Committee hears HB515 to top out school facilities trust, expand maintenance aid for small districts

House Education’s meeting opened with a fiscal primer on the coal severance trust before members considered House Bill 515, a proposal to consolidate school facilities funding and boost state support for major maintenance.

Sponsor Linda Rekston told the committee HB515 would combine the school major maintenance aid and the School Facility and Technology Fund into a single account and provide a one-time $75,000,000 transfer from the general fund to cap the school facilities subtrust at $300,000,000. "We are increasing the school major maintenance aid formula," Rekston said, explaining the bill raises the fixed district amount to $40,000 and sets the per‑A&B rate at $115 while leaving local levies unchanged.

A fiscal briefing from Sam Schaeffer summarized how coal severance revenues and the coal trust operate. Schaeffer said FY2024 coal severance tax collections were about $77,000,000 and that the constitution requires at least 50% of those collections be deposited into the coal trust. He emphasized that "the interest earnings off the trust are what is spent" and that accessing the trust corpus requires a three‑quarters vote of both chambers.

Pat McCracken of the Legislative Services Division described the school major maintenance "box" framework: under current law the box is formed by a $15,000 flat district component plus roughly $110 per A&B student. He said HB515’s changes—boosting the flat amount to $40,000 and setting a $115 per‑student rate—are designed to direct proportionally more assistance to smaller, rural districts that carry deferred maintenance needs.

Supporters, including the Coalition of Advocates for Montana’s Public Schools and the governor’s budget office, told the committee the proposal would expand state aid without increasing local tax burdens. Nancy Hall of the Budget Office said the bill "increases the coal sub trust with [a] general fund appropriation one time only of $75,000,000 to cap at $300,000,000" and that interest from that subtrust would be used to fund major maintenance aid going forward.

Members asked follow‑up about revenue stability and the permanence of the transfer. Schaeffer described severance tax receipts as volatile—varying from about $40 million in some years up to nearly $88 million in others—and said the $75,000,000 described in the bill is a proposed one‑time transfer from the general fund into the school facilities subtrust intended to generate ongoing interest revenue. He added that once funds enter the trust corpus, appropriating corpus (rather than spending interest) requires a three‑quarters legislative vote.

The hearing closed with the sponsor urging a do‑pass, saying the measure would help aging school buildings and reduce the need for local levies in some districts. No formal committee vote was recorded in the hearing minutes.

The committee is expected to receive proposed amendments that would reallocate unclaimed major maintenance funds; those amendments were described but not adopted during the hearing.