(a) In those instances in which a school district provides transportation services, by district-owned, leased, or contracted school buses, a nonallowable pupil deduction shall be calculated for purposes of determining aid pursuant to section 3602 of the Education Law, for transportation expenses incurred in the 1990-91 school year and each school year thereafter, pursuant to this paragraph.

1. (1) The calculation of the nonallowable pupil deduction for each school district shall be as follows: the dollar amount of the district's nonallowable pupil deduction for expenses for transportation services, by district-owned, leased, or contracted school buses, incurred in each of the school years 1987-88, 1988-89, and 1989-90, as audited and confirmed by the Education Department, shall be summed, with such sum divided by the sum of the district's net transportation expenses related to mileage travelled by district-owned, leased, or contracted school buses for the three years, with the result expressed as a decimal to four places without rounding. This nonallowable pupil decimal shall be calculated by the Education Department for each district, and shall be reported to each district by July 1, 1991. Net transportation expense for purposes of this paragraph shall be the total expense attributable to transportation service to and from school and BOCES programs, for which an apportionment is provided pursuant to article 65, 73 or 89 of the Education Law, excluding the expenses attributable to other purpose transportation.

2. (2) In calculating aid to be paid in each school year commencing in school year 1991-92, the nonallowable pupil decimal calculated in paragraph (1) of this subdivision shall be multiplied by net transportation expense of the base year to determine nonallowable expense. Such nonallowable expense shall be deducted from net transportation expense to determine the allowable transportation expense for transportation aid.

   1. (i) A school district shall provide documentation to the commissioner for the calculation of a new nonallowable pupil decimal at least once every three years, on a schedule prescribed by the commissioner, using the nonallowable pupil decimal worksheet prescribed by the commissioner; and in addition, a school district shall provide such documentation during any school year in which the district experiences an increase or decrease from the nonallowable pupil decimal previously calculated pursuant to this section, when any one or more of the following conditions apply:

      1. (a) change in school district transportation eligibility policy;
      2. (b) school district reorganization with one or more other districts;
      3. (c) opening of a school building or closing of a building currently used as a school building;
      4. (d) an error made by either the school district or the Education Department in the calculation of a nonallowable pupil decimal for a prior year; or
      5. (e) a change in school district transportation policy to provide transportation of eligible children to or from a universal prekindergarten program pursuant to section 3602-3 of the Education Law.

   2. (ii) Upon receipt of such documentation, the commissioner shall calculate a new nonallowable pupil decimal by dividing the total number of pupil miles of transportation services provided to nonallowable pupils on all district-owned, leased, or contracted school buses during the school year reported by the total number of pupil miles of transportation services provided to all pupils on all district-owned, leased, or contracted school buses during such school year, with the result expressed as decimal to four places without rounding. The number of pupil miles of transportation services provided to pupils attending an approved prekindergarten program pursuant to section 3602-e of the Education Law shall be excluded for the purposes of such calculation, provided that the transportation services furnished to such prekindergarten pupils are provided on a space-available basis and do not require, or result in:

      1. (a) any expansion of approved bus routes or additional trips; or
      2. (b) any increase in contracted expenditures for transportation expenses; or
      3. (c) any purchase or lease of additional vehicles.
   3. (iii) The new nonallowable pupil decimal shall be used in calculating transportation aid in each school year after the school year in which such documentation is provided, in lieu of the decimal previously calculated pursuant to this section.

   (3)