AGO Opinion 97041

State Aid Certification Procedures; Effect of the 1997 Enactment of LB 595 and LB 713
Opinion 97041

DATE: August 13, 1997

SUBJECT: State Aid Certification Procedures; Effect of the 1997 Enactment of LB 595 and LB 713

REQUESTED BY: Douglas D. Christensen

Commissioner of Education

WRITTEN BY: Don Stenberg, Attorney General

Lauren L. Hill, Assistant Attorney General

You have requested an opinion from this office regarding

what effect the 1997 enactments of LB 595 and LB 713 have upon the

Nebraska Department of Education's duties with respect to

certification and distribution of state aid payments to local

school districts. Specifically, you have posed two questions which

are set forth, below, following a brief statement of the facts

which were supplied as background to the opinion request.

Pertinent Facts

Pursuant to Neb. Rev. Stat. § 79-1022 (1996), the

Nebraska Department of Education ["NDE"] is required, on or before

July 1 of each year, to determine the amount of state aid that

will be distributed to Nebraska public school districts under the

state's statutory school finance formula. The certified state aid

amounts are then distributed to the school districts in ten

payments made from September through June of the ensuing school

year. In developing their annual budgets, school districts are

required to use the amount of state aid that the NDE has certified

will be received for that particular school fiscal year. See Neb.

Rev. Stat. § 79-1022. School districts must complete and file

their proposed budget statements no later than August 1. Neb. Rev.

Stat. § 13-504(1) (Supp. 1996).

The NDE utilizes information collected within the agency,

from school district reports, and from other sources in order to

calculate and certify each year's state aid payments. As to

information regarding each school district's adjusted valuations,

Neb. Rev. Stat. § 79-1016 requires that on or before July 1, 1997,

the Property Tax Administrator compute and certify to the NDE "the

adjusted valuation for the current calendar year of each district

. . . so that the valuation of property for each district, for

purposes of determining state aid [payments] . . . , shall reflect

as nearly as possible state aid value [as defined by the statute]."

The adjusted valuations utilized by the NDE in the 1997-98 state

aid formula calculations were those provided to the NDE pursuant to

Neb. Rev. Stat. § 79-1016.

At times, data relied upon in calculating and disbursing

the statutory school finance formula payments is changed. In those

circumstances, the NDE is required to recalculate a prior year's

state aid payments so that each school district "will receive all

funds to which it was finally determined to be entitled." Neb.

Rev. Stat. § 79-1065 (1996). When the NDE recalculates state aid

payments under § 79-1065, it incorporates adjustments in the

following year's state aid payment amount. The NDE makes an annual

recalculation for all school districts because of the fact that any

adjustment (positive or negative) to one school district impacts

all other districts receiving state aid payments in a particular

year. See "Tax Equity & Educational Opportunities Support Act,"

Neb. Rev. Stat. § 79-1001 - § 79-1033 (1996).

On June 26, 1997, the NDE certified to all school

districts the amount of state aid payments which the districts

would receive for the 1997-98 school year. The certification was

based upon statutes which were current in June, 1997 -- the time

frame in which the NDE computed the 1997-98 payments. However,

occurring concurrently with the NDE's 1997-98 state aid

certification process was the Legislature's deliberation and

enactment of LB 595. The legislation added the following new


Beginning with the 1997-98 school fiscal year, in

the school fiscal year beginning during the calendar year

that a county board adopts special valuation for all

qualifying property in the county pursuant to sections

77-1343 to 77-1348, the adjusted valuations used in the

calculation of state aid shall not exceed one hundred

eight percent of the assessed valuation for the property

tax year on which the adjusted valuation is based.

Neb. Rev. Stat. § 79-1016(6) (as amended by 1997 Neb. Laws, LB 595,

§ 6) (effective June 10, 1997).


Based upon these facts, we now address your two specific

questions. To the extent that resolution of your inquiries turns

on construction of the newly-enacted statutes, our analysis is

governed by several well-established standards of statutory

construction. First, in the absence of any indication to the

contrary, statutory language is to be given its plain and ordinary

meaning. State ex rel. City of Elkhorn v. Haney, 252 Neb. 788,

792, ____ N.W.2d ____ (1997). Therefore, no interpretation is

required to ascertain "the meaning of statutory words which are

plain, direct, and unambiguous." Id. Finally, a statute "is open

for construction when the language used requires interpretation or

may reasonably be considered ambiguous." Id. at 793, ____ N.W.2d

at ____; Omaha Public Power Dist. v. Nebraska Dep't of Revenue, 248

Neb. 518, 537 N.W.2d 312 (1995).

1. If any of the data provided to the Nebraska Department of

Education was changed (or corrected) after the certification

date specified in the statute (July 1 for 1997-98 State Aid

and December 1 for 1998-99 State Aid and each year

thereafter), is NDE required to do a recertification

immediately, or are we required to use this information in the

recalculation of the prior year's State Aid?

An initial duty imposed upon the NDE is to correctly

calculate and certify school fiscal year state aid payments under

the formula set forth in the "Tax Equity and Educational

Opportunities Support Act." Once, however, changes or corrections

are required to be made to an annual state aid calculation, the

only duty imposed by law upon the NDE to recalculate state aid

payments is that set forth in Neb. Rev. Stat. § 79-1065 (1996).

The statute mandates that the NDE shall adjust state aid payments

provided to school districts which, after final determination,

received funds not equal to the appropriate allocation for a

previous year. The purpose of the recalculation is to ensure that

the district will receive all funds to which it was finally

determined to be entitled. There is no duty under § 79-1065 to

immediately recalculate state aid payments; rather, the statute

contemplates an annual recalculation made by the NDE to rectify

errors made in a previous year's calculation.

2. In addition, as LB 595 passed with the emergency clause, ...

my second question is (and it is our understanding that the

Property Tax Division will also be asking you to address some

questions regarding LB 595, 1997) should the certification of

the 1997-98 State Aid, which was mailed on June 26, 1997, have

the [LB 595, § 6] provision in the certification process?

The provisions of LB 595 were signed into law on June 9,

1997. Since the legislation contained an emergency clause, the

provisions of the bill became operative on June 10, 1997. See Neb.

Const. art. III, § 27. Clearly, the NDE became obligated to

operate under Neb. Rev. Stat. § 79-1016, as amended by LB 595, on

June 10, 1997. What is not as clear is precisely how the NDE could

comply with the LB 595 amendment by July 1, 1997, the date on which

it was required to certify state aid payment amounts to each school

district. Existing law requires that

[a]djusted valuation means the assessed valuation of

taxable property of each district in the state adjusted

pursuant to the adjustment factors described in section

79-1016. . . . For calculation of state aid to be paid

in school year 1996-97 and each school year thereafter,

adjusted valuation means the adjusted valuation for the

property tax year ending during the school year

immediately preceding the school year in which the aid

based upon that value is to be paid.

Neb. Rev. Stat. § 79-1003(2) (1996). This provision must be

reconciled with the § 79-1016(6) provision, operative as of June

10, 1997, which requires, beginning with the current school fiscal

year, that if a county board adopts a special valuation for certain

agricultural and horticultural property in 1997 or future years,

then the adjusted valuation used in the calculation of state aid

shall not exceed 108 percent of the assessed valuation for the

property tax year on which the adjusted valuation is based.

As a general rule, "[i]n the absence of clear legislative

intent, a construction of a statute will not be adopted which has

the effect of nullifying or repealing another statute." State ex

rel. City of Elkhorn, 252 Neb. at 794, ____ N.W.2d ____ (____);

Georgetown Ltd. Part. v. Geotechnical Services, 230 Neb. 22, 430

N.W.2d 34 (1988). Therefore, the plain meaning of both § 79-

1003(2) and § 79-1016(6) must be construed so as to give legal

effect to each statute. Section 79-1003(2) clearly directs the NDE

to have utilized in its 1997-98 state aid certification adjusted

valuations for the property tax year ending during the 1996-97

school year. Section 79-1016(1) directs the Property Tax

Administrator to compute and certify to the NDE the adjusted

valuations for the current calendar year. In addition, § 79-

1016(6) clearly directs that specific valuations should not have

exceeded 108 percent of the assessed valuations for certain

property in certain counties. What is assumed by the LB 595

amendment is that the Property Tax Administrator would have data

available from each of Nebraska's 93 counties with which to compute

and certify to the NDE adjusted valuations which the NDE should

have utilized in certifying the 1997-98 state aid payments to

districts. Evidently, due to the time constraints imposed by

existing statutes, the Property Tax Administrator was not able to

provide to the NDE adjusted valuation figures reflecting the

requirements of the LB 595 amendment. Thus, we conclude that, if

applicable, the Neb. Rev. Stat. § 79-1016(6) provision should have

been taken into account by the NDE in certifying state aid payments

for the 1997-98 school year.



Attorney General

Lauren L. Hill

Assistant Attorney General