§ 6-20-2305 - School funding.
6-20-2305. School funding.
(a) (1) (A) For each school year, each school district shall receive state foundation funding aid computed as the difference between the foundation funding amount pursuant to subdivision (a)(2) of this section and the sum of ninety-eight percent (98%) of the uniform rate of tax multiplied by the property assessment of the school district plus the miscellaneous funds of the school district.
(B) The Department of Education shall distribute state foundation funding aid to each school district in eleven (11) equal monthly payments.
(2) (A) For the 2009-2010 school year, the foundation funding amount is equal to five thousand nine hundred five dollars ($5,905) multiplied by the school district's average daily membership for the previous school year.
(B) For the 2010-2011 school year, the foundation funding amount is equal to six thousand twenty-three dollars ($6,023) multiplied by the school district's average daily membership for the previous school year.
(C) (i) In accordance with the state's desire to foster educational excellence, in addition to the amounts determined by the General Assembly to be constitutionally adequate pursuant to subdivisions (a)(2)(A) and (B) of this section, and in addition to the funds distributed to school districts pursuant to subdivisions (a)(2)(A) and (B) of this section, each school district shall receive an amount equal to thirty-five dollars ($35.00) multiplied by the school district's average daily membership for the previous school year.
(ii) The Department of Education shall distribute the additional funding provided by this subdivision (a)(2)(C) in eleven (11) monthly payments from funds appropriated by law and available for distribution as state foundation funding aid.
(iii) The General Assembly has determined that the funding provided by this subdivision (a)(2)(C), which is known as "Enhanced Educational Funding", is in addition to, and in excess of, the amount of funds necessary to provide an adequate education as required by the Arkansas Constitution.
(iv) Enhanced Educational Funding is available from a combination of fortunate economic factors, conservative budgeting of all state government, and the favorable forecast of state revenues. As a result, the enhanced component of Enhanced Educational Funding cannot be ensured and may not be relied on beyond the 2009-2010 school year.
(3) (A) A school district that has experienced a decline in average daily membership over the two (2) immediately preceding school years shall receive:
(i) Declining enrollment funding equal to the difference between the average of the two (2) immediately preceding years' average daily memberships and the average daily membership for the previous school year multiplied by the amount of foundation funding set forth in subdivision (a)(2) of this section; or
(ii) Special needs isolated funding under 6-20-604.
(B) Any funding appropriated and available for declining enrollment funding under subdivision (a)(3)(A)(i) of this section or special needs isolated funding under 6-20-604 that is not distributed under subdivision (a)(3)(A) of this section shall be prorated and distributed equally per average lost student to school districts that meet the qualifications for both declining enrollment funding under subsection (a)(3)(A)(i) of this section and special needs isolated funding under 6-20-604.
(C) No school district shall receive both declining enrollment funding under subdivision (a)(3)(A)(i) of this section and student growth funding under subsection (c) of this section.
(4) (A) By the end of each school fiscal year, for a school district whose net revenues are less than the sum of ninety-eight percent (98%) of the uniform rate of tax multiplied by the property assessment of the school district, the Department of Education shall distribute to the school district the difference between:
(i) The net revenues distributed to the school district as reported under 26-26-2004 for the calendar year immediately preceding the current school year; and
(ii) The sum of ninety-eight percent (98%) of the uniform rate of tax multiplied by the property assessment of the school district.
(B) For a school district whose net revenues are more than the sum of ninety-eight percent (98%) of the uniform rate of tax multiplied by the property assessment of the school district, the Department of Education, under the authority of 6-20-2306, shall recoup from the school district an amount equal to the difference between:
(i) The net revenues of the school district; and
(ii) The sum of ninety-eight percent (98%) of the uniform rate of tax multiplied by the property assessment of the school district.
(C) (i) Data to verify the timely receipt of revenues applicable to the required ninety-eight percent (98%) of the uniform rate of tax multiplied by the property assessment of the school district shall be collected annually by the Department of Education in cooperation with the Assessment Coordination Department.
(ii) (a) Data may be appropriately adjusted by the Department of Education if it is determined that irregular distributions by a county treasurer of excess commissions cause a school district's property tax collection rate from the uniform rate of tax to exceed ninety-eight percent (98%).
(b) The Department of Education may adjust the uniform rate of tax from an irregular distribution to an amount not in excess of ninety-eight percent (98%) and apply the excess distribution amount the following school year.
(iii) Evidence of irregular distributions shall be in the form required by the Department of Education.
(b) (1) In addition to state foundation funding aid, each school district shall receive funding for additional education categories as provided in subdivisions (b)(2)-(5) of this section.
(2) (A) (i) Beginning with the 2007-2008 school year, alternative learning environment funding shall be four thousand sixty-three dollars ($4,063) multiplied by the number of identified alternative learning environment students enrolled during the previous school year.
(ii) Funding for students in alternative learning environments shall be distributed based on rules promulgated by the State Board of Education.
(B) (i) Beginning with the 2007-2008 school year, secondary vocational area center funding shall be three thousand two hundred fifty dollars ($3,250) multiplied by the number of students enrolled in a secondary vocational area center during the previous school year.
(ii) Funding for students in secondary vocational area centers shall be distributed based on rules promulgated by the State Board of Career Education.
(3) (A) Beginning with the 2007-2008 school year, funding for students who are identified as English-language learners shall be two hundred ninety-three dollars ($293) for each identified English-language learner.
(B) Funding for English-language learners shall be distributed to school districts for students who have been identified as not proficient in the English language based upon a state-approved English proficiency assessment instrument.
(C) Funds allocated for English-language learners to school districts under this subchapter shall be expended only for eligible activities as identified in current rules promulgated by the State Board of Education and are a supplement to funding for national school lunch students provided in subdivision (b)(4) of this section.
(4) (A) Beginning with the 2009-2010 school year, national school lunch state categorical funding for each identified national school lunch student shall be as follows:
(i) For a school district in which ninety percent (90%) or greater of the previous school year's enrolled students are national school lunch students, the amount of per-student national school lunch state categorical funding shall be one thousand four hundred eighty-eight dollars ($1,488);
(ii) For school districts in which at least seventy percent (70%) but less than ninety percent (90%) of the previous school year's enrolled students are national school lunch students, the amount of per-student national school lunch state categorical funding shall be nine hundred ninety-two dollars ($992); and
(iii) For school districts in which less than seventy percent (70%) of the previous school year's enrolled students are national school lunch students, the amount of per student national school lunch state categorical funding shall be four hundred ninety-six dollars ($496).
(B) (i) (a) National school lunch state categorical funding under this subdivision (b)(4) shall be based on the number of national school lunch students for the immediately preceding school year determined under 6-20-2303(12)(A).
(b) If the school district is participating under 42 U.S.C. 1759a, funding under this subdivision (b)(4) is based on the percentage determined in 6-20-2303(12)(B) multiplied by the number of enrolled students for the immediately preceding school year.
(ii) (a) Beginning with the 2009-2010 school year, if a school district will receive in the current school year national school lunch state categorical funding under subdivision (b)(4)(A) of this section that is based on a different per-student amount of national school lunch state categorical funding than the school district received in the immediately preceding school year, due to a percentage change in national school lunch students, the department shall adjust the funding to the school district in a transitional three-year period.
(b) The amount of national school lunch state categorical funding under this subdivision (b)(4)(B)(ii) shall be increased or decreased in each year of a three-year transition period by one-third (1/3) of the difference between the amount of national school lunch state categorical funding per student for the current year and the amount of national school lunch state categorical funding per student for the immediately preceding year, adjusted for changes to the funding rates in 6-20-2305(b)(4)(A).
(iii) (a) The Department of Education shall establish rules to implement the transitional national school lunch state categorical funding provided in subdivision (b)(4)(B)(ii) of this section.
(b) The rules shall include the methods of transition for a school district that:
(1) Experiences a decrease in the amount of national school lunch state categorical funding per student under subdivision (b)(4)(A) of this section;
(2) Experiences an increase in the amount of national school lunch state categorical funding per student under subdivision (b)(4)(A) of this section; or
(3) Within a three-year transition period, experiences both a decrease and an increase in the amount of national school lunch state categorical funding per student under subdivision (b)(4)(A) of this section;
(iv) Under no circumstances shall a school district be entitled to receive more or less funding as a result of the transitional process than the school district is otherwise entitled to receive under this subdivision (b)(4) based on the school district's national school lunch student population as a percentage of the school district's entire student population.
(v) (a) A school district that has experienced a significant growth in enrolled students in the previous three (3) years shall receive funding for the expected increase in the number of national school lunch students based on the expected increase in enrolled students based on the levels of funding provided in this section for national school lunch students.
(b) The State Board of Education shall establish rules to be used by the Department of Education to determine:
(1) The amount of growth necessary to qualify as significant growth;
(2) The expected increase in the number of national school lunch students based on the expected increase in enrolled students; and
(3) Which school districts have experienced a significant growth in enrolled students as necessary to qualify for funding under this subdivision (b)(4)(B)(v).
(c) The Department of Education shall not be required to adjust or fund a school district's national school lunch students based on the current year's number of national school lunch students enrolled in the school district or the average growth of students in the school district.
(C) (i) (a) The State Board of Education shall establish by rule a list of approved programs and purposes for which funds allocated under this subdivision (b)(4) may be expended.
(b) School districts shall expend funds allocated under this subdivision (b)(4) only on the programs or purposes on the State Board of Education's list of approved programs and purposes for which funds allocated under this subdivision (b)(4) may be expended, which shall include, but are not limited to:
(1) Classroom teachers, provided that the school district meets the minimum salary schedule in 6-17-2403 without using funds provided under this subdivision (b)(4) and that those teachers are used for the purposes delineated in this subdivision (b)(4);
(2) Before-school academic programs and after-school academic programs, including transportation to and from the programs;
(3) Prekindergarten programs coordinated by the Department of Human Services;
(4) Tutors, teachers' aides, counselors, social workers, nurses, and curriculum specialists;
(5) Parent education;
(6) Summer programs;
(7) Early intervention programs; and
(8) Materials, supplies, and equipment, including technology used in approved programs or for approved purposes.
(ii) School districts that have met the needs of students for whom the funding is provided for additional educational categories under this subsection (b) and that have excess national school lunch student categorical funds provided under this subdivision (b)(4) may use the excess national school lunch student categorical funds to supplement all classroom teacher salaries under the following conditions:
(a) The school district shall not use any portion of the national school lunch student categorical funds that are carry forward or reserve funds to supplement classroom teacher salaries;
(b) The school district shall meet the minimum teacher salary schedule under 6-17-2403 without using national school lunch student categorical funds;
(c) The school district shall comply with the Standards for Accreditation of Arkansas Public Schools and School Districts established under The Quality Education Act of 2003, 6-15-201 et seq., and the Arkansas Fiscal Assessment and Accountability Program under 6-20-1901 et seq. without using national school lunch student categorical funds; and
(d) The school district shall agree that it shall not allocate or use any excess national school lunch student categorical funds in any manner except as a bonus to the salary of classroom teachers.
(iii) The school district shall include with its comprehensive school improvement plan a written detailed statement concerning how the school district will use its excess national school lunch categorical funds each school year and explaining in detail the amount of funds and percent of total funds to be used to supplement all classroom teacher salaries as allowed in subdivision (b)(4)(C)(ii) of this section.
(iv) (a) Upon review of the school district's comprehensive school improvement plan, if the Commissioner of Education determines that the school district has met the needs of students in the school district for whom the funding for additional educational categories this subsection (b) is provided, has met the requirements of subdivisions (b)(4)(C)(ii) and (iii) of this section, and has prudently managed its resources, the commissioner shall give written approval of the detailed planned flexible use of excess national school lunch student categorical funds provided to the school district.
(b) The school district shall not use its excess national school lunch categorical funds for classroom teacher salaries as provided in subdivision (b)(4)(C)(ii) of this section unless:
(1) The commissioner provides the written approval required under subdivision (b)(4)(C)(iv)(a) of this section; and
(2) Funds allocated under this subdivision (b)(4) are available.
(v) The excess national school lunch student categorical funds used to supplement the salary of a classroom teacher shall only be used as a nonrecurring bonus to a classroom teacher's salary for any given school year and shall not be considered a permanent obligation under the school district's teacher salary schedule or as contract obligations of any classroom teacher or employee of the school district.
(vi) Notwithstanding any other provision of law, if the Department of Education determines that a school district's expenditure of funds allocated under this subdivision (b)(4) would result in the school district's losing funding under any federal law, then the funds allocated to a school district under this subdivision (b)(4) may be expended for other academic programs or salaries.
(vii) The Department of Education may direct that a school district expend available funds on specified programs under subdivision (b)(4)(C)(i) of this section.
(viii) (a) By September 15 of each school year, a school district shall submit to the Department of Education a report for the immediately preceding school year listing each program upon which funds allocated under this subdivision (b)(4) were expended, the amount expended, and any other information required by the Department of Education on the use of funds allocated under this subdivision (b)(4).
(b) The Department of Education shall develop appropriate reporting forms for use by school districts to comply with subdivision (b)(4)(C)(viii) of this section.
(ix) Beginning with the 2007-2008 school year and each school year thereafter, any school district that used or applied restricted national school lunch student categorical funds as a supplement for salaries of classroom teachers in a school district during the 2006-2007 school year under former 6-20-2305 (b)(4)(C)(i)(b) [repealed] shall either:
(a) Remove the use of all national school lunch student categorical funds immediately as a supplement to classroom teacher salaries; or
(b) Begin the process of removing the use or application of national school lunch student categorical funds as part of an obligated salary schedule in the following manner:
(1) A school district shall reduce each current school year by twenty percent (20%) the amount of national school lunch student categorical funds received and used by the school district as a supplement to classroom teacher salaries and shall continue this reduction in the application of national school lunch student categorical funds as a supplement to classroom teacher salaries until the school district has no more than twenty percent (20%) of the total of any current year of all national school lunch student categorical funds received by a school district applied and used as a supplement to classroom teacher salaries for a current school year;
(2) No school district shall be allowed to use or consider reserve or carry forward national school lunch student categorical funds as a supplement to classroom teacher salaries;
(3) The school district shall meet the minimum teacher salary schedule under 6-17-2403 without using national school lunch student categorical funds;
(4) The school district shall comply with the Standards for Accreditation of Arkansas Public Schools and School Districts established under The Quality Education Act of 2003, 6-15-201 et seq., without using national school lunch categorical funds;
(5) The school district shall include with its comprehensive school improvement plan a written detailed narrative or plan concerning how the school district will use its excess national school lunch categorical funds each school year and explaining in detail the amount of funds and percent of total funds to be used to supplement all classroom teacher salaries as allowed in this subdivision (b)(4)(C)(ix);
(6) Upon review of the school district's comprehensive school improvement plan, if the commissioner determines that the school district has met or is meeting the needs of students in the school district for which the funding for additional educational categories under this subdivision (b)(4)(C)(ix) and has prudently managed its resources, the commissioner shall give written approval of the detailed planned flexible use of excess national school lunch student categorical funds provided to the school district; and
(7) Upon review of the school district's comprehensive school improvement plan and other indicators, if the commissioner determines that a school district has not met the needs of students that may be served with national school lunch student categorical funds, the commissioner may require that any and all national school lunch categorical funds dedicated for use or application in the teacher salary fund shall be removed from and not used to meet the classroom teacher salary obligation and redirected and applied to meet the needs of students in a school district.
(x) Each school district shall submit to the Department of Education a report listing each program and purpose upon which funds allocated under this subdivision (b)(4) were expended, the amount expended, and any other information required by the Department of Education concerning the receipt and use of funds allocated under this subdivision (b)(4).
(xi) No provision of subdivision (b)(4)(C)(ix) of this section shall be deemed to prohibit a school district from participating in the provisions of subdivisions (b)(4)(C)(ii)-(viii) of this section.
(xii) The Department of Education shall promulgate rules and develop appropriate reporting forms for use by school districts to comply with this subdivision (b)(4)(C).
(D) (i) By the end of each school year, each school district shall submit to the Department of Education a report listing each program upon which funds allocated under this subdivision (b)(4) were expended, the amount expended, and any other information required by the Department of Education.
(ii) The Department of Education shall develop appropriate reporting forms for use by school districts.
(E) (i) The Department of Education shall provide a report on the impact of national school lunch student categorical funding provided under this subdivision (b)(4) on closing the achievement gap to the House Committee on Education and the Senate Committee on Education by May 31 each even-numbered year, beginning in 2010.
(ii) The report shall include information broken down by category as described in subdivision (b)(4)(A) of this section on:
(a) How school districts are spending national school lunch student categorical funds, including specific programs utilized by school districts;
(b) The amount of national school lunch student categorical funds transferred to another categorical fund, including an explanation of why the national school lunch student categorical funds were transferred; and
(c) The analysis of student achievement data evaluated in student achievement growth models as defined under 6-15-435 shall be expanded to include the evaluation of the best estimates of classroom, school, and school district effects on narrowing the achievement gap, in addition to the examination of student progress based on established value-added longitudinal calculations.
(iii) The report shall be included in the General Assembly's biennial adequacy study to evaluate the adequacy of education in the state.
(5) (A) Beginning with school year 2007-2008, professional development funding shall be equal to an amount of up to fifty dollars ($50.00) multiplied by the school district's previous school year average daily membership.
(B) Funding for professional development for teachers in Arkansas public schools shall be used for professional development activities and materials that improve the knowledge of teachers, administrators, and paraprofessionals concerning effective instructional strategies, methods, and skills for improving teaching practices and student academic achievement and training for school bus drivers as outlined in rules promulgated by the State Board of Education.
(c) Isolated funding under 6-20-601, student growth funding, and special education-catastrophic occurrences funding shall be funded as follows:
(1) Isolated funding and special education-catastrophic occurrences funding shall be allocated and funded to school districts in a line item appropriation within the Public School Fund pursuant to law or rules promulgated by the State Board of Education; and
(2) (A) Student growth funding is calculated as the sum of the following amounts:
(i) One quarter (1/4) of the per student foundation funding for the school district under subdivision (a)(2) of this section multiplied by the increase, if any, of each of the following:
(a) The school district's quarterly average daily membership for the first quarter of the current school year over average daily membership of the previous school year;
(b) The school district's quarterly average daily membership for the second quarter of the current year over the average daily membership of the previous school year;
(c) The school district's quarterly average daily membership for the third quarter of the current school year over the average daily membership of the previous school year; and
(d) The school district's quarterly average daily membership for the fourth quarter of the current school year over the average daily membership of the previous school year; and
(ii) Excluding any increase resulting solely from consolidation or annexation with another school district.
(B) The Department of Education shall:
(i) By January 31 of each year:
(a) Calculate an amount of student growth funding under subdivision (c)(2)(A) of this section using the quarterly average daily membership for the first quarter and an estimation of the average daily membership for the second, third, and fourth quarters; and
(b) Distribute to the school district not less than sixty percent (60%) of the amount calculated under subdivision (c)(2)(B)(i)(a) of this section;
(ii) By April 30 of each year, distribute to the school district forty percent (40%) of the amount calculated under subdivision (c)(2)(B)(i)(a) of this section;
(iii) (a) By July 31 of each year, calculate the amount of student growth funding under subdivision (c)(2)(A) of this section using the actual quarterly average daily membership for all four (4) quarters of the applicable school year.
(C) By August 31 of the fiscal year in which the student growth funding is received, if the amount under subdivision (c)(2)(B)(iii)(a) of this section is:
(1) More than the amount under subdivision (c)(2)(B)(i)(a) of this section, the department shall distribute the difference to the school district; or
(2) Less than the amount under subdivision (c)(2)(B)(i)(a), the school district shall refund the difference to the department.
(d) The sum of subsections (a)-(c) of this section shall be the total state aid allocated and funded to school districts pursuant to this section.
(e) Funds distributed to school districts under subsection (b) of this section shall be expended on:
(1) The students within each category of special needs for which the funds were allocated;
(2) Any students within any category of special needs under subsection (b) of this section as permitted by rules issued by the State Board of Education; or
(3) If the Department of Education determines that a school district's expenditure of funds allocated under subsection (b) of this section would result in the school district's losing funding under any federal law, then the funds allocated to a school district under subsection (b) of this section may be expended for other academic programs or salaries as permitted by the Department of Education.
(f) In order for a school district to be entitled to state funds under the provisions of this subchapter, the school district shall satisfy the following requirements:
(1) Expenditures for any fiscal year shall not exceed the legal revenues for that fiscal year;
(2) The school district shall maintain records and make reports relative to attendance, receipts, and disbursements and other reports as required by the Department of Education for the administration of this subchapter;
(3) The school district shall maintain proper financial records in accordance with the state's school accounting manual and regulations promulgated by the State Board of Education;
(4) (A) Each school year the school district shall file with the State Board of Education a salary schedule for its certified employees that recognizes a minimum level of training and experience.
(B) The schedule shall reflect the actual pay practices of the school district, including all fringe benefits.
(C) Salary increments for experience or education, or both, shall be identified on the schedule; and
(5) (A) All pupil attendance records shall be kept in their original form and shall be public records.
(B) The records shall be kept according to law and regulations on paper or electronic forms either furnished or approved by the Department of Education.
(C) After the school term has ended, the superintendent of the school district shall:
(1) Keep the original attendance records on file for a period of three (3) school years; and
(2) Make the original attendance records available for monitoring purposes during any day of the school term for the teachers or other persons designated to keep attendance.
(g) (1) By the end of each school year, each school district shall submit to the Department of Education a report listing each program upon which funds allocated under subsection (b) of this section were expended, the amount expended, and any other information required by the Department of Education.
(2) The Department of Education shall develop appropriate reporting forms for use by school districts.