Relates to the appropriation to the Public Schools Educational Support Program for fiscal year 2027.

LEGISLATURE OF THE STATE OF IDAHO Sixty-eighth Legislature Second Regular Session - 2026 IN THE SENATE SENATE BILL NO. 1362 BY FINANCE COMMITTEE AN ACT1 RELATING TO THE APPROPRIATION TO THE PUBLIC SCHOOLS EDUCATIONAL SUPPORT2 PROGRAM; APPROPRIATING MONEYS TO THE PUBLIC SCHOOLS EDUCATIONAL SUP-3 PORT PROGRAM'S DIVISION OF TEACHERS FOR FISCAL YEAR 2027; APPROPRIATING4 MONEYS TO THE PUBLIC SCHOOLS EDUCATIONAL SUPPORT PROGRAM'S DIVISION OF5 STUDENT SUPPORT FOR FISCAL YEAR 2027; APPROPRIATING MONEYS TO THE PUB-6 LIC SCHOOLS EDUCATIONAL SUPPORT PROGRAM'S IDAHO DIGITAL LEARNING ACAD-7 EMY FOR FISCAL YEAR 2027; APPROPRIATING MONEYS TO THE PUBLIC SCHOOLS8 EDUCATIONAL SUPPORT PROGRAM'S DIVISION OF FACILITIES FOR FISCAL YEAR9 2027; APPROPRIATING MONEYS TO THE PUBLIC SCHOOLS EDUCATIONAL SUPPORT10 PROGRAM'S DIVISION OF CENTRAL SERVICES FOR FISCAL YEAR 2027; APPRO-11 PRIATING MONEYS TO THE PUBLIC SCHOOLS EDUCATIONAL SUPPORT PROGRAM'S12 DIVISION OF EDUCATIONAL SERVICES FOR THE DEAF AND THE BLIND FOR FISCAL13 YEAR 2027; CLARIFYING THE ORIGINAL FUND SOURCE FOR EXPENDITURES IN THE14 PUBLIC SCHOOLS EDUCATIONAL SUPPORT PROGRAM FOR FISCAL YEAR 2027; DI-15 RECTING THE USE OF MONEYS FOR PROFESSIONAL DEVELOPMENT FOR THE DIVISION16 OF TEACHERS; PROVIDING FOR A DISTRIBUTION OF ADDITIONAL COMPENSATION17 FOR INSTRUCTIONAL AND PUPIL SERVICE STAFF; PROVIDING AN ESTIMATE OF18 DISCRETIONARY FUNDS PER SUPPORT UNIT; PROVIDING AN ESTIMATE OF HEALTH19 BENEFIT AND INSURANCE FUNDS PER SUPPORT UNIT; DIRECTING THE USE OF AN20 APPROPRIATION FOR CLASSROOM TECHNOLOGY, WIRELESS INFRASTRUCTURE, AND21 LEARNING MANAGEMENT SYSTEMS; EXEMPTING THE APPROPRIATION FROM PROGRAM22 TRANSFER LIMITATIONS; DIRECTING THE USE OF CIGARETTE, TOBACCO, AND23 LOTTERY INCOME TAX MONEYS; DIRECTING THE USE OF MONEYS FOR COURSEWORK;24 DIRECTING COMPLIANCE WITH OPEN ENROLLMENT; DIRECTING THE USE OF MONEYS25 FOR ENGLISH LANGUAGE LEARNERS PROGRAMS; DIRECTING THE STATE DEPART-26 MENT OF EDUCATION TO COMPILE INFORMATION ON ADVANCED OPPORTUNITIES;27 PROVIDING A TRANSFER TO THE COMMISSION ON HISPANIC AFFAIRS; PROVIDING28 A TRANSFER TO THE IDAHO STATE POLICE; DIRECTING A DISTRIBUTION TO PUR-29 CHASE DIGITAL CONTENT AND CURRICULA; PROVIDING REQUIREMENTS REGARDING30 THE IDAHO DIGITAL LEARNING ACADEMY; DIRECTING THE USE OF MONEYS FOR31 LITERACY PROGRAMS, INTERVENTION SERVICES, MATH INITIATIVE PROGRAMS,32 AND LIMITED-ENGLISH PROFICIENCY PROGRAMS; DIRECTING THE USE OF MONEYS33 FOR STUDENT ASSESSMENTS; DIRECTING THE USE OF MONEYS FOR PROFESSIONAL34 DEVELOPMENT FOR THE CENTRAL SERVICES DIVISION; PROVIDING REQUIREMENTS35 FOR CONTENT AND CURRICULUM; PROVIDING REQUIREMENTS FOR TECHNOLOGY36 CONTENT AND CURRICULUM; PROVIDING FOR STATEWIDE TRAINING FOR EARLY LIT-37 ERACY; PROVIDING GUIDANCE ON YEAR-END RECONCILIATION; DEFINING "DIS-38 TRIBUTED" AND "EXPENDED"; REQUIRING AN ACQUISITIONS REPORT; APPROPRI-39 ATING GENERAL FUND MONEYS FOR TRANSFER TO THE PUBLIC SCHOOL INCOME FUND40 FOR FISCAL YEAR 2027; PROVIDING FOR CONDITIONS, LIMITATIONS, AND RE-41 STRICTIONS; AND DECLARING AN EMERGENCY AND PROVIDING AN EFFECTIVE DATE.42

Be It Enacted by the Legislature of the State of Idaho:43

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SECTION 1. There is hereby appropriated to the Public Schools Educa-1 tional Support Program's Division of Teachers the following amounts to be2 expended from the listed funds for the period July 1, 2026, through June 30,3 2027:4 FROM:5 Public School Income Fund6 $1,344,188,100 Federal Grant Fund7 11,000,000 TOTAL8 $1,355,188,100

SECTION 2. There is hereby appropriated to the Public Schools Educa-9 tional Support Program's Division of Student Support the following amounts10 to be expended to the designated programs from the listed funds for the pe-11 riod July 1, 2026, through June 30, 2027:12 TOTAL13 I. ADMINISTRATORS DIVISION:14 FROM:15 Public School Income16 Fund17 $126,042,900 II. OPERATIONS DIVISION:18 FROM:19 Public School Income20 Fund21 $1,200,372,600 III. CHILDREN'S PROGRAMS DIVISION:22 FROM:23 Public School Income24 Fund25 $124,182,700 Federal Grant26 Fund27 249,647,800 TOTAL28 $373,830,500 DIVISION TOTAL29 $1,700,246,000

SECTION 3. There is hereby appropriated to the Public Schools Educa-30 tional Support Program's Idaho Digital Learning Academy $25,810,000 to be31 expended from the Public School Income Fund for the period July 1, 2026,32 through June 30, 2027.33

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SECTION 4. There is hereby appropriated to the Public Schools Educa-1 tional Support Program's Division of Facilities $12,589,700 to be expended2 from the Public School Income Fund for the period July 1, 2026, through June3 30, 2027.4

SECTION 5. There is hereby appropriated to the Public Schools Educa-5 tional Support Program's Division of Central Services $19,237,600 to be ex-6 pended for operating expenditures from the Public School Income Fund for the7 period July 1, 2026, through June 30, 2027.8

SECTION 6. There is hereby appropriated to the Public Schools Educa-9 tional Support Program's Division of Educational Services for the Deaf and10 the Blind the following amounts to be expended from the listed funds for the11 period July 1, 2026, through June 30, 2027:12 FROM:13 Public School Income Fund14 $16,871,500 School for the Deaf and the Blind Endowment Fund15 250,100 TOTAL16 $17,121,600

SECTION 7. Of the amounts appropriated in Sections 1 through 6 of17 this act for the Public Schools Educational Support Program, the following18 amounts shall be considered expended from the listed funds for the period19 July 1, 2026, through June 30, 2027:20 FROM:21 General Fund22 $2,773,295,400 Public Schools Other Income Fund23 23,450,000 School for the Deaf and the Blind Endowment Fund24 250,100 Cigarette, Tobacco and Lottery Income Taxes Fund25 4,324,900 Public School Endowment Income Fund26 68,224,800 Federal Grant Fund27 260,647,800 TOTAL28 $3,130,193,000

SECTION 8. PROFESSIONAL DEVELOPMENT -- TEACHERS. Of the moneys appro-29 priated in Section 1 of this act, $13,750,000 from the Public School Income30 Fund shall be distributed for professional development that supports in-31 structors and pupil service staff to increase student learning, mentoring,32 and collaboration. Professional development efforts should be measurable,33 provide the instructors and pupil service staff with a clear understanding34 of their progress, be incorporated into their performance evaluations, and,35 to the extent possible, be included in the school district or public charter36 school continuous improvement plans required by Section 33-320, Idaho Code.37 Funding shall be distributed by a formula prescribed by the State Department38 of Education, and the State Department of Education shall track usage and39

4 effectiveness of professional development efforts at the state and local1 levels.2

SECTION 9. INSTRUCTIONAL AND PUPIL SERVICE STAFF COMPENSATION. In ad-3 dition to the distribution criteria set forth in Section 33-1004B(9)(f),4 Idaho Code, an additional $6,359 shall be allocated to each cell for resi-5 dential, professional, and advanced professional rungs. These funds must6 be used for instructional and pupil service compensation. Funding shall7 be distributed in combination with other career ladder allocations for the8 period July 1, 2026, through June 30, 2027. School districts and public9 charter schools shall report to the State Department of Education on the10 allocation of these funds for instructional and pupil service compensation.11 The State Department of Education shall provide a report to the Joint Fi-12 nance-Appropriations Committee by January 5, 2027, on the allocations made13 by school districts and public charter schools. The format of the report and14 the contents therein shall be determined by the Legislative Services Office15 Budget and Policy Analysis Division.16

SECTION 10. DISCRETIONARY FUNDS. Notwithstanding any law to the con-17 trary, for the period July 1, 2026, through June 30, 2027, it is estimated18 that the appropriation of state funds to the Public Schools Educational Sup-19 port Program's Division of Operations as part of the Student Support Divi-20 sion will result in total discretionary funds of $23,472 per support unit21 that are to be used at the discretion of the school district or public charter22 school.23

SECTION 11. HEALTH BENEFIT AND INSURANCE FUNDS. Notwithstanding any24 law to the contrary, for the period July 1, 2026, through June 30, 2027, it25 is estimated that the appropriation of state funds to the Public Schools26 Educational Support Program's Division of Operations as part of the Stu-27 dent Support Division will result in total health benefits or insurance and28 health benefits-related funds of $25,063.50 per support unit to be dis-29 tributed to schools that are on the state's health insurance plan, and funds30 of $24,273.43 per support unit to be distributed for schools that are not on31 the state's health insurance plan. Before distribution, a school district's32 or charter school's enrollment in the state's health insurance plan will be33 verified by the State Department of Education. If a school district's or34 charter school's enrollment status changes during the fiscal year, the State35 Department of Education will accordingly adjust the school district's or36 charter school's distribution amount per support unit. Funds are to be used37 to offset the costs of health, vision, and dental benefits or insurance of-38 fered to school employees. If the distribution provided for health, vision,39 and dental benefits or insurance is in excess of the individual school dis-40 trict's or charter school's actual costs, the excess funds may then be used41 at the school district's or charter school's discretion. Further, the State42 Department of Education shall work with the Legislative Services Office43 Budget and Policy Analysis Division and the Division of Financial Management44 to determine the information that the State Department of Education shall45 collect on school districts' and charter schools' health, vision, and dental46 benefits or insurance plan information and costs, including but not limited47

5 to actual insurance premium costs, premium percentage increases, and health1 insurance revenues and expenditures from all fund sources.2

SECTION 12. CLASSROOM TECHNOLOGY. Of the moneys appropriated in Sec-3 tion 2 of this act, $36,500,000 from the Public School Income Fund shall be4 distributed for classroom technology, classroom technology infrastruc-5 ture, wireless technology infrastructure, and learning management systems6 that assist teachers and students in effective and efficient instruction or7 learning. Funding shall be distributed based on a formula prescribed by the8 State Department of Education. Moneys so distributed shall be used to imple-9 ment and operate a learning management system of each school district's or10 public charter school's choice. A learning management system shall include11 integration with a school district's or public charter school's student12 information system and shall administer, monitor, and document student and13 classroom levels of learning. The State Department of Education shall ver-14 ify that school districts and public charter schools are using funds to pur-15 chase a learning management system that is compliant with these standards.16

SECTION 13. EXEMPTIONS FROM PROGRAM TRANSFER LIMITATIONS. For the pe-17 riod July 1, 2026, through June 30, 2027, the State Department of Education18 is hereby granted the authority to transfer appropriations among the Teach-19 ers, Student Support, Facilities, and Idaho Digital Learning Academy divi-20 sions of the Public Schools Educational Support Program, in any amount nec-21 essary to comply with the public school funding provisions of appropriations22 and Idaho Code. Additionally, appropriations may be transferred from the23 Division of Central Services to the other divisions of the Public Schools Ed-24 ucational Support Program.25

SECTION 14. CIGARETTE, TOBACCO, AND LOTTERY DISTRIBUTION. Notwith-26 standing any provision of law to the contrary, of the moneys appropriated in27 Section 2 of this act, up to $4,324,900 from available cigarette, tobacco,28 and lottery income tax revenue funds accruing, appropriated, or distributed29 to the Public School Income Fund pursuant to Sections 63-2506, 63-2552A,30 and 63-3067, Idaho Code, for the period July 1, 2026, through June 30, 2027,31 shall be distributed to school districts and public charter schools through32 a combination of a base amount of $2,000 plus a prorated amount based on the33 prior year's average daily attendance. Such funds shall be used to develop34 and implement school safety improvements and/or to facilitate and provide35 substance abuse prevention programs in the public school system.36

SECTION 15. COURSEWORK. Of the moneys appropriated in Section 2 of this37 act, $4,715,000 shall be distributed for coursework for students failing to38 achieve proficiency on Idaho's standards-based achievement tests in dollar39 amounts determined by the State Department of Education. The State Depart-40 ment of Education shall report to the Joint Finance-Appropriations Commit-41 tee, the Senate Education Committee, and the House Education Committee by42 no later than January 5, 2027, on the uses of funds and effectiveness of the43 coursework and efforts.44

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SECTION 16. OPEN ENROLLMENT INFORMATION. The State Department of Edu-1 cation shall withhold the November payment for any school district that is2 not in compliance with the provisions of Section 33-1409, Idaho Code, until3 such time as the school district becomes compliant.4

SECTION 17. ENGLISH PROFICIENCY. Pursuant to Section 33-1617, Idaho5 Code, of the moneys appropriated in Section 2 of this act, $4,820,000 shall6 be distributed for support of students in English language learner programs7 as follows:8 (1) The State Department of Education shall distribute $4,370,000 to9 school districts and public charter schools pro rata based on the population10 of English language learners under criteria established by the department.11 (2) The State Department of Education shall distribute $450,000 for12 a competitive grant program to assist school districts and public char-13 ter schools in which English language learners are not reaching statewide14 accountability interim targets or long-term goals, as defined by federal15 law. This amount shall be distributed annually in three-year grant cycles,16 contingent on appropriation and the ability of grantees to meet program ob-17 jectives.18 The State Department of Education shall develop the program elements19 and objectives governing the use of these funds and include a program evalua-20 tion component.21 The purpose of these funds is to improve student English language skills22 to allow for better access to the educational opportunities offered in pub-23 lic schools. The State Department of Education shall report to the Joint24 Finance-Appropriations Committee, the Senate Education Committee, and the25 House Education Committee by no later than January 5, 2027, on the program26 design, use of funds, and program effectiveness.27

SECTION 18. ADVANCED OPPORTUNITIES COURSES AND PROGRAM EVALUATION. The28 State Department of Education shall compile information concerning the num-29 ber of students enrolling in advanced opportunities courses according to the30 provisions of Chapter 46, Title 33, Idaho Code, whether coursework is suc-31 cessfully completed, and total expenditures for fiscal year 2026. As nearly32 as practicable, the report shall contain information about enrollment of33 this student population in postsecondary education. A report containing34 such information shall be posted on the website of the State Department of35 Education no later than January 5, 2027.36

SECTION 19. PUBLIC SCHOOL INCOME FUND TRANSFER TO COMMISSION ON HIS-37 PANIC AFFAIRS. There is hereby appropriated and the Office of the State Con-38 troller shall transfer in accordance with Section 63-2552A(2), Idaho Code,39 on July 1, 2026, or as soon thereafter as practicable, $80,000 from the Pub-40 lic School Income Fund to the Commission on Hispanic Affairs Miscellaneous41 Revenue Fund to be used for substance abuse prevention efforts in collabora-42 tion with the State Department of Education.43

SECTION 20. PUBLIC SCHOOL INCOME FUND TRANSFER TO THE IDAHO STATE PO-44 LICE. There is hereby appropriated and the Office of the State Controller45 shall transfer in accordance with Section 63-2552A(2), Idaho Code, on July46

7 1, 2026, or as soon thereafter as practicable, $200,000 from the Public1 School Income Fund to the Idaho State Police Miscellaneous Revenue Fund for2 the purpose of increasing toxicology lab capacity in forensic services.3

SECTION 21. DIGITAL CONTENT AND CURRICULA. Of the funds appropriated in4 Section 2 of this act, $1,600,000 shall be distributed by the State Depart-5 ment of Education to school districts and public charter schools to purchase6 digital content and curricula of their choice. Funding will be distributed7 pursuant to Section 33-4804(2), Idaho Code.8

SECTION 22. IDAHO DIGITAL LEARNING ACADEMY. The Idaho Digital Learning9 Academy (IDLA), created pursuant to Chapter 55, Title 33, Idaho Code, shall10 utilize state-appropriated funds for the period July 1, 2026, through June11 30, 2027, to achieve the following:12 (1) Tuition charged by IDLA to Idaho school districts and charter13 schools shall not exceed $40.00 per enrollment.14 (2) Provide remedial coursework for students failing to achieve profi-15 ciency in one or more areas of Idaho's standards-based tests.16 (3) Pursuant to State Board of Education rule, IDAPA 08.02.03, provide17 advanced opportunities, including access to dual credit courses, for stu-18 dents.19 The preceding list shall not be construed as excluding other instruc-20 tion and training that may be provided by the IDLA.21

SECTION 23. PROGRAM SUPPORT. Of the moneys appropriated in Section22 5 of this act, up to $2,459,100 from the Public School Income Fund shall23 be expended for the support of literacy programs, intervention services24 for non-Title I schools that fail to achieve proficiency on Idaho's stan-25 dards-based achievement tests, math initiative programs and regional math26 labs, and evaluation of the programs for students with non-English or lim-27 ited-English proficiency. The State Department of Education shall report to28 the Joint Finance-Appropriations Committee, the Senate Education Commit-29 tee, and the House Education Committee by no later than January 5, 2027, on30 the uses of funds and effectiveness of the programs and efforts.31

SECTION 24. STUDENT ASSESSMENTS. Of the moneys appropriated in Section32 5 of this act, the State Department of Education may expend up to $2,258,50033 for the development or administration of student assessments, including a34 college entrance exam for grade 11 students, an exam for grade 10 students35 that provides preparation for the college entrance exam, and end-of-course36 exams for high school science subjects.37

SECTION 25. PROFESSIONAL DEVELOPMENT -- CENTRAL SERVICES. Of the mon-38 eys appropriated in Section 5 of this act, the State Department of Education39 may expend up to $4,500,000 for professional development and teacher train-40 ing and to track usage and effectiveness of professional development efforts41 at the state and local levels.42

SECTION 26. CONTENT AND CURRICULUM. Of the moneys appropriated in43 Section 5 of this act, $1,200,000 shall be expended for the purchase of44

8 content and curriculum for adaptive math instruction, and $2,250,000 shall1 be expended for research-based programs to assist with the instruction of2 students with non-English or limited-English proficiency and for learning3 loss.4

SECTION 27. CONTENT AND CURRICULUM -- TECHNOLOGY. Of the moneys appro-5 priated in Section 5 of this act, an amount not to exceed $1,570,000 from the6 Public School Income Fund may be expended by the State Department of Edu-7 cation to contract for services that provide technology education opportu-8 nities and/or information technology certifications to students, including9 faculty that prepare students for college, career, or the workplace. Fund-10 ing shall be awarded for projects that include three or more of the following11 components:12 (1) Certification of skills and competencies;13 (2) Professional development for teachers;14 (3) Integration with curriculum standards;15 (4) Online access to research-based content and curriculum; or16 (5) Instructional software for classroom use.17 The State Department of Education shall provide a report to the Joint18 Finance-Appropriations Committee, the Senate Education Committee, and the19 House Education Committee by no later than January 5, 2027, regarding the20 number and type of certificates earned by students and faculty.21

SECTION 28. STATEWIDE TRAINING FOR EARLY LITERACY. Of the moneys appro-22 priated in Section 5 of this act, $5,000,000 shall be expended for intensive23 professional development and coaching supports that leverage literacy ex-24 perts who are approved by the State Department of Education and trained in25 the science of reading in conformance with Section 33-1807(7), Idaho Code.26 The State Department of Education shall provide all kindergarten through27 grade 3 teachers this professional development on a three-year cycle, while28 extending the training to other support staff as time and resources allow.29 Additionally, the State Department of Education shall prioritize these30 professional development services to teachers in underperforming schools31 as calculated in the bottom 25 percent based on the most recent spring Idaho32 Reading Indicators scores. Support for low-performing schools may include33 pay for success models provided under Section 33-125B, Idaho Code, for34 turnaround school service providers. No later than January 5, 2027, the35 State Department of Education shall report to the Legislative Services Of-36 fice Budget and Policy Analysis Division on the distribution, expenditure,37 and results of these funds. The format and content of the report shall be38 determined in consultation with the State Department of Education and the39 Legislative Services Office Budget and Policy Analysis Division.40

SECTION 29. YEAR-END RECONCILIATION. If the moneys appropriated and41 transferred to the Public School Income Fund and the moneys appropriated42 from the General Fund in Section 5 of this act exceed the actual expenditures43 for the specified purposes, the difference shall be included in the year-end44 reconciliation used to calculate funding available to meet the requirements45 of Section 33-1018, Idaho Code, notwithstanding any other provision of law46 to the contrary. If the funding amounts specified in Section 24 of this act47

9 are insufficient to meet the actual expenditures, the difference shall be1 included in the year-end reconciliation used to calculate funding available2 to meet the requirements of Section 33-1018, Idaho Code, notwithstanding any3 other provision of law to the contrary.4

SECTION 30. DEFINITIONS. (1) As used in Sections 8, 9, 12, and 21 of this5 act, "distributed" means moneys that are transferred to school districts and6 public charter schools, with no funds withheld for any other contract or ad-7 ministrative costs.8 (2) As used in Sections 14, 15, and 17 of this act, "distributed" means9 moneys that are transferred to school districts, public charter schools, and10 the Idaho Digital Learning Academy, with no funds withheld for any other con-11 tract or administrative costs.12 (3) As used in Sections 23, 26, 27, and 28 of this act, "expended" means13 moneys that pay for the cost of contracts that provide services to school14 districts, public charter schools, or students or that pay for the State15 Department of Education's cost of administering the programs for which the16 moneys are allocated.17

SECTION 31. ACQUISITIONS. Consistent with the provisions of Chapter18 92, Title 67, Idaho Code, and funding provided in Section 5 of this act, the19 State Department of Education is required to engage in open, competitive20 acquisition processes. The State Department of Education shall provide a21 report to the Joint Finance-Appropriations Committee by no later than De-22 cember 1, 2026, on all contracts signed during fiscal year 2026 for property23 valued at more than $25,000. The report shall include for each contract: (a)24 the amount; (b) the duration; (c) the parties; (d) the subject; (e) whether25 the contract was awarded as a result of an open, competitive acquisition26 process or as a sole source or other noncompetitive procurement pursuant27 to Section 67-9221, Idaho Code; and (f) the rationale for signing any sole28 source or other noncompetitive procurements.29

SECTION 32. There is hereby appropriated and the Office of the State30 Controller shall transfer $2,773,295,400 from the General Fund to the Public31 School Income Fund on July 1,2026, or as soon thereafter as practicable for32 the period July 1,2026, through June 30,2027.33

SECTION 33. CONDITIONS, LIMITATIONS, AND RESTRICTIONS. Appropriations34 made pursuant to this act are subject to the conditions, limitations, and re-35 strictions specified in this act.36

SECTION 34. An emergency existing therefor, which emergency is hereby37 declared to exist, this act shall be in full force and effect on and after38 July 1, 2026.39