PURPOSE: Section 163.161, RSMo authorizes state transportation aid to school districts based upon allowable costs. This rule defines allowable costs and specifies how they will be used in calculating state transportation aid. The rule further specifies school district recordkeeping and audit requirements related to the calculation of state aid.

1. (1) Allowable Costs for School District Operated Transportation.

   1. (A) Salaries of personnel employed for the operation and maintenance of pupil transportation are allowable. If employees have other school duties in addition to those relating directly to transportation, salaries shall be divided between pupil transportation and other programs according to time actually spent in each program.

      1. 1. Examples of allowable salaries for

pupil transportation personnel include those paid to full-time transportation directors, school aides serving students with special needs pursuant to law, school bus drivers, mechanics, mechanic’s helpers and garage custodians.

1. 2. Examples of nonallowable salaries

include those paid to part-time transportation directors, school administrators and administrative support staff that exceed the limitation described in paragraph (1)(I)1. of this rule.

1. (B) Employee benefits paid on salaries charged under subsection (1)(A) of this rule required by law, including unemployment and Workers’ Compensation insurance, retirement and Social Security or other benefits approved by public school district board of education action as necessary to recruit and retain qualified school bus drivers are allowable. Contributions or benefits for employees who are charged part-time to pupil transportation shall be prorated accordingly.

2. (C) Purchased service expense is an allowable cost. Examples of allowable purchased service expense include:

   1. 1. Insurance on pupil transportation

school buses;

1. 2. Labor contracted for repairs and parts

used for repairs by persons other than school district employees;

1. 3. Expenditures for utilities, insurance

and telephone for the school bus garage/storage facility. If these facilities are used for vehicles other than school buses, costs must be prorated on the basis of the number of vehicles served by the facility; and

1. 4. Expenditures for cellular telephone

service for school bus two (2)-way radio communication system.

1. (D) Supplies expense is an allowable cost. Examples of allowable supplies include:

   1. 1. Fuel;
   2. 2. Oil and other lubricants;
   3. 3. Tires, both new and recapped, tubes,

tire and tube repair;

1. 4. Tools;
2. 5. Parts, including engine parts, batter-

ies, antifreeze, small motors, lights, lenses, bulbs, springs and shock absorbers; and

1. 6. Custodial supplies for the school bus

garage/storage facility. If these facilities are used for vehicles other than pupil transportation vehicles, costs must be prorated on the basis of the number of vehicles served by the facility.

1. (E) Capital outlay expense is an allowable cost. Capital outlay expenditures must be paid out of the Capital Projects Fund. Examples of allowable capital outlay expenditures include:

   1. 1. The cost of retrofit equipment

required on school buses under Missouri specification or otherwise authorized in this rule;

1. 2. Expenses incurred to equip school

buses with a two (2)-way radio communication system, including a communication tower (antenna) and administrative base station or cellular telephones;

1. 3. Expenses incurred to equip school

buses with strobe lights; and

1. 4. The cost of replacement engines for

school buses.

1. (F) The depreciation costs of new and used school buses. New and used school buses which are being leased with the intention of purchase must be depreciated. The purchase price of leased school buses shall not include interest. Each vehicle eligible for depreciation shall be depreciated on a straight-line depreciation schedule of eight (8) years beginning in the first year the school bus is placed in service. No depreciation will be paid for school buses which are ten (10) model years of age or older. If a vehicle is sold, either for cash or trade-in, its value and the gain or loss from sale or trade must be reflected in the aggregate district depreciation schedule.
2. (G) The depreciation costs of new facilities such as the school bus storage facilities and maintenance garages may be claimed by a school district on a straight-line depreciation schedule of not less than twenty (20) years beginning in the first year of the facility’s use. If these facilities are used for vehicles other than school buses, the depreciation charged will be prorated on the basis of the number of vehicles served by the facilities.
3. (H) Gasoline, oil, parts or other operating expense for any vehicle or equipment that is not a school bus are not allowable. Examples include, but are not limited to, superintendents’ cars, food service vans, school maintenance vehicles, driver education cars, lawn mowers, tractors, speech laboratories and bookmobiles.

4. (I) Administrative support service expenditures not to exceed five percent (5%) for each district-operated transportation services school district’s total of subsections (1)(A)–(G) in this rule and for each contractoperated school district’s total of subsection (2)(A) cost for providing administrative support services related to the operation of their pupil transportation program. Administrative support service expenditures include:

   1. 1. Salaries and benefits paid to part-time

transportation directors, school administrators and administrative support staff;

1. 2. Expenditures for utilities, insurance

and telephone for the transportation office;

1. 3. Custodial and office supplies for the

transportation office; and

1. 4. Office space and equipment for the

transportation office, including but not limited to: furniture, copy machine, fax machine, computer hardware and software.

1. (2) Allowable Costs for Contracted Transportation Service.

   1. (A) Contracted transportation costs, including transportation of students under the provisions of section 304.060, RSMo administrative support services in subsection (1)(I) of this rule and costs paid to other school districts, are allowable.

2. (3) Eligible and Ineligible Transportation Mileage.

   1. (A) Transportation eligible for state aid includes:

      1. 1. Approved route mileage during the

regular school term to and from—

1. A. School at the beginning and end of

the school day;

1. B. A publicly-operated university lab-

oratory school at the beginning and end of the school day;

1. C. Any school, department or class

conducted during the regular school day for which vocational aid is paid by the Division of Vocational and Adult Education that provides education services for high school students;

1. D. Special education classes either in

or outside the district that require special transportation arrangements; and 5 CSR 30-261

1. E. Any public school district with an

accredited high school when provided by an elementary school district at the beginning and end of the school day;

1. 2. Approved route mileage during the

summer school term (for summer school programs that are approved by the Division of Instruction) to and from special education classes either in or outside the district that require special transportation arrangements; and

1. 3. Route mileage will be approved by the

State Board of Education on the basis of the most effective and economical route to transport students. All mileage on approved routes will be considered eligible including necessary mileage before student pickups and after student delivery.

1. (B) Transportation ineligible for state aid includes:

   1. 1. Mileage to and from any place at any

time for field trips, athletic events or extracurricular activities;

1. 2. Mileage for maintenance or safety

inspections;

1. 3. Mileage for school bus operators to

take commercial driver’s license or school bus permit driving skills tests, or both;

1. 4. Mileage for special education shuttle

transportation services for diagnostic purposes, physical, speech or occupational therapy; and

1. 5. Mileage for transporting three (3)-

and four (4)-year old special education students to any place for education services authorized by section 162.700, RSMo.

1. (C) Each district shall maintain records in a detail as to readily disclose the eligible and ineligible mileage that contracted and/or district-operated school buses travel during the year.

1. (4) Students Eligible and Ineligible for State Transportation Aid.

   1. (A) State aid for transportation shall be paid as provided in section 163.161, RSMo and as implemented in this rule, only on the basis of the cost of transportation for those students living one (1) mile or more from school including publicly-operated university laboratory schools or who are transported one (1) mile or more to and from public accredited vocational courses, special education classes either in or outside the district. School term, vocational and special education students, are defined as eligible students in calculating a district’s state transportation aid.
   2. (B) If a district provides transportation service to students living less than one (1) mile from school as provided in section 167.231, RSMo or who are provided shuttle transportation less than one (1) mile to and from any school or learning center either in or outside the district for department-approved specialized learning opportunities, these students may be transported and are defined as ineligible students in calculating a district’s state transportation aid. If, however, a board of education determines that certain students who live less than one (1) mile from school or who are provided shuttle transportation less than one (1) mile to and from specialized learning opportunities are transported at no appreciable expense to that incurred in the transportation of eligible students, a district may provide transportation to these students without increasing or diminishing its entitlement to state transportation aid but in no case shall more than twelve percent (12%) of its average daily number of eligible pupils transported be at no appreciable additional expense.
   3. (C) If a district receives compensation from a parent or guardian for transporting a student who lives less than one (1) mile from school, as provided in section 167.231, RSMo or who is provided shuttle transportation less than one (1) mile to and from specialized learning opportunities, the student shall be reported as ineligible and shall not be counted as a part of the students transported at no appreciable additional expense.

2. (5) Calculation of State Transportation Aid for Districts Other Than Special School Districts for the Cost of Transportation Incurred after June 30, 1998.

   1. (A) State transportation aid will be determined by prorating total allowable cost less the total cost of transportation of handicapped and severely handicapped students, including district-operated transportation costs, contracted costs, or both, on the basis of eligible and ineligible miles less the miles for the transportation of handicapped and severely handicapped students. The average number of students scheduled to be transported (AST) and the applicable mileage resulting from a contract for transportation between two (2) school districts will be certified by the district providing contracted service to the sending district. The AST and mileage so certified will be omitted by the serving district from its calculation of state aid and will be included by the sending district in its state aid computations.

      1. 1. Non-handicapped students allowable

costs, less any receipts for interdistrict contracted transportation, will be divided by the total number of non-handicapped students eligible miles and ineligible miles traveled to obtain a non-handicapped students cost per mile.

1. 2. The non-handicapped students cost

per mile is multiplied by total non-handicapped students eligible miles giving the cost for non-handicapped students eligible miles. This cost is divided by the average number of eligible non-handicapped students plus the average number of ineligible students scheduled to be transported, less the average scheduled number transported at no appreciable additional expense, giving the cost per nonhandicapped students AST.

1. 3. The cost per AST for non-handi-

capped students calculated in paragraph (5)(A)2. is multiplied by the eligible nonhandicapped students AST, representing the average number of non-handicapped students scheduled to be transported who live one (1) mile or more from school. If necessary, this product is then adjusted by the district’s cost factor, as outlined in Appendix A, to determine what portion of its costs for eligible non-handicapped students will be used in calculating transportation aid. The result of this step is then multiplied by seventy-five percent (75%) to obtain a tentative non-handicapped students transportation aid figure.

1. 4. The total cost of transportation of

handicapped and severely handicapped students multiplied by seventy-five percent (75%) to obtain a tentative handicapped students transportation aid figure for public school districts that maintain records of specialized services for school students.

1. 5. The cost per AST for non-handi-

capped students calculated in paragraph (5)(A)3. is combined with the cost per AST for handicapped students calculated in paragraph (5)(A)4. to obtain a tentative transportation aid figure.

1. (B) One hundred twenty-five percent (125%) of the state average per pupil cost for the second preceding year is multiplied by the district’s eligible non-handicapped students AST to obtain a ceiling figure. This ceiling figure is compared to the tentative transportation aid figure determined in paragraph (5)(A)4. of this rule.
2. (C) If the smaller figure is the tentative transportation aid figure determined in paragraph (5)(A)4. of this rule, the state transportation aid to be apportioned for the ensuing year will be the amount calculated in paragraph (5)(A)4.

3. (D) If the smaller figure is the ceiling figure determined in subsection (5)(B) of this rule and if the district provides no transportation for handicapped, severely handicapped students, or both, the amount of transportation aid to be apportioned for the ensuing year will be the ceiling figure determined in subsection (5)(B) of this rule. If the district provides transportation for handicapped, severely handicapped students, or both, additional aid may be calculated as follows:

   1. 1. That portion of total allowable costs

which is directly and exclusively incurred for approved transportation of handicapped and severely handicapped students is divided by the average number of handicapped and severely handicapped students scheduled to be transported in this approved transportation. From the result is subtracted the district average cost per non-handicapped students AST determined in paragraph (5)(A)3. of this rule;

1. 2. The difference obtained in paragraph

(5)(D)1. is multiplied by seventy-five percent (75%) and the product is then multiplied again by the average number of handicapped and severely handicapped students scheduled to be transported; and

1. 3. The result in paragraph (5)(D)2. is

added to the amount of transportation aid calculated in subsection (5)(B). The sum is compared to the tentative transportation aid figure calculated in paragraph (5)(A)3. and the smaller amount is the aid to be apportioned during the ensuing school year.

1. (E) If the amount appropriated for trans-

portation aid is less than the aggregate amount of entitlement for districts, then the amount of aid distributed to each district shall be prorated to equal the level of appropriation.

1. (6) Records and Audits.

   1. (A) Each school district will submit an application each year showing the allowable costs and mileage upon which its claim for transportation aid is based. The application figures must be documented by the records of the local school district.

      1. 1. Records are to be kept on a school-

year basis.

1. 2. Records are to include substantiation

for the following:

1. A. Allowable costs as defined in this

rule;

1. B. Eligible and ineligible mileage as

defined in this rule;

1. C. Numbers of students who are pro-

vided transportation under eligible mileage; and

1. D. All receipts for transportation con-

tracts from other districts, student activities or other sources.

1. (B) The school district audit provided for in section 165.121, RSMo shall include an opinion statement regarding the adequacy and accuracy of allowable cost and mileage records kept by the district and used for the transportation aid application for the period audited.

1. (7) Additional Allowable Cost for Transporting the Handicapped/Severely Handicapped.

   1. (A) Expenditures for additional equipment necessary for transporting the handicapped/ severely handicapped, such as vehicle renovation, lifts, seat restraints and wheelchair locks.

   2. (B) Expenditures for additional drivers’ salaries, benefits, purchased services, supplies and capital outlay (excluding vehicle purchases) incurred operating routes transporting only handicapped/severely handicapped.

      1. 1. Routes to be approved by the board of

education and included for additional costs for transporting the handicapped must meet the following criteria:

1. A. Transport students to and from

school on a daily basis; and

1. B. Transport exclusively handicapped/

severely handicapped students.

1. (C) Expenditures for salaries and required benefits of bus aides required for transporting handicapped/severely handicapped.

1. (8) Procedures to Evaluate Circumstances to Authorize State Transportation Aid in Excess of State Average Approved Cost Per Pupil Transported the Second Previous Year.

   1. (A) The district cost factor described in Appendix A of this rule shall be used to measure the efficiency of the transportation program for costs other than the costs of transporting exclusively handicapped and severely handicapped students. The State Board of Education will authorize transportation aid in excess of one hundred twenty-five percent (125%) of the state average cost per pupil transported the second previous year in an amount not to exceed seventy-five percent (75%) of allowable costs if the district would be eligible under the cost factor described in Appendix A.

AUTHORITY: section 163.161, RSMo 1994.* This rule was previously filed as 5 CSR 40- 261.040. Original rule filed Sept. 15, 1977, effective Jan. 16, 1978. Amended: Filed July 14, 1978, effective Oct. 12, 1978. Amended: Filed July 1, 1980, effective Nov. 17, 1980. Amended: Filed Sept. 22, 1983, effective Feb. 15, 1984. Amended: Filed Jan. 18, 1984, effective June 15, 1984. Amended: Filed Sept. 16, 1985, effective Dec. 26, 1985. Amended: Filed Dec. 30, 1987, effective July 1, 1988. Amended: Filed Dec. 14, 1990, effective June 10, 1991. Amended: Filed March 21, 1995, effective Oct. 30, 1995. 5 CSR 30-261 Amended: Filed Oct. 28, 1997, effective May 30, 1998. Amended: Filed July 31, 1998, effective Feb. 28, 1999. *Original authority 1963, amended 1965, 1969, 1973, 1977, 1978, 1980, 1983, 1985, 1986, 1987, 1993. APPENDIX A The Determination of District Cost Factors for Use in Paragraph (5)(A)3. When section 163.161, RSMo, the authority for paying transportation aid, was revised in 1977, the General Assembly assigned responsi- bility for determining allowable costs to the State Board of Education. The definition of these costs and the way they are used in calculating transportation aid have been included in this rule. Because transportation aid is based on the level of costs, the board has been concerned that transportation service be provided as efficiently as possible. Accordingly, an approach has been developed to predict costs for transportation in school districts. An analysis of transportation statistics has confirmed a strong correlation between the average number of bus miles per pupil traveled each day (x) and the average cost per pupil mile (y). Based on this correlation, a simple curvilinear regression analysis can be computed to predict y, the cost per pupil mile, based on x, the number of miles per pupil per day, for each district. This general approach has been used as the basis for transportation aid in other states. Using the results of the regression analysis, the cost per pupil mile predicted for each district can be compared with its actual cost per pupil mile. To the extent that the actual cost is less than the predicted cost, a district can be considered to be operating its transportation service efficiently. To the extent that the actual cost exceeds the predicted cost, the district may be providing service inefficiently. Another way to express this relationship is as a percentage. If the ratio of actual to predicted costs is one hundred percent (100%) or less, the district program is assumed to be efficient. If the percentage is greater than one hundred percent (100%), there is presumed inefficiency. The State Board of Education uses this cost factor expressed as a percentage to adjust allowable costs as an incentive for economical service. A variance factor based statistically on the standard error has been determined to allow for any possible error in the regression analysis. The variance factor has been set at four percent (4%). The state maximum cost factor will be one hundred four percent (104%) (100 percent plus 4 percent variance factor). If a school district has a cost factor percentage of one hundred four percent (104%) or less, no adjustment is made in allowable costs. If the cost factor is greater than one hundred four percent (104%), the allowable costs will be reduced by the same percentage that the factor exceeds one hundred four percent (104%). For example, if the cost factor is one hundred ten percent (110%), this figure exceeds one hundred four percent (104%) by six percent (6%) and the allowable costs would be reduced six percent (6%) before calculating transportation aid. Allowable costs will not be adjusted to a level lower than seventy percent (70%) using this cost factor. The cost per pupil mile will be predicted annually for all school districts providing transportation service based on data submitted on the application for transportation aid. The following statistical formula defines the curvilinear regression analysis used to determine cost factors. Prediction Formula y = axb y = predicted cost per pupil per mile for a district x = actual miles per pupil per day for a district a and b = computed amounts using the entire state’s average miles per pupil per day (x) and average cost per pupil mile (y) as further defined. Formula to compute a a = e ((cid:1)Lny — b(cid:1)Lnx)/N e = 2.71. . . . (This is a constant from mathematics. “a” is obtained by finding the natural antilog of the exponent of “e” as shown in the equation above.) Formula to compute b N(cid:1)(Lnx (cid:127) Lny) – ((cid:1)Lnx) (cid:127) ((cid:1)Lny) b = N(cid:1)(Lnx)2 – ((cid:1)Lnx)2 The meanings of the symbols used in the formulas defining “a” and “b” are as listed— Lnx = natural logarithm of each x Lny = natural logarithm of each y (Lnx)2 = natural logarithm of each x squared (Lnx) (cid:127) (Lny) = natural logarithm of x multiplied by the natural logarithm of y for each district (cid:1)Lnx = sum of Lnx for all transporting districts (cid:1)Lny = sum of Lny for all trans-porting districts (cid:1)(Lnx)2 = sum of (Lnx)2 for all transporting districts (cid:1)(Lnx (cid:127) Lny) = sum of (Lnx (cid:127) Lny) for all transporting districts N = number of transporting districts