(1) When an attachment order has been communicated to the Board of County Commissioners pursuant to 20-6-701 , MCA:

(a) The Board of County Commissioners and the Board of Trustees of the elementary district will proceed to prepare all instruments necessary to convey title to the real and personal property of the elementary district to the high school district, so that these instruments may be executed and effective as of July 1 of the fiscal year of the attachment;

(b) The officials of the elementary district trustees shall entrust the district official records and all district property and materials to the high school district trustees on July 1 of the year of the attachment;

(c) The county treasurer, in accordance with procedures established by the Department of Commerce and the State Superintendent of Public Instruction, shall transfer all elementary district fund balances to the high school district's funds effective July 1 of the year of the attachment. The K-12 school district will assume the cash and liabilities of the attached elementary district, and will maintain a single budgeted or nonbudgeted fund for each of the authorized funds of the K-12 district for the costs of operating all grades and programs of the district, pursuant to accounting and reporting procedures prescribed by the Office of Public Instruction.

(2) The board of trustees of the high school district will become the trustees of the K-12 district effective July 1 of the year of the attachment.

(3) End-of-year elementary district fiscal and nonfiscal reporting will be completed as required for the elementary district for the school year prior to the formation of a K-12 district. If the end-of-year elementary reporting is due after the effective date of the formation of the K-12 district, the reports shall be completed and filed by the officials of the newly formed K-12 district.

(4) The elementary and high school district officials shall prepare a single budget per fund for the K-12 district for the effective year of formation of the K-12 district, and for each year thereafter, using the forms and procedures established by the State Superintendent of Public Instruction.

(a) The school district general fund budget limitations established by 20-9-308 , MCA, shall be determined for K-12 districts in the following manner:

(i) The budget limitations shall be applied to the combined total of the elementary and high school budgets for the fiscal year prior to the effective fiscal year of the attachment. For each year thereafter, the budget limitations shall be applied to the prior year K-12 district budget.

(ii) In order to determine equalized status of a transition K-12 school district for the ensuing fiscal year, the district shall make the following calculation:

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Current FY 20XX Elementary BASE Budget Limit	1a
Current FY 20XX High School BASE Budget Limit	1b
Combined BASE Budget Limit (1a+1b)	1c
Current FY 20XX Elementary Maximum General Fund Budget Limit	2a
Current FY 20XX High School Maximum General Fund Budget Limit	2b
Combined Maximum General Fund Budget Limit (2a+2b)	2c
FY 20XX Elementary Adopted General Fund Budget	3a
FY 20XX High School Adopted General Fund Budget	3b
FY 20XX Combined Adopted General Fund Budget (3a+3b)	3c

If 3c is less than or equal to the Maximum General Fund Budget (line 2c) , the K-12 district will be considered "equalized" in the ensuing school year (FY 20XX+1) . If not, then the K-12 district will be considered "not equalized" for the ensuing school year.

(b) For the purpose of determining guaranteed tax base aid, the BASE budget levy amount for a K-12 district will be prorated between elementary and high school programs using the ratio of the elementary GTBA budget area to the high school GTBA budget area.

(i) The ratio for prorating the BASE budget levy will be determined in the following manner:

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Calculation of ratio for proration of GTBA budget area

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�	Elem.	H.S.	K-12
(A) 80% of Basic Entitlement �	______	______	______
(B) 80% of Per-Student Entitlement �	______	______	______
(C) Special Education Allowable Cost Payments: �	�	�	�
(I) Allowable costs, including disproportionate cost reimbursement times (Elementary current ANB divided by total K-12 ANB)	______	�	�
(II) [Allowable costs, including disproportionate cost reimbursement times (High School current ANB divided by total K-12 current ANB) ]	�	______	�
(III) Total K-12 allowable cost payments �	�	�	______
(D) Related Services Payment to Co-op	______	______	______
(E) 40% of Special Education Allowable Costs & Related Services Payment to Co-op [40 times (C) +(D) ] ___	______	______	______
(F) BASE Budget Limit [(A) +(B) +(C) +(E) ]	______	______	______
(G) Direct Aid Payment [(A+B) times the direct state aid percentage in 20-9-306 , MCA]	G1	G2	G3
(H) GTBA Budget Area [(F) -(G) -(C) ]	H1	H2	H3
(I) Prorated GTBA Budget Area	H1/H3	H2/H3	100%

(ii) The eligibility for guaranteed tax base aid will be determined for the elementary prorated portion and for the high school prorated portion using the procedures established for elementary and high school districts set out in ARM 10.21.101F, on the Office of Public Instruction budget forms. The K-12 district will be eligible to receive the sum of the amounts of guaranteed tax base aid determined for both the elementary and high school prorated portions, or for a single portion if eligibility is determined only for the elementary or the high school portion of the BASE budget amount.

(c) After the resolution to attach and establish a K-12 district, the trustees of the K-12 district will submit a single proposition to the voters for the amount of the K-12 general fund budget that must be submitted to the electorate.

(5) For the initial year of the K-12 district, eligibility for program funding, established by the State Superintendent of Public Instruction in the year prior to the formation of the K-12 districts, will be transferred to the K-12 district. Characteristics of the districts (i.e., enrollment, expenditures, low-income data, needs assessment) may be calculated based on the combined districts' characteristics if the funding would be adversely affected when calculated separately, and if allowed by program requirements. Following the initial year of the K-12 district, funding eligibility will be determined for K-12 programs as a single district, or per specific program requirements.

(6) All certified employees of the elementary and high school district who have the right of tenure under Montana law will continue to have tenure in the K-12 district, and all noncertified employees of the elementary district must be given preference in hiring for any K-12 district position for which the employee has substantially equal qualifications, pursuant to 20-6-711 , MCA.