Introduced Version






HOUSE BILL No. 1544

_____


DIGEST OF INTRODUCED BILL



Citations Affected: IC 4-30-16-3; IC 20-18-2-23; IC 20-26-12; IC 20-40; IC 20-41; IC 20-43.

Synopsis: School textbook funding. Expands the definition of "textbook" to include certain materials used in student instruction. Transfers and distributes $70,000,000 annually from the administrative trust fund of the state lottery to the state textbook grant fund. Requires school corporations to establish a textbook fund and to use money from the fund to purchase textbooks. Appropriates an annual state textbook grant to each school corporation equal to: (1) $83; multiplied by (2) the average daily membership of the school corporation. Requires the deposit of grant funds in a school corporation's textbook fund. Limits a student textbook rental fee to: (1) 25% of the total purchase price of the textbooks minus; (2) $83. Makes conforming changes.

Effective: July 1, 2007.





Goodin




    January 23, 2007, read first time and referred to Committee on Education.







Introduced

First Regular Session 115th General Assembly (2007)


PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana Constitution) is being amended, the text of the existing provision will appear in this style type, additions will appear in this style type, and deletions will appear in this style type.
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HOUSE BILL No. 1544



    A BILL FOR AN ACT to amend the Indiana Code concerning education finance and to make an appropriation.

Be it enacted by the General Assembly of the State of Indiana:

SOURCE: IC 4-30-16-3; (07)IN1544.1.1. -->     SECTION 1. IC 4-30-16-3, AS AMENDED BY P.L.2-2006, SECTION 7, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2007]: Sec. 3. (a) The commission shall transfer the surplus revenue in the administrative trust fund as follows:
        (1) Before the last business day of January, April, July, and October, the commission shall transfer to the treasurer of state, for deposit in the Indiana state teachers' retirement fund (IC 5-10.4-2), seven million five hundred thousand dollars ($7,500,000). Notwithstanding any other law, including any appropriations law resulting from a budget bill (as defined in IC 4-12-1-2), the money transferred under this subdivision shall be set aside in the pension stabilization fund (IC 5-10.4-2-5) to be used as a credit against the unfunded accrued liability of the pre-1996 account (as defined in IC 5-10.4-1-12) of the Indiana state teachers' retirement fund. The money transferred is in addition to the appropriation needed to pay benefits for the state fiscal year.
        (2) Before the last business day of January, April, July, and October, the commission shall transfer:
            (A) two million five hundred thousand dollars ($2,500,000) of the surplus revenue to the treasurer of state for deposit in the "k" portion of the pension relief fund (IC 5-10.3-11); and
            (B) five million dollars ($5,000,000) of the surplus revenue to the treasurer of state for deposit in the "m" portion of the pension relief fund (IC 5-10.3-11).
         (3) Before the last business day of January, April, July, and October, the commission shall transfer seventeen million five hundred thousand dollars ($17,500,000) of the surplus revenue to the treasurer of state for deposit in the state textbook grant fund (IC 20-43-11).
        (3) (4) The surplus revenue remaining in the fund on the last day of January, April, July, and October after the transfers under subdivisions (1) and (2) through (3) shall be transferred by the commission to the treasurer of state for deposit on that day in the build Indiana fund.
    (b) The commission may make transfers to the treasurer of state more frequently than required by subsection (a). However, the number of transfers does not affect the amount that is required to be transferred for the purposes listed in subsection subsections (a)(1) and (a)(2). through (a)(3). Any amount transferred during the month in excess of the amount required to be transferred for the purposes listed in subsection subsections (a)(1) and (a)(2) through (a)(3) shall be transferred to the build Indiana fund.
SOURCE: IC 20-18-2-23; (07)IN1544.1.2. -->     SECTION 2. IC 20-18-2-23, AS ADDED BY P.L.1-2005, SECTION 2, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2007]: Sec. 23. "Textbook" means includes the following:
        (1)
Systematically organized material designed to provide a specific level of instruction in a subject matter category.
        (2) Instructional materials that are used by students for more than one (1) school year, including materials used in special education and gifted and talented classes.
        (3) Workbooks and consumable instructional materials that are used by students for not more than one (1) school year, including workbooks, consumable textbooks, and other consumable instructional materials that are used in special education and gifted and talented classes.
        (4) Developmentally appropriate materials used:
            (A) for instruction in kindergarten through grade 3, laboratories, and children's literature programs; and
            (B) instead of items described in subdivisions (2) through (3).

SOURCE: IC 20-26-12-1; (07)IN1544.1.3. -->     SECTION 3. IC 20-26-12-1, AS ADDED BY P.L.1-2005, SECTION 10, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2007]: Sec. 1. (a) Except as provided in subsections (b) and (c) and notwithstanding any other law, each governing body shall may purchase from a contracting publisher, at a price equal to or less than the net contract price, the textbooks adopted by the state board and selected by the proper local officials, and shall rent these textbooks to each student enrolled in a public school that is:
        (1) in compliance with the minimum certification standards of the board; and
        (2) located within the attendance unit served by the governing body.
    (b) This section does not prohibit the purchase of textbooks at the option of a student or the providing of free textbooks by the governing body under sections 6 through 21 of this chapter.
    (c) This section does not prohibit a governing body from suspending the operation of this section under a contract entered into under IC 20-26-15.
SOURCE: IC 20-26-12-2; (07)IN1544.1.4. -->     SECTION 4. IC 20-26-12-2, AS ADDED BY P.L.1-2005, SECTION 10, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2007]: Sec. 2. (a) A governing body may purchase from a contracting publisher, at a price equal to or less than the net contract price, any textbook adopted by the state board and selected by the proper local officials. The governing body may rent these textbooks to students enrolled in any public or nonpublic school that is:
        (1) in compliance with the minimum certification standards of the state board; and
        (2) located within the attendance unit served by the governing body.
The total annual rental rate amount charged to a student may not exceed twenty-five percent (25%) of the retail price of the textbooks. the amount determined under STEP FOUR of the following formula:
        STEP ONE: Determine the sum of the purchase prices of the textbooks rented to the student.
        STEP TWO: Multiply the STEP ONE result by twenty-five hundredths (0.25).
        STEP THREE: Subtract eighty-three dollars ($83) from the STEP TWO result.

         STEP FOUR: Determine the greater of the following:
            (A) The STEP THREE result.
            (B) Zero (0).

    (b) Notwithstanding subsection (a), the governing body may not assess a rental fee of more than fifteen percent (15%) of the retail price of a textbook that has been:
        (1) adopted for usage by students under IC 20-20-5;
        (2) extended for usage by students under IC 20-20-5-2; and
        (3) paid for through rental fees previously collected.
    (c) This section does not limit other laws.
SOURCE: IC 20-26-12-14; (07)IN1544.1.5. -->     SECTION 5. IC 20-26-12-14, AS ADDED BY P.L.1-2005, SECTION 10, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2007]: Sec. 14. (a) This subsection applies to a school corporation described in section 13(1) of this chapter. The governing body shall make the first appropriation from the school corporation's general fund to the school corporation's textbook fund in August following the petition's filing. Not later than the school term following the first appropriation, the library must be established and textbooks must be loaned to resident students enrolled in the first five (5) grades of the elementary school. Not later than the second school term following the first appropriation, textbooks must be procured and loaned to resident students enrolled in the eight (8) grades of the elementary school.
    (b) This subsection applies to a school corporation described in section 13(2) of this chapter. The governing body shall make the first appropriation from the school corporation's general fund to the school corporation's textbook fund in September following the petition's filing. Not later than the second school term following the first appropriation, the library must be established and textbooks of the library must be loaned to resident students enrolled in grade nine of the high school. During each following school term, textbooks must be procured and loaned to resident students for an additional high school grade, in addition to the earlier high school grades.
SOURCE: IC 20-26-12-15; (07)IN1544.1.6. -->     SECTION 6. IC 20-26-12-15, AS ADDED BY P.L.231-2005, SECTION 34, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2007]: Sec. 15. (a) A governing body shall requisition the necessary textbooks from the contracting publishers approved by the state board. The contracting publisher shall ship the textbooks to the governing body not more than ninety (90) days after the requisition. On receipt of the textbooks, the governing body's school corporation has custody of the textbooks. The governing body shall provide a receipt to the contracting publisher and reimburse the contracting publisher the amount owed by the school corporation from the school corporation's

general textbook fund.
    (b) A governing body shall purchase textbooks:
        (1) from a resident student who presents the textbooks for sale on or before the beginning of the school term in which the books are to be used;
        (2) with money from the school corporation's general textbook fund; and
        (3) at a price based on the original price to the school corporation minus a reasonable reduction for damage from usage.

SOURCE: IC 20-26-12-18; (07)IN1544.1.7. -->     SECTION 7. IC 20-26-12-18, AS ADDED BY P.L.1-2005, SECTION 10, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2007]: Sec. 18. A governing body may provide a sufficient number of textbooks for sale to resident students at the price stipulated in the contracts under which the textbooks are supplied to the governing body's school corporation. Proceeds from sales under this section must be paid into the school corporation's general textbook fund.
SOURCE: IC 20-26-12-22; (07)IN1544.1.8. -->     SECTION 8. IC 20-26-12-22, AS ADDED BY P.L.1-2005, SECTION 10, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2007]: Sec. 22. If a school corporation purchases textbooks on a time basis:
        (1) the schedule for payments shall coincide with student payments distributions under IC 20-43-11 to the school corporation for textbook rental; and
        (2) the schedule must not require the school corporation to assume a greater burden than payment of twenty-five percent (25%) within thirty (30) days after the beginning of the school year immediately following delivery by the contracting publisher with the school corporation's promissory note evidencing the unpaid balance.
SOURCE: IC 20-26-12-23; (07)IN1544.1.9. -->     SECTION 9. IC 20-26-12-23, AS ADDED BY P.L.1-2005, SECTION 10, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2007]: Sec. 23. (a) A school corporation may:
        (1) borrow money to buy textbooks; and
        (2) issue notes, maturing serially in not more than six (6) years and payable from its general textbook fund, to secure the loan.
However, when an adoption is made by the state board for less than six (6) years, the period for which the notes may be issued is limited to the period for which that adoption is effective.
    (b) Notwithstanding subsection (a), a school township may not borrow money to purchase textbooks unless a petition requesting such an action and bearing the signatures of twenty-five percent (25%) of

the resident taxpayers of the school township has been presented to and approved by the township trustee and township board.

SOURCE: IC 20-40-9-7; (07)IN1544.1.10. -->     SECTION 10. IC 20-40-9-7, AS ADDED BY P.L.2-2006, SECTION 163, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2007]: Sec. 7. (a) Money in the fund may be used for payment of all unreimbursed costs of textbooks for the school corporation's students who were eligible for free or reduced lunches in the previous school year.
    (b) The governing body may transfer the amount levied to cover unreimbursed costs of textbooks under this section to the textbook rental fund. or extracurricular account.
SOURCE: IC 20-40-16; (07)IN1544.1.11. -->     SECTION 11. IC 20-40-16 IS ADDED TO THE INDIANA CODE AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2007]:
     Chapter 16. Textbook Fund
    Sec. 1. As used in this chapter, "fund" refers to the textbook fund established under section 2 of this chapter.
    Sec. 2. Each school corporation shall establish a textbook fund.
    Sec. 3. Money in the fund may be used only for the following purposes:
        (1) Paying interest and principal on loans obtained by the school corporation to purchase textbooks.
        (2) Implementing IC 20-26-12, including the purchase, storage, distribution, or repair of textbooks.
    Sec. 4. A school corporation shall deposit in the fund the following:
        (1) Distributions under IC 20-43-11.
        (2) Textbook rental fees received under IC 20-26-12.
        (3) Receipts from sales of textbooks under IC 20-26-12.
        (4) Other revenues designated for the fund.
    Sec. 5. Money in the fund at the end of a school year or fiscal year does not revert to the school general fund.

SOURCE: IC 20-41-1-2; (07)IN1544.1.12. -->     SECTION 12. IC 20-41-1-2, AS ADDED BY P.L.2-2006, SECTION 164, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2007]: Sec. 2. Any self-supporting programs maintained by a school corporation, including
        (1) school lunch, and
        (2) rental or sale of textbooks;
may be established as separate funds, separate and apart from the general fund, if no local tax rate is established for the programs.
SOURCE: IC 20-41-2-2; (07)IN1544.1.13. -->     SECTION 13. IC 20-41-2-2, AS ADDED BY P.L.2-2006, SECTION 164, IS AMENDED TO READ AS FOLLOWS

[EFFECTIVE JULY 1, 2007]: Sec. 2. Each township trustee in operating a textbook rental program may use either of the following accounting methods:
        (1) The township trustee may supervise and control the program through its school corporation account by establishing a textbook rental fund.
        (2) If textbooks have not been purchased and financial commitments or guarantees for the purchases have not been made by the school corporation, the township trustee may have the program operated by the individual schools of the school corporation through the school corporation's extracurricular account or accounts under IC 20-41-1. textbook fund.

SOURCE: IC 20-41-2-3; (07)IN1544.1.14. -->     SECTION 14. IC 20-41-2-3, AS ADDED BY P.L.2-2006, SECTION 164, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2007]: Sec. 3. (a) If a school lunch fund is established under section 1 of this chapter, or a textbook rental fund is established under section 2 of this chapter, the receipts and expenditures for each the school lunch program shall be made to and from the proper school lunch fund without appropriation or the application of other laws relating to the budgets of local governmental units.
    (b) If either a school lunch program or both programs under sections 1 and 2 of this chapter are is operated through the extracurricular account, the township trustee shall approve the amount of the bond of the treasurer of the extracurricular account in an amount the township trustee considers necessary to protect the account for all funds coming into the hands of the treasurer.
SOURCE: IC 20-41-2-5; (07)IN1544.1.15. -->     SECTION 15. IC 20-41-2-5, AS ADDED BY P.L.2-2006, SECTION 164, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2007]: Sec. 5. (a) A governing body in operating a textbook rental program under IC 20-26-5-4(12) may use either of the following accounting methods:
        (1) The governing body may supervise and control the program through the school corporation account, establishing a textbook rental fund.
        (2) If textbooks have not been purchased and financial commitments or guarantees for the purchases have not been made by the school corporation, the governing body may cause the program to be operated by the individual schools of the school corporation through the school corporation's extracurricular account or accounts in accordance with IC 20-41-1.
    (b) If the governing body determines that a hardship exists due to

the inability of a student's family to purchase or rent textbooks, taking into consideration the income of the family and the demands on the family, the governing body may furnish textbooks to the student without charge, without reference to the application of any other statute or rule except IC 20-26-1 through IC 20-26-5, IC 20-26-7, IC 20-40-12, and IC 20-48-1.

SOURCE: IC 20-41-2-6; (07)IN1544.1.16. -->     SECTION 16. IC 20-41-2-6, AS ADDED BY P.L.2-2006, SECTION 164, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2007]: Sec. 6. (a) If a school lunch fund is established under section 4 of this chapter, and a textbook rental fund is established under section 5 of this chapter, the receipts and expenditures from a the fund for the lunch program to which the fund relates shall be made to and from the fund without appropriation or the application of other statutes and rules relating to the budgets of municipal corporations.
    (b) If either the lunch program or textbook rental program is handled through the extracurricular account, the governing body of the school corporation shall approve the amount of the bond of the treasurer of the extracurricular account in an amount the governing body considers sufficient to protect the account for all funds coming into the hands of the treasurer of the account.
SOURCE: IC 20-43-2-3; (07)IN1544.1.17. -->     SECTION 17. IC 20-43-2-3, AS AMENDED BY P.L.162-2006, SECTION 43, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2007]: Sec. 3. (a) Except as provided in subsection (b), if the total amount to be distributed:
        (1) as basic tuition support;
        (2) for academic honors diploma awards;
        (3) for primetime distributions;
        (4) for special education grants; and
        (5) for vocational education grants; and
        (6) for textbook grants;

for a particular year exceeds the maximum state distribution for a calendar year, the amount to be distributed for state tuition support under this article to each school corporation during each of the last six (6) months of the year shall be proportionately reduced so that the total reductions equal the amount of the excess.
    (b) The department of education shall distribute the full amount of tuition support to school corporations in the second six (6) months of 2006 in accordance with this article without a reduction under this section.
SOURCE: IC 20-43-11; (07)IN1544.1.18. -->     SECTION 18. IC 20-43-11 IS ADDED TO THE INDIANA CODE AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE

JULY 1, 2007]:
     Chapter 11. Textbook Grants
    Sec. 1. As used in this chapter, "fund" refers to the state textbook grant fund established by section 3 of this chapter.
    Sec. 2. As used in this chapter, "textbook fund" refers to a textbook fund established under IC 20-40-16-2.
    Sec. 3. (a) The state textbook grant fund is established to provide money for the annual textbook grants provided under this chapter. The fund shall be administered by the department. The fund consists of the following:
        (1) Transfers made from the administrative trust fund under IC 4-30-16-3(a)(3).
        (2) Any appropriations to the fund.
    (b) The treasurer of state shall invest the money in the fund not currently needed to meet the obligations of the fund in the same manner as other public money may be invested.
    (c) Money in the fund at the end of a state fiscal year does not revert to the state general fund. Money in the fund is appropriated to carry out the purposes of the fund.
    Sec. 4. A school corporation's textbook grant for a calendar year is the amount equal to:
        (1) the school corporation's ADM for the calendar year; multiplied by
        (2) eighty-three dollars ($83).
    Sec. 5. The textbook grant under this chapter shall be distributed monthly in twelve (12) equal installments.
    Sec. 6. A school corporation shall deposit the money received from the textbook grant under this chapter in the school corporation's textbook fund for use only for the purposes specified in IC 20-40-16-3.
    Sec. 7. The amount necessary to provide textbook grants under this chapter is annually appropriated from the fund established by section 3 of this chapter and, as needed, from the state general fund.

SOURCE: ; (07)IN1544.1.19. -->     SECTION 19. [EFFECTIVE JULY 1, 2007] (a) On July 1, 2007, a school corporation shall transfer any unencumbered money in any fund or account used for textbook rental fees to the textbook fund established by the school corporation under IC 20-40-16-2, as added by this act. The money transferred under this SECTION may be used for any purpose for which other money in the school corporation's textbook fund may be used.
    (b) Notwithstanding IC 20-43-11-4, as added by this act, a school

corporation is entitled in 2007 to only fifty percent (50%) of the amount of the textbook grant specified in IC 20-43-11-4, as added by this act, to be distributed in six (6) monthly installments.
    (c) This SECTION expires January 1, 2008.