The online versions of legislation provided on this website are not official. Enrolled bills are the final version passed by the Ohio General Assembly and presented to the Governor for signature. The official version of acts signed by the Governor are available from the Secretary of State's Office in the Continental Plaza, 180 East Broad St., Columbus.
|
As Reported by the Senate Finance and Financial
Institutions Committee
123rd General Assembly
Regular Session
1999-2000 | Sub. S. B. No. 345 |
SENATORS GARDNER-CUPP-HOTTINGER-RAY
A BILL
To amend sections 3315.17, 3315.18, 3316.03, 3316.04, 3316.06, 3316.20,
5705.13, 5705.29, and 5705.38 and to enact sections 3316.031 and 3316.061 of
the Revised Code to address certain school district mandates and to establish
additional procedures for avoiding fiscal problems in school
districts.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section 1. That sections 3315.17, 3315.18, 3316.03, 3316.04, 3316.06, 3316.20,
5705.13, 5705.29, and 5705.38 be amended and sections 3316.031 and 3316.061 of
the Revised Code be enacted to read as follows:
Sec. 3315.17. (A) The
board of education of each city, exempted village, local, and
joint vocational school district shall establish a textbook and
instructional materials fund and. EACH BOARD ANNUALLY
shall deposit into that fund
four per cent, or another percentage if established in rules
adopted under division (C) of
this section, of all AN AMOUNT DERIVED FROM revenues received by
the district for
operating expenses
THAT IS EQUAL TO THREE PER CENT OF THE FORMULA AMOUNT
FOR THE CURRENT FISCAL YEAR, AS DEFINED IN SECTION 3317.02 of the Revised Code, OR ANOTHER
PERCENTAGE IF ESTABLISHED BY THE AUDITOR OF STATE UNDER DIVISION (C)
OF THIS SECTION, MULTIPLIED BY
THE DISTRICT'S STUDENT POPULATION FOR THAT FISCAL YEAR.
Money in the fund shall be used solely for
textbooks, instructional software, and instructional materials,
supplies, and equipment. Any money in the fund that is not used
in any fiscal year shall carry forward to the next fiscal
year.
(B) Notwithstanding division (A) of this section, if in a
fiscal year
a district board deposits in the textbook and instructional
materials fund an amount of money greater than the amount required
to be deposited by this section or the rules adopted under
division (C) of this section, the board may deduct the excess
amount of money from the amount of money required to be deposited in
succeeding fiscal years.
(C) The state
superintendent of public instruction and the auditor of state
jointly shall adopt rules in accordance with
Chapter 119. of the
Revised Code defining what constitutes
textbooks, instructional software, and instructional materials,
supplies, and equipment for which money in a school district's
textbook and instructional materials fund may be used. The
jointly adopted rules AUDITOR OF STATE also may designate a
percentage, other
than four THREE per cent, of district operating revenues
THE FORMULA AMOUNT MULTIPLIED BY THE DISTRICT'S STUDENT POPULATION that
must be
deposited into the fund. The auditor of state shall adopt rules under
section 117.20 of the
Revised Code
authorizing up to a three-year phase-in period for district boards to meet the
percentage requirements of division (A) of
this section, and specifying the manner in which district boards may
deduct from a required deposit an excess amount deposited into the textbook
and instructional materials fund in a prior fiscal year.
(D) Notwithstanding
division (A) of this section, a
district board of education in any fiscal year may appropriate
money in the district textbook and instructional materials fund
for purposes other than those permitted by that division if both
of the following occur during that fiscal year:
(1) All of the following certify to the district board in writing
that the district has sufficient textbooks, instructional
software, and instructional materials, supplies, and equipment
to ensure a thorough and efficient education within the
district:
(a) The district superintendent;
(b) In districts required to have a business advisory council, a
person designated by vote of the business advisory council;
(c) If the district teachers are represented by an
exclusive bargaining representative for purposes of
Chapter 4117. of the
Revised
Code, the president of that
organization or the president's designee.
(2) The district board adopts, by unanimous vote of all
members of the board, a resolution stating that the district has
sufficient textbooks, instructional software, and instructional
materials, supplies, and equipment to ensure a thorough and
efficient education within the district.
(E) Notwithstanding any provision to the contrary in
Chapter 4117. of the Revised Code, the requirements of this section prevail
over any
conflicting provisions of agreements between employee organizations and public
employers entered into on or after
November 21, 1997.
(F) AS USED IN THIS SECTION AND IN SECTION 3315.18 OF THE
REVISED CODE, "STUDENT
POPULATION" MEANS THE FULL-TIME-EQUIVALENT NUMBER OF STUDENTS IN KINDERGARTEN
THROUGH TWELFTH GRADE
RECEIVING ANY EDUCATIONAL SERVICES FROM THE SCHOOL DISTRICT, EXCLUDING
STUDENTS ENROLLED IN ADULT
EDUCATION CLASSES, BUT INCLUDING ALL OF THE FOLLOWING:
(1) ADJACENT OR OTHER DISTRICT STUDENTS ENROLLED IN THE DISTRICT
UNDER AN OPEN ENROLLMENT POLICY PURSUANT TO SECTION 3313.98 OF THE
REVISED CODE;
(2) STUDENTS RECEIVING SERVICES IN THE DISTRICT PURSUANT TO A
COMPACT, COOPERATIVE EDUCATION AGREEMENT, OR A CONTRACT, BUT WHO ARE
ENTITLED TO ATTEND SCHOOL IN ANOTHER DISTRICT PURSUANT TO SECTION
3313.64 OR 3313.65 OF THE REVISED CODE;
(3) STUDENTS FOR WHOM TUITION IS PAYABLE PURSUANT TO SECTIONS
3317.081 AND 3323.141 OF THE REVISED CODE.
Sec. 3315.18. (A) The board of education of each city,
exempted village, local, and joint vocational school district
shall establish a capital and maintenance fund and. EACH
BOARD ANNUALLY shall deposit
into that fund four per cent, or another percentage if
established in rules adopted under division (B) of this section,
of all AN AMOUNT DERIVED FROM revenues received by the district
that would otherwise
have been deposited in the general fund
THAT IS EQUAL TO THREE PER CENT OF THE FORMULA AMOUNT
FOR THE CURRENT FISCAL YEAR, AS DEFINED IN SECTION 3317.02 of the Revised Code, OR ANOTHER
PERCENTAGE IF ESTABLISHED BY THE AUDITOR OF STATE UNDER DIVISION (B)
OF THIS SECTION MULTIPLIED BY
THE DISTRICT'S STUDENT POPULATION FOR THAT FISCAL YEAR,
except that money
received from a permanent improvement levy authorized by section
5705.21 of the Revised Code may replace general revenue moneys in
meeting the requirements of this section. Money in the fund
shall be used solely for acquisition, replacement, enhancement, maintenance,
or repair of permanent improvements, as that term is defined in
section 5705.01 of the Revised Code. Any money in the fund that
is not used in any fiscal year shall carry forward to the next
fiscal year.
(B) The state superintendent of public instruction and
the auditor of state jointly shall adopt rules in accordance
with Chapter 119. of the Revised Code defining what constitutes
expenditures permitted by division (A) of this section and.
THE AUDITOR OF STATE may
designate a percentage, other than four THREE per cent, of
district
operating revenues THE FORMULA AMOUNT MULTIPLIED BY THE DISTRICT'S
STUDENT POPULATION that must be deposited into the fund. The auditor
of state shall adopt rules under section 117.20 of the
Revised Code
authorizing up to a three-year phase-in period for district boards to meet the
percentage requirements of division (A) of
this section.
(C) Notwithstanding any provision to the contrary in
Chapter 4117. of the Revised Code, the requirements of this section prevail
over any conflicting provisions of agreements between employee organizations
and public employers entered into after the effective date of this
section NOVEMBER 21, 1997.
Sec. 3316.03. (A) The
existence of a fiscal watch shall be determined DECLARED by the
auditor of state. The
auditor of state may make the A determination on the auditor of
state's
initiative, or upon receipt of a written request for such a determination,
which may be filed by the governor, the superintendent of public instruction,
or a majority of the members of the board of education of the school
district.
The auditor of state shall declare a school district to
be in a state of fiscal watch if the auditor of state determines that
division (A)(1), (2), or (3) of this
section applies to the school district:
(1) All BOTH of the following conditions are satisfied with
respect to
the school district:
(a) An operating deficit has been certified for the
current fiscal year by the auditor of state, and the certified
operating deficit exceeds eight TWO per cent of the school
district's general fund revenue for the preceding fiscal
year, UNLESS THE AUDITOR OF STATE, IN CONSULTATION WITH THE
SUPERINTENDENT OF PUBLIC INSTRUCTION, FINDS THAT THERE IS REASONABLE CAUSE FOR
THE DEFICIT BUT IN NO CASE MAY THE AUDITOR OF STATE EXCUSE ANY DEFICIT OF FIVE
PER CENT OR GREATER;
(b) The unencumbered cash balance in the school
district's general fund at the close of the preceding fiscal
year, less any advances of property taxes, was less than eight
per cent of the expenditures made from the
general fund for the
preceding fiscal year;
(c) A majority of the voting electors have not voted in
favor of levying
a tax under section 5705.194 or 5705.21 or Chapter 5748. of the Revised Code
that the auditor of state expects will raise enough additional revenue in the
next succeeding fiscal year that divisions DIVISION
(A)(1)(a) and (b) of this section will not apply
to the district in such next succeeding fiscal year.
(2) The school district has outstanding securities issued under division
(A)(4) of section 3316.06 of the Revised Code, and its financial
planning and
supervision commission has been terminated under section 3316.16 of the
Revised Code.
(3) The school district has received an advancement under section
3316.20 of the Revised Code. BOTH OF THE FOLLOWING CONDITIONS ARE
SATISFIED:
(a) THE SUPERINTENDENT OF PUBLIC INSTRUCTION HAS DECLARED THE
DISTRICT UNDER SECTION 3316.031 of the Revised Code TO BE UNDER A FISCAL CAUTION, HAS FOUND
THAT THE DISTRICT HAS NOT OR WILL NOT COMPLY WITH THE RECOMMENDATIONS THE
SUPERINTENDENT PROVIDED UNDER THAT SECTION, AND HAS NOTIFIED THE
AUDITOR OF STATE TO DECLARE A STATE OF FISCAL WATCH FOR THE DISTRICT.
(b) THE AUDITOR OF STATE DETERMINES THAT THE
DECISION OF THE SUPERINTENDENT IS NOT ARBITRARY OR CAPRICIOUS.
(B) The auditor of state, after consulting with the superintendent of public
instruction, shall issue an order declaring a school district to be in a
state
of fiscal emergency if the auditor of state
determines that division (B)(1), (2), (3), or (4), OR
(5) of this section applies to the school district:
(1) All BOTH of the following conditions are satisfied with
respect to the
school district:
(a) The board of education of the school district is not
able to demonstrate, to the auditor of state's satisfaction, the
district's ability to repay outstanding loans received pursuant
to section 3313.483 of the Revised Code or to repay securities issued pursuant
to section 133.301 of the Revised Code in accordance with
applicable repayment schedules unless the board requests
additional loans under section 133.301 of the
Revised Code in an aggregate principal
amount exceeding fifty per cent of the sum of the
following:
(i) The aggregate original principal
amount of loans received in the preceding fiscal year under
section 3313.483 of the Revised Code;
(ii) The aggregate amount borrowed by the district under
section 133.301 of
the Revised Code, excluding any additional amount borrowed as authorized under
division (C) of that section.
(b) An operating deficit has been certified for the
current fiscal year by the auditor of state, and the certified
operating deficit exceeds fifteen FIVE per cent of the school
district's general fund revenue for the preceding fiscal year,
UNLESS THE AUDITOR OF STATE, IN CONSULTATION WITH THE SUPERINTENDENT OF
PUBLIC INSTRUCTION FINDS THAT THERE IS REASONABLE CAUSE FOR THE DEFICIT BUT IN
NO CASE MAY THE AUDITOR OF STATE EXCUSE ANY DEFICIT OF EIGHT PER CENT OR
GREATER.
In determining the amount of an operating deficit under division
(B)(1)(b) of this section, the
auditor of state shall credit toward the amount of that deficit
only the amount that may be borrowed from the spending reserve
balance as determined under section 133.301 and division
(F) of section 5705.29 of the Revised Code.
(c)(b) A majority of the voting electors have not voted in
favor of levying
a tax under section 5705.194 or 5705.21 or Chapter 5748. of the Revised Code
that the auditor of state expects will raise enough additional revenue in the
next succeeding fiscal year that divisions DIVISION
(A)(B)(1)(a) and (b) of this section will not apply
to the district in such next succeeding fiscal year.
(d) The school district is one that, at the time of the
auditor of
state's determination under this section, had a total student count of
more than ten thousand students as most recently
determined by the department of
education pursuant to section
3317.03 of the Revised Code.
(2) The school district board fails, pursuant to
section 3316.04 of the Revised
Code, to submit a plan acceptable to the state
superintendent of public instruction within one hundred twenty days of the
auditor of state's declaration under division (A) of
this section;
(3)
BOTH OF THE FOLLOWING CONDITIONS ARE SATISFIED:
(a) THE SUPERINTENDENT OF PUBLIC INSTRUCTION HAS DETERMINED AND
REPORTED TO THE
AUDITOR OF STATE THAT THE DISTRICT HAS NOT SUBMITTED UNDER SECTION
3316.04 OF THE REVISED CODE A FINANCIAL PLAN THAT IS
ACCEPTABLE TO THE SUPERINTENDENT OR IS NOT MATERIALLY COMPLYING WITH THE
PROVISIONS OF THE PLAN AS APPROVED BY THE STATE
SUPERINTENDENT UNDER THAT SECTION.
(b) THE AUDITOR OF STATE FINDS THAT THE
DETERMINATION OF THE SUPERINTENDENT IS NOT ARBITRARY OR
CAPRICIOUS.
(4)
A declaration of fiscal emergency is required by division
(D) of section 3316.04 of the Revised Code;
(4)(5) The school district has received more than one
advancement SOLVENCY ASSISTANCE THAT REQUIRES REPAYMENT under
DIVISION (A)(4) OF section 3316.20 of the Revised
Code within a two-year period, or has received
only one such advancement but also has an operating deficit as described in
division (B)(1)(b) of this section.
(C) In making the determinations under this section, the auditor
of state may use financial reports required under section
117.43 of the Revised Code; tax
budgets, certificates of estimated resources and amendments thereof, annual
appropriating measures and spending plans, and any other
documents or information prepared pursuant to
Chapter 5705. of the Revised Code; and any other documents,
records, or information available to the auditor of state that
indicate the conditions described in divisions (A) and (B) of this section.
(D) The auditor of state shall certify the action taken under division (A) or
(B) of this section to the board of education of the school district, the
director of budget and management, the mayor or county auditor who could be
required to act pursuant to division (B)(1) of section 3316.05 of the Revised
Code, and to the superintendent of public instruction.
(E) A determination by the auditor of state under this section
that a fiscal emergency condition does not exist is final and conclusive and
not appealable. A determination by the auditor of state under this section
that a fiscal emergency exists is final, except that the board of education of
the school district affected by such a determination may appeal the
determination of the existence of a fiscal emergency condition to the court of
appeals having territorial jurisdiction over the school district. The appeal
shall be heard expeditiously by the court of appeals and for good cause shown
shall take precedence over all other civil matters except earlier matters of
the same character. Notice of such appeal must be filed with the auditor of
state and such court within thirty days after certification by the auditor of
state to the board of education of the school district provided for in
division (D) of this section. In such appeal, determinations of the
auditor of state shall be presumed to be valid and the board of education
shall have the burden of proving, by clear and convincing evidence, that each
of the determinations made by the auditor of state as to the existence of a
fiscal emergency condition under this section was in error. If the board of
education fails, upon presentation of its case, to prove by clear and
convincing evidence that each such determination by the auditor of state was
in error, the court shall dismiss the appeal. The board of education and the
auditor of state may introduce any evidence relevant to the existence or
nonexistence of such fiscal emergency conditions. The pendency of any such
appeal shall not affect or impede the operations of this chapter; no
restraining order, temporary injunction, or other similar restraint upon
actions consistent with this chapter shall be imposed by the court or any
court pending determination of such appeal; and all things may be done under
this chapter that may be done regardless of the pendency of any such appeal.
Any action taken or contract executed pursuant to this chapter during the
pendency of such appeal is valid and enforceable among all parties,
notwithstanding the decision in such appeal. If the court of appeals reverses
the determination of the existence of a fiscal emergency condition by the
auditor of state, the determination no longer has any
effect, and any procedures
undertaken as a result of the determination shall be terminated.
Sec. 3316.031. THE STATE SUPERINTENDENT OF PUBLIC INSTRUCTION, IN
CONSULTATION WITH THE AUDITOR OF STATE, SHALL DEVELOP GUIDELINES FOR
IDENTIFYING FISCAL PRACTICES AND BUDGETARY CONDITIONS THAT, IF UNCORRECTED,
COULD RESULT
IN A FUTURE DECLARATION OF A FISCAL WATCH OR FISCAL EMERGENCY WITHIN A
SCHOOL DISTRICT.
IF THE STATE SUPERINTENDENT DETERMINES FROM A SCHOOL DISTRICT'S
FIVE YEAR FORECAST SUBMITTED UNDER SECTION 5705.391 OF THE REVISED
CODE THAT A DISTRICT IS ENGAGING IN ANY OF THOSE PRACTICES OR THAT
ANY OF THOSE CONDITIONS EXIST WITHIN THE DISTRICT, THE STATE
SUPERINTENDENT MAY DECLARE THE DISTRICT TO BE UNDER A FISCAL CAUTION. IF
THE AUDITOR OF STATE FINDS THAT A DISTRICT IS ENGAGING IN ANY OF
THOSE PRACTICES OR THAT ANY OF THOSE CONDITIONS EXIST WITHIN THE
DISTRICT, THE AUDITOR OF STATE SHALL REPORT THAT FINDING TO THE
STATE SUPERINTENDENT AND THE STATE SUPERINTENDENT MAY DECLARE THE
DISTRICT TO BE UNDER A FISCAL CAUTION.
WHEN THE STATE SUPERINTENDENT DECLARES A DISTRICT TO BE UNDER FISCAL
CAUTION, THE STATE SUPERINTENDENT SHALL PROMPTLY NOTIFY THE DISTRICT BOARD
OF EDUCATION OF THAT DECLARATION AND SHALL PROVIDE THE BOARD WITH
WRITTEN RECOMMENDATIONS FOR DISCONTINUING OR CORRECTING THE FISCAL
PRACTICES OR BUDGETARY CONDITIONS THAT PROMPTED THE DECLARATION
AND FOR PREVENTING THE DISTRICT FROM EXPERIENCING FURTHER FISCAL DIFFICULTIES
THAT COULD RESULT IN THE DISTRICT BEING DECLARED TO BE IN A STATE
OF FISCAL WATCH OR FISCAL EMERGENCY.
THE STATE SUPERINTENDENT MAY APPOINT A MONITOR TO INSPECT AND
VISIT ANY DISTRICT THAT IS DECLARED TO BE UNDER A FISCAL CAUTION. THE MONITOR
SHALL REVIEW THE RECOMMENDATIONS PROVIDED TO THE DISTRICT BOARD TO
DISCONTINUE OR CORRECT THE FISCAL PRACTICES OR BUDGETARY
CONDITIONS, SHALL PROVIDE ASSISTANCE TO THE BOARD IN COMPLYING
WITH THE RECOMMENDATIONS, SHALL MONITOR THE DISTRICT'S PROGRESS IN
COMPLYING WITH THE RECOMMENDATIONS, AND SHALL REPORT THE
DISTRICT'S PROGRESS TO THE STATE SUPERINTENDENT.
IF THE STATE SUPERINTENDENT FINDS THAT A SCHOOL DISTRICT DECLARED
TO BE UNDER A FISCAL CAUTION HAS NOT OR WILL NOT COMPLY WITH THE STATE
SUPERINTENDENT'S RECOMMENDATIONS FOR DISCONTINUING OR CORRECTING
THE FISCAL PRACTICES OR BUDGETARY CONDITIONS, AND IF THE STATE
SUPERINTENDENT CONSIDERS IT NECESSARY TO AVOID FURTHER FISCAL DECLINE, THE
STATE SUPERINTENDENT MAY
DETERMINE THAT THE DISTRICT
SHOULD BE IN A STATE OF FISCAL WATCH. THE AUDITOR OF STATE SHALL DECLARE THE
DISTRICT IN A STATE OF FISCAL WATCH UNLESS THE AUDITOR FINDS THE
SUPERINTENDENT'S DETERMINATION TO BE ARBITRARY AND CAPRICIOUS.
Sec. 3316.04. (A) Within sixty days of the auditor's declaration
under
division (A) of section 3316.03 of the Revised Code, the board of education of
the school district shall prepare and submit to the superintendent of public
instruction a financial plan delineating the steps the board will take to
eliminate the district's current operating deficit and avoid incurring
operating deficits in ensuing years, including the implementation of spending
reductions. The superintendent of public instruction shall evaluate the
initial financial plan, and either approve or disapprove it within thirty
calendar days from the date of its submission. If the initial financial plan
is disapproved, the state superintendent shall recommend modifications that
will render the financial plan acceptable. No school district board shall
implement a financial plan submitted to the superintendent
of public instruction under this section unless the superintendent has
approved the plan.
IF A DISTRICT FAILS TO SUBMIT A FINANCIAL PLAN UNDER THIS SECTION
THAT IS ACCEPTABLE TO THE STATE SUPERINTENDENT OR IF THE STATE
SUPERINTENDENT FINDS THAT THE DISTRICT IS NOT MATERIALLY COMPLYING WITH
THE PROVISIONS OF THE PLAN AS APPROVED BY THE STATE
SUPERINTENDENT, AND IF THE STATE SUPERINTENDENT CONSIDERS IT
APPROPRIATE, THE STATE SUPERINTENDENT MAY
DETERMINE THAT THE DISTRICT SHOULD BE DECLARED TO BE IN A STATE OF FISCAL
EMERGENCY. THE AUDITOR OF STATE SHALL DECLARE THE DISTRICT IN A STATE OF
FISCAL EMERGENCY UNLESS THE AUDITOR FINDS THE SUPERINTENDENT'S DECISION TO BE
ARBITRARY AND CAPRICIOUS.
(B) Upon request of the board of education of a school district
declared to be in
a state of fiscal watch, the auditor of state and superintendent of public
instruction shall provide technical assistance to the board in resolving the
fiscal problems that gave rise to the declaration, including assistance in
drafting the board's financial plan.
(C) A financial plan adopted under this section may be amended at
any time with the approval of the superintendent.
The board of education of the school district shall submit
an updated financial plan to the superintendent, for the
superintendent's approval, every year that the district is in a
state of fiscal watch. The updated plan shall be submitted in a
form acceptable to the superintendent. The superintendent shall approve or
disapprove each updated plan no later than the anniversary of the date on
which the first such
plan was approved.
(D) A school district
that has restructured or refinanced a loan under section
3316.041 of the Revised
Code shall be declared to be in
a state of fiscal emergency if any of the following
occurs:
(1) An operating deficit is certified for the district
under section 3313.483 of the
Revised
Code for any year prior to the
repayment of the restructured or refinanced loan;
(2) The superintendent determines, in consultation
with the auditor of state, that the school district is not
satisfactorily complying with the terms of the financial plan
required by this section;
(3) The board of education of the school district
fails to submit an updated plan that is acceptable to the
superintendent under division
(C) of this section.
Sec. 3316.06. (A) Within one hundred twenty days after the
first meeting of a school district financial planning and supervision
commission, the commission shall adopt a financial recovery plan regarding the
school district for which the commission was created. During the formulation
of the plan, the commission shall seek appropriate input from the school
district board and from the community. This plan shall contain the following:
(1) Actions to be taken to:
(a) Eliminate all fiscal emergency conditions declared
to exist pursuant to division (B) of section 3316.03 of the Revised Code;
(b) Satisfy any judgments, past-due accounts payable, and
all past-due and payable payroll and fringe benefits;
(c) Eliminate the deficits in all deficit funds;
(d) Restore to special funds any moneys from such funds that were
used for purposes not within the
purposes of such funds, or borrowed from such funds
by the purchase of debt obligations of the school district with the
moneys of such funds, or missing from the special funds and not accounted for,
if any;
(e) Balance the budget, avoid future deficits in any
funds, and maintain on a current basis payments of payroll, fringe benefits,
and all accounts;
(f) Avoid any fiscal emergency condition in the future;
(g) Restore the ability of the school district to market
long-term general obligation bonds under provisions of law
applicable to school districts generally.
(2) The management structure that will enable the school district to
take the actions enumerated in division (A)(1) of this
section. The plan shall specify the level of fiscal and management control
that the commission will exercise within the school district during the period
of fiscal emergency, and shall enumerate respectively, the powers and duties
of the commission and the powers and duties of the school board during that
period. The commission may elect to assume any of the powers and duties of
the school board it considers necessary, including all powers related to
personnel, curriculum, and legal issues in order to successfully implement the
actions described in division (A)(1) of this section.
(3) The target dates for the commencement, progress
upon, and completion of the actions enumerated in
division (A)(1) of this section and a reasonable period of time
expected to be required to implement the plan. The commission shall prepare a
reasonable time schedule for progress toward and
achievement of the requirements for the plan, and the
plan shall be consistent with that time schedule.
(4) The amount and purpose of any issue of debt
obligations that will be issued, together with assurances that
any such debt obligations that will be issued will not exceed
debt limits supported by appropriate certifications by the fiscal
officer of the school district and the county auditor. Debt obligations
issued pursuant to section 133.301 of the Revised Code shall include
assurances that such debt shall be in an amount not to exceed the amount
certified under division (B) of such section. If the
commission
considers it
necessary in order to maintain or improve educational opportunities of pupils
in the school district, the plan may include a proposal to restructure or
refinance outstanding debt obligations incurred by the board under section
3313.483 of the Revised Code contingent upon
the approval, during the period of the fiscal emergency, by district voters of
a tax levied under section 718.09, 718.10, 5705.194, 5705.21, 5748.02, or
5748.08 of
the Revised Code, that is not a renewal or replacement levy and that
will provide new operating revenue. Notwithstanding any provision of
Chapter 133.
or sections 3313.483 to 3313.4811 of the Revised Code,
following the
required approval of the district voters and with the approval of the
commission, the school district may issue securities to evidence the
restructuring or refinancing. Those securities may extend the
original period for repayment, not to exceed ten years, and
may alter
the frequency and amount of repayments, interest or other
financing charges, and other terms of agreements under which the debt
originally was contracted, at the discretion of the commission, provided that
any loans received pursuant to section 3313.483 of the Revised Code shall be
paid from funds the district would otherwise receive under sections 3317.022
to 3317.025 of the Revised Code, as required under division (E)(3) of section
3313.483 of the Revised Code. The securities issued for the purpose of
restructuring or refinancing the debt shall be repaid in equal payments and at
equal intervals over the term of the debt and are not eligible to be included
in any subsequent proposal for the purpose of restructuring or refinancing
debt under this section.
(B) Any financial recovery plan may be amended subsequent to its
adoption. Each financial recovery plan shall be updated annually.
(C) EACH SCHOOL DISTRICT FINANCIAL PLANNING AND SUPERVISION
COMMISSION SHALL SUBMIT THE FINANCIAL RECOVERY PLAN IT ADOPTS OR UPDATES UNDER
THIS SECTION TO THE STATE
SUPERINTENDENT OF PUBLIC INSTRUCTION FOR APPROVAL IMMEDIATELY
FOLLOWING ITS ADOPTION OR UPDATING. THE STATE SUPERINTENDENT
SHALL EVALUATE THE PLAN AND EITHER APPROVE OR DISAPPROVE IT WITHIN
THIRTY CALENDAR DAYS FROM THE DATE OF ITS SUBMISSION. IF THE
PLAN IS DISAPPROVED, THE STATE SUPERINTENDENT SHALL RECOMMEND
MODIFICATIONS THAT WILL RENDER IT ACCEPTABLE. NO FINANCIAL
PLANNING AND SUPERVISION COMMISSION SHALL IMPLEMENT A FINANCIAL
RECOVERY PLAN THAT IS ADOPTED OR UPDATED ON OR AFTER THE EFFECTIVE
DATE OF THIS AMENDMENT UNLESS THE STATE SUPERINTENDENT HAS
APPROVED IT.
Sec. 3316.061. IF ANY SCHOOL DISTRICT FINANCIAL PLANNING AND
SUPERVISION COMMISSION FAILS TO SUBMIT TO THE STATE SUPERINTENDENT OF
PUBLIC INSTRUCTION UNDER SECTION 3316.06 OF THE REVISED
CODE A
FINANCIAL RECOVERY PLAN THAT IS ACCEPTABLE TO THE STATE
SUPERINTENDENT OR IF THE STATE SUPERINTENDENT AND THE AUDITOR OF STATE FIND
THAT A
COMMISSION IS NOT MATERIALLY COMPLYING WITH THE PROVISIONS OF ITS
FINANCIAL RECOVERY PLAN, THE STATE SUPERINTENDENT AND
THE AUDITOR OF STATE
MAY JOINTLY DISSOLVE THE FINANCIAL PLANNING AND
SUPERVISION COMMISSION AND JOINTLY APPOINT AN INDIVIDUAL TO ACT AS THE
FISCAL ARBITRATOR OF THE DISTRICT.
WHEN A FINANCIAL PLANNING AND
SUPERVISION COMMISSION IS DISSOLVED UNDER THIS SECTION, THE COMMISSION CEASES
TO EXIST AND THE APPOINTED FISCAL ARBITRATOR BECOMES THE SUCCESSOR
TO THE COMMISSION. A FISCAL ARBITRATOR APPOINTED UNDER THIS
SECTION HAS ALL OF THE RIGHTS, POWERS, AND DUTIES GIVEN BY THIS
CHAPTER TO THE COMMISSION THAT THE ARBITRATOR SUCCEEDS. A
REFERENCE IN ANY STATUTE, RULE, CONTRACT, OR OTHER DOCUMENT TO A
SCHOOL DISTRICT FINANCIAL PLANNING AND SUPERVISION COMMISSION IS
DEEMED TO REFER TO A FISCAL ARBITRATOR APPOINTED UNDER THIS
SECTION.
BUSINESS COMMENCED BUT NOT COMPLETED BY A COMMISSION WHEN IT IS
DISSOLVED UNDER THIS SECTION SHALL BE COMPLETED BY THE APPOINTED FISCAL
ARBITRATOR WITH THE SAME EFFECT AS IF COMPLETED BY THE COMMISSION. NO
VALIDATION, CURE, RIGHT, PRIVILEGE, REMEDY, OBLIGATION, OR LIABILITY IS
LOST OR IMPAIRED BY REASON OF THE DISSOLUTION OF THE COMMISSION
AND APPOINTMENT OF A FISCAL ARBITRATOR, BUT SHALL BE ADMINISTERED
BY THE ARBITRATOR.
Sec. 3316.20. (A)(1) The school district solvency assistance fund
is hereby created in the state treasury, to consist of such amounts designated
for the purposes of the fund by the general assembly. The fund shall be used
to make advancements PROVIDE ASSISTANCE AND GRANTS to school
districts to enable them to
remain solvent and
to pay unforseeable expenses of a temporary or emergency nature that they are
unable to pay from existing resources.
Advancements SOLVENCY ASSISTANCE AND GRANTS shall be made from
the fund by the
superintendent of public
instruction in accordance with rules jointly adopted by the superintendent and
the auditor of state specifying advancement approval criteria and
procedures
necessary for administering the fund.
(2) THERE IS HEREBY CREATED WITHIN THE FUND AN ACCOUNT KNOWN AS
THE SCHOOL DISTRICT SHARED RESOURCE ACCOUNT, WHICH SHALL CONSIST
OF MONEY APPROPRIATED TO IT BY THE GENERAL ASSEMBLY. THE MONEY IN
THE ACCOUNT SHALL BE USED SOLELY FOR SOLVENCY ASSISTANCE TO SCHOOL
DISTRICTS.
(3) THERE IS HEREBY CREATED WITHIN THE FUND AN ACCOUNT KNOWN AS
THE CATASTROPHIC EXPENDITURES ACCOUNT, WHICH SHALL CONSIST OF MONEY
APPROPRIATED TO THE ACCOUNT BY THE GENERAL ASSEMBLY PLUS ALL INVESTMENT
EARNINGS OF THE FUND. MONEY IN THE ACCOUNT SHALL BE USED SOLELY
FOR SOLVENCY ASSISTANCE TO SCHOOL DISTRICTS IN THE EVENT THAT ALL
MONEY IN THE SHARED RESOURCE ACCOUNT IS UTILIZED FOR SOLVENCY ASSISTANCE OR
FOR GRANTS TO SCHOOL DISTRICTS
UNDER DIVISION (B) OF THIS SECTION.
(4) The fund shall be reimbursed for any SOLVENCY ASSISTANCE
amounts advanced PAID UNDER DIVISION (A)(2) OR (3) OF THIS
SECTION not later
than the
end of the second fiscal year following the fiscal year in which the
advancement SOLVENCY ASSISTANCE PAYMENT was made. If not made
directly by
the
school district, such reimbursement shall be made by the director of budget
and
management from the amounts the school district would otherwise receive
pursuant to sections 3317.022 to 3317.025 of the
Revised Code,
or from any other funds appropriated for the district by the general
assembly. REIMBURSEMENTS SHALL BE CREDITED TO THE RESPECTIVE ACCOUNT FROM
WHICH THE SOLVENCY ASSISTANCE PAID TO THE DISTRICT WAS DEDUCTED.
(B) THE SUPERINTENDENT OF PUBLIC INSTRUCTION AND THE DIRECTOR OF
BUDGET AND MANAGEMENT, WITH THE APPROVAL OF THE CONTROLLING BOARD, JOINTLY MAY
GRANT MONEY FROM THE CATASTROPHIC EXPENDITURES
ACCOUNT TO ANY SCHOOL DISTRICT THAT SUFFERS AN UNPLANNED
CATASTROPHIC EVENT THAT SEVERELY DEPLETES THE DISTRICT'S FINANCIAL
RESOURCES AS DETERMINED BY THE SUPERINTENDENT
AND DIRECTOR. A SCHOOL DISTRICT SHALL NOT BE REQUIRED TO REPAY ANY
GRANT AWARDED TO THE DISTRICT UNDER THIS DIVISION UNLESS THE
DISTRICT RECEIVES MONEY FROM A THIRD PARTY, INCLUDING AN AGENCY OF THE
GOVERNMENT OF THE UNITED STATES, SPECIFICALLY FOR THE
PURPOSE OF COMPENSATING THE DISTRICT FOR EXPENSES INCURRED AS A RESULT OF THE
UNPLANNED CATASTROPHIC EVENT.
Sec. 5705.13. (A) Except as otherwise provided for a board of
education under division (H) of section 5705.29 of the Revised Code, a
A taxing
authority of a subdivision, by
resolution or ordinance, may
establish a reserve balance account to accumulate currently available
resources for any of the following purposes:
(1) To stabilize subdivision budgets against cyclical changes in revenues
and expenditures;
(2) Except as otherwise provided by this section, to provide for the
payment of claims under a self-insurance program for the subdivision, if the
subdivision is permitted by law to establish such a program;
(3) To provide for the payment of claims under a retrospective ratings
plan for workers' compensation.
The ordinance or resolution establishing a reserve balance account shall
state the purpose for which the reserve balance account is established, the
fund in which the account is to be established, and the total amount of money
to be reserved in the account.
A subdivision that participates in a risk-sharing pool, by which
governments pool risks and funds and share in the costs of losses, shall not
establish a reserve balance account to provide self-insurance for the
subdivision.
A taxing authority of a subdivision shall not have more than three reserve
balance
accounts at any time. Not more than one reserve balance account may be
established for each of the purposes permitted under this section. Money to
the credit of a reserve balance account may be expended only for the purpose
for which the account was established.
A reserve balance account established for the purpose described in
division (A)(1) of this section shall be established in the general
fund of the subdivision, and the amount of money to be reserved in that
account in any fiscal year shall not exceed five per cent of the general fund
revenue for the preceding fiscal year. Subject to division (G) of
section 5705.29 of the Revised Code, any reserve balance in
an account
established under division (A)(1) of this section shall not be
considered part of the unencumbered balance or revenue of the subdivision
under division (A) of section 5705.35 or division (A)(1) of
section 5705.36 of the Revised Code.
At any time, a taxing authority of a subdivision, by resolution or
ordinance, may
reduce or eliminate the reserve balance in a reserve balance account
established for the purpose described in division (A)(1) of this
section.
A reserve balance account established for the purpose described in
division (A)(2) or (3) of this section shall be established in the general
fund
of the subdivision or by the establishment of a separate internal service
fund established to
account for the operation of the self-insurance or retrospective ratings plan
program, and shall be based on sound actuarial principles. The total amount
of money in a reserve balance
account for self-insurance may be expressed in dollars or as the amount
determined to represent an adequate reserve according to sound actuarial
principles.
A taxing authority of a subdivision, by resolution or ordinance, may
rescind a reserve balance account established under this division. If a
reserve balance account is rescinded, money that has accumulated in the
account shall be transferred to the fund or funds from which the money
originally was transferred.
(B) A taxing authority of a subdivision, by resolution or ordinance, may
establish a special revenue fund for the purpose of accumulating resources
for the payment of accumulated sick leave and vacation leave, and for payments
in lieu of taking compensatory time off, upon the
termination of employment or the retirement of officers and employees of the
subdivision. The special revenue fund may also accumulate resources for
payment of salaries during any fiscal year when the number of pay periods
exceeds the usual and customary number of pay periods. Notwithstanding
sections 5705.14, 5705.15, and 5705.16 of the Revised Code,
the taxing authority, by resolution or ordinance, may transfer money to the
special
revenue fund from any other fund of the subdivision from which such payments
may lawfully be made. The taxing authority, by resolution or ordinance,
may rescind a special revenue fund established under this division. If a
special revenue fund is rescinded, money that has accumulated in the fund
shall be transferred to the fund or funds from which the money originally was
transferred.
(C) A taxing authority of a subdivision, by resolution or
ordinance, may establish a capital projects fund for the purpose of
accumulating resources for the acquisition, construction, or improvement of
fixed assets of the subdivision. For the purposes of this section, "fixed
assets" includes motor vehicles. More than one capital projects fund may be
established and may exist at any time. The ordinance or resolution shall
identify the source of the money to be used to acquire, construct, or improve
the fixed assets identified in the resolution or ordinance, the amount of
money to be accumulated for that purpose, the period of time over which that
amount is to be accumulated, and the fixed assets that the taxing authority
intends to acquire, construct, or improve with the money to be
accumulated in the fund.
A taxing authority of a subdivision shall not accumulate money in a
capital projects
fund for more than five years after the resolution or ordinance establishing
the fund is adopted. If the subdivision has not entered into a contract for
the acquisition, construction, or improvement of
fixed assets for which money was accumulated in such a fund before the end of
that five-year period, the fiscal officer of the subdivision
shall transfer all money in the fund to the fund or funds from which that
money originally was transferred or the fund that originally was intended to
receive the money.
A taxing authority of a subdivision, by resolution or ordinance, may
rescind a capital
projects fund. If a capital projects fund is rescinded, money that has
accumulated in the fund shall be transferred to the fund or funds from which
the money originally was transferred.
Notwithstanding sections 5705.14, 5705.15, and 5705.16 of the Revised Code, the
taxing authority of a subdivision, by resolution or ordinance, may transfer
money to the
capital projects fund from any other fund of the subdivision that may
lawfully
be used for the purpose of acquiring, constructing, or improving the fixed
assets identified in the resolution or ordinance.
Sec. 5705.29. The tax budget shall present the following
information in such detail as is prescribed by the auditor of
state, unless an alternative form of the budget is permitted under section
5705.281 of the Revised Code:
(A)(1) A statement of the necessary current operating
expenses for the ensuing fiscal year for each department and
division of the subdivision, classified as to personal services
and other expenses, and the fund from which such expenditures are
to be made. Except in the case of a school district, this
estimate may include a contingent expense not designated for any
particular purpose, and not to exceed three per cent of the total
amount of appropriations for current expenses. In the case of a
school district, this estimate may include a contingent expense
not designated for any particular purpose and not to exceed
thirteen per cent of the total amount of appropriations for
current expenses.
(2) A statement of the expenditures for the ensuing fiscal
year necessary for permanent improvements, exclusive of any
expense to be paid from bond issues, classified as to the
improvements contemplated by the subdivision and the fund from
which such expenditures are to be made;
(3) The amounts required for the payment of final
judgments;
(4) A statement of expenditures for the ensuing fiscal
year necessary for any purpose for which a special levy is
authorized, and the fund from which such expenditures are to be
made;
(5) Comparative statements, so far as possible, in
parallel columns of corresponding items of expenditures for the
current fiscal year and the two preceding fiscal years.
(B)(1) An estimate of receipts from other sources than the
general property tax during the ensuing fiscal year, which shall
include an estimate of unencumbered balances at the end of the
current fiscal year, and the funds to which such estimated
receipts are credited;
(2) The amount each fund requires from the general
property tax, which shall be the difference between the
contemplated expenditure from the fund and the estimated
receipts, as provided in this section. The section of the
Revised Code under which the tax is authorized shall be set
forth.
(3) Comparative statements, so far as possible, in
parallel columns of taxes and other revenues for the current
fiscal year and the two preceding fiscal years.
(C)(1) The amount required for debt charges;
(2) The estimated receipts from sources other than the tax
levy for payment of such debt charges, including the proceeds of
refunding bonds to be issued to refund bonds maturing in the next
succeeding fiscal year;
(3) The net amount for which a tax levy shall be made,
classified as to bonds authorized and issued prior to January 1,
1922, and those authorized and issued subsequent to such date,
and as to what portion of the levy will be within and what in
excess of the ten-mill limitation.
(D) An estimate of amounts from taxes authorized to be
levied in excess of the ten-mill limitation on the tax rate, and
the fund to which such amounts will be credited, together with
the sections of the Revised Code under which each such tax is
exempted from all limitations on the tax rate.
(E)(1) A board of education may include in its budget for
the fiscal year in which a levy proposed under section 5705.194,
5705.21, or 5705.213, or the original levy under section 5705.212
of the Revised Code is first extended on the tax list and
duplicate an estimate of expenditures to be known as a voluntary
contingency reserve balance, which shall not be greater than
twenty-five per cent of the total amount of the levy estimated to
be available for appropriation in such year.
(2) A board of education may include in its budget for the
fiscal year following the year in which a levy proposed under
section 5705.194, 5705.21, or 5705.213, or the original levy
under section 5705.212 of the Revised Code is first extended on
the tax list and duplicate an estimate of expenditures to be
known as a voluntary contingency reserve balance, which shall not
be greater than twenty per cent of the amount of the levy
estimated to be available for appropriation in such year.
(3) Except as provided in division (E)(4) of this section,
the full amount of any reserve balance the board includes in its
budget shall be retained by the county auditor and county
treasurer out of the first semiannual settlement of taxes until
the beginning of the next succeeding fiscal year, and thereupon,
with the depository interest apportioned thereto, it shall be
turned over to the board of education, to be used for the
purposes of such fiscal year.
(4) A board of education, by a two-thirds vote of all
members of the board, may appropriate any amount withheld as a
voluntary contingency reserve balance during the fiscal year for
any lawful purpose, provided that prior to such appropriation the
board of education has authorized the expenditure of all amounts
appropriated for contingencies under section 5705.40 of the
Revised Code. Upon request by the board of education, the county
auditor shall draw a warrant on the district's account in the
county treasury payable to the district in the amount requested.
(F)(1) A board of education may include a spending reserve
in its budget for fiscal years ending on or before
June 30, 2002. The spending reserve shall consist of an estimate
of expenditures not to exceed the district's spending reserve
balance. A district's spending reserve balance is the amount by
which the designated percentage of the district's
estimated personal
property taxes to be settled during the calendar year in which
the fiscal year ends exceeds the estimated amount of personal
property taxes to be so settled and received by the district
during that fiscal year. Moneys from a spending reserve shall be
appropriated in accordance with section 133.301 of the Revised
Code.
(2) For the purposes of computing a school district's spending
reserve balance for a fiscal year, the designated percentage shall be as
follows:
Fiscal year ending in:
|
Designated percentage
|
1998 | 50% |
1999 | 40% |
2000 | 30% |
2001 | 20% |
2002 | 10% |
(G) Except as otherwise provided in this division, the county budget
commission shall not reduce the taxing authority of a subdivision as a
result of the creation of a reserve balance account. Except as
otherwise provided in this division, the county budget commission shall not
consider the amount in a reserve balance account of a township, county, or
municipal corporation as an
unencumbered balance or as revenue for the purposes of division
(E)(3) or (4) of section 5747.51 or division (E)(3) or (4)
of section 5747.62 of the Revised Code. The county budget commission may
require documentation of the reasonableness of the reserve balance held in any
reserve balance account. The commission shall consider any amount in a
reserve balance account that it determines to be unreasonable as unencumbered
and as revenue for the purposes of sections 5747.51 and 5747.62 of the
Revised Code and may take such amounts into consideration
when determining whether to reduce the taxing authority of a subdivision.
(H)(1) Each board of education shall include in its tax budget
and shall establish a reserve balance
account to accumulate currently available resources to stabilize the school
district's budget against cyclical changes in revenues and expenditures.
The balance in the reserve balance account shall not at any time be less than
five per
cent of general fund revenues
for the most recently concluded fiscal year, except as provided in division
(H)(2) or (3) of this section, and except for deficiencies arising
from the appropriation of money from the account for
unanticipated deficiencies
in revenue or other emergencies pursuant to a resolution adopted by
two-thirds of the membership of the board of education specifying the reason
for the appropriation. The auditor of state and the superintendent of public
instruction jointly shall adopt rules governing conditions that constitute
unanticipated deficiencies in revenue or emergencies for which appropriations
may be made from a reserve balance account.
The rules also shall provide that a
board of education that borrows against its spending
reserve established in its tax budget for a
fiscal year under division (F) of this section is not
subject to division (H)(2) of this section for that fiscal year. A
board of education shall not appropriate money from a reserve
balance account without
filing a schedule for replenishing the account with the
superintendent of public
instruction and receiving approval of the schedule from the superintendent of
public instruction.
(2)(a) Beginning with the fiscal year ending in 1999 and
continuing each fiscal year until the balance in the reserve
balance account equals five per cent
of the district's revenues received for current expenses for the preceding
fiscal year, if the growth in a district's total revenues received for current
expenses from one fiscal year to the next is at least three per cent, the
board
of education shall credit to its reserve balance
account, from the general fund or
from other sources that may lawfully be credited to the general fund, an
amount that, when added to the account
balance, is not less than:
(i) One per cent of revenues received for current expenses for
the prior fiscal year; plus
(ii) The sum of the amounts credited under this section for all
fiscal years that amounts were required to be credited under this section.
Each board shall maintain the balance in the district's reserve balance
account at not less than five per cent of the district's revenues received for
current expenses for the preceding fiscal year, except as otherwise
authorized under division (H) of this section.
(b) Notwithstanding division (H)(2)(a)
of this section, in no year shall a board be required to credit to its
reserve balance account more than one per cent of revenues received for
current expenses for the prior fiscal year.
(3) The balance in the reserve balance
account of a school district may be
less than five per cent of the general fund revenue for the most recently
concluded fiscal year in any fiscal year in which the school district is in a
state of fiscal watch or fiscal emergency pursuant to section 3316.03 of the
Revised Code.
(4) Notwithstanding any provision to the contrary in Chapter
4117. of the Revised Code, the requirements of division (H)
of this section
prevail over any conflicting provisions of agreements between employee
organizations and public employers entered into after November
21, 1997.
(5) Notwithstanding division (H)(2) of this section, a
school district may, pursuant to rules adopted by the auditor of state,
credit less than one per cent of its prior year's revenue received for current
expenses into its reserve balance account.
(6) A school district board may apply to the state
superintendent of public instruction for a one-time waiver of the deposit
requirements of division
(H)(2) of this section when it determines that meeting the
requirements in the current or next fiscal year would cause the district to
significantly reduce or eliminate important educational services. The
district shall apply
in the form and manner required by the state superintendent, and the
application may request a waiver of all or part of the deposit required for
the current or next fiscal year. The state superintendent may grant a
waiver if the state superintendent and the auditor of state determine that
meeting the requirement in the current or next fiscal year would cause the
school district to significantly reduce or
eliminate important educational services. A waiver may entirely exempt the
district from making any deposit
into its reserve balance account during the current or next fiscal year or,
regardless of whether the district board applied for a waiver of the entire
deposit, may simply reduce the amount of the deposit otherwise required during
the current or next fiscal year by division (H)(2) of this section.
A waiver is valid for one fiscal year: either the fiscal year in which the
district board applied for it or the immediately following fiscal year. A
district board may receive only one waiver under division (H)(6) of
this section.
(I) Notwithstanding division (H)(2) of this section, whenever a
city, local, exempted village, or joint vocational school district
receives from the bureau of workers' compensation a refund or
other reimbursement of money that the district previously paid to
the bureau, the district shall deposit the full amount of the
refund or other reimbursement into the district's reserve balance
account, unless the account already contains five per cent of the
district's revenues received for current expenses for the
preceding year as prescribed in division (H)(2)(a) of this
section. A district may credit any amount it deposits into that account under
this division toward any minimum deposit
required for the account in that fiscal year.
Sec. 5705.38. (A) This division does not apply to school
district appropriation measures. On or about the first day of
each year, the taxing authority of each subdivision or other
taxing unit shall pass an appropriation measure, and thereafter
during the year it may pass any supplemental appropriation
measures as it finds necessary, based on the revised tax budget
and the official certificate of estimated resources or amendments
of the certificate. If adoption of a tax budget was waived under section
5705.281 of the Revised Code, appropriation measures shall be based on the
official certificate of estimated resources. If it desires to postpone the
passage of the annual appropriation measure until an amended certificate is
received based on the actual balances, it may pass a temporary
appropriation measure for meeting the ordinary expenses of the
taxing unit until no later than the first day of April of the
current year, and the appropriations made in the temporary
measure shall be chargeable to the appropriations in the annual
appropriation measure for that fiscal year when passed.
(B) A board of education shall pass its annual
appropriation measure by the first day of October. If, by the
first day of October, a board has not received either the amended
certificates of estimated resources required by division (B) of
section 5705.36 of the Revised Code or certifications that no
amended certificates need be issued, the adoption of the annual
appropriation measure shall be delayed until the amended
certificates or certifications are received. Prior to the
passage of the annual appropriation measure, the board may pass a
temporary appropriation measure for meeting the ordinary expenses
of the district until it passes an annual appropriation measure,
and appropriations made in the temporary measure shall be
chargeable to the appropriations in the annual appropriation
measure for that fiscal year when passed. During the fiscal year
and after the passage of the annual appropriation measure, a
district may pass any supplemental appropriation measures as it
finds necessary, based on the revised tax budget and the official
certificate of estimated resources or amendments of the
certificate. The annual appropriation measure, and any temporary or
supplemental appropriation measure, shall provide for the reservation of a
sufficient amount of money for the budget reserve fund as required under
division (H) of section 5705.29 of the Revised Code.
School district appropriation measures shall be in
the form as the auditor of state, after consultation with the tax
commissioner, prescribes.
(C) Appropriation measures shall be classified so as to
set forth separately the amounts appropriated for each office,
department, and division, and, within each, the amount
appropriated for personal services. In the case of a municipal
university, the board of directors of which have assumed, in the
manner provided by law, custody and control of the funds of the
university, funds shall be appropriated as a lump sum for the use
of the university.
Section 2. That existing sections 3315.17, 3315.18, 3316.03, 3316.04, 3316.06,
3316.20, 5705.13, 5705.29, and 5705.38 of the Revised Code
are hereby repealed.
Section 3. After the effective date of this section, no board of
education of any school district shall be required to establish
and maintain a budget reserve account as previously required under
divisions (H) and (I) of section 5705.29 of the Revised Code as
that section existed prior to the effective date of this section.
Any money on hand in a school district's budget reserve account
established and maintained under those divisions on the effective
date of this section may at the discretion of the district board
of education be returned to the district's general fund or may be
left in the account and may be used by the district board to
offset any budget deficit the district may experience in future
fiscal years. However, any portion of that money consisting of
refunds or rebates from the Bureau of Workers' Compensation that
was required to be deposited in the fund under Section 39 of Am. Sub. H.B. 770
of the 122nd General Assembly or division (I) of section 5705.29 of the
Revised Code as it existed prior to the effective date of this section
may be used solely to offset a budget deficit or for school facility
construction, renovation,
or repair; textbooks or instructional materials, including science
equipment or laboratories; or professional development of
teachers.
This section does not affect a district board's authority to
establish a reserve balance account under section 5705.13 of the
Revised Code as that section exists after the effective date of
this section.
Section 4. Sections 3315.17 and 3315.18 of the Revised Code,
which were enacted by Sub. H.B. 412 of the 122nd General Assembly,
required school districts to set aside percentages of their general
operating funds for textbooks and instructional materials and for
capital and maintenance costs. Section 3313.603 of the Revised
Code, enacted by Am. Sub. S.B. 55 of the 122nd General Assembly,
increased from eighteen to twenty-one the minimum number of
academic units required for students graduating from high school
in this state after September 15, 2001. The Ohio Supreme Court,
in DeRolph v. State (2000), 89 Ohio St. 3d 1,
concluded that all of these
requirements impermissibly imposed unfunded mandates upon school districts.
The General Assembly finds that the costs of the set-aside
requirements of sections 3315.17 and 3315.18 are not unfunded to the extent
the required set-asides are percentages of the base cost formula amount.
Since fiscal year 1999, these set-asides have been included within
the base cost formula amounts prescribed by section 3317.012 of
the Revised Code, which was enacted by Am. Sub. H.B. 650 of the
122nd General Assembly. The General Assembly has reanalyzed
fiscal year 1996 fiscal data of the one hundred three model
effective school districts, described in section 3317.012 of the
Revised Code, which served as the basis for the fiscal policies
contained in Am. Sub. H.B. 650. This analysis is based on
testimony and evidence presented in 2000 before the Joint
Committee to Examine the Base Cost of an Adequate Education, which
clearly demonstrated that in fiscal year 1996, the model school
districts spent at least the percentages prescribed in sections
3315.17 and 3315.18 of the Revised Code for textbooks and
instructional materials and capital and maintenance costs as those
percentages were adjusted by the auditor of state under those sections.
The
base cost formula amount enacted in Am. Sub. H.B. 650 was derived
from these districts' costs, which include their expenditures for
textbooks and instructional materials and capital and maintenance
costs. The base cost formula amount therefore includes an amount
adequate for school districts to meet the requirements of sections
3315.17 and 3315.18 provided that the required set-asides are percentages of
the base cost amount and not of school district total revenues. Accordingly,
this
act amends the set-aside requirements to reflect this finding.
Other evidence submitted to the Joint Committee demonstrated that
in fiscal year 1996 the average minimum number of academic units
required to graduate from high school in the model school
districts was nineteen and six-tenths, but that many students in
those districts graduated with credits exceeding the minimum. The
General Assembly therefore finds that the base cost formula amount
reflects the cost of providing nineteen and six-tenths high school
academic units. The General Assembly intends to increase the base
cost formula amount in future education funding legislation to
close the gap between the model districts' average of nineteen and
six-tenths units and the required minimum of twenty-one units
imposed by section 3313.603 of the Revised Code.
|