72nd OREGON LEGISLATIVE ASSEMBLY--2003 Regular Session
NOTE: Matter within { + braces and plus signs + } in an
amended section is new. Matter within { - braces and minus
signs - } is existing law to be omitted. New sections are within
{ + braces and plus signs + } .
LC 2225
Senate Bill 498
Sponsored by Senators METSGER, RINGO
SUMMARY
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.
Allows education service district to be abolished and merged
with component school districts if approved by voters of
education service district.
Provides that component school districts of former education
service district receive State School Fund grant that former
education service district would have received under funding
formula.
A BILL FOR AN ACT
Relating to education service districts; creating new provisions;
amending ORS 294.060, 327.019, 328.115, 328.304, 332.118,
334.020, 339.035 and 757.612 and section 7, chapter 695, Oregon
Laws 2001; and repealing ORS 334.127.
Be It Enacted by the People of the State of Oregon:
SECTION 1. { + Section 2 of this 2003 Act is added to and made
a part of ORS chapter 334. + }
SECTION 2. { + (1) An education service district may be
abolished by merging the education service district with its
component school districts pursuant to this section. A petition
or request for a proposed merger shall:
(a) Be directed to the education service district board of the
education service district that is to be merged with its
component school districts;
(b) Contain the names and numbers of the education service
district and component school districts affected by the change;
and
(c) Contain a proposal for distribution of the debt, property
and other assets of the education service district.
(2) In addition to the requirements for a petition or request
under subsection (1) of this section, a request for a proposed
merger may be filed by the school district boards of the
component school districts only if each of the boards has
approved the request.
(3) In addition to the requirements for a petition or request
under subsection (1) of this section, a petition for a proposed
merger submitted by electors from the affected education service
district must be:
(a) Signed by five percent or 500, whichever is less, of the
electors of the affected education service district; and
(b) Contain the signatures and resident addresses of the
petitioners and the names of the school districts in which the
petitioners reside.
(4) If the education service district board determines that a
petition or request meets the requirements of subsections (1) to
(3) of this section, the education service district board shall
submit the question of the proposed merger to the electors of the
affected education service district. The cost of an election on a
proposed merger shall be prorated among the component school
districts in accordance with ORS 255.305.
(5) If the majority of votes cast are in favor of the proposed
merger, the education service district board shall declare the
merger effective and final as provided in subsection (6) of this
section.
(6) When an education service district merger becomes final
according to ORS 308.225 (2)(a) and the merger:
(a) Occurs on or after July 1 and prior to March 31 next
following, the merger shall take effect May 31 following the
election.
(b) Occurs between March 31 and June 30, inclusive, the merger
shall take effect May 31 of the following year.
(7) Districts subject to a merger under this section shall, for
the purposes of administration and operation, continue to operate
separately until the end of the fiscal year in which the merger
is effective.
(8) On the date the merger takes effect under subsection (6) of
this section, the education service district board is abolished
and the terms of office of the board members expire. During the
period following the election and prior to the date the merger
takes effect, the education service district board may take such
action as is essential in order that the component school
districts may carry out the functions of the education service
district after the date the merger takes effect. + }
SECTION 3. ORS 327.019 is amended to read:
327.019. (1) As used in this section:
(a) 'Education service district extended ADMw' means the sum of
the extended ADMw of the component school districts of the
education service district as computed under ORS 327.013.
(b) 'Local revenues of an education service district' means the
total of the following:
(A) The amount of revenue offset against local property taxes
as determined by the Department of Revenue under ORS 311.175
(3)(a)(A);
(B) The amount of property taxes actually received by the
district including penalties and interest on taxes;
(C) The amount of revenue received by the district from
state-managed forestlands under ORS 530.115 (1)(b) and (c); and
(D) Any positive amount obtained by subtracting the operating
property taxes actually imposed by the district based on the rate
certified pursuant to ORS 310.060 from the amount that would have
been imposed by the district if the district had certified the
maximum rate of operating property taxes allowed by law.
(2) Each fiscal year, the Superintendent of Public Instruction
shall calculate a State School Fund grant for each education
service district as provided in this section.
(3)(a) Each fiscal year, the superintendent shall calculate the
total amount appropriated or allocated to the State School Fund
and available for distribution to school districts, education
service districts and programs + total amount of local revenues
of all school districts, computed as provided in ORS 327.013, +
total amount of local revenues of all education service
districts. The superintendent may not include in the calculation
under this paragraph amounts transferred from the State School
Fund to the Out-of-State Disabilities Placement Education Fund or
amounts recovered by the Department of Education from the State
School Fund under ORS 343.243.
(b) The superintendent shall multiply the amount calculated
under paragraph (a) of this subsection by 95 percent.
(c) Based on the amount calculated under paragraph (b) of this
subsection, the superintendent shall calculate a funding
percentage to distribute as nearly as practicable under ORS
327.006 to 327.133 the total amount calculated under paragraph
(b) of this subsection as school district general purpose grants,
facility grants and transportation grants to school districts.
(d) Based on the funding percentage calculated under paragraph
(c) of this subsection, the superintendent shall calculate the
general purpose grant, facility grant and transportation grant
amounts for each school district.
(4) The general services grant for an education service
district shall equal the higher of:
(a) Total amount calculated under subsection (3)(d) of this
section for the component school districts of the education
service district X 5.263 percent; or
(b) $1 million.
(5) Subject to subsection (6) of this section, the State School
Fund grant for an education service district = general services
grant - local revenues of the education service district.
(6)(a) After completing the calculations under subsections (2)
to (5) of this section, the Superintendent of Public Instruction
shall apportion from the State School Fund to each education
service district an amount = (funding percentage X general
services grant) - local revenues of the education service
district.
(b) The funding percentage used in paragraph (a) of this
subsection shall be calculated by the superintendent to
distribute as nearly as practicable the total amount available
for distribution to education service districts from the State
School Fund for each fiscal year.
(7) Notwithstanding subsections (5) and (6) of this section,
the State School Fund grant of an education service district may
not be less than zero.
(8) An education service district shall distribute to its
component school districts any amount of local revenues of the
education service district that is greater than the general
services grant. The amount that each component school district
receives under this subsection shall be prorated based on the
district extended ADMw of each school district.
{ + (9) If an education service district is abolished and
merged under section 2 of this 2003 Act, the component school
districts of the former education service district shall receive
a State School Fund grant as calculated under this section that
is equal to the amount the education service district would have
received under this section if the education service existed. The
State School Fund grant shall be divided among the component
school districts based on the extended ADMw of the school
districts. The Superintendent of Public Instruction shall
distribute funds payable to school districts from the State
School Fund under this subsection following the same percentages
and dates specified for school districts under ORS 327.095. + }
SECTION 4. Section 7, chapter 695, Oregon Laws 2001, is amended
to read:
{ + Sec. 7. + } (1) For each fiscal year, the Superintendent
of Public Instruction shall calculate a general services grant
for each education service district that is equal to:
(a) For education service districts with a base amount that is
greater than the target amount, base amount - base adjustment.
(b) For education service districts with a base amount that is
less than the target amount or equal to the target amount, base
amount + base adjustment.
(2) Notwithstanding subsection (1) of this section, for each
education service district that has a base amount that is greater
than the target amount or equal to the target amount and that has
an education service district extended ADMw of less than 2,500,
the general services grant of the education service district
shall be equal to at least:
(a) For the 2001-2002 fiscal year, $700,000.
(b) For the 2002-2003 fiscal year, $750,000.
(c) For the 2003-2004 fiscal year, $800,000.
(d) For the 2004-2005 fiscal year, $900,000.
(3)(a) Each fiscal year, subject to subsection (5) of this
section, each education service district shall receive a State
School Fund grant = general services grant - local revenues of
the education service district.
(b) Notwithstanding paragraph (a) of this subsection and
subsection (5) of this section, the State School Fund grant of an
education service district may not be less than zero.
(4) { + Except as provided in section 2 of this 2003 Act, + }
if the boundaries of an education service district change after
July 1, 2001, the Superintendent of Public Instruction shall
determine the amounts under subsections (1) to (3) of this
section as if the newly formed education service district existed
in the prior fiscal year.
(5)(a) After completing the calculations under subsections (1)
to (4) of this section, the Superintendent of Public Instruction
shall apportion from the State School Fund to each education
service district an amount = (funding percentage X general
services grant) - local revenues of the education service
district.
(b) The funding percentage used in paragraph (a) of this
subsection shall be calculated by the superintendent to
distribute as nearly as practicable the total amount available
for distribution to education service districts from the State
School Fund for each fiscal year.
{ + (6) If an education service district is abolished and
merged under section 2 of this 2003 Act, the component school
districts of the former education service district shall receive
a State School Fund grant as calculated under this section that
is equal to the amount the education service district would have
received under this section if the education service existed. The
State School Fund grant shall be divided among the component
school districts based on the extended ADMw of the school
districts. The Superintendent of Public Instruction shall
distribute funds payable to school districts from the State
School Fund under this subsection following the same percentages
and dates specified for school districts under ORS 327.095. + }
SECTION 5. ORS 328.115 is amended to read:
328.115. (1) The county treasurer shall loan the Douglas County
School Fund in the manner provided by law at the best rate
obtainable per annum and shall rent all lands owned by the county
belonging to the fund.
(2) The county treasurer shall place the interest and rentals
with other moneys the county receives for support of the common
schools. The education service district board shall apportion and
the county treasurer shall distribute the interest and rentals
with, and in the same manner as, such other moneys. { + If an
education service district board does not exist for the county,
the county treasurer shall apportion the interest and
rentals. + }
SECTION 6. ORS 328.304 is amended to read:
328.304. (1) { + (a) + } A board of directors of an education
service district may proceed under subsection (2) of this section
to create a county education bond district if two-thirds of the
component school districts that are part of the education service
district and that have at least a majority of the pupils included
in the average daily membership of the education service
district, as determined by the reports of such school districts
for the preceding year, enrolled in the schools of the districts
by resolution have approved { - of - } the creation of the
county education bond district.
{ + (b) If an education service district has been abolished
and merged under section 2 of this 2003 Act, the school district
boards of the school districts with administrative offices in a
county without an education service district may create a county
education bond district if two-thirds of the school districts
with at least a majority of the pupils included in the average
daily membership of the county, as determined by the reports of
such school districts for the preceding year, enrolled in the
schools of the districts by joint resolution have approved the
creation of the county education bond district. + }
(2)(a) The board of directors of an education service district
may, by resolution, classify and designate an area within the
district as a county education bond district.
{ + (b) If an education service district has been abolished
and merged under section 2 of this 2003 Act, the school district
boards of the school districts with administrative offices in a
county without an education service district may, by joint
resolution, classify and designate an area as a county education
bond district.
(c) + } The boundaries of { - the - } { + a + } county
education bond district shall be coterminous with the boundaries
of the school districts that have administrative offices
{ - that lie within the boundaries of - } { + in + } one
county within the education service district.
{ - (b) - } { + (d) + } Once so classified and designated,
{ - the - } { + a + } county education bond district is a body
corporate of this state and may:
(A) Acquire by purchase, gift, devise, condemnation proceedings
or any other means such real and personal property and rights of
way, within the bond district, as in the judgment of the board
are necessary or proper in the exercise of the powers of the
education service district.
(B) Employ and pay necessary agents, employees and assistants.
(C) Engage in capital construction and capital improvement
activities.
(D) Make and accept contracts, deeds, releases and documents
that, in the judgment of the board, are necessary or proper in
the exercise of the powers of the bond district.
(E) Perform any act necessary or proper to the complete
exercise and effect of any of the powers of the county education
bond district under ORS 328.205 to 328.304.
(F) Contract a bonded indebtedness and levy direct ad valorem
taxes on all taxable property within the county education bond
district in the manner that component school districts and
education service districts are authorized to issue bonds and
levy taxes under ORS 328.205 to 328.304 and other laws applicable
to the issuance of bonds and levying of taxes by school
districts.
{ - (c) - } { + (e) + } The board of directors of the
education service district shall be the governing body of
{ - the - } { + a + } county education bond district { +
created under paragraph (a) of this subsection + }. The
chairperson of the board of directors of the education service
district shall be the chairperson of the county education bond
district board.
{ + (f) The governing body of a county education bond
district and the chairperson of the county education bond
district created under paragraph (b) of this subsection shall be
as designated by the component school districts, by joint
resolution.
(g) + } { - The - } { + A + } county education bond
district board is authorized to transact all business coming
within the jurisdiction of the county education bond district and
to sue and be sued.
{ - (d) - } { + (h) + } { - The - } { + A + } county
education bond district shall exist for one year from the date of
the resolution creating the district or until any bonded
indebtedness contracted by the county education bond district for
which the district was created has been paid. The existence of a
county education bond district may not extend beyond the time
period necessary for payment of the bonded indebtedness for which
the district was originally created. The board of directors of
an education service district { + , or the school district boards
of the school districts with administrative offices in a county
without an education service district, + } may designate an area
as a county education bond district that was previously
designated as such by proceeding under { - subsections (1) and
(2) - } { + this subsection and subsection (1) + } of this
section.
(3) When authorized by a majority of the electors of the county
education bond district and subject to ORS 328.245, a county
education bond district may contract a bonded indebtedness for
any of the following purposes:
(a) To acquire, construct, reconstruct, improve, repair, equip
or furnish a school building or school buildings or additions
thereto;
(b) To fund or refund the removal or containment of asbestos
substances in school buildings and to make repairs necessary
because of such removal or containment;
(c) To acquire or to improve all property, real and personal,
appurtenant thereto or connected therewith, including school
buses;
(d) To fund or refund outstanding indebtedness; and
(e) To provide for the payment of the debt.
(4) The county education bond district board shall call an
election on a date specified in ORS 255.345 for the purpose of
submitting to the electors of the county education bond district
a question of contracting bonded indebtedness referred to in
subsection (3) of this section. The requirements for preparing,
circulating and filing a petition under this subsection shall be
as provided for an initiative petition in ORS 255.135 to 255.205.
The petition shall specify the proposed amount of bonded
indebtedness. If the electors of the county education bond
district approve the contracting of bonded indebtedness, the
county education bond district board, without further vote of the
electors, shall issue negotiable coupon bonds of the county
education bond district, at the time or times that the county
education bond district board directs.
(5) As used in ORS 328.205 to 328.304, 'school district' or '
district' includes a county education bond district as described
in this section.
SECTION 7. ORS 332.118 is amended to read:
332.118. (1) Unless specifically provided otherwise, ORS
chapter 255 governs the following:
(a) The nomination and election of school directors and local
school committee members.
(b) The conduct of all school district elections.
(2) ORS 249.865 to 249.877 govern the recall of school board
members and local school committee members.
(3) The Secretary of State has supervising authority over all
elections conducted by school districts and over elections
conducted by education service districts when an education
service district board is serving as a district boundary
board { + or when an education service district board has
received a request or petition for merger under section 2 of this
2003 Act + }.
(4) A petition for a proposed change or merger under ORS
330.095, a remonstrance petition under ORS 330.101, a petition
for zoning under ORS 332.128 or a petition to lengthen the course
of study under ORS 335.495 shall not be circulated for signatures
until the prospective petition has been filed with the county
clerk. The prospective petition shall designate the names and
residence addresses of not more than three persons as chief
petitioner. The authority of the Secretary of State and the
application of the election laws commence when the prospective
petition is filed with the county clerk. The filing of the
prospective petition is to be treated like a prospective petition
for an initiative, referendum or recall. Except as otherwise
provided in ORS 330.080 to 330.113, ORS chapter 255 applies to
the procedures applicable to petitions described in this
subsection and the elections held on the petitions.
SECTION 8. ORS 334.020 is amended to read:
334.020. (1) On and after the effective date of the order
entered under section 25, chapter 784, Oregon Laws 1993, except
as the boundaries of an education service district may be changed
by merger under ORS 334.710 to 334.770 or other provision of
law { + , and except as an education service district may be
abolished and merged with its component school districts under
section 2 of this 2003 Act + }, the education service districts
are as follows:
(a) Region 1. Clatsop, Columbia, Tillamook and Washington
Counties.
(b) Region 2. Multnomah County.
(c) Region 3. Marion and Polk Counties.
(d) Region 4. Lincoln, Linn and Benton Counties.
(e) Region 5. Lane County.
(f) Region 6. Douglas County.
(g) Region 7. Coos and Curry Counties and the area lying within
the Reedsport School District.
(h) Region 8. Jackson, Josephine and Klamath Counties.
(i) Region 9. Hood River and Wasco Counties.
(j) Region 10. Crook and Deschutes Counties.
(k) Region 11. Lake County.
(L) Region 12. Umatilla and Morrow Counties.
(m) Region 13. Union and Baker Counties.
(n) Region 14. Malheur County and the area comprising the
Huntington School District.
(o) Region 15. Clackamas County.
(p) Region 16. Yamhill County.
(q) Region 17. Harney County.
(r) Region 18. Wallowa County.
(s) Region 19. Sherman, Gilliam and Wheeler Counties.
(t) Region 20. Grant County.
(u) Region 21. Jefferson County and the area comprising the
Warm Springs Reservation.
(2) Where a boundary change or formation of a component school
district results in a joint school district, the joint school
district shall be included in the education service district in
which the joint district's administrative office is located.
SECTION 9. ORS 339.035 is amended to read:
339.035. (1) As used in this section, 'education service
district' means { + :
(a) + } The education service district that contains the school
district of which the child is a resident { + ; or
(b) If the education service district does not exist, the
school district of which the child is a resident + }.
(2) When a child is taught or is withdrawn from a public school
to be taught by a parent, legal guardian or private teacher, as
provided in ORS 339.030, the parent, legal guardian or private
teacher must notify the education service district in writing. In
addition, when a child who is taught by a parent, legal guardian
or private teacher moves to a new education service district, the
parent, legal guardian or private teacher shall notify the new
education service district in writing. The education service
district shall acknowledge receipt of any notification in
writing.
(3) Children being taught as provided in subsection (2) of this
section shall be examined at grades 3, 5, 8 and 10 in accordance
with the following procedures:
(a) The State Board of Education shall adopt by rule a list of
approved comprehensive examinations that are readily available.
(b)(A) The parent or legal guardian shall select an examination
from the approved list and arrange to have the examination
administered to the child by a qualified neutral person, as
defined by rule by the State Board of Education.
(B) If the child was withdrawn from public school, the first
examination shall be administered to the child at least 18 months
after the date on which the child was withdrawn from public
school.
(C) If the child never attended public or private school, the
first examination shall be administered to the child prior to the
end of grade three.
(c) The person administering the examination shall:
(A) Score the examination; and
(B) Report the results of the examination to the parent or
legal guardian.
(d) Upon request of the superintendent of the education service
district, the parent or legal guardian shall submit the results
of the examination to the education service district.
(4)(a) If the composite test score of the child places the
child below the 15th percentile based on national norms, the
child shall be given an additional examination within one year of
when the first examination was administered.
(b) If the composite test score of the child on the second
examination shows a declining score, then the child shall be
given an additional examination within one year of when the
second examination was administered and the superintendent of the
education service district may:
(A) Allow the child to continue to be taught by a parent, legal
guardian or private teacher; or
(B) Place the education of the child under the supervision of a
person holding a teaching license who is selected by the parent
or legal guardian at the expense of the parent or legal guardian.
If the composite test score of the child continues to show a
declining score, the superintendent of the education service
district may:
(i) Allow the child to continue under the educational
supervision of a licensed teacher selected by the parent or legal
guardian and require that the child be given an additional
examination within one year of when the last examination was
administered;
(ii) Allow the child to be taught by a parent, legal guardian
or private teacher and require that the child be given an
additional examination within one year of when the last
examination was administered; or
(iii) Order the parent or legal guardian to send the child to
school for a period not to exceed 12 consecutive months as
determined by the superintendent.
(c) If the parent or legal guardian of the child does not
consent to placing the education of the child under the
supervision of a licensed teacher who is selected by the parent
or legal guardian, then the superintendent of the education
service district may order the child to return to school for a
period not to exceed 12 consecutive months as determined by the
superintendent.
(d) If the composite test score of the child on an examination
is equal to or greater than the percentile score on the prior
test, the child may be taught by a parent, legal guardian or
private teacher and for the next examination be examined pursuant
to paragraph (a) of this subsection or subsection (3) of this
section.
(5)(a) Notwithstanding the examination requirements of
subsections (3) and (4) of this section, the parent or legal
guardian of a child with disabilities who has an individualized
education plan and is receiving special education and related
services through the school district or who is being educated in
accordance with a privately developed plan shall be evaluated for
satisfactory educational progress according to the
recommendations of the plan.
(b) The parent or legal guardian of a child with disabilities
who was evaluated by service providers selected by the parent or
legal guardian based on a privately developed plan shall submit a
report of such evaluation to the education service district in
lieu of the examination results required by subsections (3) and
(4) of this section.
(c) A child with disabilities described in this subsection
shall not be subject to the examination requirements of
subsections (3) and (4) of this section unless the examination is
recommended in the plan in effect for the child.
SECTION 10. ORS 294.060 is amended to read:
294.060. (1) The moneys received by each county under ORS
293.560 shall be divided 75 percent to the road fund and 25
percent to the school fund of the county and, subject to
subsections (2) and (3) of this section, the moneys shall be
expended as other moneys in those funds are expended.
(2) The moneys apportioned to the county road fund may be
applied in payment of any outstanding road bonds or may be placed
in any county road bond sinking fund for the purpose of being so
applied.
(3) The moneys apportioned to the school fund in any county
operating under and by virtue of ORS chapter 333 shall be used
for and applied to the payment of the bonded and warrant
indebtedness of the school districts incurred prior to January 1,
1925, until such bonded and warrant indebtedness has been paid in
full.
(4) Notwithstanding the division of receipts specified in
subsection (1) of this section, in any county east of the summit
of the Cascade Mountains with a population of less than 9,000 and
more than 6,500, according to the 1990 federal decennial census,
moneys from the road fund in excess of $2 million may be
transferred to the school fund when the amount of money credited
to the road fund under subsection (1) of this section exceeds the
amount needed for county roads, as determined by the board of
county commissioners. Any amount received by a school district
from the school fund of the county that is in excess of the 25
percent required under subsection (1) of this section shall not
be considered as a receipt that would reduce the district's
apportionments from the State School Fund.
(5) Notwithstanding the division of receipts specified in
subsection (1) of this section, in any county east of the summit
of the Cascade Mountains with a population of less than 58,000
and more than 55,000, according to the 1990 federal decennial
census, if the moneys credited to the road fund under subsection
(1) of this section exceed the amount needed for county roads, as
determined by the county governing body, the portion of such
moneys in excess of an amount specified by the county governing
body may be transferred to the school fund of the county or may
be transferred directly to the school districts of the county in
accordance with procedures established by the county governing
body. The county governing body may distribute moneys under this
subsection among the several school districts without regard to
the percentage of the resident average daily membership in each
school district. Moneys transferred under this subsection may be
transferred upon the condition that any school district receiving
a share of such moneys must use the moneys only for a purpose
described in ORS 328.205 (1)(a) or (c). Any amount received by a
school district from the county under this subsection that is in
excess of the 25 percent required under subsection (1) of this
section shall not be considered as a receipt that would reduce
the district's apportionments from the State School Fund.
(6) Notwithstanding the division of receipts specified in
subsection (1) of this section, in any county east of the summit
of the Cascade Mountains with a population of less than 6,500,
according to the 1990 federal decennial census, moneys received
by the county under ORS 293.560 may be divided between the road
fund and the school fund of the county as specified under an
agreement between the county governing body and the education
service district board of the county that provides for a
different apportionment of those moneys. { + If an education
service district does not exist in a county east of the summit of
the Cascade Mountains with a population of less than 6,500,
according to the 1990 federal decennial census, moneys received
by the county under ORS 293.560 may be divided between the road
fund and the school fund of the county as specified under an
agreement between the county governing body and the school
districts with administrative offices in the county. + } Any
amount received by a school district from the school fund of the
county that is in excess of the 25 percent required under
subsection (1) of this section shall not be considered as a
receipt that would reduce the district's apportionments from the
State School Fund.
(7) Notwithstanding the division of receipts specified in
subsection (1) of this section, in any county west of the summit
of the Cascade Mountains with a population of less than 19,500
and more than 6,500, according to the 1990 federal decennial
census, moneys from the road fund in excess of $1 million may be
transferred to the school fund when the amount of money credited
to the road fund under subsection (1) of this section exceeds the
amount needed for county roads, as determined by the board of
county commissioners. Any amount received by a school district
from the school fund of the county that is in excess of the 25
percent required under subsection (1) of this section shall not
be considered as a receipt that would reduce the district's
apportionments from the State School Fund.
(8) As used in subsections (4) to (7) of this section, ' summit
of the Cascade Mountains' has the meaning for that term provided
in ORS 477.001.
SECTION 11. ORS 757.612 is amended to read:
757.612. (1) There is established an annual public purpose
expenditure standard for electric companies to fund new
cost-effective local energy conservation, new market
transformation efforts, the above-market costs of new renewable
energy resources, and new low-income weatherization. The public
purpose expenditure standard shall be funded by the public
purpose charge described in subsection (2) of this section.
(2)(a) Beginning on the date an electric company offers direct
access to its retail electricity consumers, except residential
electricity consumers, the electric company shall collect a
public purpose charge from all of the retail electricity
consumers located within its service area for a period of 10
years. Except as provided in paragraph (b) of this subsection,
the public purpose charge shall be equal to three percent of the
total revenues collected by the electric company or electricity
service supplier from its retail electricity consumers for
electricity services, distribution, ancillary services, metering
and billing, transition charges and other types of costs included
in electric rates on July 23, 1999.
(b) For an aluminum plant that averages more than 100 average
megawatts of electricity use per year, beginning on March 1,
2002, the electric company whose territory abuts the greatest
percentage of the site of the aluminum plant shall collect from
the aluminum company a public purpose charge equal to one percent
of the total revenue from the sale of electricity services to the
aluminum plant from any source.
(3)(a) The Public Utility Commission shall establish rules
implementing the provisions of this section relating to electric
companies.
(b) Subject to paragraph (e) of this subsection, funds
collected by an electric company through public purpose charges
shall be allocated as follows:
(A) Sixty-three percent for new cost-effective conservation and
new market transformation.
(B) Nineteen percent for the above-market costs of new
renewable energy resources.
(C) Thirteen percent for new low-income weatherization.
(D) Five percent shall be transferred to the Housing and
Community Services Department Revolving Account created under ORS
456.574 and used for the purpose of providing grants as described
in ORS 458.625 (2). Moneys deposited in the account under this
subparagraph are continuously appropriated to the Housing and
Community Services Department for the purposes of ORS 458.625
(2). Interest on moneys deposited in the account under this
subparagraph shall accrue to the account.
(c) The costs of administering subsections (1) to (6) of this
section for an electric company shall be paid out of the funds
collected through public purpose charges. The commission may
require that an electric company direct funds collected through
public purpose charges to the state agencies responsible for
implementing subsections (1) to (6) of this section in order to
pay the costs of administering such responsibilities.
(d) The commission shall direct the manner in which public
purpose charges are collected and spent by an electric company
and may require an electric company to expend funds through
competitive bids or other means designed to encourage
competition, except that funds dedicated for low-income
weatherization shall be directed to the Housing and Community
Services Department as provided in subsection (7) of this
section. The commission may also direct that funds collected by
an electric company through public purpose charges be paid to a
nongovernmental entity for investment in public purposes
described in subsection (1) of this section. Notwithstanding any
other provision of this subsection, at least 80 percent of the
funds allocated for conservation shall be spent within the
service area of the electric company that collected the funds.
(e)(A) The first 10 percent of the funds collected annually by
an electric company under subsection (2) of this section shall be
distributed to education service districts, as described in ORS
334.010, that are located in the service territory of the
electric company. The funds shall be distributed to individual
education service districts according to the weighted average
daily membership (ADMw) of the component school districts of the
education service district for the prior fiscal year as
calculated under ORS 327.013. The commission shall establish by
rule a methodology for distributing a proportionate share of
funds under this paragraph to education service districts that
are only partially located in the service territory of the
electric company { + and to school districts that are located
in a service territory without an education service district + }.
(B) An education service district that receives funds under
this paragraph shall use the funds first to pay for energy audits
for school districts located within the education service
district. { + A school district that receives funds under this
paragraph shall use the funds first to pay for energy audits and
to implement the energy audits. + } An education service district
{ + or school district + } shall not expend additional funds
received under this paragraph on a school district facility until
an energy audit has been completed for that school district. To
the extent practicable, an education service district { + or
school district + } shall coordinate with the Office of Energy
and incorporate federal funding in complying with this paragraph.
Following completion of an energy audit for an individual school
district, the education service district may expend funds
received under this paragraph to implement the energy audit. Once
an energy audit has been conducted and completely implemented for
each school district within the education service district, the
education service district may expend funds received under this
paragraph for any of the following purposes:
(i) Conducting energy audits. A school district shall conduct
an energy audit prior to expending funds on any other purpose
authorized under this paragraph unless the school district has
performed an energy audit within the three years immediately
prior to receiving the funds.
(ii) Weatherization and upgrading the energy efficiency of
school district facilities.
(iii) Energy conservation education programs.
(iv) Purchasing electricity from environmentally focused
sources and investing in renewable energy resources.
(f) The commission may establish a different public purpose
charge than the public purpose charge otherwise described in
subsection (2) of this section for an individual retail
electricity consumer or any class of retail electricity consumers
located within the service area of an electric company, provided
that a retail electricity consumer with a load greater than one
average megawatt shall not be required to pay a public purpose
charge in excess of three percent of its total cost of
electricity services.
(g) The commission shall remove from the rates of each electric
company any costs for public purposes described in subsection (1)
of this section that are included in rates. A rate adjustment
under this paragraph shall be effective on the date that the
electric company begins collecting public purpose charges.
(4) An electric company that satisfies its obligations under
this section shall have no further obligation to invest in
conservation, new market transformation, new renewable energy
resources or new low-income weatherization or to provide a
commercial energy conservation services program and is not
subject to ORS 469.631 to 469.645, 469.860 to 469.900 and 758.505
to 758.555.
(5)(a) A retail electricity consumer that uses more than one
average megawatt of electricity at any site in the prior year
shall receive a credit against public purpose charges billed by
an electric company for that site. The amount of the credit shall
be equal to the total amount of qualifying expenditures for new
energy conservation, not to exceed 68 percent of the annual
public purpose charges, and the above-market costs of purchases
of new renewable energy resources incurred by the retail
electricity consumer, not to exceed 19 percent of the annual
public purpose charges, less administration costs incurred under
this subsection. The credit shall not exceed, on an annual
basis, the lesser of:
(A) The amount of the retail electricity consumer's qualifying
expenditures; or
(B) The portion of the public purpose charge billed to the
retail electricity consumer that is dedicated to new energy
conservation, new market transformation or the above-market costs
of new renewable energy resources.
(b) To obtain a credit under this subsection, a retail
electricity consumer shall file with the Office of Energy a
description of the proposed conservation project or new renewable
energy resource and a declaration that the retail electricity
consumer plans to incur the qualifying expenditure. The Office of
Energy shall issue a notice of precertification within 30 days of
receipt of the filing, if such filing is consistent with this
subsection. The credit may be taken after a retail electricity
consumer provides a letter from a certified public accountant to
the Office of Energy verifying that the precertified qualifying
expenditure has been made.
(c) Credits earned by a retail electricity consumer as a result
of qualifying expenditures that are not used in one year may be
carried forward for use in subsequent years.
(d)(A) A retail electricity consumer that uses more than one
average megawatt of electricity at any site in the prior year may
request that the Office of Energy hire an independent auditor to
assess the potential for conservation investments at the site. If
the independent auditor determines there is no available
conservation measure at the site that would have a simple payback
of one to 10 years, the retail electricity consumer shall be
relieved of 54 percent of its payment obligation for public
purpose charges related to the site. If the independent auditor
determines that there are potential conservation measures
available at the site, the retail electricity consumer shall be
entitled to a credit against public purpose charges related to
the site equal to 54 percent of the public purpose charges less
the estimated cost of available conservation measures.
(B) A retail electricity consumer shall be entitled each year
to the credit described in this subsection unless a subsequent
independent audit determines that new conservation investment
opportunities are available. The Office of Energy may require
that a new independent audit be performed on the site to
determine whether new conservation measures are available,
provided that the independent audits shall occur no more than
once every two years.
(C) The retail electricity consumer shall pay the cost of the
independent audits described in this subsection.
(6) Electric utilities and retail electricity consumers shall
receive a fair and reasonable credit for the public purpose
expenditures of their energy suppliers. The Office of Energy
shall adopt rules to determine eligible expenditures and the
methodology by which such credits are accounted for and used. The
rules also shall adopt methods to account for eligible public
purpose expenditures made through consortia or collaborative
projects.
(7)(a) In addition to the public purpose charge provided under
subsection (2) of this section, beginning on October 1, 2001, an
electric company shall collect funds for low-income electric bill
payment assistance in an amount determined under paragraph (b) of
this subsection.
(b) The total amount collected for low-income electric bill
payment assistance under this section shall be $10 million per
year. The commission shall determine each electric company's
proportionate share of the total amount. The commission shall
determine the amount to be collected from a retail electricity
consumer, except that a retail electricity consumer shall not be
required to pay more than $500 per month per site for low-income
electric bill payment assistance.
(c) Funds collected by the low-income electric bill payment
assistance charge shall be paid into the Housing and Community
Services Department Revolving Account created under ORS 456.574.
Moneys deposited in the account under this paragraph are
continuously appropriated to the Housing and Community Services
Department for the purpose of funding low-income electric bill
payment assistance. Interest earned on moneys deposited in the
account under this paragraph shall accrue to the account. The
department's cost of administering this subsection shall be paid
out of funds collected by the low-income electric bill payment
assistance charge. Moneys deposited in the account under this
paragraph shall be expended solely for low-income electric bill
payment assistance. Funds collected from an electric company
shall be expended in the service area of the electric company
from which the funds are collected.
(d) The Housing and Community Services Department, in
consultation with the federal Advisory Committee on Energy, shall
determine the manner in which funds collected under this
subsection will be allocated by the department to energy
assistance program providers for the purpose of providing
low-income bill payment and crisis assistance, including programs
that effectively reduce service disconnections and related costs
to retail electricity consumers and electric utilities. Priority
assistance shall be directed to low-income electricity consumers
who are in danger of having their electricity service
disconnected.
(e) Notwithstanding ORS 293.140, interest on moneys deposited
in the Housing and Community Services Department Revolving
Account under this subsection shall accrue to the account and may
be used to provide heating bill payment and crisis assistance to
electricity consumers whose primary source of heat is not
electricity.
(f) Notwithstanding ORS 757.310, the commission may allow an
electric company to provide reduced rates or other payment or
crisis assistance or low-income program assistance to a
low-income household eligible for assistance under the federal
Low Income Home Energy Assistance Act of 1981, as amended and in
effect on July 23, 1999.
(8) In addition to all other charges provided in this section,
for the period from January 1, 2000, to October 1, 2001, an
electric company shall collect from its retail electricity
consumers an electric bill payment assistance charge. A retail
electricity consumer shall not be required to pay more than $500
per month per site for low-income electric bill payment
assistance under this subsection. The statewide total amount
collected under this subsection shall equal $5 million per year,
prorated for any fraction of a year. The commission shall
determine each electric company's proportionate share of the
statewide total amount. Moneys collected under this subsection
shall be deposited in the Housing and Community Services
Department Revolving Account created under ORS 456.574 and
expended for low-income electric bill payment assistance in the
manner provided in subsection (7)(d) of this section.
(9) For purposes of this section, 'retail electricity
consumers' includes any direct service industrial consumer that
purchases electricity without purchasing distribution services
from the electric utility.
SECTION 12. { + ORS 334.127 is repealed. + }
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