EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
*sb0385*
SENATE BILL 385
F1 4lr0876
CF HB 221
By: Senators Lewis Young, Hester, and Gile
Introduced and read first time: January 17, 2024
Assigned to: Budget and Taxation
A BILL ENTITLED
AN ACT concerning 1
Education – Funding for General Education Programs – Definition Alterations 2
FOR the purpose of altering certain definitions relating to student enrollment that are used 3
for the calculation of funding for general education programs; and generally relating 4
to funding for general education programs. 5
BY repealing and reenacting, with amendments, 6
Article – Education 7
Section 5–201 and 5–239(b)(1)(v) and (d) 8
Annotated Code of Maryland 9
(2022 Replacement Volume and 2023 Supplement) 10
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 11
That the Laws of Maryland read as follows: 12
Article – Education 13
5–201. 14
(a) In this subtitle, except as otherwise provided, the following words have the 15
meanings indicated. 16
(b) “Assessable base” has the meaning stated in: 17
(1) § 12–201 of the Economic Development Article; or 18
(2) For Baltimore City, Article II, § 62 of the Charter of Baltimore City. 19
(c) “Assessed value of personal property” means the most recent estimate by the 20
State Department of Assessments and Taxation before the annual State budget is 21
submitted to the General Assembly of the assessed value for county purposes of personal 22 2 SENATE BILL 385
property as of July 1 of the first completed fiscal year before the school year for which the 1
calculation is made under this section. 2
(d) (1) Subject to paragraph (2) of this subsection, “assessed value of real 3
property” means the most recent estimate made by the State Department of Assessments 4
and Taxation before the annual State budget is submitted to the General Assembly of the 5
assessed value of real property for State purposes as of July 1 of the first completed fiscal 6
year before the school year for which the calculation of State aid is made under this section. 7
(2) (i) Subject to subparagraphs (ii), (iii), and (iv) of this paragraph, for 8
counties that qualify for a disparity grant under § 16–501 of the Local Government Article 9
and that established a development district under Title 12, Subtitle 2 of the Economic 10
Development Article or Article II, § 62 of the Charter of Baltimore City after May 1, 2016, 11
and is still in effect, using the assessed value of real property as of July 1 of the second 12
completed fiscal year before the school year for which the calculation of State aid is made 13
under this section, “assessed value of real property” does not include the lesser of: 14
1. The difference between the original base and the 15
assessable base of all real property in a development district that is subject to tax increment 16
financing under Title 12, Subtitle 2 of the Economic Development Article or Article II, § 62 17
of the Charter of Baltimore City as certified by the State Department of Assessments and 18
Taxation; or 19
2. The quotient of the annual debt service for a tax increment 20
financing bond in a development district divided by the county’s real property tax rate 21
pledged to the tax increment financing bond multiplied by 100. 22
(ii) If the result of items 1 or 2 of subparagraph (i) of this paragraph 23
is a negative number, then the result shall be $0. 24
(iii) The calculations under this paragraph shall be made separately 25
for each development district in a county. 26
(iv) For Baltimore City, if the result of item 1 or 2 of subparagraph 27
(i) of this paragraph is a positive number, then the amount is required to be appropriated 28
by the Mayor and City Council of Baltimore City to the Baltimore City Board of School 29
Commissioners. 30
(E) “AVERAGE ENROLLMENT CH ANGE” MEANS THE RESULT OF THE 31
FOLLOWING CALCULATIO NS FOR THE FO LLOWING FISCAL YEARS : 32
(1) FOR FISCAL YEAR 2025, THE RESULT OF THE FO LLOWING 33
CALCULATION MULTIPLI ED BY 0.10: 34
(I) THE PRIOR SCHOOL YEAR FULL–TIME EQUIVALENT 35
ENROLLMENT MINUS THE THIRD PRIOR SCHOOL Y EAR FULL–TIME EQUIVALENT 36 SENATE BILL 385 3
ENROLLMENT ; DIVIDED BY 1
(II) TWO; 2
(2) FOR FISCAL YEAR 2026, THE RESULT OF THE FO LLOWING 3
CALCULATION MULTIPLI ED BY 0.20: 4
(I) THE PRIOR SCHOOL YEAR FULL–TIME EQUIVALENT 5
ENROLLMENT MINUS THE THIRD PRIOR SCHOOL Y EAR FULL–TIME EQUIVALENT 6
ENROLLMENT ; DIVIDED BY 7
(II) TWO; 8
(3) FOR FISCAL YEAR 2027, THE RESULT OF THE FO LLOWING 9
CALCULATION MULTIPLI ED BY 0.30: 10
(I) THE PRIOR SCHOOL YEAR FULL–TIME EQUIVALENT 11
ENROLLMENT MINUS THE THIRD PRIOR SCHOOL Y EAR FULL–TIME EQUIVALENT 12
ENROLLMENT ; DIVIDED BY 13
(II) TWO; 14
(4) FOR FISCAL YEAR 2028, THE RESULT OF THE FO LLOWING 15
CALCULATION MULTIPLI ED BY 0.40: 16
(I) THE PRIOR SCHOOL YEAR FULL–TIME EQUIVALENT 17
ENROLLMENT MINUS THE THIRD PRIOR SCHOOL Y EAR FULL–TIME EQUIVALENT 18
ENROLLMENT ; DIVIDED BY 19
(II) TWO; 20
(5) FOR FISCAL YEAR 2029, THE RESULT OF THE FOL LOWING 21
CALCULATION MULTIPLI ED BY 0.50: 22
(I) THE PRIOR SCHOOL YEAR FULL–TIME EQUIVALENT 23
ENROLLMENT MINUS THE THIRD PRIOR SCHOOL Y EAR FULL–TIME EQUIVALENT 24
ENROLLMENT ; DIVIDED BY 25
(II) TWO; 26
(6) FOR FISCAL YEAR 2030, THE RESULT OF THE FOLLOWING 27
CALCULATION MULTIPLI ED BY 0.60: 28
4 SENATE BILL 385
(I) THE PRIOR SCHOOL YEAR FULL–TIME EQUIVALENT 1
ENROLLMENT MINUS THE THIRD PRIOR SCHOOL Y EAR FULL–TIME EQUIVALENT 2
ENROLLMENT ; DIVIDED BY 3
(II) TWO; 4
(7) FOR FISCAL YEAR 2031, THE RESULT OF THE FO LLOWING 5
CALCULATION MULTIPLI ED BY 0.70: 6
(I) THE PRIOR SCHOOL YEAR FULL–TIME EQUIVALENT 7
ENROLLMENT MINUS THE THIRD PRIOR SCHOOL Y EAR FULL–TIME EQUIVALENT 8
ENROLLMENT ; DIVIDED BY 9
(II) TWO; 10
(8) FOR FISCAL YEAR 2032, THE RESULT OF THE FO LLOWING 11
CALCULATION MULTIPLIED BY 0.80: 12
(I) THE PRIOR SCHOOL YEAR FULL–TIME EQUIVALENT 13
ENROLLMENT MINUS THE THIRD PRIOR SCHOOL Y EAR FULL–TIME EQUIVALENT 14
ENROLLMENT ; DIVIDED BY 15
(II) TWO; 16
(9) FOR FISCAL YEAR 2033, THE RESULT OF THE FO LLOWING 17
CALCULATION MULTIPLI ED BY 0.90: 18
(I) THE PRIOR SCHOOL YEAR FULL–TIME EQUIVALENT 19
ENROLLMENT MINUS THE THIRD PRIOR SCHOOL Y EAR FULL–TIME EQUIVALENT 20
ENROLLMENT ; DIVIDED BY 21
(II) TWO; AND 22
(10) FOR FISCAL YEAR 2034, AND EACH FISCAL YEAR THEREAFTER , 23
THE RESULT OF THE FO LLOWING CALCULATION : 24
(I) THE PRIOR SCHOOL YEAR FULL–TIME EQUIVALENT 25
ENROLLMENT MINUS THE THIRD PRIOR SCHOOL Y EAR FULL–TIME EQUIVALENT 26
ENROLLMENT ; DIVIDED BY 27
(II) TWO. 28
[(e)] (F) “Enrollment count” means the greater of: 29 SENATE BILL 385 5
(1) The PRIOR SCHOOL YEAR full–time equivalent enrollment; [or] 1
(2) The 3–year moving average enrollment; OR 2
(3) THE SUM OF THE PRIOR SCHOOL YEAR FULL –TIME EQUIVALENT 3
ENROLLMENT AND THE A VERAGE ENROLLMENT CH ANGE. 4
[(f)] (G) “Foundation program” means the product of the annual per pupil 5
foundation amount and a county’s enrollment count. 6
[(g)] (H) “Full–time equivalent enrollment” means the sum of: 7
(1) The number of students enrolled in kindergarten through grade 12 or 8
their equivalent in regular day school programs on September 30 of the [prior] school year; 9
(2) The number of full–time equivalent students, as determined by a 10
regulation of the Department, enrolled in evening high school programs during the [prior] 11
school year; and 12
(3) The number of P–TECH students, as provided in § 7–1804(b) of this 13
article. 14
[(h)] (I) (1) Subject to paragraph (2) of this subsection, “inflation 15
adjustment” means a percentage, rounded to the nearest two decimal places, that is the 16
lesser of: 17
(i) The increase in the implicit price deflator for State and local 18
government expenditures for the second prior fiscal year; 19
(ii) The Consumer Price Index for All Urban Consumers for the 20
Washington Metropolitan Area, or any successor index, for the second prior fiscal year; or 21
(iii) 5%. 22
(2) If there is no increase in the implicit price deflator for State and local 23
government expenditures for the second prior fiscal year or in the Consumer Price Index 24
for All Urban Consumers for the Washington Metropolitan Area, or any successor index, 25
for the second prior fiscal year, then “inflation adjustment” means 0%. 26
[(i)] (J) “Local contribution rate” means the figure that is calculated as follows: 27
(1) Multiply the statewide full–time equivalent enrollment by the target 28
per pupil amount and by 0.50; divided by 29
(2) The sum of the wealth of all of the counties in this State; and 30 6 SENATE BILL 385
(3) Round the result obtained in paragraph (2) of this subsection to seven 1
decimal places and express as a percent with five decimal places. 2
[(j)] (K) “Local share of the foundation program” means the product of the local 3
contribution rate and a county’s wealth rounded to the nearest whole dollar. 4
[(k)] (L) “Local wealth per pupil” means a county’s wealth divided by the 5
county’s full–time equivalent enrollment. 6
[(l)] (M) “Major education aid” means the sum of the State and local share of the 7
following: 8
(1) Foundation program under § 5–213 of this subtitle; 9
(2) Transportation aid under § 5–218 of this subtitle; 10
(3) Compensatory education under § 5–222 of this subtitle; 11
(4) English learner program under § 5–224 of this subtitle; 12
(5) Special education under § 5–225 of this subtitle; 13
(6) Guaranteed tax base program under § 5–214 of this subtitle; 14
(7) Comparable wage index grant under § 5–216 of this subtitle; 15
(8) Post college and career readiness pathways under § 5–217 of this 16
subtitle; 17
(9) Concentration of poverty under § 5–223 of this subtitle; 18
(10) Transitional supplemental instruction under § 5–226 of this subtitle; 19
(11) Publicly funded prekindergarten under § 5–229 of this subtitle; and 20
(12) Career ladder for educators under § 6–1009 of this article. 21
[(m)] (N) “Net taxable income” means the amount certified by the State 22
Comptroller for the second completed calendar year before the school year for which the 23
calculation of State aid under this section is made, based on tax returns filed on or before 24
November 1 after the current calendar year. 25
[(n)] (O) “Original base”: 26
(1) Has the meaning stated in § 12–201 of the Economic Development 27
Article; or 28 SENATE BILL 385 7
(2) For Baltimore City, means “original assessable base” as defined in 1
Article II, § 62 of the Charter of Baltimore City. 2
[(o)] (P) “Personal property” means all property classified as personal property 3
under § 8–101(c) of the Tax – Property Article. 4
[(p)] (Q) “Real property” means all property classified as real property under § 5
8–101(b) of the Tax – Property Article. 6
[(q)] (R) “State share of the foundation program” means, rounded to the nearest 7
whole dollar, the greater of: 8
(1) The difference between the foundation program and the local share of 9
the foundation program; and 10
(2) The result obtained by multiplying the target per pupil foundation 11
amount by the county’s enrollment count, and multiplying this product by 0.15 in fiscal 12
year 2008 and each fiscal year thereafter. 13
[(r)] (S) “Statewide wealth per pupil” means the sum of the wealth of all 14
counties divided by the statewide full–time equivalent enrollment. 15
[(s)] (T) “Target per pupil foundation amount” means: 16
(1) For fiscal year 2022, $7,991; 17
(2) For fiscal year 2023, $8,310; 18
(3) For fiscal year 2024, $8,642; 19
(4) For fiscal year 2025, $8,789; 20
(5) For fiscal year 2026, $9,226; 21
(6) For fiscal year 2027, $9,732; 22
(7) For fiscal year 2028, $10,138; 23
(8) For fiscal year 2029, $10,564; 24
(9) For fiscal year 2030, $11,004; 25
(10) For fiscal year 2031, $11,442; 26
(11) For fiscal year 2032, $11,898; 27
8 SENATE BILL 385
(12) For fiscal year 2033, $12,365; and 1
(13) For subsequent fiscal years, the target per pupil foundation amount for 2
the prior fiscal year increased by the inflation adjustment rounded to the nearest whole 3
dollar. 4
[(t)] (U) (1) Except as provided in paragraph (2) of this subsection, “3–year 5
moving average enrollment” means the average of the full–time equivalent enrollment in 6
the 3 prior school years. 7
(2) If the 3 prior school years includes the 2020–2021 school year, “3–year 8
moving average enrollment” means: 9
(i) The sum of the full–time equivalent enrollment for the 4 prior 10
school years minus the 2020–2021 school year full–time equivalent enrollment; divided by 11
(ii) Three. 12
[(u)] (V) “Wealth” means the sum of: 13
(1) Net taxable income; 14
(2) 100 percent of the assessed value of the operating real property of public 15
utilities; 16
(3) 40 percent of the assessed value of all other real property; and 17
(4) 50 percent of assessed value of personal property. 18
5–239. 19
(b) (1) (v) “Major education aid” has the meaning stated in [§ 5–201(l)] § 20
5–201(M) of this subtitle minus item (9) of [§ 5–201(l)] § 5–201(M) of this subtitle. 21
(d) Subject to the limitation in subsection (a) of this section, the local share of 22
major education aid shall be reduced by: 23
(1) The sum of the amount of State funds provided to a county board in a 24
county that is eligible for the minimum State funding under the foundation program as 25
defined in [§ 5–201(q)(2)] § 5–201(R)(2) of this subtitle and the difference between the 26
local share of the foundation program and the foundation program; and 27
(2) The amount by which the sum of the State share and local share of the 28
at–promise programs as defined in § 5–221(c)(2) of this subtitle exceeds the total program 29
amount as defined in § 5–221(e) of this subtitle for each program. 30
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 31 SENATE BILL 385 9
1, 2024. 1