HBA-NRS CCH H.B. 934 77(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 934 By: Solis, Jim Public Education 4/9/2001 Introduced BACKGROUND AND PURPOSE Current law allows school districts with eligible bonds to receive state assistance for making debt service payments available through a guaranteed yield formula with certain limitations. Certain school districts that qualified for Tier II monies under the Foundation School Program to pay for these bonds did not have to levy a tax in the 1998-1999 school year. Because the tax rate of the district does not imply the use of funds for debt service, the ceiling rate for Tier II was reset as directed by legislation last session to a level that allows the district to raise the same funds for maintenance and operations as under the old law. This calculation effectively treats the debt service use of Tier II funds as a maintenance expense, thereby letting the district's revenue stream support the continued payment of debt service without a separate debt tax. House Bill 934 provides that school bonds are eligible to be paid with state and local funds if the district made payments on the bonds during the 1998-1999 school year. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. ANALYSIS House Bill 934 amends the Education Code to provide that school bonds are eligible to be paid with state and local funds if: _the district made payments on the bonds during the 1998-1999 school year, or taxes levied to pay the principal of and interest on the bonds were included in the district's audited debt service collections for that school year, rather than only for the 1998-1999 school year; and _the district does not receive state assistance for payment of the principal and interest on the bonds under the instructional facilities allotment. EFFECTIVE DATE September 1, 2001.