LB 1134 (1997) - Change Provisions Relating to Reorganization Incentives

Prior to the enactment of LB 1134 and pursuant to the Tax Equity and Educational Opportunities Support Act, school districts that reorganize in accordance with a reorganization plan receive incentive payments from the state for three years beginning with the second year after reorganization. Incentive payments are given to reorganized school districts in recognition of their efforts to provide more efficient delivery of educational services. The passage of LB 1134 changes the timing of the commencement of those payments by providing that school districts that reorganize during or after the 1997-98 school year can begin receiving incentive payments the first school fiscal year following reorganization.

To fund the incentive payments, LB 1134 creates the Reorganized School Assistance Fund, and on September 1, 1998, $2 million will be transferred from the Cash Reserve Fund to the Reorganized School Assistance Fund. Subsequently, on September 1, 1999, $2 million will be transferred from the General Fund, via the Reorganized School Assistance Fund, to the Cash Reserve Fund. an essence, this transfer repays the original loan, and it is the intent of the Legislature to deduct $2 million from the total amount appropriated as state aid to schools in FY1999-2000.)

Thereafter, $2 million will be set aside annually for school fiscal years 1999-2000, 2000-01, and 2001-02 and subtracted from the appropriation to the Tax Equity and Educational Opportunities Fund to fund the incentive payments. No district will be eligible for incentive payments on or after July 1, 2002.

LB 1134 passed 43-2 and was approved by the Governor on April 8, 1998.