ADE Director's Communication Memo Form


Memo Number : FIN-05-006

Date Created : 08/05/2004

Attention:

Superintendents
Co-op Directors

Type of Memo: Regulatory
Response Required: Yes
   
Section:   Public School Finance and Admin Support - Ms. Patricia Martin
Subject:
Act 69 of the Second Extraordinary Session of 2003 – Funding Run

Regulatory Authority:
A.C.A. 6-20-2401-2407 and Act 69, Second Extraordinary Session, 2003

Contact Person:
Vivian Roberts

Phone Number:
501/682-4258

E-mail:
vroberts@arkedu.k12.ar.us

Attached to this Director’s Memo is a spreadsheet providing the result of funding calculations for Act 69 of the Second Extraordinary Session of 2003 (Act 69). Act 69 amended the calculation of General Facilities Funding and Debt Service Funding Supplement and added a new funding category called Supplemental Millage Incentive Funding. Act 69 requires districts to elect between receiving 1) General Facilities Funding and Debt Service Funding Supplement or 2) Supplemental Millage Incentive Funding. The Act 69 Election Form (Form) will be attached to a hard copy of this memo and mailed to each district. Districts that are not eligible for Supplemental Millage Incentive Funding are not required to return the Form to the Department. On the Form of a district that is eligible the words “Please Check One, Sign and Return to ADE” appear in the gray highlighted bar above the election and signature section. The Form lists the amount of funding for General Facilities Funding, Debt Service Funding Supplement, and Supplemental Millage Incentive Funding; the applicable statute; an indication of the existence of expenditure restrictions; the Revenue Code; and the Source of Funds Code. Act 69 funding will be distributed in four payments. The first payment will be distributed in September 2004. Further information on the fiscal year 2004-2005 schedule of disbursement of state funds is available in Director’s Memo FIN-05-004.

Act 69 defined a school district qualified to receive Debt Service Funding Supplement or Supplemental Millage Incentive Funding as a school district that: (A) issued bonds to finance school district projects before May 30, 2004, and for which outstanding bonds exist as of May 30, 2004; (B) was approved by the Department of Education to issue bonds on or before December 31, 2003; and (C) received debt service funding supplements pursuant to A.C.A. §§6-20-303 and 6-20-308 during the school year 2003-2004 in accordance with regulations promulgated by the Department of Education. Supplemental millage incentive funding is defined by Act 69 as state funding paid to school districts that levy ad valorem taxes in excess of the twenty-five (25) mills required by Amendment 74 to the Arkansas Constitution.

Also, Act 69 defined bonded debt eligible for use in the calculation of Debt Service Funding Supplement. Bonded debt is not eligible for use in the calculation:
1. If approved by the Board prior to December 31, 2003, but not issued until after May 30, 2004;
2. If approved by the Board after December 31, 2003; or
3. If issued after May 30, 2004.
For additional information, please see Attorney General Opinion No. 2004-180.

For clarification, note that the code cites used in Act 69 have been changed due to a conflict with other legislation. The statutory code is A.C.A. §§6-20-Subchapter 24.

Attachments:

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