(a) In making apportionment of the Public School Fund held by the state, to the local boards of education, the State Superintendent of Education shall first set apart and distribute to the schools of each township the amount due from the state thereto as interest on its sixteenth section fund, or other trust fund held by the state.

(b) It is the intent of the Legislature to insure that no local board of education receive less state funds per pupil than it received in fiscal year 1994-95. For this reason the Foundation Program for each local board of education shall be supplemented, if necessary, by a hold harmless allowance. The base amount of each local board's hold harmless allowance calculation is the 1994-95 program cost as defined herein. The 1994-95 program cost of each local board of education was determined by using the first forty scholastic days of average daily membership from 1993-94. Beginning with the fiscal year 1995-96, the hold harmless allowance calculation shall be the current year Foundation Program state allocation, including allocated Public Education Employees' Health Insurance Plan reserves, less the fiscal year 1994-95 program cost as defined herein. The fiscal year 1994-95 program cost is defined as including the local boards of education allocations for kindergarten through grade twelve plus fringe benefits including Public Education Employees' Health Insurance Plan reserves and the Public School Fund less the transportation allowance.

(c) Beginning with the fiscal year 1995-96, the first cost to the Public School Fund, after complying with the provisions of subsection (a), shall be the hold harmless allowance. The hold harmless calculation shall continue until no local board of education receives less funds per pupil than it received in fiscal year 1994-95. However, this hold harmless allowance shall terminate not later than September 30, 2002.

(d) It is the intent of the Legislature that funds shall be provided to local boards of education in addition to Foundation Program funds to provide continuing funding to provide for soundness and adequacy of public school facilities in Alabama. To that end the remainder of the Public School Fund after deducting the costs pursuant to subsection (a) shall be available to the local boards of education for capital outlay, including the planning, construction, reconstruction, enlargement, improvement, repair or renovation of public school facilities, for the purchase of land for public school facilities, for debt payments related to public school facilities, for insuring public school facilities, and for the acquisition and/or purchase of education technology and equipment.

(e) It is the intent of the Legislature that the distribution of capital funds for the purpose of capital purchases from the Public School Fund be made to all school systems, require a variable matching with local funds based on yield per mill per average daily membership of district property tax, and guarantee the same amount per student in each system for capital purchases from the total of state and matching local funds. The State Superintendent of Education shall allocate the available funds pursuant to the rules adopted by the State Board of Education. Also, to receive funds from this appropriation, the local board of education must develop a comprehensive, long range capital plan addressing the facility, educational technology and equipment needs of the local board of education, pursuant to the rules adopted by the State Board of Education. The goal of this program is to have each local board of education complete its comprehensive, long range capital plan and begin making satisfactory progress in implementing the plan for providing adequate public school facilities for all students.

(f) In addition to rules adopted by the State Board of Education and used by the State Superintendent of Education in the distribution of said funds, it is the intent of the Legislature to impose the following. For fiscal year 1996 a school system may elect to use up to 100 percent of its matched capital purchase funds for serving at-risk students as defined by the State Board of Education or a legislative approved definition. For fiscal year 1997 a school system may elect to use up to 75 percent, in fiscal year 1998 up to 50 percent, and in fiscal year 1999 up to 25 percent. It is the intent of the Legislature that beginning in fiscal year 2000, all public school funds must be used for capital purchases as specified in subsection (e) above. School systems electing to expend their allocations of capital purchase funds on at-risk student programs pursuant to this subsection shall expend those funds for effective programs and tutorial assistance programs that include but shall not be limited to after school, Saturday, and/or summer school; provided, that such programs shall be outside of the normal day school.