As Passed by the House 1
122nd General Assembly 4
Regular Session Am. Sub. H. B. No. 426 5
1997-1998 6
REPRESENTATIVES CLANCY-CATES-BATEMAN-GARCIA-GRENDELL-PRINGLE- 8
SCHULER-WILLIAMS-CORBIN-SAWYER-REID-SCHUCK-VESPER-VAN VYVEN- 9
ROMAN-HOTTINGER-PADGETT-TAYLOR-LEWIS-CALLENDER-CAREY- 10
OPFER-MOTTLEY-TERWILLEGER-SULZER-O'BRIEN-OGG-WINKLER- 11
CORE-BUCHY-LOGAN-KASPUTIS-GARDNER-HARRIS-METZGER-HAINES- 12
THOMAS-DAMSCHRODER-BRADING-MYERS-HOUSEHOLDER-MASON- 13
AMSTUTZ-PATTON-LUCAS-OLMAN-SALERNO-VERICH-COLONNA 14
16
A B I L L
To amend sections 3316.03, 5705.12, 5705.29, 18
5705.35, 5705.36, 5747.51, and 5747.62; to amend, 19
for the purpose of adopting a new section number 20
as indicated in parentheses, section 5705.13 21
(5705.121); to enact new section 5705.13 and 22
section 5705.131; and to repeal sections 305.23, 23
505.83, and 505.831 of the Revised Code to permit 24
taxing authorities of subdivisions to create 25
accounts in which funds may be reserved for 26
budget stabilization, self-insurance claim 27
payments, the payment of claims under 28
retrospective ratings plans for workers' 30
compensation, accumulated employee leave, 31
capital projects, and nonexpendable trusts, and 32
to specify that certain amounts in such reserves 34
shall not affect revenue distributions to 35
certain subdivisions through local government 36
funds. 37
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO: 39
Section 1. That sections 3316.03, 5705.12, 5705.29, 41
2
5705.35, 5705.36, 5747.51, and 5747.62 be amended, section 42
5705.13 (5705.121) be amended for the purpose of adopting a new 43
section number as indicated in parentheses, and new section 44
5705.13 and section 5705.131 of the Revised Code be enacted to 45
read as follows:
Sec. 3316.03. (A) The auditor of state shall declare a 54
school district to be in a state of fiscal watch if the auditor 55
of state determines that all of the following conditions are 56
satisfied with respect to the school district: 57
(1) An operating deficit has been certified for the 59
current fiscal year by the auditor of state under section 60
3313.483 of the Revised Code, and the certified operating deficit 62
exceeds eight per cent of the school district's general fund 63
revenue for the preceding fiscal year; 64
(2) The unencumbered cash balance in the school district's 67
general fund at the close of the preceding fiscal year, less any 68
advances of property taxes, was less than eight per cent of the 69
expenditures made from the general fund for the preceding fiscal 70
year;
(3) A majority of the voting electors have not voted in 72
favor of levying a tax under section 5705.194 or 5705.21 or 73
Chapter 5748. of the Revised Code that the auditor of state 74
expects will raise enough additional revenue in the next 75
succeeding fiscal year that divisions (A)(1) and (2) of this 76
section will not apply to the district in such next succeeding 77
fiscal year.
(B) The auditor of state, after consulting with the 79
superintendent of public instruction, shall issue an order 80
declaring a school district to be in a state of fiscal emergency 81
if the school district board fails, pursuant to section 3316.04 82
of the Revised Code, to submit a plan acceptable to the state
superintendent of public instruction within one hundred twenty 83
days of the auditor's declaration pursuant to division (A) of 84
this section, or if the auditor of state determines that all of 85
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the following conditions are satisfied with respect to the school 87
district:
(1) The board of education of the school district is not 89
able to demonstrate, to the auditor of state's satisfaction, the 90
district's ability to repay outstanding loans received pursuant 91
to section 3313.483 of the Revised Code or to repay securities 92
issued pursuant to section 133.301 of the Revised Code in 93
accordance with applicable repayment schedules unless the board 94
requests additional loans under section 3313.483 and section 95
133.301 of the Revised Code in an aggregate principal amount 97
exceeding fifty per cent of the sum of the following: 98
(a) The aggregate original principal amount of loans 101
received in the preceding fiscal year under section 3313.483 of 102
the Revised Code;
(b) The aggregate amount borrowed by the district under 104
section 133.301 of the Revised Code, excluding any additional 105
amount borrowed as authorized under division (C) of that section. 106
(2) An operating deficit has been certified for the 108
current fiscal year by the auditor of state under section 109
3313.483 of the Revised Code, and the certified operating deficit 111
exceeds fifteen per cent of the school district's general fund 112
revenue for the preceding fiscal year. In determining the amount 113
of an operating deficit under division (B)(2) of this section, 114
the auditor of state shall credit toward the amount of that 115
deficit only the amount that may be borrowed from the spending 116
reserve balance as determined under section 133.301 and division 117
(G)(F) of section 5705.29 of the Revised Code;. 118
(3) A majority of the voting electors have not voted in 120
favor of levying a tax under section 5705.194 or 5705.21 or 121
Chapter 5748. of the Revised Code that the auditor of state 122
expects will raise enough additional revenue in the next 123
succeeding fiscal year that divisions (A)(1) and (2) of this 124
section will not apply to the district in such next succeeding 125
fiscal year.
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(4) The school district is one that, at the time of the 127
auditor of state's determination under this section, had an 128
average daily membership of more than ten thousand students as 129
most recently reported to the department of education pursuant to 131
division (A) of section 3317.03 of the Revised Code. 132
(C) In making the determinations under this section, the 134
auditor of state may use financial reports required under section 136
117.43 of the Revised Code; tax budgets, certificates of 137
estimated resources and amendments thereof, annual appropriating 138
measures and spending plans, and any other documents or 139
information prepared pursuant to Chapter 5705. of the Revised 140
Code; and any other documents, records, or information available 141
to the auditor of state that indicate the conditions described in 142
divisions (A) and (B) of this section.
(D) The auditor of state shall certify the action taken 144
under division (A) or (B) of this section to the board of 145
education of the school district, the director of budget and 146
management, the mayor or county auditor who could be required to 147
act pursuant to division (B)(1) of section 3316.05 of the Revised
Code, and to the superintendent of public instruction. 148
(E) A determination by the auditor of state under this 150
section that a fiscal emergency condition does not exist is final 151
and conclusive and not appealable. A determination by the 152
auditor of state under this section that a fiscal emergency 153
exists is final, except that the board of education of the school 154
district affected by such a determination may appeal the
determination of the existence of a fiscal emergency condition to 155
the court of appeals having territorial jurisdiction over the 156
school district. The appeal shall be heard expeditiously by the 157
court of appeals and for good cause shown shall take precedence 158
over all other civil matters except earlier matters of the same 159
character. Notice of such appeal must be filed with the auditor
of state and such court within thirty days after certification by 160
the auditor of state to the board of education of the school 161
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district provided for in division (D) of this section. In such 162
appeal, determinations of the auditor of state shall be presumed 163
to be valid and the board of education shall have the burden of 164
proving, by clear and convincing evidence, that each of the 165
determinations made by the auditor of state as to the existence
of a fiscal emergency condition under this section was in error. 166
If the board of education fails, upon presentation of its case, 167
to prove by clear and convincing evidence that each such 168
determination by the auditor of state was in error, the court 169
shall dismiss the appeal. The board of education and the auditor 170
of state may introduce any evidence relevant to the existence or
nonexistence of such fiscal emergency conditions. The pendency 171
of any such appeal shall not affect or impede the operations of 172
this chapter; no restraining order, temporary injunction, or 173
other similar restraint upon actions consistent with this chapter 174
shall be imposed by the court or any court pending determination 175
of such appeal; and all things may be done under this chapter 176
that may be done regardless of the pendency of any such appeal.
Any action taken or contract executed pursuant to this chapter 177
during the pendency of such appeal is valid and enforceable among 178
all parties, notwithstanding the decision in such appeal. If the 179
court of appeals reverses the determination of the existence of a 180
fiscal emergency condition by the auditor of state, the 181
determination no long LONGER has any effect, and any procedures 182
undertaken as a result of the determination shall be terminated. 183
Sec. 5705.12. In addition to the funds provided for by 192
sections 5705.09 and, 5705.121, 5705.13, AND 5705.131 of the 194
Revised Code, the taxing authority of a subdivision may 195
establish, with the approval of and in the manner prescribed by 196
the auditor of state, such other funds as are desirable, and may 197
provide by ordinance or resolution that money derived from 198
specified sources other than the general property tax shall be 199
paid directly into such funds. The auditor of state shall 200
consult with the tax commissioner before giving his approval 201
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APPROVING SUCH FUNDS.
Sec. 5705.13 5705.121. A municipal corporation may 210
establish in the manner provided by law a sanitary police pension 212
fund, an urban redevelopment tax increment equivalent fund, or a 213
cemetery fund. A township may establish by law a cemetery fund. 214
Sec. 5705.13. (A) A TAXING AUTHORITY OF A SUBDIVISION, BY 216
RESOLUTION OR ORDINANCE, MAY ESTABLISH A RESERVE BALANCE ACCOUNT 218
TO ACCUMULATE CURRENTLY AVAILABLE RESOURCES FOR ANY OF THE 219
FOLLOWING PURPOSES:
(1) TO STABILIZE SUBDIVISION BUDGETS AGAINST CYCLICAL 221
CHANGES IN REVENUES AND EXPENDITURES; 222
(2) EXCEPT AS OTHERWISE PROVIDED BY THIS SECTION, TO 224
PROVIDE FOR THE PAYMENT OF CLAIMS UNDER A SELF-INSURANCE PROGRAM 225
FOR THE SUBDIVISION, IF THE SUBDIVISION IS PERMITTED BY LAW TO 226
ESTABLISH SUCH A PROGRAM;
(3) TO PROVIDE FOR THE PAYMENT OF CLAIMS UNDER A 228
RETROSPECTIVE RATINGS PLAN FOR WORKERS' COMPENSATION. 229
THE ORDINANCE OR RESOLUTION ESTABLISHING A RESERVE BALANCE 231
ACCOUNT SHALL STATE THE PURPOSE FOR WHICH THE RESERVE BALANCE 232
ACCOUNT IS ESTABLISHED, THE FUND IN WHICH THE ACCOUNT IS TO BE 233
ESTABLISHED, AND THE TOTAL AMOUNT OF MONEY TO BE RESERVED IN THE 234
ACCOUNT.
A SUBDIVISION THAT PARTICIPATES IN A RISK-SHARING POOL, BY 236
WHICH GOVERNMENTS POOL RISKS AND FUNDS AND SHARE IN THE COSTS OF 237
LOSSES, SHALL NOT ESTABLISH A RESERVE BALANCE ACCOUNT TO PROVIDE 238
SELF-INSURANCE FOR THE SUBDIVISION. 239
A TAXING AUTHORITY OF A SUBDIVISION SHALL NOT HAVE MORE 241
THAN THREE RESERVE BALANCE ACCOUNTS AT ANY TIME. NOT MORE THAN 243
ONE RESERVE BALANCE ACCOUNT MAY BE ESTABLISHED FOR EACH OF THE 244
PURPOSES PERMITTED UNDER THIS SECTION. MONEY TO THE CREDIT OF A 245
RESERVE BALANCE ACCOUNT MAY BE EXPENDED ONLY FOR THE PURPOSE FOR 246
WHICH THE ACCOUNT WAS ESTABLISHED.
A RESERVE BALANCE ACCOUNT ESTABLISHED FOR THE PURPOSE 248
DESCRIBED IN DIVISION (A)(1) OF THIS SECTION SHALL BE ESTABLISHED 249
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IN THE GENERAL FUND OF THE SUBDIVISION, AND THE AMOUNT OF MONEY 250
TO BE RESERVED IN THAT ACCOUNT IN ANY FISCAL YEAR SHALL NOT 251
EXCEED FIVE PER CENT OF THE GENERAL FUND REVENUE FOR THE 252
PRECEDING FISCAL YEAR. SUBJECT TO DIVISION (G) OF SECTION 253
5705.29 OF THE REVISED CODE, ANY RESERVE BALANCE IN AN ACCOUNT 254
ESTABLISHED UNDER DIVISION (A)(1) OF THIS SECTION SHALL NOT BE 255
CONSIDERED PART OF THE UNENCUMBERED BALANCE OR REVENUE OF THE 256
SUBDIVISION UNDER DIVISION (A) OF SECTION 5705.35 OR DIVISION 257
(A)(1) OF SECTION 5705.36 OF THE REVISED CODE. 258
AT ANY TIME, A TAXING AUTHORITY OF A SUBDIVISION, BY 260
RESOLUTION OR ORDINANCE, MAY REDUCE OR ELIMINATE THE RESERVE 262
BALANCE IN A RESERVE BALANCE ACCOUNT ESTABLISHED FOR THE PURPOSE 263
DESCRIBED IN DIVISION (A)(1) OF THIS SECTION. 264
A RESERVE BALANCE ACCOUNT ESTABLISHED FOR THE PURPOSE 266
DESCRIBED IN DIVISION (A)(2) OR (3) OF THIS SECTION SHALL BE 268
ESTABLISHED IN THE GENERAL FUND OF THE SUBDIVISION OR BY THE 270
ESTABLISHMENT OF A SEPARATE INTERNAL SERVICE FUND ESTABLISHED TO 271
ACCOUNT FOR THE OPERATION OF THE SELF-INSURANCE OR RETROSPECTIVE 272
RATINGS PLAN PROGRAM, AND SHALL BE BASED ON SOUND ACTUARIAL 273
PRINCIPLES. THE TOTAL AMOUNT OF MONEY IN A RESERVE BALANCE 274
ACCOUNT FOR SELF-INSURANCE MAY BE EXPRESSED IN DOLLARS OR AS THE 275
AMOUNT DETERMINED TO REPRESENT AN ADEQUATE RESERVE ACCORDING TO 276
SOUND ACTUARIAL PRINCIPLES. 277
A TAXING AUTHORITY OF A SUBDIVISION, BY RESOLUTION OR 279
ORDINANCE, MAY RESCIND A RESERVE BALANCE ACCOUNT ESTABLISHED 280
UNDER THIS DIVISION. IF A RESERVE BALANCE ACCOUNT IS RESCINDED, 281
MONEY THAT HAS ACCUMULATED IN THE ACCOUNT SHALL BE TRANSFERRED TO 282
THE FUND OR FUNDS FROM WHICH THE MONEY ORIGINALLY WAS 283
TRANSFERRED.
(B) A TAXING AUTHORITY OF A SUBDIVISION, BY RESOLUTION OR 285
ORDINANCE, MAY ESTABLISH A SPECIAL REVENUE FUND FOR THE PURPOSE 287
OF ACCUMULATING RESOURCES FOR THE PAYMENT OF ACCUMULATED SICK 288
LEAVE AND VACATION LEAVE, AND FOR PAYMENTS IN LIEU OF TAKING 289
COMPENSATORY TIME OFF, UPON THE TERMINATION OF EMPLOYMENT OR THE 290
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RETIREMENT OF OFFICERS AND EMPLOYEES OF THE SUBDIVISION. 291
NOTWITHSTANDING SECTIONS 5705.14, 5705.15, AND 5705.16 OF THE
REVISED CODE, THE TAXING AUTHORITY, BY RESOLUTION OR ORDINANCE, 292
MAY TRANSFER MONEY TO THE SPECIAL REVENUE FUND FROM ANY OTHER 294
FUND OF THE SUBDIVISION FROM WHICH SUCH PAYMENTS MAY LAWFULLY BE 295
MADE. THE TAXING AUTHORITY, BY RESOLUTION OR ORDINANCE, MAY 296
RESCIND A SPECIAL REVENUE FUND ESTABLISHED UNDER THIS DIVISION.
IF A SPECIAL REVENUE FUND IS RESCINDED, MONEY THAT HAS 297
ACCUMULATED IN THE FUND SHALL BE TRANSFERRED TO THE FUND OR FUNDS 298
FROM WHICH THE MONEY ORIGINALLY WAS TRANSFERRED. 299
(C) A TAXING AUTHORITY OF A SUBDIVISION, BY RESOLUTION OR 301
ORDINANCE, MAY ESTABLISH A CAPITAL PROJECTS FUND FOR THE PURPOSE 302
OF ACCUMULATING RESOURCES FOR THE ACQUISITION, CONSTRUCTION, OR 303
IMPROVEMENT OF FIXED ASSETS OF THE SUBDIVISION. MORE THAN ONE 304
CAPITAL PROJECTS FUND MAY BE ESTABLISHED AND MAY EXIST AT ANY 305
TIME. THE ORDINANCE OR RESOLUTION SHALL IDENTIFY THE SOURCE OF 306
THE MONEY TO BE USED TO ACQUIRE, CONSTRUCT, OR IMPROVE THE FIXED 307
ASSETS IDENTIFIED IN THE RESOLUTION OR ORDINANCE, THE AMOUNT OF
MONEY TO BE ACCUMULATED FOR THAT PURPOSE, THE PERIOD OF TIME OVER 308
WHICH THAT AMOUNT IS TO BE ACCUMULATED, AND THE FIXED ASSETS THAT 309
THE TAXING AUTHORITY INTENDS TO ACQUIRE, CONSTRUCT, OR IMPROVE 310
WITH THE MONEY TO BE ACCUMULATED IN THE FUND. 311
A TAXING AUTHORITY OF A SUBDIVISION SHALL NOT ACCUMULATE 313
MONEY IN A CAPITAL PROJECTS FUND FOR MORE THAN FIVE YEARS AFTER 315
THE RESOLUTION OR ORDINANCE ESTABLISHING THE FUND IS ADOPTED. IF 316
THE SUBDIVISION HAS NOT ENTERED INTO A CONTRACT FOR THE 317
ACQUISITION, CONSTRUCTION, OR IMPROVEMENT OF FIXED ASSETS FOR 318
WHICH MONEY WAS ACCUMULATED IN SUCH A FUND BEFORE THE END OF THAT 319
FIVE-YEAR PERIOD, THE FISCAL OFFICER OF THE SUBDIVISION SHALL 321
TRANSFER ALL MONEY IN THE FUND TO THE FUND OR FUNDS FROM WHICH
THAT MONEY ORIGINALLY WAS TRANSFERRED OR THE FUND THAT ORIGINALLY 322
WAS INTENDED TO RECEIVE THE MONEY. 323
A TAXING AUTHORITY OF A SUBDIVISION, BY RESOLUTION OR 325
ORDINANCE, MAY RESCIND A CAPITAL PROJECTS FUND. IF A CAPITAL 327
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PROJECTS FUND IS RESCINDED, MONEY THAT HAS ACCUMULATED IN THE 328
FUND SHALL BE TRANSFERRED TO THE FUND OR FUNDS FROM WHICH THE 329
MONEY ORIGINALLY WAS TRANSFERRED.
NOTWITHSTANDING SECTIONS 5705.14, 5705.15, AND 5705.16 OF 331
THE REVISED CODE, THE TAXING AUTHORITY OF A SUBDIVISION, BY 332
RESOLUTION OR ORDINANCE, MAY TRANSFER MONEY TO THE CAPITAL 334
PROJECTS FUND FROM ANY OTHER FUND OF THE SUBDIVISION THAT MAY
LAWFULLY BE USED FOR THE PURPOSE OF ACQUIRING, CONSTRUCTING, OR 336
IMPROVING THE FIXED ASSETS IDENTIFIED IN THE RESOLUTION OR 337
ORDINANCE.
Sec. 5705.131. A TAXING AUTHORITY OF A SUBDIVISION MAY 339
ESTABLISH A NONEXPENDABLE TRUST FUND FOR THE PURPOSE OF RECEIVING 340
DONATIONS OR CONTRIBUTIONS THAT THE DONOR OR CONTRIBUTOR REQUIRES 341
TO BE MAINTAINED INTACT. THE PRINCIPAL OF SUCH FUND MAY BE 342
INVESTED, AND THE INVESTMENT EARNINGS ON THE PRINCIPAL SHALL BE 343
CREDITED TO THE FUND. THE PRINCIPAL OF THE FUND, AND ANY 344
ADDITIONS TO PRINCIPAL ARISING FROM SOURCES OTHER THAN THE 346
REINVESTMENT OF INVESTMENT EARNINGS ARISING FROM THE FUND, SHALL 347
NOT BE CONSIDERED PART OF THE UNENCUMBERED BALANCE OR REVENUE OF
THE SUBDIVISION UNDER DIVISION (A) OF SECTION 5705.35 OR DIVISION 348
(A)(1) OF SECTION 5705.36 OF THE REVISED CODE. ONLY INVESTMENT 350
EARNINGS ARISING FROM INVESTMENT OF THE PRINCIPAL OR INVESTMENT
OF SUCH ADDITIONS TO PRINCIPAL MAY BE CONSIDERED AN UNENCUMBERED 351
BALANCE OR REVENUE OF THE SUBDIVISION UNDER THAT DIVISION. 352
Sec. 5705.29. The tax budget shall present the following 361
information in such detail as is prescribed by the auditor of 362
state, unless an alternative form of the budget is permitted 363
under section 5705.281 of the Revised Code: 364
(A)(1) A statement of the necessary current operating 366
expenses for the ensuing fiscal year for each department and 367
division of the subdivision, classified as to personal services 368
and other expenses, and the fund from which such expenditures are 369
to be made. Except in the case of a school district, this 370
estimate may include a contingent expense not designated for any 371
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particular purpose, and not to exceed three per cent of the total 372
amount of appropriations for current expenses. In the case of a 373
school district, this estimate may include a contingent expense 374
not designated for any particular purpose and not to exceed 375
thirteen per cent of the total amount of appropriations for 376
current expenses. 377
(2) A statement of the expenditures for the ensuing fiscal 379
year necessary for permanent improvements, exclusive of any 380
expense to be paid from bond issues, classified as to the 381
improvements contemplated by the subdivision and the fund from 382
which such expenditures are to be made; 383
(3) The amounts required for the payment of final 385
judgments; 386
(4) A statement of expenditures for the ensuing fiscal 388
year necessary for any purpose for which a special levy is 389
authorized, and the fund from which such expenditures are to be 390
made; 391
(5) Comparative statements, so far as possible, in 393
parallel columns of corresponding items of expenditures for the 394
current fiscal year and the two preceding fiscal years. 395
(B)(1) An estimate of receipts from other sources than the 397
general property tax during the ensuing fiscal year, which shall 398
include an estimate of unencumbered balances at the end of the 399
current fiscal year, and the funds to which such estimated 400
receipts are credited; 401
(2) The amount each fund requires from the general 403
property tax, which shall be the difference between the 404
contemplated expenditure from the fund and the estimated 405
receipts, as provided in this section. The section of the 406
Revised Code under which the tax is authorized shall be set 407
forth. 408
(3) Comparative statements, so far as possible, in 410
parallel columns of taxes and other revenues for the current 411
fiscal year and the two preceding fiscal years. 412
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(C)(1) The amount required for debt charges; 414
(2) The estimated receipts from sources other than the tax 416
levy for payment of such debt charges, including the proceeds of 417
refunding bonds to be issued to refund bonds maturing in the next 418
succeeding fiscal year; 419
(3) The net amount for which a tax levy shall be made, 421
classified as to bonds authorized and issued prior to January 1, 422
1922, and those authorized and issued subsequent to such date, 423
and as to what portion of the levy will be within and what in 424
excess of the ten-mill limitation. 425
(D) An estimate of amounts from taxes authorized to be 427
levied in excess of the ten-mill limitation on the tax rate, and 428
the fund to which such amounts will be credited, together with 429
the sections of the Revised Code under which each such tax is 430
exempted from all limitations on the tax rate. 431
(E)(1) A board of education may include in its budget for 433
the fiscal year in which a levy proposed under section 5705.194, 434
5705.21, or 5705.213, or the original levy under section 5705.212 435
of the Revised Code is first extended on the tax list and 436
duplicate an estimate of expenditures to be known as a voluntary 437
contingency reserve balance, which shall not be greater than 438
twenty-five per cent of the total amount of the levy estimated to 439
be available for appropriation in such year. 440
(2) A board of education may include in its budget for the 442
fiscal year following the year in which a levy proposed under 443
section 5705.194, 5705.21, or 5705.213, or the original levy 444
under section 5705.212 of the Revised Code is first extended on 445
the tax list and duplicate an estimate of expenditures to be 446
known as a voluntary contingency reserve balance, which shall not 447
be greater than twenty per cent of the amount of the levy 448
estimated to be available for appropriation in such year. 449
(3) Except as provided in division (E)(4) of this section, 451
the full amount of any reserve balance the board includes in its 452
budget shall be retained by the county auditor and county 453
12
treasurer out of the first semiannual settlement of taxes until 454
the beginning of the next succeeding fiscal year, and thereupon, 455
with the depository interest apportioned thereto, it shall be 456
turned over to the board of education, to be used for the 457
purposes of such fiscal year. 458
(4) A board of education may, by a two-thirds vote of all 460
members of the board, MAY appropriate any amount withheld as a 461
voluntary contingency reserve balance during the fiscal year for 462
any lawful purpose, provided that prior to such appropriation the 463
board of education has authorized the expenditure of all amounts 464
appropriated for contingencies under section 5705.40 of the 465
Revised Code. Upon request by the board of education, the county 466
auditor shall draw a warrant on the district's account in the 467
county treasury payable to the district in the amount requested. 468
(F)(1) As used in this division, "police or fire 470
department equipment expenditures" includes expenditures for 471
equipment used to provide ambulance or emergency medical services 472
operated by a police or fire department. 473
A board of township trustees may include in its budget an 476
estimate of expenditures to be known as a reserve balance for 477
police or fire department equipment or road maintenance equipment 478
expenditures. This reserve balance shall not exceed ten per cent 479
of the total estimated appropriations included in the township 480
budget estimate. If, in accordance with division (A) of section 481
505.83 of the Revised Code, the board of township trustees has 482
unanimously adopted a resolution establishing the reserve balance 483
account and specifying the reason for its creation and has 484
certified the resolution to the county auditor, the full amount 485
of the reserve balance, as allowed by the budget commission, 486
shall be turned over to the township each year by the county 487
auditor and county treasurer out of the second semiannual 488
settlement of taxes until the date specified in the resolution, 489
which shall not be later than five years from the date of the 490
first such deposit in the account, or until the reserve amount 491
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has been reached, whichever occurs first. 492
(2) Upon receipt of a certified copy of a resolution to 494
rescind the creation of a township reserve balance account 495
pursuant to division (B) of section 505.83 of the Revised Code, 496
the county auditor shall close the account and transfer the 497
account moneys and depository interest apportioned to it to the 498
township's general fund. 499
(G) A board of education may include in its budget a 501
spending reserve, which shall consist of an estimate of 502
expenditures not to exceed the district's spending reserve 503
balance. A district's spending reserve balance is the amount by 504
which fifty per cent of the district's estimated personal 505
property taxes to be settled during the calendar year in which 506
the fiscal year ends exceeds the estimated amount of personal 507
property taxes to be so settled and received by the district 508
during that fiscal year. Moneys from a spending reserve shall be 509
appropriated in accordance with section 133.301 of the Revised 510
Code. 511
(H) As used in this division: 513
(1) "Police or fire department equipment expenditures" 515
includes expenditures for equipment used to provide ambulance or 516
emergency medical services operated by a police or fire 517
department.
(2) "Detention facility" means any place used for the 519
confinement of a person charged with or convicted of any crime or 521
alleged or found to be a delinquent or unruly child.
The legislative authority of a municipal corporation may 523
include in its budget an estimate of expenditures to be known as 524
a reserve balance for police or fire department equipment 525
expenditures, for constructing, acquiring, equipping, or 526
repairing a detention facility, or for road maintenance equipment 527
expenditures by creating, by ordinance or resolution, a reserve 528
balance account. Money credited to the account may be derived 529
from any general fund sources or from the proceeds of a special 530
14
levy that may be used for the purpose for which the account is 531
established. The ordinance or resolution shall state that money 532
in the account may be expended only for the purpose for which the 533
account is established, that the account will be maintained until 535
a specified date not to exceed five years from the date of the 536
first deposit in the account, and that the total amount of money 537
in all reserve balance accounts derived from general fund sources 538
shall not exceed ten per cent of the current total estimated 539
expenditures from the municipal corporation's general fund, and 540
the total amount of money in all reserve balance accounts derived 541
from a special levy shall not exceed ten per cent of the current 542
total estimated expenditures from the special levy. The 543
legislative authority shall certify a copy of the ordinance or 544
resolution to the county auditor. Upon receiving the certified 545
copy, the county auditor and county treasurer shall turn over to 546
the municipal corporation, out of the second semiannual 548
settlement of taxes, any amount of the reserve balance to be
derived from property tax sources, but only until the date 550
specified in the ordinance or resolution or until the reserve 551
amount as indicated in the ordinance or resolution has been 552
reached, whichever occurs first.
A legislative authority may create a separate reserve 553
balance account under this division for police department 554
equipment expenditures, fire department equipment expenditures, 555
or ambulance or emergency medical services equipment 556
expenditures, or any combination thereof. Each such account is 557
subject to the provisions of this section regarding a single 558
account for all such purposes. 559
Upon receiving a certified copy of an ordinance or 561
resolution to rescind the creation of a municipal reserve balance 562
account, the county auditor shall close the account and transfer 563
all money in the account to the municipal general fund, if the 564
account is derived from the general fund, or to the fund to which 565
proceeds of the special levy are credited, if the account is 566
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derived from the proceeds of a special levy. 567
(I) A board of county commissioners that has adopted a 570
resolution establishing a reserve balance account under section 571
305.23 of the Revised Code may include in its budget an estimate 573
of expenditures to be known as a reserve balance for the purpose 574
for which the account was established under that section. The 575
reserve shall not exceed ten per cent of the total estimated 576
appropriations included in the budget estimate of the general 577
fund in the case of a reserve balance account established under 578
division (A) of that section, or ten per cent of the total 580
estimated appropriations included in the budget estimate of the 581
special fund in which the account is established in the case of a 582
reserve balance account established under division (B) of that 583
section. If the board of county commissioners has certified a 584
copy of a resolution to the county auditor pursuant to that 585
section, the county auditor and county treasurer shall deposit 586
the amount of the annual reserve balance into the reserve balance 587
account out of the second semiannual settlement of taxes until 588
the date specified in that resolution, or until the reserve 589
amount specified in the resolution has been reached, whichever 590
occurs first.
Upon receiving a certified copy of a resolution rescinding 592
a reserve balance account, the county auditor shall close the 593
account and transfer all money in the account to a special fund 594
created for the purpose of receiving that money. Money deposited 596
into the fund from the reserve balance account shall be expended 597
only for the purpose for which the account was established. 598
(J) The (G) EXCEPT AS OTHERWISE PROVIDED IN THIS DIVISION, 600
THE county budget commission shall not reduce the taxing 602
authority of a board of township trustees, a board of county 603
commissioners, or the legislative authority of a municipal 604
corporation SUBDIVISION as a result of the creation of a reserve 605
balance account, and. EXCEPT AS OTHERWISE PROVIDED IN THIS 606
DIVISION, THE COUNTY BUDGET COMMISSION shall not consider the 607
16
amount in a reserve balance account OF A TOWNSHIP, COUNTY, OR 608
MUNICIPAL CORPORATION as an unencumbered balance or as revenue 610
for the purposes of division (E)(3) or (4) of section 5747.51 or 611
division (E)(3) or (4) of section 5747.62 of the Revised Code. 612
THE COUNTY BUDGET COMMISSION MAY REQUIRE DOCUMENTATION OF THE 613
REASONABLENESS OF THE RESERVE BALANCE HELD IN ANY RESERVE BALANCE 614
ACCOUNT. THE COMMISSION SHALL CONSIDER ANY AMOUNT IN A RESERVE 615
BALANCE ACCOUNT THAT IT DETERMINES TO BE UNREASONABLE AS
UNENCUMBERED AND AS REVENUE FOR THE PURPOSES OF SECTIONS 5747.51 616
AND 5747.62 OF THE REVISED CODE AND MAY TAKE SUCH AMOUNTS INTO 617
CONSIDERATION WHEN DETERMINING WHETHER TO REDUCE THE TAXING 618
AUTHORITY OF A SUBDIVISION.
Sec. 5705.35. (A) The certification of the budget 628
commission to the taxing authority of each subdivision or taxing 629
unit, as set forth in section 5705.34 of the Revised Code, shall 630
show the various funds of such subdivisions other than funds to 631
be created by transfer and shall be filed by the county budget 632
commission with such taxing authority on or before the first day 633
of March in the case of school districts and on or before the 634
first day of September in each year in the case of all other 635
taxing authorities. There shall be set forth on the credit side 636
of each fund the estimated unencumbered balances and receipts, 637
and if a tax is to be levied for such fund, the estimated revenue 638
to be derived therefrom, the rate of the levy, and what portion 639
thereof is within, and what in excess of, the ten-mill tax 640
limitation, and on the debit side, the total appropriations that 641
may be made therefrom. SUBJECT TO DIVISION (G) OF SECTION 642
5705.29 OF THE REVISED CODE, ANY RESERVE BALANCE IN AN ACCOUNT 643
ESTABLISHED UNDER SECTION 5705.13 OF THE REVISED CODE FOR THE 645
PURPOSE DESCRIBED IN DIVISION (A)(1) OF THAT SECTION, AND THE 646
PRINCIPAL OF A NONEXPENDABLE TRUST FUND ESTABLISHED UNDER SECTION 648
5705.131 OF THE REVISED CODE AND ANY ADDITIONS TO PRINCIPAL
ARISING FROM SOURCES OTHER THAN THE REINVESTMENT OF INVESTMENT 649
EARNINGS ARISING FROM THAT FUND, ARE NOT UNENCUMBERED BALANCES 650
17
FOR THE PURPOSES OF THIS SECTION. There shall be attached 652
thereto TO THE CERTIFICATION a summary, which shall be known as 654
the "official certificate of estimated resources," which THAT 655
shall state the total estimated resources of each fund of the 657
subdivision that are available for appropriation in the fiscal 658
year, other than funds to be created by transfer, and a statement 659
of the amount of the total tax duplicate of the school district 660
to be used in the collection of taxes for the following calendar 661
year. Before the end of the fiscal year, the taxing authority of 662
each subdivision and other taxing unit shall revise its tax 663
budget so that the total contemplated expenditures from any fund 664
during the ensuing fiscal year will not exceed the total 665
appropriations that may be made from such fund, as determined by 666
the budget commission in its certification; and such revised 667
budget shall be the basis of the annual appropriation measure. 668
(B)(1) Except as otherwise provided in division (B)(2) of 670
this section, revenues from real property taxes scheduled to be 671
settled on or before the tenth day of August and the fifteenth 672
day of February of a fiscal year under divisions (A) AND (C) and 674
(A) of section 321.24 of the Revised Code, and revenue from taxes 675
levied on personal property used in business scheduled to be 676
settled on or before the thirty-first day of October and the 677
thirtieth day of June of a fiscal year under divisions (B) AND 678
(D) and (B) of section 321.24 of the Revised Code shall not be 680
available for appropriation by a board of education prior to the 681
fiscal year in which such latest scheduled settlement date 682
occurs, except that moneys advanced to the treasurer of a board 683
of education under division (A)(2)(b) of section 321.34 of the 684
Revised Code shall be available for appropriation in the fiscal 685
year in which they are paid to the treasurer under such section. 686
If the date for any settlement of taxes is extended under 687
division (E) of section 321.24 of the Revised Code, the latest 688
date set forth in divisions (A) to (D) of that section shall be 689
used to determine in which fiscal year the revenues are first 690
18
available for appropriation. 691
(2) Revenues available for appropriation by a school 693
district during a fiscal year may include amounts borrowed in 694
that fiscal year under section 133.301 of the Revised Code in 695
anticipation of the collection of taxes that are to be included 696
in the settlements made under divisions (C) and (D) of section 697
321.24 of the Revised Code in the ensuing fiscal year. 698
Sec. 5705.36. (A)(1) On or about the first day of each 707
fiscal year, the fiscal officer of each subdivision and other 708
taxing unit shall certify to the county auditor the total amount 709
from all sources available for expenditures from each fund set up 710
in the tax budget or, if adoption of a tax budget was waived 711
under section 5705.281 of the Revised Code, from each fund 712
created by or on behalf of the taxing authority. The amount 713
certified shall include any UNENCUMBERED balances that existed at 714
the end of the preceding year, EXCLUDING ANY OF THE FOLLOWING: 715
(a) SUBJECT TO DIVISION (G) OF SECTION 5705.29 OF THE 718
REVISED CODE, ANY RESERVE BALANCE IN AN ACCOUNT ESTABLISHED UNDER 719
SECTION 5705.13 OF THE REVISED CODE FOR THE PURPOSE DESCRIBED IN 720
DIVISION (A)(1) OF THAT SECTION; 721
(b) THE PRINCIPAL OF A NONEXPENDABLE TRUST FUND 723
ESTABLISHED UNDER SECTION 5705.131 OF THE REVISED CODE AND ANY 724
ADDITIONS TO PRINCIPAL ARISING FROM SOURCES OTHER THAN THE 725
REINVESTMENT OF INVESTMENT EARNINGS ARISING FROM THAT FUND. 726
A school district's certification shall separately show the 728
amount of any notes and unpaid and outstanding expenses on the 729
preceding thirtieth day of June that are to be paid from property 730
taxes that are to be settled during the current fiscal year under 731
divisions (C) and (D) of section 321.24 of the Revised Code, and 732
the amount of any spending reserve available for appropriation 733
during the current fiscal year under section 133.301 of the 734
Revised Code. The budget commission, taking into consideration 735
the balances and revenues to be derived from taxation and other 736
sources, shall revise its estimate of the amounts that will be 737
19
credited to each fund from such sources, and shall certify to the 738
taxing authority of each subdivision an amended official 739
certificate of estimated resources. If the subdivision collects 740
revenue available for the purposes of such fiscal year from a new 741
source that is not included in an official certificate, or if the 742
actual balances and receipts in any fund exceed the certified 743
estimate, then upon the certification by its fiscal officer of 744
the amount of the excess balances and receipts, the commission 745
shall certify an amended official certificate including them. 746
(2) Upon a determination by the treasurer of a board of 748
education that the revenue to be collected by a school district 749
will be greater or less than the amount included in an official 750
certificate, the treasurer shall certify the amount of the 751
deficiency or excess to the commission, and the commission shall 752
certify an amended official certificate reflecting the deficiency 753
or excess. 754
(3) Upon a determination by the county auditor that the 756
revenue to be collected by the county will be greater or less 757
than the amount included in an official certificate, the county 758
auditor shall certify the amount of the deficiency or excess to 759
the commission, and if the commission determines that the 760
auditor's certification is reasonable, the commission shall 761
certify an amended official certificate reflecting the deficiency 762
or excess. 763
(4) Upon a determination by the fiscal officer of a 765
municipal corporation that the revenue to be collected by the 766
municipal corporation will be greater or less than the amount 767
included in the AN official certificate, the fiscal officer shall 769
certify the amount of the excess or deficiency to the commission, 770
and if the commission determines that the fiscal officer's 771
certification is reasonable, the commission shall certify an 772
amended official certificate reflecting the deficiency or excess. 773
(5) The total appropriations made during the fiscal year 775
from any fund shall not exceed the amount set forth as available 776
20
for expenditure from such fund in the official certificate of 777
estimated resources, or any amendment thereof, certified prior to 778
the making of the appropriation or supplemental appropriation. 779
(B) At the time of settlement of taxes against which notes 781
have been issued under section 133.301 or division (D) of section 782
133.10 of the Revised Code and at the time a tax duplicate is 783
delivered pursuant to section 319.28 or 319.29 of the Revised 784
Code, the county auditor shall determine whether the total amount 785
to be distributed to each school district from such settlement or 786
duplicate, when combined with the amounts to be distributed from 787
any subsequent settlement, will increase or decrease the amount 788
available for appropriation during the current fiscal year from 789
any fund. The county auditor shall certify this finding to the 790
budget commission, which shall certify an amended official 791
certificate reflecting the finding or certify to the school 792
district that no amended certificate needs to be issued. 793
Sec. 5747.51. (A) Within ten days after the fifteenth day 802
of July of each year, the tax commissioner shall make and certify 803
to the county auditor of each county an estimate of the amount of 804
the local government fund to be allocated to the undivided local 805
government fund of each county for the ensuing calendar year and 806
the estimated amount to be received by the undivided local 807
government fund of each county from the taxes levied pursuant to 808
section 5707.03 of the Revised Code for the ensuing calendar 809
year. 810
(B) At each annual regular session of the county budget 812
commission convened pursuant to section 5705.27 of the Revised 813
Code, each auditor shall present to the commission the 814
certificate of the commissioner, the annual tax budget and 815
estimates, and the records showing the action of the commission 816
in its last preceding regular session. The estimates shown on 817
the certificate of the commissioner of the amount to be allocated 818
from the local government fund and the amount to be received from 819
taxes levied pursuant to section 5707.03 of the Revised Code 820
21
shall be combined into one total comprising the estimate of the 821
undivided local government fund of the county. The commission, 822
after extending to the representatives of each subdivision an 823
opportunity to be heard, under oath administered by any member of 824
the commission, and considering all the facts and information 825
presented to it by the auditor, shall determine the amount of the 826
undivided local government fund needed by and to be apportioned 827
to each subdivision for current operating expenses, as shown in 828
the tax budget of the subdivision. This determination shall be 829
made pursuant to divisions (C) to (I) of this section, unless the 830
commission has provided for a formula pursuant to section 5747.53 831
of the Revised Code. 832
Nothing in this section prevents the budget commission, for 835
the purpose of apportioning the undivided local government fund, 836
from inquiring into the claimed needs of any subdivision as 837
stated in its tax budget, or from adjusting claimed needs to 838
reflect actual needs. For the purposes of this section, "current 839
operating expenses" means the lawful expenditures of a 840
subdivision, except those for permanent improvements and except 841
payments for interest, sinking fund, and retirement of bonds, 842
notes, and certificates of indebtedness of the subdivision. 843
(C) The commission shall determine the combined total of 845
the estimated expenditures, including transfers, from the general 846
fund and any special funds other than special funds established 847
for road and bridge; street construction, maintenance, and 848
repair; state highway improvement; and gas, water, sewer, and 849
electric public utilities operated by a subdivision, as shown in 850
the subdivision's tax budget for the ensuing calendar year. 851
(D) From the combined total of expenditures calculated 853
pursuant to division (C) of this section, the commission shall 854
deduct the following expenditures, if included in these funds in 855
the tax budget: 856
(1) Expenditures for permanent improvements as defined in 858
division (E) of section 5705.01 of the Revised Code; 859
22
(2) In the case of counties and townships, transfers to 861
the road and bridge fund, and in the case of municipalities, 862
transfers to the street construction, maintenance, and repair 863
fund and the state highway improvement fund; 864
(3) Expenditures for the payment of debt charges; 866
(4) Expenditures for the payment of judgments. 868
(E) In addition to the deductions made pursuant to 870
division (D) of this section, revenues accruing to the general 871
fund and any special fund considered under division (C) of this 872
section from the following sources shall be deducted from the 873
combined total of expenditures calculated pursuant to division 874
(C) of this section: 875
(1) Taxes levied within the ten-mill limitation, as 877
defined in section 5705.02 of the Revised Code; 878
(2) The budget commission allocation of estimated county 880
library and local government support fund revenues to be 881
distributed pursuant to section 5747.48 of the Revised Code; 882
(3) Estimated unencumbered balances as shown on the tax 884
budget as of the thirty-first day of December of the current year 885
in the general fund, but not any estimated balance in any special 886
fund considered in division (C) of this section; 887
(4) Revenue, including transfers, shown in the general 889
fund and any special funds other than special funds established 890
for road and bridge; street construction, maintenance, and 891
repair; state highway improvement; and gas, water, sewer, and 892
electric public utilities, from all other sources except those 893
that a subdivision receives from an additional tax or service 894
charge voted by its electorate or receives from special 895
assessment or revenue bond collection. For the purposes of this 896
division, where the charter of a municipal corporation prohibits 897
the levy of an income tax, an income tax levied by the 898
legislative authority of such municipal corporation pursuant to 899
an amendment of the charter of that municipal corporation to 900
authorize such a levy represents an additional tax voted by the 901
23
electorate of that municipal corporation. For the purposes of 902
this division, any measure adopted by a board of county 903
commissioners pursuant to section 322.02, 324.02, 4504.02, or 904
5739.021 of the Revised Code, including those measures upheld by 905
the electorate in a referendum conducted pursuant to section 906
322.021, 324.021, 4504.021, or 5739.022 of the Revised Code, 907
shall not be considered an additional tax voted by the 908
electorate. 909
Money SUBJECT TO DIVISION (G) OF SECTION 5705.29 OF THE 912
REVISED CODE, MONEY in a reserve balance account established by a 913
county or, township, OR MUNICIPAL CORPORATION under section 915
305.23, 505.83, or 505.831 5705.13 of the Revised Code or by a 916
municipal corporation pursuant to an ordinance or resolution that 917
has been included as a reserve balance in the county's, 918
township's, or municipal corporation's budget under section 919
5705.29 of the Revised Code shall not be considered an 920
unencumbered balance or revenue under division (E)(3) or (4) of 921
this section.
If a COUNTY, TOWNSHIP, OR municipal corporation has created 923
and maintains a NONEXPENDABLE TRUST fund exclusively for the 924
purpose of investing the principal of the fund and using the 927
investment earnings to fund expenditures UNDER SECTION 5705.131 928
OF THE REVISED CODE, the principal of the fund, and any additions 929
to the principal arising from sources other than the reinvestment 930
of investment earnings arising from such a fund, shall not be 931
considered an unencumbered balance or revenue under division 932
(E)(3) or (4) of this section. Only investment earnings arising 933
from investment of the principal or INVESTMENT OF SUCH additions 935
to principal may be considered an unencumbered balance or revenue 936
under those divisions.
(F) The total expenditures calculated pursuant to division 938
(C) of this section, less the deductions authorized in divisions 939
(D) and (E) of this section, shall be known as the "relative 940
need" of the subdivision, for the purposes of this section. 941
24
(G) The budget commission shall total the relative need of 943
all participating subdivisions in the county, and shall compute a 944
relative need factor by dividing the total estimate of the 945
undivided local government fund by the total relative need of all 946
participating subdivisions. 947
(H) The relative need of each subdivision shall be 949
multiplied by the relative need factor to determine the 950
proportionate share of the subdivision in the undivided local 951
government fund of the county; provided, that the maximum 952
proportionate share of a county shall not exceed the following 953
maximum percentages of the total estimate of the undivided local 954
government fund governed by the relationship of the percentage of 955
the population of the county that resides within municipal 956
corporations within the county to the total population of the 957
county as reported in the reports on population in Ohio by the 958
department of development as of the twentieth day of July of the 959
year in which the tax budget is filed with the budget commission: 960
Percentage of Percentage share 961
municipal population of the county 962
within the county: shall not exceed: 963
Less than forty-one per cent Sixty per cent 966
Forty-one per cent or more but Fifty per cent 968
less than eighty-one per
cent
Eighty-one per cent or more Thirty per cent 969
Where the proportionate share of the county exceeds the 972
limitations established in this division, the budget commission 973
shall adjust the proportionate shares determined pursuant to this 974
division so that the proportionate share of the county does not 975
exceed these limitations, and it shall increase the proportionate 976
shares of all other subdivisions on a pro rata basis. In 977
counties having a population of less than one hundred thousand, 978
not less than ten per cent shall be distributed to the townships 979
therein. 980
25
(I) The proportionate share of each subdivision in the 982
undivided local government fund determined pursuant to division 983
(H) of this section for any calendar year shall not be less than 984
the product of the average of the percentages of the undivided 985
local government fund of the county as apportioned to that 986
subdivision for the calendar years 1968, 1969, and 1970, 987
multiplied by the total amount of the undivided local government 988
fund of the county apportioned pursuant to former section 5735.23 989
of the Revised Code for the calendar year 1970. For the purposes 990
of this division, the total apportioned amount for the calendar 991
year 1970 shall be the amount actually allocated to the county in 992
1970 from the state collected intangible tax as levied by section 993
5707.03 of the Revised Code and distributed pursuant to section 994
5725.24 of the Revised Code, plus the amount received by the 995
county in the calendar year 1970 pursuant to division (B)(1) of 996
former section 5739.21 of the Revised Code, and distributed 997
pursuant to former section 5739.22 of the Revised Code. If the 998
total amount of the undivided local government fund for any 999
calendar year is less than the amount of the undivided local 1,000
government fund apportioned pursuant to former section 5739.23 of 1,001
the Revised Code for the calendar year 1970, the minimum amount 1,002
guaranteed to each subdivision for that calendar year pursuant to 1,003
this division shall be reduced on a basis proportionate to the 1,004
amount by which the amount of the undivided local government fund 1,005
for that calendar year is less than the amount of the undivided 1,006
local government fund apportioned for the calendar year 1970. 1,007
(J) On the basis of such apportionment, the county auditor 1,009
shall compute the percentage share of each such subdivision in 1,010
the undivided local government fund and shall at the same time 1,011
certify to the tax commissioner the percentage share of the 1,012
county as a subdivision. No payment shall be made from the 1,013
undivided local government fund, except in accordance with such 1,014
percentage shares. 1,015
Within ten days after the budget commission has made its 1,017
26
apportionment, whether conducted pursuant to section 5747.51 or 1,018
5747.53 of the Revised Code, the auditor shall publish a list of 1,019
the subdivisions and the amount each is to receive from the 1,020
undivided local government fund and the percentage share of each 1,021
subdivision, in a newspaper or newspapers of countywide 1,022
circulation, and send a copy of such allocation to the tax 1,023
commissioner. 1,024
The county auditor shall also send by certified mail, 1,026
return receipt requested, a copy of such allocation to the fiscal 1,027
officer of each subdivision entitled to participate in the 1,028
allocation of the undivided local government fund of the county. 1,029
This copy shall constitute the official notice of the commission 1,030
action referred to in section 5705.37 of the Revised Code. 1,031
All money received into the treasury of a subdivision from 1,033
the undivided local government fund in a county treasury shall be 1,034
paid into the general fund and used for the current operating 1,035
expenses of the subdivision. 1,036
If a municipal corporation maintains a municipal 1,038
university, such municipal university, when the board of trustees 1,039
so requests the legislative authority of the municipal 1,040
corporation, shall participate in the money apportioned to such 1,041
municipal corporation from the total local government fund, 1,042
however created and constituted, in such amount as requested by 1,043
the board of trustees, provided such sum does not exceed nine per 1,044
cent of the total amount paid to the municipal corporation. 1,045
If any public official fails to maintain the records 1,047
required by sections 5747.50 to 5747.55 of the Revised Code, or 1,048
by the rules issued by the tax commissioner, the auditor of 1,049
state, or the treasurer of state, pursuant to such sections, or 1,050
fails to comply with any law relating to the enforcement of such 1,051
sections, the local government fund money allocated to the county 1,052
shall be withheld until such time as the public official has 1,053
complied with such sections or such law or the rules issued 1,054
pursuant thereto. 1,055
27
Sec. 5747.62. (A) As used in this section and section 1,064
5747.63 of the Revised Code, "subdivision" means a municipal 1,065
corporation, township, park district, or county. 1,066
(B) At each annual regular session of the county budget 1,068
commission convened pursuant to section 5705.27 of the Revised 1,069
Code, each auditor shall present to the commission the 1,070
certificate of the commissioner, the annual tax budget and 1,071
estimates, and the records showing the action of the commission 1,072
in its last preceding regular session. The commission, after 1,073
extending to the representatives of each subdivision an 1,074
opportunity to be heard, under oath administered by any member of 1,075
the commission, and considering all the facts and information 1,076
presented to it by the auditor, shall determine the amount of the 1,077
undivided local government revenue assistance fund needed by and 1,078
to be apportioned to each subdivision for current operating 1,079
expenses, as shown in the tax budget of the subdivision. This 1,080
determination shall be made pursuant to divisions (C) to (H) of 1,081
this section, unless the commission has provided for a formula 1,082
pursuant to section 5747.63 of the Revised Code. Nothing in this 1,083
section prevents the budget commission, for the purpose of 1,084
apportioning the undivided local government revenue assistance 1,085
fund, from inquiring into the claimed needs of any subdivision as 1,086
stated in its tax budget, or from adjusting claimed needs to 1,087
reflect actual needs. For the purposes of this section, "current 1,088
operating expenses" means the lawful expenditures of a 1,089
subdivision, except those for permanent improvements and except 1,090
payments for interest, sinking fund, and retirement of bonds, 1,091
notes, and certificates of indebtedness of the subdivision. 1,092
(C) The commission shall determine the combined total of 1,094
the estimated expenditures, including transfers, from the general 1,095
fund and any special funds other than special funds established 1,096
for road and bridge; street construction, maintenance, and 1,097
repair; state highway improvement; and gas, water, sewer, and 1,098
electric public utilities operated by a subdivision, as shown in 1,099
28
the subdivision's tax budget for the ensuing calendar year. 1,100
(D) From the combined total of expenditures calculated 1,102
pursuant to division (C) of this section, the commission shall 1,103
deduct the following expenditures, if included in these funds in 1,104
the tax budget: 1,105
(1) Expenditures for permanent improvements as defined in 1,107
division (E) of section 5705.01 of the Revised Code; 1,108
(2) In the case of counties and townships, transfers to 1,110
the road and bridge fund, and in the case of municipalities, 1,111
transfers to the street construction, maintenance, and repair 1,112
fund and the state highway improvement fund; 1,113
(3) Expenditures for the payment of debt charges; 1,115
(4) Expenditures for the payment of judgments. 1,117
(E) In addition to the deductions made pursuant to 1,119
division (D) of this section, revenues accruing to the general 1,120
fund and any special fund considered under division (C) of this 1,121
section from the following sources shall be deducted from the 1,122
combined total of expenditures calculated pursuant to division 1,123
(C) of this section: 1,124
(1) Taxes levied within the ten-mill limitation, as 1,126
defined in section 5705.02 of the Revised Code; 1,127
(2) The budget commission allocation of estimated county 1,129
library and local government support fund revenues to be 1,130
distributed pursuant to section 5747.48 of the Revised Code; 1,131
(3) Estimated unencumbered balances as shown on the tax 1,133
budget as of the thirty-first day of December of the current year 1,134
in the general fund, but not any estimated balance in any special 1,135
fund considered in division (C) of this section; 1,136
(4) Revenue, including transfers, shown in the general 1,138
fund and any special funds other than special funds established 1,139
for road and bridge; street construction, maintenance, and 1,140
repair; state highway improvement; and gas, water, sewer, and 1,141
electric public utilities, from all other sources except those 1,142
that a subdivision receives from an additional tax or service 1,143
29
charge voted by its electorate or receives from special 1,144
assessment or revenue bond collection. For the purposes of this 1,145
division, where the charter of a municipal corporation prohibits 1,146
the levy of an income tax, an income tax levied by the 1,147
legislative authority of such municipal corporation pursuant to 1,148
an amendment of the charter of that municipal corporation to 1,149
authorize such a levy represents an additional tax voted by the 1,150
electorate of that municipal corporation. For the purposes of 1,151
this division, any measure adopted by a board of county 1,152
commissioners pursuant to section 322.02, 324.02, 4504.02, or 1,153
5739.021 of the Revised Code, including those measures upheld by 1,154
the electorate in a referendum conducted pursuant to section 1,155
322.021, 324.021, 4504.021, or 5739.022 of the Revised Code, 1,156
shall not be considered an additional tax voted by the 1,157
electorate. 1,158
Money SUBJECT TO DIVISION (G) OF SECTION 5705.29 OF THE 1,161
REVISED CODE, MONEY in a reserve balance account established by a 1,162
county or, township, OR MUNICIPAL CORPORATION under section 1,164
305.23, 505.83, or 505.831 of the Revised Code or by a municipal 1,165
corporation pursuant to an ordinance or resolution that has been 1,166
included as a reserve balance in the county's, township's, or 1,167
municipal corporation's budget under section 5705.29 5705.13 of 1,168
the Revised Code shall not be considered an unencumbered balance 1,170
or revenue under division (E)(3) or (4) of this section. 1,171
If a COUNTY, TOWNSHIP, OR municipal corporation has created 1,173
and maintains a NONEXPENDABLE TRUST fund exclusively for the 1,174
purpose of investing the principal of the fund and using the 1,176
investment earnings to fund expenditures UNDER SECTION 5705.131 1,177
OF THE REVISED CODE, the principal of the fund, and any additions
to the principal arising from sources other than the reinvestment 1,179
of investment earnings arising from such a fund, shall not be 1,180
considered an unencumbered balance or revenue under division 1,181
(E)(3) or (4) of this section. Only investment earnings arising 1,182
from investment of the principal or INVESTMENT OF SUCH additions 1,184
30
to principal may be considered an unencumbered balance or revenue 1,186
under those divisions.
(F) The total expenditures calculated pursuant to division 1,188
(C) of this section, less the deductions authorized in divisions 1,189
(D) and (E) of this section, shall be known as the "relative 1,190
need" of the subdivision, for the purposes of this section. 1,191
(G) The budget commission shall total the relative need of 1,193
all participating subdivisions in the county, and shall compute a 1,194
relative need factor by dividing the total estimate of the 1,195
undivided local government revenue assistance fund by the total 1,196
relative need of all participating subdivisions. 1,197
(H) The relative need of each subdivision shall be 1,199
multiplied by the relative need factor to determine the 1,200
proportionate share of the subdivision in the undivided local 1,201
government revenue assistance fund of the county, provided that 1,202
the maximum proportionate share of a county shall not exceed the 1,203
following maximum percentages of the total estimate of the 1,204
undivided local government revenue assistance fund governed by 1,205
the relationship of the percentage of the population of the 1,206
county that resides within municipal corporations within the 1,207
county to the total population of the county as reported in the 1,208
reports on population in Ohio by the department of development as 1,209
of the twentieth day of July of the year in which the tax budget 1,210
is filed with the budget commission: 1,211
Percentage of Percentage share 1,212
municipal population of the county 1,213
within the county: shall not exceed: 1,214
Less than forty-one per cent Sixty per cent 1,217
Forty-one per cent or more but Fifty per cent 1,219
less than eighty-one per
cent
Eighty-one per cent or more Thirty per cent 1,221
Where the proportionate share of the county exceeds the 1,224
limitations established in this division, the budget commission 1,225
31
shall adjust the proportionate shares determined pursuant to this 1,226
division so that the proportionate share of the county does not 1,227
exceed these limitations, and it shall increase the proportionate 1,228
shares of all other subdivisions on a pro rata basis. In 1,229
counties having a population of less than one hundred thousand, 1,230
not less than ten per cent shall be distributed to the townships 1,231
therein. 1,232
(I) On the basis of such apportionment, the county auditor 1,234
shall compute the percentage share of each such subdivision in 1,235
the undivided local government revenue assistance fund and shall 1,236
at the same time certify to the tax commissioner the percentage 1,237
share of the county as a subdivision. No payment shall be made 1,238
from the undivided local government revenue assistance fund, 1,239
except in accordance with such percentage shares. 1,240
Within ten days after the budget commission has made its 1,242
apportionment, whether conducted pursuant to this section or 1,243
section 5747.63 of the Revised Code, the auditor shall publish a 1,244
list of the subdivisions and the amount each is to receive from 1,245
the undivided local government revenue assistance fund and the 1,246
percentage share of each subdivision, in a newspaper or 1,247
newspapers of countywide circulation, and send a copy of such 1,248
apportionment to the tax commissioner. 1,249
The county auditor shall also send by certified mail, 1,251
return receipt requested, a copy of such apportionment to the 1,252
fiscal officer of each subdivision entitled to participate in the 1,253
allocation of the undivided local government revenue assistance 1,254
fund of the county. This copy shall constitute the official 1,255
notice of the commission action referred to in section 5705.37 of 1,256
the Revised Code. 1,257
All money received by a subdivision from the county 1,259
undivided local government revenue assistance fund shall be paid 1,260
into the subdivision's general fund and used for current 1,261
operating expenses. 1,262
If any public official fails to maintain the records 1,264
32
required by sections 5747.61 to 5747.63 of the Revised Code, or 1,265
by the rules issued by the tax commissioner, the auditor of 1,266
state, or the treasurer of state, pursuant to such sections, or 1,267
fails to comply with any law relating to the enforcement of such 1,268
sections, the local government revenue assistance fund money 1,269
allocated to the county shall be withheld until such time as the 1,270
public official has complied with such sections or such law or 1,271
the rules issued pursuant thereto. 1,272
Section 2. That existing sections 3316.03, 5705.12, 1,274
5705.13, 5705.29, 5705.35, 5705.36, 5747.51, and 5747.62 and 1,275
sections 305.23, 505.83, and 505.831 of the Revised Code are 1,276
hereby repealed.
Section 3. Section 5705.29 of the Revised Code is 1,278
presented in this act as a composite of the section as amended by 1,279
both Am. Sub. H.B. 86 and Sub. H.B. 194 of the 121st General 1,280
Assembly, with the new language of neither of the acts shown in 1,282
capital letters. This is in recognition of the principle stated 1,283
in division (B) of section 1.52 of the Revised Code that such 1,284
amendments are to be harmonized where not substantively 1,285
irreconcilable and constitutes a legislative finding that such is 1,286
the resulting version in effect prior to the effective date of 1,287
this act.