FISCAL NOTE

Date Requested: February 19, 2016
Time Requested: 05:23 PM
Agency: Education, Department of
CBD Number: Version: Bill Number: Resolution Number:
1477 Amendment HB4466
CBD Subject: Education (K12)


FUND(S):



Sources of Revenue:

General Fund

Legislation creates:

Neither Program nor Fund



Fiscal Note Summary


Effect this measure will have on costs and revenues of state government.


The estimated cost savings to the State under the Public School Support Program (PSSP) for the proposed legislation is $2,853,034.



Fiscal Note Detail


Effect of Proposal Fiscal Year
2016
Increase/Decrease
(use"-")
2017
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost 0 -2,853,034 -2,853,034
Personal Services 0 0 0
Current Expenses 0 -2,853,034 -2,853,034
Repairs and Alterations 0 0 0
Assets 0 0 0
Other 0 0 0
2. Estimated Total Revenues 0 0 0


Explanation of above estimates (including long-range effect):


The estimated cost savings to the State for the proposed legislation is $2,853,034 for the 2016-17 year. The majority of the cost savings to the state is due to the reduction in the Step 7a base for the 2016-17 year from $47,840,943 to $44,041,641 for total savings of $3,799,302. The cost savings from the Step 7a change are offset by an additional cost related to the county boards of education that currently employ less professional educators than the allowable amount calculated per the enrollment limits and are therefore funded for the lower number actually employed. The proposed legislation funds the county boards at the enrollment limits even if the personnel are not actually employed by the county board. The proposed legislation also removes the professional instructional ratio requirement for the 2016-17 year only. The estimated cost for these changes of $460,544 consists of an increase in Step 1 - Allowance for Professional Salaries of $342,393 and related increases in Step 3 - Allowance for Fixed Charges of $29,514, Step 6b - Allowance for Substitutes of $8,560, Retirement of $28,861 and PEIA of $51,216. There is also an estimated additional cost of $485,724 related to the change in the calculation of Step 6a - Allowance for Current Expense. The estimated cost for the proposed legislation would vary each year depending on the changes in student enrollment and county personnel that sometimes result in county boards of education employing less personnel than allowed by the state aid funding formula (i.e. being under formula). For the 2016-17 funding year for example, no county board of education is under formula in the service personnel category resulting in no additional estimated cost for that category of personnel. However, in the previous fiscal year, there were two county boards of education that were slightly below formula.



Memorandum


There are several provisions included in the proposed legislation that would have no fiscal impact on the State. There is no anticipated cost to the State for the proposed changes to WVC 18-9A-6a. The revised language matches the calculation currently performed by the WV Department of Education (WVDE). There is no anticipated cost to the State for the additional flexibility granted under WVC 18-9A-7 allowing the use of bus replacement funds up to the lesser of 20% or $200,000 for alternate purposes. This flexibility does not change the way the funding is calculated under the PSSP. The proposed changes in WVC 18-9A-10 regarding the distribution of the growth in local share would not change the total amount of state aid funding under PSSP. The changes would decrease the funds allocated to Step 7a - Improvement of Instructional Programs (from 10% to 5% of the growth) and increase the amount of funds allocated to Step 7b - Allowance for 21st Century Technology System (from 20% to 25% of the growth) but would keep the total amount of state aid funding the same. In addition, the proposed changes would impact the distribution of the statewide funds between the county boards of education. There is no estimated additional cost to the State for the additional proposed flexibility allowing county boards of education to utilize a portion of their Step 7b funding to employ Technology System Specialists (TSS). This flexibility does not increase the overall amount of Step 7b funding. There is no estimated cost to the State regarding the proposed change to WVC 18-9A-10(a)(4) regarding the timing of the payments by WVDE into the School Building Capital Improvements Fund. WVDE currently transfers the funds in accordance with the expenditure schedule approved by the state budget office as specified in the proposed language.



    Person submitting Fiscal Note: Brenda Freed
    Email Address: bfreed@k12.wv.us