87R8150 KJE-D
By: Huberty H.B. No. 3445
A BILL TO BE ENTITLED
AN ACT
relating to requiring the use of a public school's excess funds for
certain purposes.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter A, Chapter 44, Education Code, is
amended by adding Section 44.013 to read as follows:
Sec. 44.013. USE OF EXCESS FUNDS REQUIRED. (a) In this
section:
(1) "Cash on hand" includes cash equivalents and money
invested in short-term investments.
(2) "Operating expenses" means total general fund
expenditures less any capital outlay.
(b) Each school district and open-enrollment charter school
shall annually review the district's or school's fund balances to
determine the amount of excess funds held by the district or school
as described by Subsection (c).
(c) For purposes of this section, a school district or
open-enrollment charter school has excess funds if:
(1) for a district, the total amount of the district's
cash on hand or unobligated funds exceeds the district's operating
expenses for a period of 110 days; or
(2) for a school, the total amount of the school's cash
on hand or net assets exceeds the school's operating expenses for a
period of 80 days.
(d) Not later than the end of the fiscal year following a
determination made under Subsection (b), each school district or
open-enrollment charter school shall use the amount of excess funds
identified under that subsection, if any, to, as applicable:
(1) pay down debt obligations;
(2) lower the district's maintenance and operations
tax rate;
(3) provide employee compensation, subject to
Subsection (e); or
(4) pay costs of deferred maintenance.
(e) Funding provided for employee compensation under
Subsection (d)(3) must be used to implement a new compensation
program or supplement an existing compensation program and may not
be used to supplant funding for an existing compensation program.
(f) Subject to Subsection (g), for any period of the fiscal
year following a determination made under Subsection (b) in which
the school district or open-enrollment charter school has excess
funds, the district or school may not:
(1) for a district, issue a bond or hold an election
seeking voter approval to issue a bond under Subchapter A, Chapter
45; or
(2) for a school:
(A) receive funding under Section 12.106(d); or
(B) apply for bonds issued under Chapter 53 for
the school to be guaranteed by the permanent school fund under
Chapter 45, as provided by Section 12.135.
(g) The restrictions under Subsection (f) do not apply to a
school district or open-enrollment charter school that posts on the
district's or school's Internet website an explanation of how the
district's or school's excess funds identified under Subsection (b)
will be spent in accordance with Subsection (d).
(h) If the commissioner determines that a school district or
open-enrollment charter school has failed to comply with this
section, the commissioner shall, as applicable, increase the
district's local share under Section 48.256 or reduce the school's
entitlement under Section 12.106 by an amount equal to the amount of
the district's or school's excess funds not spent as required under
Subsection (d).
(i) This section does not apply to:
(1) a special-purpose school district established
under Section 11.351 that is operated by an institution of higher
education, as that term is defined by Section 61.003;
(2) an open-enrollment charter school operated under a
charter granted to a governmental entity; or
(3) a charter school granted a charter under
Subchapter E, Chapter 12.
(j) The commissioner may adopt rules as necessary to
implement this section.
SECTION 2. Section 12.106, Education Code, is amended by
adding Subsection (k) to read as follows:
(k) The commissioner shall reduce the amount of funding to
which a charter holder is entitled for an open-enrollment charter
school under this section as provided by Section 44.013(h).
SECTION 3. Section 48.256, Education Code, is amended by
adding Subsection (f) to read as follows:
(f) The commissioner shall increase a school district's
local share under this section as provided by Section 44.013(h).
SECTION 4. Section 48.277, Education Code, is amended by
amending Subsection (e) and adding Subsection (f) to read as
follows:
(e) The commissioner shall reduce a school district's or
open-enrollment charter school's allotment under this section as
necessary to comply with Section 44.013(h).
(f) This section expires September 1, 2025.
SECTION 5. Section 48.278, Education Code, is amended by
adding Subsection (b-1) to read as follows:
(b-1) The commissioner shall reduce a school district's
allotment under this section as necessary to comply with Section
44.013(h).
SECTION 6. This Act takes effect September 1, 2021.