1.__Graduated.__Has graduated from an approved secondary school or matriculated at a postsecondary school prior to high school graduation or has successfully completed a general educational development examination or its equivalent;

2.__Accepted as undergraduate.__Has been accepted for enrollment as an undergraduate or is in good standing as an undergraduate at an institution of higher education in an eligible program of study and has not received a previous baccalaureate degree;

3.__Applied for grant.__Has applied for a postsecondary enrollment grant according to schedules and procedures and on forms developed by the authority;

4.__State residency requirements.__Meets any state residency requirements that may be established by rules adopted by the authority in accordance with Title 5, chapter 375, subchapter II- A.__Rules adopted pursuant to this subsection are routine technical rules as defined in Title 5, chapter 375, subchapter II-A.

§11723.__Determination of grants

A grant to a student who is eligible under section 11722 must be determined as follows.

1.__Award amounts.__A grant awarded under this chapter, except as provided in subsections 2 to 4, may not be less than:

A.__Two thousand dollars for a student attending an institution of higher education within the State and enrolled in an associate degree program; or

B.__Four thousand dollars for a student attending an institution of higher education within the State and enrolled in a baccalaureate degree program.

2.__Prorated grants.__A grant recipient under this chapter whose course load is reduced from full time must receive a grant prorated for that recipient's part-time course load during the recipient's part-time enrollment.

3.__Withdrawal.__If a recipient of a grant under this chapter withdraws from an institution of higher education and the student is entitled to a refund of tuition, fees or other

charges, the institution shall make a refund payment directly to the authority in accordance with the institution's refund policy.

4.__Part-time students.__The authority may allocate up to 25% of the postsecondary enrollment grants available under this chapter to part-time students who are eligible under section 11722.__The authority shall establish eligibility criteria for part-time students by rulemaking pursuant to the Maine Administrative Procedure Act.__Rules adopted pursuant to this subsection are routine technical rules as defined in Title 5, chapter 375, subchapter II-A.

§11724.__Length of grant; period of study

1.__Length of grant.__A grant may be for a period not to exceed one academic year.__A student may apply for a new grant for each year of study during the period required for completion of an eligible program of study being pursued by that student.__A grant recipient who remains eligible under section 11722 must be considered in the succeeding award year.

2.__Period of study.__A student eligible under section 11722 enrolled in an associate degree program may receive a grant for a period not to exceed 4 semesters or its equivalent for a full- time student or 8 semesters or 60 credit hours, whichever is completed first, for a part-time student.__An eligible student enrolled in a baccalaureate degree program may receive a grant for a period not to exceed 8 semesters or its equivalent for a full-time student or 16 semesters or 120 credit hours, whichever is completed first, for a part-time student.

§11725.__Program administration

1.__Responsibility of authority.__The authority shall administer the grant program under this chapter, including establishing and maintaining fund accounting and control procedures as required by state law or as necessary for the State to be eligible to receive federal assistance under the Federal Student Assistance Program, Higher Education Act of 1965, Title IV, Part A, Subpart 3, as amended, 20 United States Code, Sections 1070c-1, 1070c-2 and 1070c-3.

2.__Guidelines and rules.__The following provisions apply to the program under subsection 1.

A.__The authority shall develop rules, procedures, schedules and forms necessary to carry out the purposes of the program under subsection 1.

B.__To the maximum extent possible consistent with the need for state control of the program under subsection 1, the authority shall use the guidelines, rules, regulations, procedures, forms and schedules set forth by the United States Secretary of Education for the administration of the Federal Student Assistance Program, Higher Education Act of 1965, Title IV, Part A, Subpart 1, as amended, 20 United States Code, Section 1070c.

§11726.__Nonlapsing fund

Any unexpended funds appropriated by the Legislature to the authority to carry out the purposes of the program under section 11725, subsection 1 do not lapse but must be carried forward by the authority for continued use in the program.

Sec. 2. 20-A MRSA §15603, sub-§26-A, ¶F, as amended by PL 1999, c. 401, Pt. GG, §2, is repealed.

Sec. 3. 20-A MRSA §15613, sub-§17, as enacted by PL 1997, c. 395, Pt. R, §1, is amended to read:

17. Unobligated balances. Unobligated balances from amounts appropriated for general purpose aid for local schools may not lapse but must be redistributed to school administrative units in the same fiscal year. The commissioner shall make the final determination of the total amount of unobligated funds and must redistribute 75% of those funds to program costs and 25% of those funds to out-of-district placement costs. To redistribute the 75% portion to the state share of program costs, the reduction percentage originally calculated for program costs pursuant to section 15603, subsection 26-A, paragraph F must be reduced by an amount sufficient to distribute the 75% share. The reductions in these percentages apply to all program cost areas except the transportation operating cost allocation.

Sec. 4. 20-A MRSA §15653, sub-§1, as amended by PL 1999, c. 731, Pt. D, §2, is further amended to read:

1. Per pupil guarantee. The Legislature shall annually establish a per pupil guarantee. For fiscal year 1999-00, the per pupil guarantee is $4,020 and, for fiscal year 2000-01, the per pupil guarantee is $4,307. In the subsequent 2 fiscal years, it is the intent of the Legislature to achieve the per pupil guarantee targets established in this subsection.

B. For fiscal year 2001-02 the per pupil guarantee target is $4,687.

C. For fiscal year 2002-03 the per pupil guarantee target is $5,204.

The intent of the Legislature is to achieve a per pupil guarantee that matches projected spending in fiscal year 2002-03. Beginning in fiscal year 2001-02, if the appropriation and any increase in the mill rate determined by the Legislature to be needed under this section are not sufficient to achieve both the targeted reduction percentage in section 15603, subsection 26-A, paragraph F and the targeted per pupil guarantee, then the per pupil guarantee must advance toward the targeted per pupil guarantee in the same proportion as the reduction percentage is lowered toward the targeted reduction percentage.

Sec. 5. Essential programs and services model; implementation. The Legislature shall review the plan proposed by the State Board of Education for implementing a new school funding formula based on the Essential Programs and Services model developed by the State Board of Education's Essential Programs and Services Committee pursuant to Public Law 1999, chapter 401, Part GG, section 11. Beginning October 1, 2001, the Joint Standing Committee on Education and Cultural Affairs shall review the plan proposed by the State Board of Education and may introduce legislation during the Second Regular Session of the 120th Legislature to replace the current school funding formula, found in the Maine Revised Statutes, Title 20-A, chapters 606 and 606-A, with a new method for funding kindergarten-to-grade-12 public education based on the Essential Programs and Services model. The new school funding formula based on the Essential Programs and Services model must be implemented no later than the legislative biennium that corresponds to fiscal year 2005-06 and fiscal year 2006-07.

Sec. 6. Appropriation. The following funds are appropriated from the General Fund to carry out the purposes of this Act.

2000-01

EDUCATION, DEPARTMENT OF

General Purpose Aid for Local Schools

All Other $139,656,122

Provides funds to fully fund 55% of the cost of the total allocation in fiscal year 2000-01

Emergency clause. In view of the emergency cited in the preamble, this Act takes effect when approved.

SUMMARY

This bill accomplishes the following.

1. It establishes a postsecondary enrollment grant program to be administered by the Finance Authority of Maine. Under this program, a Maine high school graduate enrolled in an associate degree program at a public or private institution of higher education in the State would receive a grant of $2,000 per year and a Maine high school graduate enrolled in a baccalaureate degree program at a public or private institution of higher education in the State would receive a grant of $4,000 per year.

2. It provides a supplemental appropriation of $139,656,122 to the general purpose aid to local schools program in fiscal year 2000-01 to fully fund the 55% state share of the total allocation for costs incurred by school administrative units, defined as the total of the foundation allocation and the debt service allocation.

3. It eliminates the so-called "percentage reduction method" from the School Finance Act of 1985. Under this bill, the state share of school funding would return to 55% of the cost of the total allocation.

4. It directs the Legislature to review the plan proposed by the State Board of Education for implementing a new school funding formula based on the Essential Programs and Services model developed by the board's Essential Programs and Services Committee, requires the Joint Standing Committee on Education and Cultural Affairs to review the Essential Programs and Services plan and authorizes the committee to introduce legislation during the Second Regular Session of the 120th Legislature to replace the existing school funding formula with a new school funding formula based on the Essential Programs and Services model.