This docum ent does not reflect the intent or official position of the bill sponsor or House of Representatives.
STORAGE NAME: h1259a.PKA
DATE: 3/16/2023
HOUSE OF REPRESENTATIVES STAFF ANALYSIS
BILL #: HB 1259 Education Funding
SPONSOR(S): Canady
TIED BILLS: IDEN./SIM. BILLS:
REFERENCE ACTION ANALYST STAFF DIRECTOR or
BUDGET/POLICY CHIEF
1) PreK-12 Appropriations Subcommittee 14 Y, 0 N Bailey Potvin
2) Education & Employment Committee
3) Appropriations Committee
SUMMARY ANALYSIS
Funding for charter school capital outlay is primarily provided by state funds when such funds are appropriated
in the General Appropriations Act. However, if the state appropriation for charter school capital outlay does not
meet the funding threshold specified in law, school districts are required to share local capital outlay revenue
from the discretionary 1.5 millage levy authorized in section 1011.71(2), F.S., with charter schools. The funding
threshold is defined as the Fiscal Year 2018-2019 per full-time equivalent (FTE) level of $145.3 million
adjusted by changes in the Consumer Price Index and the estimated number of charter school students for the
applicable fiscal year.
The bill:
Clarifies that charter school capital outlay funding shall consist of state funds, when such funds are
appropriated in the General Appropriations Act, and revenue resulting from the discretionary 1.5 millage
authorized in s. 1011.71(2), F.S.
Removes the state funding threshold and revises the calculation methodology for the Department of
Education (DOE) to use to allocate state funds to eligible charter schools.
Revises the calculation methodology for the DOE to use to determine the amount of the discretionary
1.5 millage revenue a school district must distribute to each eligible charter school.
Clarifies that the calculation of school district enrollment for purposes of calculating proportionate share
of school capital outlay surtax shall be based on capital outlay full-time equivalent enrollment.
The bill provides an appropriation of $213,453,885 in nonrecurring funds from the Public Education Capital
Outlay and Debt Service Trust Fund to the DOE for charter school capital outlay funding for Fiscal Year 2023-
2024. See FISCAL COMMENTS.
The bill has an effective date of July 1, 2023.
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DATE: 3/16/2023
FULL ANALYSIS
I. SUBSTANTIVE ANALYSIS
A. EFFECT OF PROPOSED CHANGES:
Present Situation
Funding for charter school capital outlay is primarily provided by state funds when such funds are
appropriated in the General Appropriations Act. Section 1013.62, F.S., describes charter school
eligibility for capital outlay funding, how such funds must be allocated, and allowable capital outlay
funding uses.
To be eligible for charter school capital outlay funding, a charter school must:
1
Have been in operation for two or more years and:
o be governed by a governing board established in Florida for two or more years which
operates both charter schools and conversion charter schools within the state;
o be part of an expanded feeder chain
2
with an existing charter school in the district that is
currently receiving charter school capital outlay funds;
o be accredited by a regional accrediting association as defined by State Board of Education
rule;
o serve students in facilities that are provided by a business partner for a charter school-in-
the-workplace; or
o be operated by a hope operator pursuant to s. 1002.333, F.S.
Have an annual audit that does not reveal any of the financial emergency conditions provided in s.
218.503(1), F.S., for the most recent fiscal year for which such audit results are available;
Have satisfactory student achievement based upon the state accountability standards applicable to
charter schools;
3
Have received final approval from its sponsor pursuant to s. 1002.33, F.S., for operation during that
fiscal year; and
Serve students in facilities that are not provided by the charter school sponsor.
Capital outlay funds may be used by a charter school’s governing board for the:
4
Purchase of real property.
Construction of school facilities.
Purchase, lease-purchase, or lease of permanent or relocatable school facilities.
Purchase of vehicles to transport students to and from the charter school.
Renovation, repair, and maintenance of school facilities that the charter school owns or is
purchasing through a lease-purchase or long-term lease of five years or longer.
Payment of the cost of premiums for property and casualty insurance necessary to insure the
school facilities.
Purchase, lease-purchase, or lease of driver’s education vehicles, motor vehicles used for the
maintenance or operation of plants and equipment, security vehicles, or vehicles used in storing or
distributing materials and equipment.
Purchase, lease-purchase, or lease of computer and device hardware and operating system
software necessary for gaining access to or enhancing the use of electronic and digital instructional
1
Section 1013.62(1)(a), F.S. A conversion charter school, i.e., a charter school created by the conversion of an existing
public school to charter status, is not eligible for capital outlay funding if it operates in facilities provided by its sponsor at
no charge or for a nominal fee or if it is directly or indirectly operated by the school district. Section 1013.62(1)(d), F.S.
2
A charter school may be considered a part of an expanded feeder chain under s. 1013.62, F.S., if it either sends or
receives a majority of its students directly to or from a charter school that is currently receiving capital outlay funding
pursuant to s. 1013.62, F.S. Rule 6A-2.0020 (1), F.A.C.
3
State board rule allows “satisfactory student achievement” to be determined in accordance with a charter contract;
however, a charter school that earns a school grade of “F” is not eligible for capital outlay funding for the school year
immediately following the designation. Rule 6A-2.0020(4), F.A.C.
4
Section 1013.62(4)(a)-(i), F.S. STORAGE NAME: h1259a.PKA PAGE: 3
DATE: 3/16/2023
content and resources; and certain enterprise resource software applications that are classified as
capital assets.
5
Payment of the cost of the opening day collection for the library media center of a new school.
If a charter school or charter lab school is nonrenewed or terminated, any unencumbered funds and all
equipment and property purchased with public funds, including charter school capital outlay funds,
revert to the ownership of the district school board or the state university, as appropriate. Any
reversions focus on recoverable assets (equipment, property, etc.) but not on intangible or
irrecoverable costs (e.g., rental or leasing fees, normal maintenance, and limited renovations).
6
State funds for charter school capital outlay are allocated to eligible charter schools based on each
school’s weighted full-time equivalent (FTE) enrollment. Charter schools receive a weight of 1.0 per
FTE student, with an additional weight for schools that meet one or both of the following criteria:
7
75 percent or more of the school’s students are eligible for free or reduced-price lunch; and
25 percent or more of the school’s students are students with disabilities.
Schools that meet only one of the above criteria receive capital outlay funding weighted at 1.25.
Schools that meet both criteria receive capital outlay funding weighted at 1.5. Eligible schools that do
not meet either of the criteria receive capital outlay funding weighted at 1.0.
8
In addition to the appropriated state funds for charter school capital outlay, the law authorizes, but does
not require, school districts to share the discretionary 1.5 mills revenue with charter schools.
9
At least
three school districts, Franklin, Sarasota, and Sumter, have shared revenue generated from the
discretionary 1.5 millage with charter schools within their districts;
10
however, it is unknown the extent
school districts currently share such revenue as the Department of Education (DOE) does not collect
this data.
If the state appropriation for charter school capital outlay does not meet the funding threshold specified
in law, school districts are required to share the local capital outlay revenue from the discretionary 1.5
millage levy authorized in s. 1011.71(2), F.S., with charter schools. The funding threshold is defined as
the Fiscal Year 2018-2019 per FTE level of $145.3 million
11
adjusted by changes in the Consumer
Price Index (CPI) and the estimated number of charter school students for the applicable fiscal year.
12
5
Qualifying enterprise resource software applications are “classified as capital assets in accordance with definitions of the
Governmental Accounting Standards Board, have a useful life of at least 5 years, and are used to support schoolwide
administration or state-mandated reporting requirements.” Section 1013.62(4)(h), F.S.
6
Section 1013.62(5), F.S.
7
Section 1013.62(2)(a), F.S.
8
Section 1013.62(2)(b), F.S.
9
Section 1011.71(2), F.S.
10
Florida Department of Education Office of Funding and Financial Reporting, Source: Survey of Florida District School
Boards, December 2011; Report Prepared May 17, 2012.
11
Chapter 2018-9 Laws of Florida.
12
Section 1013.62(1), F.S. STORAGE NAME: h1259a.PKA PAGE: 4
DATE: 3/16/2023
The Legislature has fully funded charter school capital outlay with state funds in Fiscal Years 2018-
2019 through 2022-2023
13
. The estimated amount of funding required for Fiscal Year 2023-2024 is
$213.4 million.
Effect of Proposed Changes
The bill removes the state funding threshold and revises the calculation methodology for the DOE to
use to allocate state funds to eligible charter schools. The bill revises the calculation methodology for
the DOE to use to determine the amount of the discretionary 1.5 millage revenue a school district must
distribute to each eligible charter school. The bill also clarifies that the calculation of each school
district’s enrollment for purposes of calculating the proportionate share of school capital outlay surtax
shall be based on capital outlay full-time equivalent enrollment.
Finally, the bill provides an appropriation of $213,453,885 in nonrecurring funds from the Public
Education Capital Outlay and Debt Service Trust Fund to the DOE for charter school capital outlay
funding for Fiscal Year 2023-2024.
B. SECTION DIRECTORY:
Section 1: Amends s. 212.055, F.S., to clarify the types of students that are counted for the
proportionate share of school capital outlay surtax.
Section 2: Amends s. 1013.62, F.S., to provide a process for distributing state funds and discretionary
millage funds to eligible charter schools.
Section 3: Provides a nonrecurring appropriation for charter school capital outlay funding.
Section 4: Provides an effective date of July 1, 2023.
II. FISCAL ANALYSIS & ECONOMIC IMPACT STATEMENT
A. FISCAL IMPACT ON STATE GOVERNMENT:
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Chapters 2017-70, 2018-9, 2019-115, 2020-111, 2021-36, 2022-156 Laws of Florida. STORAGE NAME: h1259a.PKA PAGE: 5
DATE: 3/16/2023
1. Revenues:
None.
2. Expenditures:
See FISCAL COMMENTS.
B. FISCAL IMPACT ON LOCAL GOVERNMENTS:
1. Revenues:
None.
2. Expenditures:
See FISCAL COMMENTS.
C. DIRECT ECONOMIC IMPACT ON PRIVATE SECTOR:
None.
D. FISCAL COMMENTS:
The bill appropriates $213,453,885 in nonrecurring funds from the Public Education Capital Outlay and
Debt Service Trust Fund to the DOE for charter school capital outlay funding for Fiscal Year 2023-
2024. School districts are estimated to collect $4.4 billion from the discretionary 1.5 millage in Fiscal
Year 2023-2024. An indeterminate portion of these funds will be shared with eligible charter schools.
III. COMMENTS
A. CONSTITUTIONAL ISSUES:
1. Applicability of Municipality/County Mandates Provision:
None.
2. Other:
None.
B. RULE-MAKING AUTHORITY:
None.
C. DRAFTING ISSUES OR OTHER COMMENTS:
None.
IV. AMENDMENTS/COMMITTEE SUBSTITUTE CHANGES