HB322

ENGROSSED

A BILL TO BE ENTITLED AN ACT

To provide further for the calculation of the annual appropriation cap for the Education Trust Fund Rolling Reserve Act to include payments to the Prepaid Affordable College Tuition (PACT) Trust Fund; to provide further for the use of revenues from the Education Trust Fund Budget Stabilization Fund and the Education Trust Fund Capital Fund; to delete certain obsolete provisions concerning PSCA debt service; and to prohibit appropriations from holding or clearing accounts.

BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:Section 1. Sections 29-9-3, 29-9-4, 29-9-5, and 29-9-6 Code of Alabama 1975, are hereby amended to read as follows:

§29-9-3.

"(a) Notwithstanding any other provision of law to the contrary, beginning with appropriations made for the fiscal year ending September 30, 2013, appropriations from the Education Trust Fund shall not exceed the fiscal year appropriation cap.

"(b) The fiscal year appropriation cap for the Education Trust Fund shall be equal to the sum of all of the following:

"(1) The total of recurring revenues deposited into the Education Trust Fund in the last completed fiscal year preceding the date on which the fiscal year appropriation cap is calculated.

"(2) An amount equal to the amount in subdivision (1) multiplied by the average annual percent of change in the recurring revenues deposited into the Education Trust Fund for the 15 completed fiscal years preceding the date on which the fiscal year appropriation cap is calculated.

"(3) An amount equal to 40 percent of the increase in recurring revenues deposited into the Education Trust Fund for the last completed fiscal year over the recurring revenues deposited into the Education Trust Fund for the fiscal year immediately preceding the last completed fiscal year. The amount provided in this subdivision shall be added only if the percentage in the recurring revenues deposited into the Education Trust Fund for the last completed fiscal year exceeds the 15 year average growth rate calculated in subdivision (b)(2).

"(4) (3) If new recurring revenue measures are enacted that will be deposited into the Education Trust Fund, or if existing revenue sources are amended to increase the amount of money deposited into the Education Trust Fund, for the first time during the year for which the fiscal year appropriation cap is being calculated, then 95 percent of the amount projected in the enacted fiscal note accompanying the legislative act creating the new recurring revenue shall be added as a part of the fiscal year appropriation cap. If a recurring revenue source is removed from the Education Trust Fund during the year for which the fiscal year appropriation cap is being calculated, the negative impact, based on the enacted fiscal note, of the removal of the recurring revenue shall be included in the calculation of the fiscal year appropriation cap.

"(5) (4) Nonrecurring revenue shall be added as a part of the fiscal year appropriation cap for the fiscal year in which the nonrecurring revenue is deposited into the Education Trust Fund.

" (5) The amount required to be appropriated from the Education Trust Fund to the Prepaid Affordable College Tuition (PACT) Trust Fund pursuant to Code of Alabama 1975, Section 16-33C-16.

"(c) The Director of Finance and the Director of the Fiscal Office shall certify their computation of the fiscal year appropriation cap at the same time as the certification required by Amendment No. 803 to the Constitution of Alabama of 1901. If the computation results in a fiscal year appropriation cap that is less than the total appropriations from the Education Trust Fund for the fiscal year immediately preceding the fiscal year for which the fiscal year appropriation cap is being calculated, the Legislature may appropriate from the Education Trust Fund Budget Stabilization Fund created in this chapter an amount equal to the difference between the preceding fiscal year's total appropriations from the Education Trust Fund and the fiscal year appropriation cap, provided that any such amount shall be in the determination of the Legislature not to compromise the fiscal integrity of the Fund to offset any future proration of the Education Trust Fund.

"(d) Amendment No. 803 to the Constitution of 1901 requires an estimate of available revenue for the Education Trust Fund which is to be certified by the Finance Director and the Legislative Fiscal Officer prior to the third legislative day of each Regular Session. If, however, the average of the estimated available revenue is less than the fiscal year appropriation cap calculated in subsection (b), the Legislature shall appropriate no more than the lesser amount of the average of the estimated available revenue or the fiscal year appropriation cap as required to be determined by this Section."

§29-9-4.

"There is hereby created in the State Treasury an Education Trust Fund Budget Stabilization Fund and an Education Trust Fund Capital Fund. Any monetary interest which accrues in the Education Trust Fund Budget Stabilization Fund shall be retained in the fund from year to year and shall be subject only to the provisions of this chapter. On or before November 15 of each fiscal year, if the total revenues deposited into the Education Trust Fund during the immediately preceding fiscal year exceed the fiscal year appropriation cap for the immediately preceding fiscal year, the excess shall be transferred to the Education Trust Fund Rainy Day Account until the account has been repaid in full. If the account has been repaid in full, any excess remaining shall be transferred to the Education Trust Fund Budget Stabilization Fund and the Education Trust Fund Capital Fund created in this chapter. The transfers to the Education Trust Fund Budget Stabilization Fund and the Education Trust Fund Capital Fund shall be made annually as follows:

"(1) An amount equal to one percent of the previous year's Education Trust Fund appropriations shall be transferred to the Education Trust Fund Budget Stabilization Fund. An additional one percent of each previous year's appropriation shall be transferred annually until the Fund reaches five percent of the previous year's appropriations from the Education Trust Fund.

"(2) Funds in excess of those transferred in (1) shall be transferred to the Education Trust Fund Capital Fund each year. Amounts in the Education Trust Fund Capital Fund shall be appropriated for the planning, construction, reconstruction, enlargement, improvement, repair or renovation of facilities for public education purposes in the state, including the purchase of land and equipment for facilities, for existing debt payments related to facilities, for classroom instructional support as provided in Section 16-13-231(b)(2)c. and Section 16-13-231.3, for insuring facilities, for transportation as provided in Section 16-13-233, for deferred maintenance and for the acquisition and/or purchase of education technology and equipment. These funds, however, shall not be used as a pledge for the issuance of new debt. No funds shall be appropriated until the balance of the Education Trust Fund Capital Fund at the end of the previous fiscal year equals or exceeds $10 million. Amounts in the Education Trust Fund Capital Fund shall be budgeted and allotted in accordance with Sections 41-4-80 through 41-4-96 and Sections 41-19-1 through 41-19-12, but shall not be limited by the fiscal year appropriation cap. until the Fund reaches an amount which equals 20 percent of the then current year's appropriations from the Education Trust Fund. After the balance in the Education Trust Fund Budget Stabilization Fund reaches a total of 20 percent, any excess remaining shall be distributed to the Education Trust Fund Capital Fund.

"(3) The annual appropriation of these funds for capital outlay purposes shall be divided between the public schools and institutions of higher education in the state in accordance with the percentage split between these two sectors of education as certified by the Legislative Fiscal Office at the end of the preceding fiscal year. Public schools shall be interpreted to include the Alabama School of Math and Science, the Alabama School of Fine Arts, the portion of the Alabama Institute for Deaf and Blind providing appropriate Elementary/Secondary instruction, and may include the Department of Youth Services School District."

§29-9-5.

"(a) Except as provided in Section 29-9-3, amounts in the Education Trust Fund Budget Stabilization Fund may be withdrawn only to prevent proration in the Education Trust Fund. The Governor must certify to the state Comptroller and notify the Legislature that proration would occur in the Education Trust Fund before funds may be withdrawn. Following the certification and notification by the Governor, withdrawals may be made from the Education Trust Fund Budget Stabilization Fund; however, withdrawals shall be limited to the amount of the anticipated proration and funds allotted only to the extent necessary to avoid proration of appropriations from the Education Trust Fund. Any funds withdrawn from the Budget Stabilization Fund in excess of the amount necessary to avoid proration shall be transferred back to the Budget Stabilization Fund within 30 days after the end of the fiscal year in which withdrawals are made.

"(b) Amounts in the Education Trust Fund Capital Fund shall be used only for construction, reconstruction, alteration, and improvement of buildings and other facilities for public education purposes in the state, including the acquisition of sites and equipment for buildings and facilities, and for the payment of indebtedness incurred for any of those purposes. Amounts in the Education Trust Fund Capital Fund shall be budgeted and allotted in accordance with Sections 41-4-80 through 41-4-96 and Sections 41-19-1 through 41-19-12 but shall not be limited by the fiscal year appropriation cap."

§29-9-6.

"During the first quarter six months of a fiscal year, the Director of Finance may temporarily transfer available funds in the Budget Stabilization Fund into the Education Trust Fund as necessary to alleviate cash flow problems in the Education Trust Fund. Any funds temporarily transferred shall be repaid to the Budget Stabilization Fund from funds in the Education Trust Fund within 90 days following the date the funds are transferred."

Section 2. Sections 16-33C-14 and 16-33C-15 Code of Alabama 1975, are hereby repealed.Section 3. Section 16-33C-16 is hereby amended to read as follows:

§16-33C-16.

"In addition to the appropriations made in Section 16-33C-14 and Section 16-33C-15, t (a) There is annually appropriated from the Education Trust Fund to the PACT Trust Fund the following amounts in the following fiscal years:

(1) For the fiscal year ending 2016 -- $10,000,000 $43,952,000 $33,952,000;

(2) For the fiscal year ending 2017 -- $20,000,000 $62,622,000 $63,622,000;

(3) For the fiscal year ending 2018 -- $20,000,000 $61,783,000 $62,783,000;

(4) For the fiscal year ending 2019 -- $13,000,000 $60,539,000 $61,539,000.

(5) For the fiscal year ending 2020 -- $53,738,300 $60,738,300 ;

(6) For the fiscal year ending 2021 -- $31,881,600;

(7) For the fiscal year ending 2022 -- $32,181,600;

(8) For the fiscal year ending 2023 -- $33,494,400;

(9) For the fiscal year ending 2024 -- $33,728,700;

(10) For the fiscal year ending 2025 -- $38,449,500;

(11) For the fiscal year ending 2026 -- $39,201,000;

(12) For the fiscal year ending 2027 -- $32,500,000.

"(b) For Beginning with the fiscal year ending September 30, 2017, for budgetary purposes and annual budget calculations, forty-five percent (45%) of the appropriations made in this section shall be considered to be a portion of the funding received by colleges and universities, and the remainder shall be considered to be the same as appropriations made for debt service."

Section 4. The Legislature shall not appropriate any funds from any of the several clearing or holding accounts into which the Department of Revenue deposits tax revenues on a timely basis and from which the State Comptroller makes disbursements, which are limited by statutes to the purpose of legal expenditure of such tax revenues. Such accounts are not the end destination of such tax revenues, but a clearinghouse for immediate deposit of tax revenues into the State Treasury as a matter of convenience until the State Comptroller makes such disbursements, including the processing of tax refunds as may be necessary. Nothing in this Section, however, shall be construed to limit the authority of the Legislature to amend current statutes to further provide for the distribution of tax revenues.

Section 5. All laws or parts of laws in direct conflict with this Act are hereby repealed.

Section 6. If a court of competent jurisdiction shall adjudge to be invalid or unconstitutional any clause, sentence, paragraph, section or part of this act, such judgment or decree shall not affect, impair, invalidate or nullify the remainder of this act, but the effect thereof shall be confined to the clause, sentence, paragraph, section, part of this act so adjudged to be invalid or unconstitutional.

Section 7. This act shall become effective upon its passage and approval by the Governor, or its otherwise becoming law.

Education Trust Fund

Rolling Reserve

Budgets

Budget Stablization Fund

Appropriations--Education Appropriations Act

Code Amended