(2) are repealed. 16 * Sec. 10. The uncodified law of the State of Alaska is amended by adding a new section to 17 read: 18 REVISOR'S INSTRUCTION. The revisor of statutes is requested to change the 19 catchline of AS 14.11.014 from "Bond reimbursement and grant review committee" to "Grant 20 review committee." 21 * Sec. 11. Sections 1 - 9 of this Act take effect July 1, 2019.