NONINSTRUCTIONAL AND BUSINESS SERVICES

701.1 - DEPOSITORY OF FUNDS

Each year at its annual meeting, the board shall designate by resolution the name and location of the Iowa located financial depository institution or institutions to serve as the official school district depository or depositories.  The maximum deposit amount allowed in each depository shall be stated in the resolution.  The amount(s) stated in the resolution will include all depositories and include all of the school district's fund(s).

It shall be the responsibility of the business manager to include the resolution in the minutes of the meeting.

Legal Reference:         Iowa Code §§  12C; 279.33 (1995).

Cross Reference:         210.1  Annual Meeting

                                    206.4  Treasurer

                                    704.1  Local - State - Federal - Miscellaneous Revenue

Approved:                   1/20/2000

Reviewed:                   11/16/15, 3/21/22

Revised:                      

NONINSTRUCTIONAL AND BUSINESS SERVICES

701.2 - TRANSFER OF FUNDS

(PREVIOUS LANGUAGE): When the necessity for a fund has ceased to exist, the balance may be transferred to another fund or account by board resolution.  School district monies received without a designated purpose may be transferred in this manner.  School district monies received for a specific purpose or upon vote of the people may only be transferred, by board resolution when the purpose for which the monies were received has been completed.  Voter approval is required to transfer monies to the general fund from the capital projects fund and debt service fund.

If all requirements for district use of funds calculated under the teacher leadership supplement are met and funds remain unexpended and unobligated at the end of the fiscal year, the district may transfer all or a portion of remaining funds into the district’s flexibility account in accordance with law.

The district may choose to request approval from the School Budget Review Committee to transfer funds to make a program whole, prior to its elimination.

Temporary transfers (loans) of funds are permitted between funds but must be repaid to the originating fund, with interest, by Oct. 1 following the end of the fiscal year.

It is the responsibility of the business manager to make recommendations to the board regarding transfers and to provide the documentation justifying the transfer.

(PROPOSED LANGUAGE): A school district may transfer funds under the following circumstances:

1. When the necessity for a fund has ceased to exist, the balance may be transferred to another fund or account by board resolution. School district monies received without a designated purpose may be transferred in this manner.
2. School district monies received for a specific purpose or upon vote of the people may only be transferred, by board resolution when the purpose for which the monies were received has been completed.  Voter approval is required to transfer monies to the general fund from the capital projects fund and debt service fund.
3. If all requirements for district use of funds under the Statewide Preschool Program, Professional Development Supplement, Home School Assistance Program, Teacher Leadership Supplement or any discontinued fund have been met and funds remain unexpended and unobligated at the end of the fiscal year, the district may transfer all or a portion of remaining funds by passage of a board resolution into the district’s flexibility account in accordance with law.  Before the expenditure of amounts in the flexibility account, the district shall publish notice of the time, date, and place of a public hearing on the proposed resolution approving said expenditures. The board must find and certify that the statutory requirements of each original source of funds have been met before adopting the resolution approving the expenditures. The district will present a copy of the signed board resolution to the Department of Education.
4. The District may transfer by board resolution from the general fund to the student activity fund an amount needed to purchase or refurbish protective and safety equipment required for any extracurricular interscholastic athletic contest or competition sponsored or administered by the Iowa High School Athletic Association of Iowa Girls High School Athletic Union.
5. If the before and after school child care program exceeds the amount necessary to operate the program, the excess amount may, following a public hearing, be transferred by resolution of the board of directors of the school corporation for deposit in the general fund of the school corporation to be used for school district general fund purposes. The district will present a copy of the signed board resolution to the Department of Education.
6.  Unexpended and unobligated dollars that remain at the end of a fiscal year in addition to ongoing revenues may be transferred to the Teacher Salary Supplement (TSS) program from Professional Development Supplement (PDS), Talented and Gifted (TAG), and Teacher Leadership Supplement (TLS) without board action.
7. The district may choose to request approval from the School Budget Review Committee to transfer funds to make a program whole, prior to its elimination.
8. Temporary transfers (loans) of funds are permitted between funds but must be repaid to the originating fund, with interest, by Oct. 1 following the end of the fiscal year in which the loan was made. 

It is the responsibility of the board secretary in coordination with the Treasurer to make recommendations to the board regarding transfers and to provide the documentation justifying the transfer.

Legal Reference:         Iowa Code §§ 24.21-.22; 279.8; 291.13 (1995).

Cross Reference:         703  Budget

Approved:                   1/20/2000

Reviewed:                  11/16/15

Revised:                      3/21/22

The board may establish other funds in accordance with generally accepted accounting principles and may certify other taxes to be levied for the funds as provided by state law.  The status of each fund must be included in the annual report.

It is the responsibility of the superintendent in conjunction with the school business official to implement this policy and bring necessary changes in the maintenance of the school district's financial records to the attention of the board.

NOTE: The list of funds above does not include the "Library levy fund," which is only available to one school district.  The school district eligible to levy the library levy must add this fund to its policy.

Code No. 701.3

NOTE: For additional information about school district fund structure, please see Chapter 9 of the “Uniform Administrative Procedures for Iowa School District and AEA Officials,” located on the “Uniform Administrative Procedures Manual” section of the Iowa Department of Education’s website.

Legal Reference:           Iowa Code §§291; 298; 298A.

                                    281 I.A.C. 98

Cross Reference:           704       Revenue

                                    705       Expenditures

Approved:     3/21/22

Reviewed:

Revised:

NONINSTRUCTIONAL OPERATIONS AND BUSINESS SERVICES

701.4 - GOVERNMENTAL ACCOUNTING PRACTICES AND REGULATIONS

School district accounting practices will follow state and federal laws and regulations, generally accepted accounting principles (GAAP) and the uniform financial accounting system provided by the Iowa Department of Education.  As advised by the school district’s auditor, determination of liabilities and assets, prioritization of expenditures of governmental funds and provisions for accounting disclosures shall be made in accordance with governmental accounting standards.

In Governmental Accounting Standards Board (GASB) Statement No. 54, the board identifies the order of spending unrestricted resources applying the highest level of classification of fund balance - restricted, committed, assigned, and unassigned - while honoring constraints on the specific purposes for which amounts in those fund balances can be spent.  A formal board action is required to establish, modify and or rescind a committed fund balance.  The resolution will state the exact dollar amount.  In the event, the board chooses to make changes or rescind the committed fund balance, formal board action is required.

The Board authorizes the business manager to assign amounts to a specific purpose in compliance with GASB 54.  An ‘assigned fund balance’ should also be reported in the order of spending unrestricted resources, but is not restricted or committed. 

It is the responsibility of the superintendent to develop administrative regulations implementing this policy.  It is also the responsibility of the superintendent to make recommendations to the board regarding fund balance designations.  

Note:  This policy is an optional policy.  Should the board not adopt a policy implementing GASB54, the default is to reduce – committed, assigned and unassigned fund balances – in that order.  Adoption of a policy gives boards the ability to have greater control over their fund balances.

Legal Reference:           Iowa Code §§ 257.31(4); 279.8; 297.22-.25; 298A.

Cross Reference:           701.3    Financial Records

                                    703       Budget

                                    704       Revenue

Approved:     3/21/22

Reviewed:

Revised:

The Board recognizes its fiduciary responsibility to oversee the management of school district funds in keeping with the school district vision, mission and goals.  To achieve this purpose, the board may engage in learning about the financial needs, operations and requirements of the school district as appropriate for the board’s understanding of the district’s financial position.  The Board also commits to engaging in annual financial goal setting for the district based upon measurable data and projections for the school district.

Monthly, the Superintendent, in coordination with the Treasurer, will provide the board with accurate reports showing the receipts, disbursements, and balances for each fund, cashflow needs, the investment portfolio, and any other reports showing the financial condition of the school district.  After the fiscal year has closed, the Superintendent, in coordination with the Treasurer  will provide to the Board concise, timely, well organized financial data for that fiscal year.  The Board will exercise its oversight responsibilities by reviewing relevant PK-12 public education sector indicators to understand the financial trends of the district.  

The Board will establish and review financial goals and fiscal management performance measures annually and publish in the minutes.  The District will measure whether these goals were obtained as of June 30, but only after completion of the Certified Annual Report due September 15th each year.

Providing the best possible educational experience for all students and meeting federal, state, and local academic goals for each student requires maximizing General Fund resources for use in the instructional program. The board may request from the School Budget Review Committee (SBRC) additional modified spending authority (MSA) where it may be available for items such as:

• Special education deficit balances
• Advances to support increasing student enrollment
• Supports for students identified as English Learners
• At risk / dropout prevention programming
• Initial staffing associated with opening new buildings or programs
• Any other lawful purpose

Any award of modified supplement amount will be levied as a cash reserve based on the recommendation of the Superintendent in coordination with the Treasurer  and approved by the Board of Directors, consistent with its annual financial goals and the fiscal management performance measures..

Legal Reference:  Iowa Code §§ 257.7, 31; 279.8
 

The following relevant PK-12 public sector indicators will be provided to the Board annually to better understand the financial trends of the district.  These indicators will be an accurate depiction as of June 30th of the preceding fiscal year and will depict at a minimum of 5 years of data.  

• Total revenues and expenditures by fund and major sources; 

• Financial Solvency Ratio - assigned plus unassigned fund balances divided by total revenue minus AEA flow through;

• Unspent Authorized Budget Ratio - amount of maximum spending authority left at year end after deducting the general fund expenditures incurred during the year;

• Unspent Authorized Balance Ratio Net of Restricted Fund Balances (Categorical Fund Balances) - amount of maximum spending authority left at year end after deducting both the general fund expenditures incurred during the year and the total restricted fund balances (categorical fund balances) at year end;

• Enrollment Trend - funding follows the student so it is important to understand district enrollment numbers;

• Staff costs as a percent of total general fund. 

Financial Projections

Five-year financial projections of the general fund will be prepared and updated annually. The general fund is the operating fund of the district where the majority of salaries and benefits are funded.  Projections will help the board determine sustainability of the annual operating budget and help make future budgetary decisions.

The District is committed to utilizing the following financial metrics in determining district financial goals:

Financial Projections

Five-year financial projections of the general fund will be prepared and updated annually to assist the Board in evaluating long-term financial sustainability and making informed budgetary decisions.

The District is committed to maintaining financial stability through the following minimum financial standards:

1. Unspent Authorized Budget Ratio: Maintain an unspent authorized budget ratio of no less than 15%. The projected balance will be reviewed annually with the Board before staffing and other significant expenditure decisions are finalized for the succeeding year.

2. Unspent Authorized Budget Net of Restricted Fund Balances (Categorical Balances): Maintain an unspent authorized budget ratio, excluding restricted categorical balances, of no less than 10%. The District will strive to utilize categorical allocations in the year received, consistent with applicable requirements and allowable expenditures.

3. Solvency Ratio: Maintain an unrestricted, uncommitted general fund balance of no less than 10%. The projected solvency ratio will be reviewed annually before establishing the succeeding year's cash reserve levy and making significant staffing or expenditure decisions.

If any financial metric falls below its established minimum, the administration will present the Board with a financial improvement plan outlining strategies and a reasonable timeline for restoring the minimum standard.