HB 1062--TRANSPORTATION FUND ISSUES ADDRESSED.
03/07/2014

CONFEREES:  Rep. Todd Huston; Rep. Sue Errington; Sen. Pete Miller; Sen. Tim Skinner.

 

A conference committee report on HB 1062 moves forward to help certain cash-strapped, circuit-breaker impacted school transportation programs (temporarily), to allow a district to debt restructure without getting the approval of the Distresssed Unit Appeals Board, subject to a single taxpayer filing an objection (which would then thrust the restructure into a petition/remonstrance process), and to being a pilot program to allow commercial advertisements to be affixed to school buses to raise supplemental transportation funds.

 

This is a good bill which holds the promise of providing a degree of relief to some-90+ school districts that have been impacted by 10% or more with regard to circuit breaker/protected taxes restrictions.  Under the bill, these districts would be exempt from protected taxes for 2014, 2015, and 2016.

 

Also, the proposed bill will allow school districts to carry a 50% operating balance in their Debt Service Funds or any debt originally incurred before July 1, 2014 (in other words, for existing debt).  Refinancing of debt after July 1, 2104 would continue to have a 50% operating balance threshold, too.

 

Debt incurred beginning July 1, 2014, could have an operating balnace in the Debt Service Fund of just 15%.  The general assembly has contemplated in prior bills 25% and 10% thresholds.  The 15% threshold could be problematic as we go forward and testimony by Denny Costerison, Indiana Association of School Business Officials, reflected that.  ISTA echoed Denny's testimony--that this was a positive move that will help many districts.

 

Newer amendments to this bill create a pilot project for the display of paid commercial advertisements on school buses.  Any revefnue from the sale of these advertisements would be depostied in the district's transportation fund.  DOE testifeid that there may be unintended consequences to this, the most impactful being that drivers in other vehicles may become distracted--that the yellow school bus is such a branded thing--but stopped short of opposing the measure.  ISTA likewise testified that it appreciates the General Assembly thinking outside the box on this revenue-raising idea and noted that it is a pilot program, the guiedelines of which would be fleshed out through the state's School Bus Committee--and suggested, too that the General Assembly study this idea over the summer as well.