HB-4295, As Passed House, March 27, 2014HB-4295, As Passed Senate, March 27, 2014

HOUSE SUBSTITUTE FOR SENATE SUBSTITUTE FOR

HOUSE BILL NO. 4295

A bill to amend 1979 PA 94, entitled

"The state school aid act of 1979,"

by amending sections 11, 11m, 20g, 21f, 22a, 22b, 22g, 51a, 51c,

99h, 101, and 147c (MCL 388.1611, 388.1611m, 388.1620g, 388.1621f,

388.1622a, 388.1622b, 388.1622g, 388.1651a, 388.1651c, 388.1699h,

388.1701, and 388.1747c), sections 11 and 22a as amended and

section 20g as added by 2013 PA 97, sections 11m, 22b, 22g, 51a,

51c, 101, and 147c as amended and section 99h as added by 2013 PA

60, and section 21f as amended by 2013 PA 130, and by adding

sections 25h, 31b, 32r, 64d, and 94.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

Sec. 11. (1) ~~For the fiscal year ending September 30, 2013,~~

~~there is appropriated for the public schools of this state and~~

~~certain other state purposes relating to education the sum of~~

~~$10,928,614,200.00 from the state school aid fund and the sum of~~

~~$282,400,000.00 from the general fund.~~ For the fiscal year ending

September 30, 2014, there is appropriated for the public schools of

this state and certain other state purposes relating to education

the sum of ~~$11,211,382,300.00~~ $11,115,232,300.00 from the state

school aid fund, the sum of $156,000,000.00 from the MPSERS

retirement obligation reform reserve fund created under section

147b, and the sum of $234,900,000.00 from the general fund. In

addition, all other available federal funds ~~, except those~~

~~otherwise appropriated under section 11p,~~ are appropriated for the

fiscal year ~~ending September 30, 2013 and for the fiscal year~~

ending September 30, 2014.

(2) The appropriations under this section shall be allocated

as provided in this article. Money appropriated under this section

from the general fund shall be expended to fund the purposes of

this article before the expenditure of money appropriated under

this section from the state school aid fund.

(3) Any general fund allocations under this article that are

not expended by the end of the state fiscal year are transferred to

the school aid stabilization fund created under section 11a.

Sec. 11m. From the appropriations in section 11, there is

allocated for 2013-2014 an amount not to exceed ~~$4,000,000.00~~

$2,500,000.00 for fiscal year cash-flow borrowing costs solely

related to the state school aid fund established by section 11 of

article IX of the state constitution of 1963.

Sec. 20g. (1) From the ~~general fund~~ money appropriated under

section 11, ~~there is allocated an~~ the following amounts are

allocated for 2013-2014:

(a) From the general fund money, an amount not to exceed

$2,200,000.00 for 2013-2014 for grants to eligible districts for

transition costs related to the enrollment of pupils who were

previously enrolled in a district that was dissolved under section

12 of the revised school code, MCL 380.12, allocated as provided

under subsection (3). It is the intent of the legislature to

continue this transition funding for a total of 4 fiscal years

following the dissolution of a district.

(b) From the state school aid fund money, an amount not to

exceed $5,000,000.00 for reimbursements to eligible districts for

costs incurred by the eligible district associated with the

transfer of property from a dissolved school district to the

eligible district, allocated as provided under subsection (4).

(2) A receiving school district, as that term is defined in

section 12 of the revised school code, MCL 380.12, is an eligible

district under this section.

(3) The amount allocated to each eligible district under ~~this~~

~~section~~ subsection (1)(a) is an amount equal to the product of the

number of membership pupils enrolled in the eligible district who

were previously enrolled in the dissolved district in the school

year immediately preceding the dissolution, or who reside in the

geographic area of the dissolved district and are entering

kindergarten, times 10.0% of the lesser of the foundation allowance

of the eligible district as calculated under section 20 or the

basic foundation allowance under section 20(1).

(4) To allocate funds under subsection (1)(b), the department

shall develop a reimbursement application process and a

reimbursement distribution process. Reimbursable costs shall

include, but are not limited to, the costs of maintenance,

utilities, security, or insurance associated with, or the

demolition of, buildings transferred from a dissolved school

district to the eligible district. However, the reimbursement made

to eligible districts for all of the property transferred from a

single dissolved school district shall not exceed the total

cumulative sum of $2,500,000.00 for all of the eligible districts

to which property was transferred from that dissolved school

district.

(5) The funds allocated under subsection (1)(b) are considered

work project appropriations and any unexpended funds for 2013-2014

are carried forward into 2014-2015. The purpose of the work project

is as described in subsection (1)(b). The total estimated cost of

the work project is $5,000,000.00. The tentative estimated

completion date for the work project is September 30, 2015.

(6) As used in this section, "dissolved school district" means

a school district that has been declared dissolved under section 12

of the revised school code, 1976 PA 451, MCL 380.12.

Sec. 21f. (1) A pupil enrolled in a district in any of grades

5 to 12 is eligible to enroll in an online course as provided for

in this section. However, this section does not apply to a pupil

enrolled in a school of excellence that is a cyber school, as

defined in section 551 of the revised school code, MCL 380.551.

(2) With the consent of the pupil's parent or legal guardian,

a district shall enroll an eligible pupil in up to 2 online courses

as requested by the pupil during an academic term, semester, or

trimester. It is the intent of the legislature to consider

increasing the limit on the number of online courses that a pupil

may enroll in beginning in 2014-2015 for pupils who have

demonstrated previous success with online courses. Consent of the

pupil's parent or legal guardian is not required if the pupil is at

least age 18 or is an emancipated minor.

(3) An eligible pupil may enroll in an online course published

in the pupil's educating district's catalog of online courses

described in subsection (7)(a) or the statewide catalog of online

courses maintained by the Michigan virtual university pursuant to

section 98.

(4) A district shall determine whether or not it has capacity

to accept applications for enrollment from nonresident applicants

in online courses and may use that limit as the reason for refusal

to enroll an applicant. If the number of nonresident applicants

eligible for acceptance in an online course does not exceed the

capacity of the district to provide the online course, the district

shall accept for enrollment all of the nonresident applicants

eligible for acceptance. If the number of nonresident applicants

exceeds the district's capacity to provide the online course, the

district shall use a random draw system, subject to the need to

abide by state and federal antidiscrimination laws and court

orders.

(5) A district may deny a pupil enrollment in an online course

if any of the following apply, as determined by the district:

(a) The pupil has previously gained the credits provided from

the completion of the online course.

(b) The online course is not capable of generating academic

credit.

graduation requirements or career interests of the pupil.

(d) The pupil does not possess the prerequisite knowledge and

skills to be successful in the online course or has demonstrated

failure in previous online coursework in the same subject.

(e) The online course is of insufficient quality or rigor. A

district that denies a pupil enrollment for this reason shall make

a reasonable effort to assist the pupil to find an alternative

course in the same or a similar subject that is of acceptable rigor

and quality.

(6) If a pupil is denied enrollment in an online course by a

district, the pupil may appeal the denial by submitting a letter to

the superintendent of the intermediate district in which the

pupil's educating district is located. The letter of appeal shall

include the reason provided by the district for not enrolling the

pupil and the reason why the pupil is claiming that the enrollment

should be approved. The intermediate district superintendent or

designee shall respond to the appeal within 5 days after it is

received. If the intermediate district superintendent or designee

determines that the denial of enrollment does not meet 1 or more of

the reasons specified in subsection (5), the district shall allow

the pupil to enroll in the online course.

(7) To offer or provide an online course, a district or

intermediate district shall do all of the following:

(a) Provide the Michigan virtual university with the course

syllabus in a form and method prescribed by the Michigan virtual

university for inclusion in a statewide online course catalog. The

district or intermediate district shall also provide on its

publicly accessible website a link to the course syllabi for all of

the online courses offered by the district or intermediate district

and a link to the statewide catalog of online courses maintained by

the Michigan virtual university.

(b) Offer the online course on an open entry and exit method,

or aligned to a semester, trimester, or accelerated academic term

format.

(8) For a pupil enrolled in 1 or more online courses published

in the pupil's educating district's catalog of online courses under

subsection (7) or in the statewide catalog of online courses

maintained by the Michigan virtual university, the district shall

use foundation allowance or per pupil funds calculated under

section 20 to pay for the expenses associated with the online

course or courses. The district shall pay 80% of the cost of the

online course upon enrollment and 20% upon completion as determined

by the district. A district is not required to pay toward the cost

of an online course an amount that exceeds 1/12 of the district's

foundation allowance or per pupil payment as calculated under

section 20 per semester or an amount that exceeds 1/18 of the

district's foundation allowance or per pupil payment as calculated

under section 20 per trimester.

(9) An online learning pupil shall have the same rights and

access to technology in his or her educating district's school

facilities as all other pupils enrolled in the educating district.

(10) If a pupil successfully completes an online course, as

determined by the district, the pupil's district shall grant

appropriate academic credit for completion of the course and shall

count that credit toward completion of graduation and subject area

requirements. A pupil's school record and transcript shall identify

the online course title as it appears in the online course

syllabus.

(11) The enrollment of a pupil in 1 or more online courses

shall not result in a pupil being counted as more than 1.0 full-

time equivalent pupils under this act.

(12) As used in this section:

(a) "Online course" means a course of study that is capable of

generating a credit or a grade, that is provided in an interactive

internet-connected learning environment, in which pupils are

separated from their teachers by time or location, or both, and in

which a teacher who holds a valid Michigan teaching certificate is

responsible for determining appropriate instructional methods for

each pupil, diagnosing learning needs, assessing pupil learning,

prescribing intervention strategies, reporting outcomes, and

evaluating the effects of instruction and support strategies.

(b) "Online course syllabus" means a document that includes

all of the following:

(i) The state academic standards addressed in an online course.

(ii) The online course content outline.

(iii) The online course required assessments.

(iv) The online course prerequisites.

(v) Expectations for actual instructor contact time with the

online learning pupil and other pupil-to-instructor communications.

(vi) Academic support available to the online learning pupil.

(vii) The online course learning outcomes and objectives.

(viii) The name of the institution or organization providing the

online content.

(ix) The name of the institution or organization providing the

online instructor.

(x) The course titles assigned by the district or intermediate

district and the course titles and course codes from the national

center for education statistics (NCES) school codes for the

exchange of data (SCED).

(xi) The number of eligible nonresident pupils that will be

accepted by the district or intermediate district in the online

course.

(xii) The results of the online course quality review using the

guidelines and model review process published by the Michigan

virtual university.

more online courses.

Sec. 22a. (1) From the appropriation in section 11, there is

allocated an amount not to exceed ~~$5,630,000,000.00 for 2012-2013~~

~~and there is allocated an amount not to exceed $5,536,700,000.00~~

$5,526,000,000.00 for 2013-2014 for payments to districts and

qualifying public school academies to guarantee each district and

qualifying public school academy an amount equal to its 1994-95

total state and local per pupil revenue for school operating

purposes under section 11 of article IX of the state constitution

of 1963. Pursuant to section 11 of article IX of the state

constitution of 1963, this guarantee does not apply to a district

in a year in which the district levies a millage rate for school

district operating purposes less than it levied in 1994. However,

subsection (2) applies to calculating the payments under this

section. Funds allocated under this section that are not expended

in the state fiscal year for which they were allocated, as

determined by the department, may be used to supplement the

allocations under sections 22b and 51c in order to fully fund those

calculated allocations for the same fiscal year.

(2) To ensure that a district receives an amount equal to the

district's 1994-95 total state and local per pupil revenue for

school operating purposes, there is allocated to each district a

state portion of the district's 1994-95 foundation allowance in an

amount calculated as follows:

(a) Except as otherwise provided in this subsection, the state

portion of a district's 1994-95 foundation allowance is an amount

equal to the district's 1994-95 foundation allowance or $6,500.00,

whichever is less, minus the difference between the sum of the

product of the taxable value per membership pupil of all property

in the district that is nonexempt property times the district's

certified mills and, for a district with certified mills exceeding

12, the product of the taxable value per membership pupil of

property in the district that is commercial personal property times

the certified mills minus 12 mills and the quotient of the ad

valorem property tax revenue of the district captured under tax

increment financing acts divided by the district's membership. For

a district that has a millage reduction required under section 31

of article IX of the state constitution of 1963, the state portion

of the district's foundation allowance shall be calculated as if

that reduction did not occur. For a receiving district, if school

operating taxes are to be levied on behalf of a dissolved district

that has been attached in whole or in part to the receiving

district to satisfy debt obligations of the dissolved district

under section 12 of the revised school code, MCL 380.12, taxable

value per membership pupil of all property in the receiving

district that is nonexempt property and taxable value per

membership pupil of property in the receiving district that is

commercial personal property do not include property within the

geographic area of the dissolved district; ad valorem property tax

revenue of the receiving district captured under tax increment

financing acts does not include ad valorem property tax revenue

captured within the geographic boundaries of the dissolved district

under tax increment financing acts; and certified mills do not

include the certified mills of the dissolved district.

(b) For a district that had a 1994-95 foundation allowance

greater than $6,500.00, the state payment under this subsection

shall be the sum of the amount calculated under subdivision (a)

plus the amount calculated under this subdivision. The amount

calculated under this subdivision shall be equal to the difference

between the district's 1994-95 foundation allowance minus $6,500.00

and the current year hold harmless school operating taxes per

pupil. If the result of the calculation under subdivision (a) is

negative, the negative amount shall be an offset against any state

payment calculated under this subdivision. If the result of a

calculation under this subdivision is negative, there shall not be

a state payment or a deduction under this subdivision. The taxable

values per membership pupil used in the calculations under this

subdivision are as adjusted by ad valorem property tax revenue

captured under tax increment financing acts divided by the

district's membership. For a receiving district, if school

operating taxes are to be levied on behalf of a dissolved district

that has been attached in whole or in part to the receiving

district to satisfy debt obligations of the dissolved district

under section 12 of the revised school code, MCL 380.12, ad valorem

property tax revenue captured under tax increment financing acts do

not include ad valorem property tax revenue captured within the

geographic boundaries of the dissolved district under tax increment

financing acts.

(3) Beginning in 2003-2004, for pupils in membership in a

qualifying public school academy, there is allocated under this

section to the authorizing body that is the fiscal agent for the

qualifying public school academy for forwarding to the qualifying

public school academy an amount equal to the 1994-95 per pupil

payment to the qualifying public school academy under section 20.

(4) A district or qualifying public school academy may use

funds allocated under this section in conjunction with any federal

funds for which the district or qualifying public school academy

otherwise would be eligible.

(5) Except as otherwise provided in this subsection, for a

district that is formed or reconfigured after June 1, 2000 by

consolidation of 2 or more districts or by annexation, the

resulting district's 1994-95 foundation allowance under this

section beginning after the effective date of the consolidation or

annexation shall be the average of the 1994-95 foundation

allowances of each of the original or affected districts,

calculated as provided in this section, weighted as to the

percentage of pupils in total membership in the resulting district

in the state fiscal year in which the consolidation takes place who

reside in the geographic area of each of the original districts. If

an affected district's 1994-95 foundation allowance is less than

the 1994-95 basic foundation allowance, the amount of that

district's 1994-95 foundation allowance shall be considered for the

purpose of calculations under this subsection to be equal to the

amount of the 1994-95 basic foundation allowance. This subsection

does not apply to a receiving district unless there is a subsequent

consolidation or annexation that affects the district.

(6) As used in this section:

(a) "1994-95 foundation allowance" means a district's 1994-95

foundation allowance calculated and certified by the department of

treasury or the superintendent under former section 20a as enacted

in 1993 PA 336 and as amended by 1994 PA 283.

(b) "Certified mills" means the lesser of 18 mills or the

number of mills of school operating taxes levied by the district in

1993-94.

for which a particular calculation is made.

(d) "Current year hold harmless school operating taxes per

pupil" means the per pupil revenue generated by multiplying a

district's 1994-95 hold harmless millage by the district's current

year taxable value per membership pupil. For a receiving district,

if school operating taxes are to be levied on behalf of a dissolved

district that has been attached in whole or in part to the

receiving district to satisfy debt obligations of the dissolved

district under section 12 of the revised school code, MCL 380.12,

taxable value per membership pupil does not include the taxable

value of property within the geographic area of the dissolved

district.

(e) "Dissolved district" means a district that loses its

organization, has its territory attached to 1 or more other

districts, and is dissolved as provided under section 12 of the

revised school code, MCL 380.12.

(f) "Hold harmless millage" means, for a district with a 1994-

95 foundation allowance greater than $6,500.00, the number of mills

by which the exemption from the levy of school operating taxes on a

homestead, qualified agricultural property, qualified forest

property, supportive housing property, industrial personal

property, and commercial personal property could be reduced as

provided in section 1211 of the revised school code, MCL 380.1211,

and the number of mills of school operating taxes that could be

levied on all property as provided in section 1211(2) of the

revised school code, MCL 380.1211, as certified by the department

of treasury for the 1994 tax year. For a receiving district, if

school operating taxes are to be levied on behalf of a dissolved

district that has been attached in whole or in part to the

receiving district to satisfy debt obligations of the dissolved

district under section 12 of the revised school code, MCL 380.12,

school operating taxes do not include school operating taxes levied

within the geographic area of the dissolved district.

(g) "Homestead", "qualified agricultural property", "qualified

forest property", "supportive housing property", "industrial

personal property", and "commercial personal property" mean those

terms as defined in section 1211 of the revised school code, MCL

380.1211.

(h) "Membership" means the definition of that term under

section 6 as in effect for the particular fiscal year for which a

particular calculation is made.

(i) "Nonexempt property" means property that is not a

principal residence, qualified agricultural property, qualified

forest property, supportive housing property, industrial personal

property, or commercial personal property.

(j) "Qualifying public school academy" means a public school

academy that was in operation in the 1994-95 school year and is in

operation in the current state fiscal year.

(k) "Receiving district" means a district to which all or part

of the territory of a dissolved district is attached under section

12 of the revised school code, MCL 380.12.

(l) "School operating taxes" means local ad valorem property

taxes levied under section 1211 of the revised school code, MCL

380.1211, and retained for school operating purposes as defined in

section 20.

(m) "Tax increment financing acts" means 1975 PA 197, MCL

125.1651 to 125.1681, the tax increment finance authority act, 1980

PA 450, MCL 125.1801 to 125.1830, the local development financing

act, 1986 PA 281, MCL 125.2151 to 125.2174, the brownfield

redevelopment financing act, 1996 PA 381, MCL 125.2651 to 125.2672,

or the corridor improvement authority act, 2005 PA 280, MCL

125.2871 to 125.2899.

(n) "Taxable value per membership pupil" means each of the

following divided by the district's membership:

(i) For the number of mills by which the exemption from the

levy of school operating taxes on a homestead, qualified

agricultural property, qualified forest property, supportive

housing property, industrial personal property, and commercial

personal property may be reduced as provided in section 1211 of the

revised school code, MCL 380.1211, the taxable value of homestead,

qualified agricultural property, qualified forest property,

supportive housing property, industrial personal property, and

commercial personal property for the calendar year ending in the

current state fiscal year. For a receiving district, if school

operating taxes are to be levied on behalf of a dissolved district

that has been attached in whole or in part to the receiving

district to satisfy debt obligations of the dissolved district

under section 12 of the revised school code, MCL 380.12, mills do

not include mills within the geographic area of the dissolved

district.

(ii) For the number of mills of school operating taxes that may

be levied on all property as provided in section 1211(2) of the

revised school code, MCL 380.1211, the taxable value of all

property for the calendar year ending in the current state fiscal

year. For a receiving district, if school operating taxes are to be

levied on behalf of a dissolved district that has been attached in

whole or in part to the receiving district to satisfy debt

obligations of the dissolved district under section 12 of the

revised school code, MCL 380.12, school operating taxes do not

include school operating taxes levied within the geographic area of

the dissolved district.

Sec. 22b. (1) From the appropriation in section 11, there is

allocated an amount not to exceed ~~$3,215,000,000.00 for 2012-2013~~

~~and there is allocated an amount not to exceed $3,373,700,000.00~~

$3,335,000,000.00 for 2013-2014 for discretionary nonmandated

payments to districts under this section. Funds allocated under

this section that are not expended in the state fiscal year for

which they were allocated, as determined by the department, may be

used to supplement the allocations under sections 22a and 51c in

order to fully fund those calculated allocations for the same

fiscal year.

(2) Subject to subsection (3) and section 296, the allocation

to a district under this section shall be an amount equal to the

sum of the amounts calculated under sections 20, 51a(2), 51a(3),

and 51a(11), minus the sum of the allocations to the district under

sections 22a and 51c.

(3) In order to receive an allocation under subsection (1),

each district shall do all of the following:

(a) Comply with section 1280b of the revised school code, MCL

380.1280b.

(b) Comply with sections 1278a and 1278b of the revised school

code, MCL 380.1278a and 380.1278b.

federal law to the center and the department in the form and manner

specified by the center or the department, as applicable.

(d) Comply with section 1230g of the revised school code, MCL

380.1230g.

(e) Comply with section 21f.

(4) Districts are encouraged to use funds allocated under this

section for the purchase and support of payroll, human resources,

and other business function software that is compatible with that

of the intermediate district in which the district is located and

with other districts located within that intermediate district.

(5) From the allocation in subsection (1), the department

shall pay up to $1,000,000.00 in litigation costs incurred by this

state related to commercial or industrial property tax appeals,

including, but not limited to, appeals of classification, that

impact revenues dedicated to the state school aid fund.

(6) From the allocation in subsection (1), the department

shall pay up to $1,000,000.00 in litigation costs incurred by this

state associated with lawsuits filed by 1 or more districts or

intermediate districts against this state. If the allocation under

this section is insufficient to fully fund all payments required

under this section, the payments under this subsection shall be

made in full before any proration of remaining payments under this

section.

(7) It is the intent of the legislature that all

constitutional obligations of this state have been fully funded

under sections 22a, 31d, 51a, 51c, and 152a. If a claim is made by

an entity receiving funds under this article that challenges the

legislative determination of the adequacy of this funding or

alleges that there exists an unfunded constitutional requirement,

the state budget director may escrow or allocate from the

discretionary funds for nonmandated payments under this section the

amount as may be necessary to satisfy the claim before making any

payments to districts under subsection (2). If funds are escrowed,

the escrowed funds are a work project appropriation and the funds

are carried forward into the following fiscal year. The purpose of

the work project is to provide for any payments that may be awarded

to districts as a result of litigation. The work project shall be

completed upon resolution of the litigation.

(8) If the local claims review board or a court of competent

jurisdiction makes a final determination that this state is in

violation of section 29 of article IX of the state constitution of

1963 regarding state payments to districts, the state budget

director shall use work project funds under subsection (7) or

allocate from the discretionary funds for nonmandated payments

under this section the amount as may be necessary to satisfy the

amount owed to districts before making any payments to districts

under subsection (2).

(9) If a claim is made in court that challenges the

legislative determination of the adequacy of funding for this

state's constitutional obligations or alleges that there exists an

unfunded constitutional requirement, any interested party may seek

an expedited review of the claim by the local claims review board.

If the claim exceeds $10,000,000.00, this state may remove the

action to the court of appeals, and the court of appeals shall have

and shall exercise jurisdiction over the claim.

(10) If payments resulting from a final determination by the

local claims review board or a court of competent jurisdiction that

there has been a violation of section 29 of article IX of the state

constitution of 1963 exceed the amount allocated for discretionary

nonmandated payments under this section, the legislature shall

provide for adequate funding for this state's constitutional

obligations at its next legislative session.

(11) If a lawsuit challenging payments made to districts

related to costs reimbursed by federal title XIX medicaid funds is

filed against this state, then, for the purpose of addressing

potential liability under such a lawsuit, the state budget director

may place funds allocated under this section in escrow or allocate

money from the funds otherwise allocated under this section, up to

a maximum of 50% of the amount allocated in subsection (1). If

funds are placed in escrow under this subsection, those funds are a

work project appropriation and the funds are carried forward into

the following fiscal year. The purpose of the work project is to

provide for any payments that may be awarded to districts as a

result of the litigation. The work project shall be completed upon

resolution of the litigation. In addition, this state reserves the

right to terminate future federal title XIX medicaid reimbursement

payments to districts if the amount or allocation of reimbursed

funds is challenged in the lawsuit. As used in this subsection,

"title XIX" means title XIX of the social security act, 42 USC 1396

to 1396v.

Sec. 22g. (1) From the funds appropriated in section 11, there

is allocated for 2013-2014 only an amount not to exceed

$5,000,000.00 for competitive assistance grants to districts and

intermediate districts.

(2) Funds received under this section may be used for

reimbursement of transition costs associated with the consolidation

of operations or services between 2 or more districts, intermediate

districts, or other local units of government or the consolidation

of districts or intermediate districts. Grant funding shall be

available for consolidations that occur on or after June 1, 2013.

The department shall develop an application process and method of

grant distribution.

Sec. 25f. (1) From the state school aid fund money

appropriated in section 11, there is allocated an amount not to

exceed $2,000,000.00 for 2013-2014 for payments to strict

discipline academies established under sections 1311b to 1311m of

the revised school code, MCL 380.1311b to 380.1311m, as provided

under this section.

(2) In order to receive funding under this section, a strict

discipline academy shall first comply with section 25e and use the

pupil transfer process under that section for changes in enrollment

as prescribed under that section.

(3) Not later than June 30, 2014, a strict discipline academy

shall report to the center and to the department, in a manner

prescribed by the center and the department, the following

information for 2013-2014:

(a) The number of pupils enrolled and in attendance at the

strict discipline academy.

(b) The number of days each pupil enrolled was in attendance

at the strict discipline academy, not to exceed 180.

(4) The amount of the payment to a strict discipline academy

under this section shall be an amount equal to the difference

between the product of 1/180 of the per-pupil payment as calculated

under section 20 for the strict discipline academy multiplied by

the number of days of pupil attendance reported under subsection

(3)(b) minus the product of the per-pupil payment as calculated

under section 20 for the strict discipline academy multiplied by

the pupils in membership at the strict discipline academy as

calculated under section 6 and as adjusted by section 25e.

(5) If the funds allocated under this section are insufficient

to fully fund the adjustments under subsection (4), payments to

eligible strict discipline academies shall be prorated on an equal

per-pupil basis.

Sec. 31b. (1) From the appropriations in section 11, there is

allocated an amount not to exceed $2,000,000.00 for 2013-2014 for

grants to at-risk districts for implementing a year-round

instructional program for at least 1 of its schools.

(2) The department shall select districts for grants under

this section from among applicant districts that meet both of the

following:

(a) The district meets 1 or both of the following:

(i) Is eligible in 2013-2014 for the community eligibility

option for free and reduced price lunch under 42 USC 1759a.

(ii) At least 50% of the pupils in membership in the district

met the income eligibility criteria for free breakfast, lunch, or

milk in the immediately preceding state fiscal year, as determined

under the Richard B. Russell national school lunch act, 42 USC 1751

to 1769i.

(b) The board of the district has adopted a resolution stating

that the district will implement for the first time a year-round

instructional calendar that will begin in 2014-2015 for at least 1

school operated by the district and committing to providing the

year-round instructional calendar in each of those schools for at

least 3 school years.

(3) A district seeking a grant under this section shall apply

to the department in the form and manner prescribed by the

department not later than May 1, 2014. The department shall select

districts for grants and make notification not later than June 1,

2014.

(4) The department shall award grants under this section on a

competitive basis, but shall give priority based solely on

consideration of the following criteria:

(a) Giving priority to districts with lower general fund

balances as a percent of revenues.

(b) Giving priority to districts that operate at least 1

school that has been identified by the department as either a

priority school or a focus school.

districts.

(5) The amount of a grant under this section to any 1 district

shall not exceed $750,000.00.

(6) A grant payment under this section to a district shall be

used for necessary modifications to instructional facilities and

other nonrecurring costs of preparing for the operation of a year-

round instructional program as approved by the department.

(7) A district receiving a grant under this section is not

required to provide more than the minimum number of days and hours

of pupil instruction prescribed under section 101, but shall spread

at least those minimum amounts of pupil instruction over the entire

year in each of its schools in which a year-round instructional

calendar is implemented. The district shall commit to providing the

year-round instructional calendar in each of those schools for at

least 3 school years.

(8) For a district receiving a grant under this section,

excessive heat is considered to be a condition not within the

control of school authorities for the purpose of days or hours

being counted as days or hours of pupil instruction under section

101(4).

(9) Notwithstanding section 17b, grant payments to districts

under this section shall be paid on a schedule determined by the

department.

Sec. 32r. (1) In addition to the funds appropriated under

section 11, for 2013-2014 only, there is appropriated the amount of

the federal funding awarded to this state under sections 14005,

14006, and 14013 of title XIV of the American recovery and

reinvestment act of 2009, Public Law 111-5, for the race to the top

- early learning challenge grant, estimated at $51,737,500.00.

(2) The department shall use the funds appropriated under this

section solely for the purposes of increasing the number of low-

income and disadvantaged infants, toddlers, and preschoolers

enrolled in high-quality early learning programs and shall spend

the funds in accordance with the state's application for the funds,

as approved by the United States department of education in

December 2013. Activities funded under this section shall focus on

the following objectives:

(a) Increase access for children with high needs to high-

quality learning programs.

(b) Increase opportunities for licensed and unlicensed

subsidized home care providers to improve the quality of their

programs.

learning and development.

(d) Expand on efforts to identify and promote children's

physical, social, and emotional health.

(e) Increase professional development opportunities for early

learning care providers.

(f) Develop an early learning data system to monitor and

evaluate quality standards of individual programs. The department

shall ensure that data reported under the data system are reported

in the aggregate and do not identify individuals. This data system

shall be maintained only as long as there is federal funding

available for expenditure under this section.

(3) The funds appropriated under this section are to be spent

over 4 years and shall be considered a work project appropriation.

Any unexpended funds for 2013-2014 are carried forward into 2014-

2015. The purpose of the work project is as described under

subsection (2). The estimated completion date of the work project

is September 30, 2018.

Sec. 51a. (1) From the appropriation in section 11, there is

allocated an amount not to exceed ~~$952,569,100.00 for 2012-2013 and~~

~~there is allocated an amount not to exceed $980,446,100.00~~

$919,846,100.00 for 2013-2014 from state sources and all available

federal funding under sections 611 to 619 of part B of the

individuals with disabilities education act, 20 USC 1411 to 1419,

~~estimated at $365,000,000.00 for 2012-2013, and~~ estimated at

$370,000,000.00 for 2013-2014, plus any carryover federal funds

from previous year appropriations. The allocations under this

subsection are for the purpose of reimbursing districts and

intermediate districts for special education programs, services,

and special education personnel as prescribed in article 3 of the

revised school code, MCL 380.1701 to 380.1766; net tuition payments

made by intermediate districts to the Michigan schools for the deaf

and blind; and special education programs and services for pupils

who are eligible for special education programs and services

according to statute or rule. For meeting the costs of special

education programs and services not reimbursed under this article,

a district or intermediate district may use money in general funds

or special education funds, not otherwise restricted, or

contributions from districts to intermediate districts, tuition

payments, gifts and contributions from individuals or other

entities, or federal funds that may be available for this purpose,

as determined by the intermediate district plan prepared pursuant

to article 3 of the revised school code, MCL 380.1701 to 380.1766.

All federal funds allocated under this section in excess of those

allocated under this section for 2002-2003 may be distributed in

accordance with the flexible funding provisions of the individuals

with disabilities education act, Public Law 108-446, including, but

not limited to, 34 CFR 300.206 and 300.208. Notwithstanding section

17b, payments of federal funds to districts, intermediate

districts, and other eligible entities under this section shall be

paid on a schedule determined by the department.

(2) From the funds allocated under subsection (1), there is

allocated the amount necessary, estimated at ~~$251,000,000.00 for~~

~~2012-2013, and estimated at $257,800,000.00~~ $247,000,000.00 for

2013-2014, for payments toward reimbursing districts and

intermediate districts for 28.6138% of total approved costs of

special education, excluding costs reimbursed under section 53a,

and 70.4165% of total approved costs of special education

transportation. Allocations under this subsection shall be made as

follows:

(a) The initial amount allocated to a district under this

subsection toward fulfilling the specified percentages shall be

calculated by multiplying the district's special education pupil

membership, excluding pupils described in subsection (11), times

the foundation allowance under section 20 of the pupil's district

of residence, not to exceed the basic foundation allowance under

section 20 for the current fiscal year, or, for a special education

pupil in membership in a district that is a public school academy,

times an amount equal to the amount per membership pupil calculated

under section 20(6) or, for a pupil described in this subsection

who is counted in membership in the education achievement system,

times an amount equal to the amount per membership pupil under

section 20(7). For an intermediate district, the amount allocated

under this subdivision toward fulfilling the specified percentages

shall be an amount per special education membership pupil,

excluding pupils described in subsection (11), and shall be

calculated in the same manner as for a district, using the

foundation allowance under section 20 of the pupil's district of

residence, not to exceed the basic foundation allowance under

section 20 for the current fiscal year.

(b) After the allocations under subdivision (a), districts and

intermediate districts for which the payments calculated under

subdivision (a) do not fulfill the specified percentages shall be

paid the amount necessary to achieve the specified percentages for

the district or intermediate district.

(3) From the funds allocated under subsection (1), there is

allocated ~~each fiscal year for 2012-2013 and~~ for 2013-2014 an

amount not to exceed $1,000,000.00 to make payments to districts

and intermediate districts under this subsection. If the amount

allocated to a district or intermediate district for a fiscal year

under subsection (2)(b) is less than the sum of the amounts

allocated to the district or intermediate district for 1996-97

under sections 52 and 58, there is allocated to the district or

intermediate district for the fiscal year an amount equal to that

difference, adjusted by applying the same proration factor that was

used in the distribution of funds under section 52 in 1996-97 as

adjusted to the district's or intermediate district's necessary

costs of special education used in calculations for the fiscal

year. This adjustment is to reflect reductions in special education

program operations or services between 1996-97 and subsequent

fiscal years. Adjustments for reductions in special education

program operations or services shall be made in a manner determined

by the department and shall include adjustments for program or

service shifts.

(4) If the department determines that the sum of the amounts

allocated for a fiscal year to a district or intermediate district

under subsection (2)(a) and (b) is not sufficient to fulfill the

specified percentages in subsection (2), then the shortfall shall

be paid to the district or intermediate district during the fiscal

year beginning on the October 1 following the determination and

payments under subsection (3) shall be adjusted as necessary. If

the department determines that the sum of the amounts allocated for

a fiscal year to a district or intermediate district under

subsection (2)(a) and (b) exceeds the sum of the amount necessary

to fulfill the specified percentages in subsection (2), then the

department shall deduct the amount of the excess from the

district's or intermediate district's payments under this article

for the fiscal year beginning on the October 1 following the

determination and payments under subsection (3) shall be adjusted

as necessary. However, if the amount allocated under subsection

(2)(a) in itself exceeds the amount necessary to fulfill the

specified percentages in subsection (2), there shall be no

deduction under this subsection.

(5) State funds shall be allocated on a total approved cost

basis. Federal funds shall be allocated under applicable federal

requirements, except that an amount not to exceed $3,500,000.00 may

be allocated by the department ~~each fiscal year for 2012-2013 and~~

for 2013-2014 to districts, intermediate districts, or other

eligible entities on a competitive grant basis for programs,

equipment, and services that the department determines to be

designed to benefit or improve special education on a statewide

scale.

(6) From the amount allocated in subsection (1), there is

allocated an amount not to exceed $2,200,000.00 ~~each fiscal year~~

~~for 2012-2013 and~~ for 2013-2014 to reimburse 100% of the net

increase in necessary costs incurred by a district or intermediate

district in implementing the revisions in the administrative rules

for special education that became effective on July 1, 1987. As

used in this subsection, "net increase in necessary costs" means

the necessary additional costs incurred solely because of new or

revised requirements in the administrative rules minus cost savings

permitted in implementing the revised rules. Net increase in

necessary costs shall be determined in a manner specified by the

department.

(7) For purposes of sections 51a to 58, all of the following

apply:

(a) "Total approved costs of special education" shall be

determined in a manner specified by the department and may include

indirect costs, but shall not exceed 115% of approved direct costs

for section 52 and section 53a programs. The total approved costs

include salary and other compensation for all approved special

education personnel for the program, including payments for social

security and medicare and public school employee retirement system

contributions. The total approved costs do not include salaries or

other compensation paid to administrative personnel who are not

special education personnel as defined in section 6 of the revised

school code, MCL 380.6. Costs reimbursed by federal funds, other

than those federal funds included in the allocation made under this

article, are not included. Special education approved personnel not

utilized full time in the evaluation of students or in the delivery

of special education programs, ancillary, and other related

services shall be reimbursed under this section only for that

portion of time actually spent providing these programs and

services, with the exception of special education programs and

services provided to youth placed in child caring institutions or

juvenile detention programs approved by the department to provide

an on-grounds education program.

(b) Beginning with the 2004-2005 fiscal year, a district or

intermediate district that employed special education support

services staff to provide special education support services in

2003-2004 or in a subsequent fiscal year and that in a fiscal year

after 2003-2004 receives the same type of support services from

another district or intermediate district shall report the cost of

those support services for special education reimbursement purposes

under this article. This subdivision does not prohibit the transfer

of special education classroom teachers and special education

classroom aides if the pupils counted in membership associated with

those special education classroom teachers and special education

classroom aides are transferred and counted in membership in the

other district or intermediate district in conjunction with the

transfer of those teachers and aides.

fiscal year that the amounts allocated for that fiscal year under

subsections (2), (3), (6), and (11) and sections 53a, 54, and 56

will exceed expenditures for that fiscal year under subsections

(2), (3), (6), and (11) and sections 53a, 54, and 56, then for a

district or intermediate district whose reimbursement for that

fiscal year would otherwise be affected by subdivision (b),

subdivision (b) does not apply to the calculation of the

reimbursement for that district or intermediate district and

reimbursement for that district or intermediate district shall be

calculated in the same manner as it was for 2003-2004. If the

amount of the excess allocations under subsections (2), (3), (6),

and (11) and sections 53a, 54, and 56 is not sufficient to fully

fund the calculation of reimbursement to those districts and

intermediate districts under this subdivision, then the

calculations and resulting reimbursement under this subdivision

shall be prorated on an equal percentage basis. This reimbursement

shall not be made after 2014-2015.

(d) Reimbursement for ancillary and other related services, as

defined by R 340.1701c of the Michigan administrative code, shall

not be provided when those services are covered by and available

through private group health insurance carriers or federal

reimbursed program sources unless the department and district or

intermediate district agree otherwise and that agreement is

approved by the state budget director. Expenses, other than the

incidental expense of filing, shall not be borne by the parent. In

addition, the filing of claims shall not delay the education of a

pupil. A district or intermediate district shall be responsible for

payment of a deductible amount and for an advance payment required

until the time a claim is paid.

(e) Beginning with calculations for 2004-2005, if an

intermediate district purchases a special education pupil

transportation service from a constituent district that was

previously purchased from a private entity; if the purchase from

the constituent district is at a lower cost, adjusted for changes

in fuel costs; and if the cost shift from the intermediate district

to the constituent does not result in any net change in the revenue

the constituent district receives from payments under sections 22b

and 51c, then upon application by the intermediate district, the

department shall direct the intermediate district to continue to

report the cost associated with the specific identified special

education pupil transportation service and shall adjust the costs

reported by the constituent district to remove the cost associated

with that specific service.

(8) A pupil who is enrolled in a full-time special education

program conducted or administered by an intermediate district or a

pupil who is enrolled in the Michigan schools for the deaf and

blind shall not be included in the membership count of a district,

but shall be counted in membership in the intermediate district of

residence.

(9) Special education personnel transferred from 1 district to

another to implement the revised school code shall be entitled to

the rights, benefits, and tenure to which the person would

otherwise be entitled had that person been employed by the

receiving district originally.

(10) If a district or intermediate district uses money

received under this section for a purpose other than the purpose or

purposes for which the money is allocated, the department may

require the district or intermediate district to refund the amount

of money received. Money that is refunded shall be deposited in the

state treasury to the credit of the state school aid fund.

(11) From the funds allocated in subsection (1), there is

allocated the amount necessary, estimated at ~~$4,300,000.00 for~~

~~2012-2013, and estimated at $4,300,000.00~~ $3,500,000.00 for 2013-

2014, to pay the foundation allowances for pupils described in this

subsection. The allocation to a district under this subsection

shall be calculated by multiplying the number of pupils described

in this subsection who are counted in membership in the district

times the foundation allowance under section 20 of the pupil's

district of residence, not to exceed the basic foundation allowance

under section 20 for the current fiscal year, or, for a pupil

described in this subsection who is counted in membership in a

district that is a public school academy, times an amount equal to

the amount per membership pupil under section 20(6) or, for a pupil

described in this subsection who is counted in membership in the

education achievement system, times an amount equal to the amount

per membership pupil under section 20(7). The allocation to an

intermediate district under this subsection shall be calculated in

the same manner as for a district, using the foundation allowance

under section 20 of the pupil's district of residence, not to

exceed the basic foundation allowance under section 20 for the

current fiscal year. This subsection applies to all of the

following pupils:

(a) Pupils described in section 53a.

(b) Pupils counted in membership in an intermediate district

who are not special education pupils and are served by the

intermediate district in a juvenile detention or child caring

facility.

by an intermediate district and provided educational services by

the department of community health.

(12) If it is determined that funds allocated under subsection

(2) or (11) or under section 51c will not be expended, funds up to

the amount necessary and available may be used to supplement the

allocations under subsection (2) or (11) or under section 51c in

order to fully fund those allocations. After payments under

subsections (2) and (11) and section 51c, the remaining

expenditures from the allocation in subsection (1) shall be made in

the following order:

(a) 100% of the reimbursement required under section 53a.

(b) 100% of the reimbursement required under subsection (6).

(d) 100% of the payment required under subsection (3).

(e) 100% of the payments under section 56.

(13) The allocations under subsections (2), (3), and (11)

shall be allocations to intermediate districts only and shall not

be allocations to districts, but instead shall be calculations used

only to determine the state payments under section 22b.

(14) If a public school academy enrolls pursuant to this

section a pupil who resides outside of the intermediate district in

which the public school academy is located and who is eligible for

special education programs and services according to statute or

rule, or who is a child with disabilities, as defined under the

individuals with disabilities education act, Public Law 108-446,

the provision of special education programs and services and the

payment of the added costs of special education programs and

services for the pupil are the responsibility of the district and

intermediate district in which the pupil resides unless the

enrolling district or intermediate district has a written agreement

with the district or intermediate district in which the pupil

resides or the public school academy for the purpose of providing

the pupil with a free appropriate public education and the written

agreement includes at least an agreement on the responsibility for

the payment of the added costs of special education programs and

services for the pupil.

Sec. 51c. As required by the court in the consolidated cases

known as Durant v State of Michigan, Michigan supreme court docket

no. 104458-104492, from the allocation under section 51a(1), there

is allocated ~~each fiscal year for 2012-2013 and~~ for 2013-2014 the

amount necessary, estimated at ~~$642,000,000.00 for 2012-2013, and~~

~~estimated at $662,200,000.00 for 2013-2014,~~ $613,200,000.00, for

payments to reimburse districts for 28.6138% of total approved

costs of special education excluding costs reimbursed under section

53a, and 70.4165% of total approved costs of special education

transportation. Funds allocated under this section that are not

expended in the state fiscal year for which they were allocated, as

determined by the department, may be used to supplement the

allocations under sections 22a and 22b in order to fully fund those

calculated allocations for the same fiscal year.

Sec. 64d. (1) From the general fund money appropriated in

section 11, there is allocated to the department for 2013-2014 the

amount of $3,900,000.00 for a contract with a single provider to

provide information technology education opportunities to high

school, career academy, and community college students. The

provider shall allow participating students and faculty to achieve

broad-based information technology certifications and college

credit. The provider shall make available through districts,

intermediate districts, career academies, and community colleges

instruction on information technology skills and competencies that

are essential for the workplace and that are requested by

employers. The department shall use a competitive request for

proposals process for the contract, and the request for proposals

shall include, but not be limited to, all of the following

requirements:

(a) A curriculum based on research, information technology,

and skill development.

(b) Online access to the curriculum.

(d) Certification of skills and competencies in a broad base

of information technology-related skill areas.

(e) Professional development for faculty.

(f) Deployment and program support, including, but not limited

to, integration with current curriculum standards.

(g) Methods for students to earn college credit.

(2) The department shall ensure that the request for proposals

under subsection (1) is delivered to all community colleges in this

state. If a community college or group of community colleges

submits a proposal, before making a decision to award a contract

under this section to any provider that is not a community college

or group of community colleges, the department shall provide to the

community college or group of community colleges an interactive

response to the proposal.

(3) The funds appropriated under this section are to be spent

over 3 years and shall be considered a work project appropriation.

Any unexpended funds for 2013-2014 are carried forward into 2014-

2015. The purpose of the work project is as described under

subsection (1). The estimated completion date of the work project

is September 30, 2017.

Sec. 94. (1) From the general fund appropriation in section

11, there is allocated to the department for 2013-2014 an amount

not to exceed $250,000.00 for efforts to increase the number of

pupils who participate and succeed in advanced placement and

international baccalaureate programs.

(2) From the funds allocated under this section, the

department shall award funds to cover all or part of the costs of

advanced placement test fees or international baccalaureate test

fees for low-income pupils who take an advanced placement or an

international baccalaureate test. Payments shall not exceed $20.00

per test completed.

(3) The department shall only award funds under this section

if the department determines that all of following criteria are

met:

(a) Each pupil for whom payment is made meets eligibility

requirements of the federal advanced placement test fee program

under section 1701 of the no child left behind act of 2001, Public

Law 107-110.

(b) The tests are administered by the college board, the

international baccalaureate organization, or another test provider

approved by the department.

toward the cost of each test for which payment is made.

(4) The department shall establish procedures for awarding

funds under this section.

(5) Notwithstanding section 17b, payments under this section

shall be made on a schedule determined by the department.

Sec. 99h. (1) From the appropriation in section 11, there is

allocated an amount not to exceed $3,000,000.00 for 2013-2014 for

competitive grants to districts that provide pupils in grades 7 to

12 with expanded opportunities to improve mathematics, science, and

technology skills by participating in events hosted by a science

and technology development program known as FIRST (for inspiration

and recognition of science and technology) robotics.

(2) A district applying for a FIRST tech challenge or FIRST

robotics competition program grant shall submit an application in a

form and manner determined by the department. To be eligible for a

grant, a district shall demonstrate in its application that the

district has established a partnership for the purposes of the

FIRST program with at least 1 sponsor, business entity, higher

education institution, or technical school.

(3) The department shall distribute the grant funding under

this section for the following purposes:

(a) Except as otherwise provided in subparagraph (iii), ~~not more~~

~~than~~ an amount estimated at $1,000,000.00 for grants to districts

to pay for stipends of $1,500.00 for 1 coach per team, distributed

as follows:

(i) Not more than 500 stipends for coaches of high school

teams, including existing teams.

(ii) Not more than 100 stipends for coaches of middle school or

junior high teams, including existing teams.

(iii) If the requests for stipends exceed the numbers of

stipends allowed under subparagraphs (i) and (ii), and if there is

funding remaining unspent under subdivisions (b) and (c), the

department shall use that remaining unspent funding for grants to

districts to pay for additional stipends in a manner that expands

the geographical distribution of teams.

(b) ~~Not more than~~ An amount estimated at $1,000,000.00 for

grants to districts for event registrations, materials, travel

costs, and other expenses associated with the preparation for and

attendance at FIRST tech challenge and FIRST robotics competitions.

Each grant recipient shall provide a local match from other private

or local funds for the funds received under this subdivision equal

to at least 50% of the costs of participating in an event. The

department shall set maximum grant amounts under this subdivision

in a manner that maximizes the number of teams that will be able to

receive funding.

grants to districts for awards to teams that advance to the state

and world championship competitions. The department shall determine

an equal amount per team for those teams that advance to the state

championship and a second equal award amount to those teams that

advance to the world championship.

(4) The funds allocated under this section are a work project

appropriation, and any unexpended funds for 2013-2014 are carried

forward into 2014-2015. The purpose of the work project is to

continue to implement the projects described under subsection (1).

The estimated completion date of the work project is September 30,

2016.

Sec. 101. (1) To be eligible to receive state aid under this

article, not later than the fifth Wednesday after the pupil

membership count day and not later than the fifth Wednesday after

the supplemental count day, each district superintendent shall

submit to the center and the intermediate superintendent, in the

form and manner prescribed by the center, the number of pupils

enrolled and in regular daily attendance in the district as of the

pupil membership count day and as of the supplemental count day, as

applicable, for the current school year. In addition, a district

maintaining school during the entire year, as provided under

section 1561 of the revised school code, MCL 380.1561, shall submit

to the center and the intermediate superintendent, in the form and

manner prescribed by the center, the number of pupils enrolled and

in regular daily attendance in the district for the current school

year pursuant to rules promulgated by the superintendent. Not later

than the sixth Wednesday after the pupil membership count day and

not later than the sixth Wednesday after the supplemental count

day, the district shall certify the data in a form and manner

prescribed by the center and file the certified data with the

intermediate superintendent. If a district fails to submit and

certify the attendance data, as required under this subsection, the

center shall notify the department and state aid due to be

distributed under this article shall be withheld from the

defaulting district immediately, beginning with the next payment

after the failure and continuing with each payment until the

district complies with this subsection. If a district does not

comply with this subsection by the end of the fiscal year, the

district forfeits the amount withheld. A person who willfully

falsifies a figure or statement in the certified and sworn copy of

enrollment shall be punished in the manner prescribed by section

161.

(2) To be eligible to receive state aid under this article,

not later than the twenty-fourth Wednesday after the pupil

membership count day and not later than the twenty-fourth Wednesday

after the supplemental count day, an intermediate district shall

submit to the center, in a form and manner prescribed by the

center, the audited enrollment and attendance data for the pupils

of its constituent districts and of the intermediate district. If

an intermediate district fails to submit the audited data as

required under this subsection, state aid due to be distributed

under this article shall be withheld from the defaulting

intermediate district immediately, beginning with the next payment

after the failure and continuing with each payment until the

intermediate district complies with this subsection. If an

intermediate district does not comply with this subsection by the

end of the fiscal year, the intermediate district forfeits the

amount withheld.

(3) Except as otherwise provided in subsections (11) and (12),

all of the following apply to the provision of pupil instruction:

(a) Except as otherwise provided in this section, each

district shall provide at least 1,098 hours and, beginning in 2010-

2011, the required minimum number of days of pupil instruction.

Beginning in 2012-2013, the required minimum number of days of

pupil instruction is 170. Beginning in 2014-2015, the required

minimum number of days of pupil instruction is 175. However, all of

the following apply to these requirements:

(i) Except as otherwise provided in subparagraph (ii), a

district shall not provide fewer days of pupil instruction than the

district provided for 2009-2010.

(ii) For 2013-2014 only, if a district is scheduled to provide

more than 174 days of instruction, the district shall provide at

least 174 days of instruction and 1,098 hours of pupil instruction.

(iii) If a collective bargaining agreement that provides for at

least 170 days but less than 175 days, and at least 1,098 hours, of

pupil instruction is in effect for employees of a district as of

June 13, 2013, then until the school year that begins after the

expiration of that collective bargaining agreement the district

shall provide at least the number of days of pupil instruction

identified in the collective bargaining agreement, and at least

1,098 hours of pupil instruction.

(iv) A district may apply for a waiver under subsection (9)

from the requirements of this subdivision. ~~For 2012-2013 only, if a~~

~~district is unable to provide the required minimum number of days~~

~~of pupil instruction because of school closures occurring before~~

~~April 20, 2013 due to conditions not within the control of school~~

~~authorities, such as severe storms, fires, epidemics, utility power~~

~~unavailability, water or sewer failure, or health conditions as~~

~~defined by the city, county, or state health authorities, but the~~

~~district does provide at least the required minimum number of hours~~

~~of pupil instruction, the district is not subject to the minimum~~

~~number of days of pupil instruction requirement of this subsection.~~

~~A district that uses the 2012-2013 exception from the minimum~~

~~number of days of pupil instruction requirement shall submit to the~~

~~department not later than July 1, 2013, in the form and manner~~

~~prescribed by the department, a report that details the amount of~~

~~instructional time that was lost due to school closures and the~~

~~amount of additional instructional time that was added to~~

~~compensate; when the additional instructional time was provided;~~

~~the activities that were carried out and subject areas addressed~~

~~during the additional instructional time; and other information~~

~~specified by the department to assess whether appropriate~~

~~instruction occurred during the additional instructional time. The~~

~~department shall aggregate and provide these reports to the senate~~

~~and house standing committees on education.~~

(b) Except as otherwise provided in this article, a district

failing to comply with the required minimum hours and days of pupil

instruction under this subsection shall forfeit from its total

state aid allocation an amount determined by applying a ratio of

the number of hours or days the district was in noncompliance in

relation to the required minimum number of hours and days under

this subsection. Not later than August 1, the board of each

district shall certify to the department the number of hours and

days of pupil instruction in the previous school year. If the

district did not provide at least the required minimum number of

hours and days of pupil instruction under this subsection, the

deduction of state aid shall be made in the following fiscal year

from the first payment of state school aid. A district is not

subject to forfeiture of funds under this subsection for a fiscal

year in which a forfeiture was already imposed under subsection

(6).

conferences shall not be counted as hours or days of pupil

instruction.

(d) If a collective bargaining agreement that provides a

complete school calendar is in effect for employees of a district

as of October 19, 2009, and if that school calendar is not in

compliance with this subsection, then this subsection does not

apply to that district until after the expiration of that

collective bargaining agreement.

(e) Except as otherwise provided in ~~subdivision (f),~~

subdivisions (f) and (g), a district not having at least 75% of the

district's membership in attendance on any day of pupil instruction

shall receive state aid in that proportion of 1/180 that the actual

percent of attendance bears to the specified percentage.

(f) If a district adds 1 or more days of pupil instruction to

the end of its instructional calendar for a school year to comply

with subdivision (a) because the district otherwise would fail to

provide the required minimum number of days of pupil instruction

even after the operation of subsection (4) due to conditions not

within the control of school authorities, then subdivision (e) does

not apply for any day of pupil instruction that is added to the end

of the instructional calendar. Instead, for any of those days, if

the district does not have at least 60% of the district's

membership in attendance on that day, the district shall receive

state aid in that proportion of 1/180 that the actual percentage of

attendance bears to the specified percentage. For any day of pupil

instruction added to the instructional calendar as described in

this subdivision, the district shall report to the department the

percentage of the district's membership that is in attendance, in

the form and manner prescribed by the department.

(g) ~~(f)~~ At the request of a district that operates a

department-approved alternative education program and that does not

provide instruction for pupils in all of grades K to 12, the

superintendent may grant a waiver from the requirements of

subdivision (e). The waiver shall indicate that an eligible

district is subject to the proration provisions of subdivision (e)

only if the district does not have at least 50% of the district's

membership in attendance on any day of pupil instruction. In order

to be eligible for this waiver, a district must maintain records to

substantiate its compliance with the following requirements:

(i) The district offers the minimum hours of pupil instruction

as required under this section.

(ii) For each enrolled pupil, the district uses appropriate

academic assessments to develop an individual education plan that

leads to a high school diploma.

(iii) The district tests each pupil to determine academic

progress at regular intervals and records the results of those

tests in that pupil's individual education plan.

(h) ~~(g)~~ All of the following apply to a waiver granted under

subdivision ~~(f):~~(g):

(i) If the waiver is for a blended model of delivery, a waiver

that is granted for the 2011-2012 fiscal year or a subsequent

fiscal year remains in effect unless it is revoked by the

superintendent.

(ii) If the waiver is for a 100% online model of delivery and

the educational program for which the waiver is granted makes

educational services available to pupils for a minimum of at least

1,098 hours during a school year and ensures that each pupil

participates in the educational program for at least 1,098 hours

during a school year, a waiver that is granted for the 2011-2012

fiscal year or a subsequent fiscal year remains in effect unless it

is revoked by the superintendent.

(iii) A waiver that is not a waiver described in subparagraph

(i) or (ii) is valid for 1 fiscal year and must be renewed annually

to remain in effect.

(i) ~~(h)~~ The superintendent shall promulgate rules for the

implementation of this subsection.

(4) Except as otherwise provided in this subsection, the first

6 days or the equivalent number of hours for which pupil

instruction is not provided because of conditions not within the

control of school authorities, such as severe storms, fires,

epidemics, utility power unavailability, water or sewer failure, or

health conditions as defined by the city, county, or state health

authorities, shall be counted as hours and days of pupil

instruction. With the approval of the superintendent of public

instruction, the department shall count as hours and days of pupil

instruction for a fiscal year not more than 6 additional days or

the equivalent number of additional hours for which pupil

instruction is not provided in a district after April 1 of the

applicable school year due to unusual and extenuating occurrences

resulting from conditions not within the control of school

authorities such as those conditions described in this subsection.

Subsequent such hours or days shall not be counted as hours or days

of pupil instruction.

(5) A district shall not forfeit part of its state aid

appropriation because it adopts or has in existence an alternative

scheduling program for pupils in kindergarten if the program

provides at least the number of hours required under subsection (3)

for a full-time equated membership for a pupil in kindergarten as

provided under section 6(4).

(6) In addition to any other penalty or forfeiture under this

section, if at any time the department determines that 1 or more of

the following have occurred in a district, the district shall

forfeit in the current fiscal year beginning in the next payment to

be calculated by the department a proportion of the funds due to

the district under this article that is equal to the proportion

below the required minimum number of hours and days of pupil

instruction under subsection (3), as specified in the following:

(a) The district fails to operate its schools for at least the

required minimum number of hours and days of pupil instruction

under subsection (3) in a school year, including hours and days

counted under subsection (4).

(b) The board of the district takes formal action not to

operate its schools for at least the required minimum number of

hours and days of pupil instruction under subsection (3) in a

school year, including hours and days counted under subsection (4).

(7) In providing the minimum number of hours and days of pupil

instruction required under subsection (3), a district shall use the

following guidelines, and a district shall maintain records to

substantiate its compliance with the following guidelines:

(a) Except as otherwise provided in this subsection, a pupil

must be scheduled for at least the required minimum number of hours

of instruction, excluding study halls, or at least the sum of 90

hours plus the required minimum number of hours of instruction,

including up to 2 study halls.

(b) The time a pupil is assigned to any tutorial activity in a

block schedule may be considered instructional time, unless that

time is determined in an audit to be a study hall period.

in grades 9 to 12 for whom a reduced schedule is determined to be

in the individual pupil's best educational interest must be

scheduled for a number of hours equal to at least 80% of the

required minimum number of hours of pupil instruction to be

considered a full-time equivalent pupil. A pupil in grades 9 to 12

who is scheduled in a 4-block schedule may receive a reduced

schedule under this subsection if the pupil is scheduled for a

number of hours equal to at least 75% of the required minimum

number of hours of pupil instruction to be considered a full-time

equivalent pupil.

(d) If a pupil in grades 9 to 12 who is enrolled in a

cooperative education program or a special education pupil cannot

receive the required minimum number of hours of pupil instruction

solely because of travel time between instructional sites during

the school day, that travel time, up to a maximum of 3 hours per

school week, shall be considered to be pupil instruction time for

the purpose of determining whether the pupil is receiving the

required minimum number of hours of pupil instruction. However, if

a district demonstrates to the satisfaction of the department that

the travel time limitation under this subdivision would create

undue costs or hardship to the district, the department may

consider more travel time to be pupil instruction time for this

purpose.

(e) In grades 7 through 12, instructional time that is part of

a junior reserve officer training corps (JROTC) program shall be

considered to be pupil instruction time regardless of whether the

instructor is a certificated teacher if all of the following are

met:

(i) The instructor has met all of the requirements established

by the United States department of defense and the applicable

branch of the armed services for serving as an instructor in the

junior reserve officer training corps program.

(ii) The board of the district or intermediate district

employing or assigning the instructor complies with the

requirements of sections 1230 and 1230a of the revised school code,

MCL 380.1230 and 380.1230a, with respect to the instructor to the

same extent as if employing the instructor as a regular classroom

teacher.

(8) Except as otherwise provided in subsections (11) and (12),

the department shall apply the guidelines under subsection (7) in

calculating the full-time equivalency of pupils.

(9) Upon application by the district for a particular fiscal

year, the superintendent may waive for a district the minimum

number of hours and days of pupil instruction requirement of

subsection (3) for a department-approved alternative education

program or another innovative program approved by the department,

including a 4-day school week. If a district applies for and

receives a waiver under this subsection and complies with the terms

of the waiver, the district is not subject to forfeiture under this

section for the specific program covered by the waiver. If the

district does not comply with the terms of the waiver, the amount

of the forfeiture shall be calculated based upon a comparison of

the number of hours and days of pupil instruction actually provided

to the minimum number of hours and days of pupil instruction

required under subsection (3). Pupils enrolled in a department-

approved alternative education program under this subsection shall

be reported to the center in a form and manner determined by the

center. All of the following apply to a waiver granted under this

subsection:

(a) If the waiver is for a blended model of delivery, a waiver

that is granted for the 2011-2012 fiscal year or a subsequent

fiscal year remains in effect unless it is revoked by the

superintendent.

(b) If the waiver is for a 100% online model of delivery and

the educational program for which the waiver is granted makes

educational services available to pupils for a minimum of at least

1,098 hours during a school year and ensures that each pupil

participates in the educational program for at least 1,098 hours

during a school year, a waiver that is granted for the 2011-2012

fiscal year or a subsequent fiscal year remains in effect unless it

is revoked by the superintendent.

or (b) is valid for 1 fiscal year and must be renewed annually to

remain in effect.

(10) Until 2014-2015, a district may count up to 38 hours of

qualifying professional development for teachers as hours of pupil

instruction. However, if a collective bargaining agreement that

provides for the counting of up to 38 hours of qualifying

professional development for teachers as pupil instruction is in

effect for employees of a district as of June 13, 2013, then until

the school year that begins after the expiration of that collective

bargaining agreement a district may count up to the contractually

specified number of hours of qualifying professional development

for teachers as hours of pupil instruction. Professional

development provided online is allowable and encouraged, as long as

the instruction has been approved by the district. The department

shall issue a list of approved online professional development

providers, which shall include the Michigan virtual school. As used

in this subsection, "qualifying professional development" means

professional development that is focused on 1 or more of the

following:

(a) Achieving or improving adequate yearly progress as defined

under the no child left behind act of 2001, Public Law 107-110.

(b) Achieving accreditation or improving a school's

accreditation status under section 1280 of the revised school code,

MCL 380.1280.

the no child left behind act of 2001, Public Law 107-110.

(d) Integrating technology into classroom instruction.

(e) Maintaining teacher certification.

(11) Subsections (3) and (8) do not apply to a school of

excellence that is a cyber school, as defined in section 551 of the

revised school code, MCL 380.551, and is in compliance with section

553a of the revised school code, MCL 380.553a.

(12) Subsections (3) and (8) do not apply to eligible pupils

enrolled in a dropout recovery program that meets the requirements

of section 23a. As used in this subsection, "eligible pupil" means

that term as defined in section 23a.

(13) Beginning in 2013, at least every 2 years the

superintendent shall review the waiver standards set forth in the

pupil accounting and auditing manuals to ensure that the waiver

standards and waiver process continue to be appropriate and

responsive to changing trends in online learning. The

superintendent shall solicit and consider input from stakeholders

as part of this review.

Sec. 147c. (1) ~~From the state school aid fund money~~

~~appropriated in section 11, there is allocated for 2012-2013 an~~

~~amount not to exceed $160,000,000.00 for payments to districts and~~

~~intermediate districts that are participating entities of the~~

~~retirement system.~~ From the appropriation in section 11, there is

allocated for 2013-2014 an amount not to exceed ~~$247,300,000.00~~

$249,500,000.00 from the state school aid fund, and there is

appropriated for 2013-2014 an amount not to exceed $156,000,000.00

from the MPSERS retirement obligation reform reserve fund, for

payments to districts and intermediate districts that are

participating entities of the Michigan public school employees'

retirement system.

(2) In addition to the allocation under subsection (1), from

the general fund money appropriated under section 11, there is

allocated for payments to district libraries that are participating

entities of the retirement system an amount not to exceed

~~$500,000.00 for 2012-2013 and an amount not to exceed~~ $1,300,000.00

for 2013-2014.

(3) ~~Payments made under this section for 2012-2013 shall be~~

~~equal to the difference between the unfunded actuarial accrued~~

~~liability contribution rate as calculated pursuant to section 41 of~~

~~the public school employees retirement act of 1979, 1980 PA 300,~~

~~MCL 38.1341, and the maximum employer rate of 20.96% included in~~

~~section 41 of the public school employees retirement act of 1979,~~

~~1980 PA 300, MCL 38.1341.~~ Payments made under this section for

2013-2014 shall be equal to the difference between the unfunded

actuarial accrued liability contribution rate as calculated

pursuant to section 41 of the public school employees retirement

act of 1979, 1980 PA 300, MCL 38.1341, as calculated without taking

into account the maximum employer rate of 20.96% included in

section 41 of the public school employees retirement act of 1979,

1980 PA 300, MCL 38.1341, and the maximum employer rate of 20.96%

included in section 41 of the public school employees retirement

act of 1979, 1980 PA 300, MCL 38.1341.

(4) The amount allocated to each participating entity under

this section shall be based on each participating entity's

proportion of the total covered payroll for the immediately

preceding fiscal year for the same type of participating entities.

A participating entity that receives funds under this section shall

use the funds solely for the purpose of retirement contributions as

specified in subsection (5).

(5) Each participating entity receiving funds under this

section shall forward an amount equal to the amount allocated under

subsection (4) to the retirement system in a form, manner, and time

frame determined by the retirement system.

(6) Funds allocated under this section should be considered

when comparing a district's growth in total state aid funding from

1 fiscal year to the next.

(7) As used in this section:

(a) "Participating entity" means a district, intermediate

district, or district library that is a reporting unit of the

Michigan public school employees' retirement system under the

public school employees retirement act of 1979, 1980 PA 300, MCL

38.1301 to 38.1437, and that reports employees to the Michigan

public school employees' retirement system for the applicable

fiscal year.

(b) "Retirement board" means the board that administers the

retirement system under the public school employees retirement act

of 1979, 1980 PA 300, MCL 38.1301 to 38.1437.

employees' retirement system under the public school employees

retirement act of 1979, 1980 PA 300, MCL 38.1301 to 38.1437.

Enacting section 1. In accordance with section 30 of article

IX of the state constitution of 1963, total state spending on

school aid under 2013 PA 60, 2013 PA 130, and this amendatory act