Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the RANs Policy topic
No spam. Unsubscribe anytime.
Committee hears HB1495 to limit how districts use short-term RAN borrowings
Summary
Rep. Rick Lad said HB1495 would require reimbursement-anticipation note (RAN) proceeds tied to adequacy or special-education aid to be spent only on the substantive elements for which those funds were intended, citing Claremont as the motivating example; lawmakers asked about duration, liability recognition, and oversight.
Representative Rick Lad, acting as vice sponsor, told the committee HB1495 clarifies and narrows permissible uses of reimbursement anticipation note proceeds when districts borrow against anticipated adequacy or special-education payments. He said the bill would require that RAN proceeds "only be used toward criterion elements that contribute to the substantive criteria and content of adequacy," and emphasized the change aims to prevent short-term borrowing from being used for unrelated purposes such as athletics, capital improvements, paying off debt, or management salaries.
Lawmakers asked operational questions about how long a district could carry a RAN and whether recognizing RAN proceeds as revenue but not as a liability could mislead taxpayers about future obligations. Lad said statutory rules and Department of Revenue Administration practice determine allowable timeframes and noted that such borrowings are liabilities "borrowing from your future," requiring caution about long-term impacts on special-education and adequacy services.
Senators and members asked which authority approves recognition and use of RAN proceeds; Lad said the process involves the Department of Revenue Administration and the commissioner, and that the bill's language is narrowly scoped to permissible spending purposes rather than the timing mechanics. Committee members also discussed proration history for special-education aid and district reserve practices; Lad said recent prorations left districts short in prior years, which informed his concern.
The hearing ended with no public testimony signed up on HB1495.
