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ARIZONA HOUSE OF REPRESENTATIVES57th Legislature, 2nd Regular Session |
Senate: ED DP 6-0-1-0 | Third Read 29-0-1-0
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SB 1763: school districts; funds; financial reports
Sponsor: Senator Dunn, LD 25
Caucus & COW
Overview
Requires each school district governing board (governing board) to establish an additional monies fund that consists of excess monies from gifts, grants and devises and the school district's unemployment compensation fund. Requires the Auditor General (OAG) to prescribe the format of the school district annual financial report (AFR) by August 15.
History
A governing board must deposit all gifts, grants and devises received with the county treasurer, who must then credit the monies as required by the Uniform System of Financial Records (USFR). If not inconsistent with the terms of the gifts, grants and devises, any monies remaining after the expenditures of the intended purposes of the monies must be used to reduce school district taxes. If a governing board does not deposit a gift or grant that is less than $1,500 and designated for use by a teacher for instructional purposes with the county treasurer as previously described, the governing board must deposit the grant and gift in a separate bank account. Monies that are not spent before the end of the fiscal year must remain in the bank account until needed for instructional purposes (A.R.S. §§ 15-341 and 15-1224).
A school district's unemployment compensation fund consists of unemployment compensation monies that are deposited with the county treasurer. An unemployment compensation fund is a continuing fund and not subject to reversion. If the governing board, or the superintendent or chief administrative officer with governing board approval, determine that monies accumulated are in excess of insurance needs, the governing board must use the excess monies to reduce school district taxes (A.R.S. § 15-1104).
The OAG, in conjunction with the Arizona Department of Education (ADE), must prescribe the format of the AFR, which contains budgeted and actual expenditures for the preceding fiscal year. By August 15, a governing board must submit a copy of the AFR to the county school superintendent and the Superintendent of Public Instruction. By November 15, a governing board must publish the AFR (A.R.S. § 15-904) (USFR).
Provisions
School District Additional Monies Fund
1. Directs each governing board to establish an additional monies fund that consists of:
a. monies remaining after expenditures for the intended purposes of gifts, grants and devises received by the school district; and
b. unemployment compensation fund monies determined to be in excess of insurance needs. (Sec. 6)
2. Declares additional fund monies are not subject to reversion. (Sec. 6)
3. Allows a school district to use monies in its additional monies fund for any lawful purpose. (Sec. 6)
4. Prohibits a school district from transferring monies from its maintenance and operations fund or unrestricted capital outlay fund into the additional monies fund. (Sec. 6)
5. Allows a governing board to transfer to its additional monies fund:
a. any balance remaining after expenditures for the intended purposes of gifts, grants and devises received by the school district; and
b. unemployment compensation fund monies determined to be in excess of insurance needs. (Sec. 1, 3)
6. Repeals statute that requires a governing board to deposit in a separate bank account grants or gifts that are:
a. less than $1,500;
b. designated for use by a teacher for instructional purposes; and
c. not deposited with the county treasurer. (Sec. 4)
7. Instructs each governing board to:
a. close the bank account opened to receive grants and gifts that are less than $1,500 and designated for use by a teacher for instructional purposes; and
b. transfer any remaining monies to the county treasurer for deposit in the school district's additional monies fund. (Sec. 7)
Miscellaneous
8. Directs the OAG, in conjunction with ADE, to prescribe the format of the school district AFR and AFR summary form by August 15. (Sec. 2)
9. Makes technical and conforming changes. (Sec. 1, 2, 3, 5)
Amendments
Committee on Education
1. Removes the authorization for a governing board to transfer excess unemployment compensation fund monies to the additional monies fund.
2. Clarifies that the additional monies fund is subject to statute that requires a governing board to deposit all monies received by a school district with the county treasurer.
3. Specifies the additional monies fund is a cash controlled fund.
4. Requires a governing board to authorize each expenditure from the additional monies fund by a majority vote before the monies are spent and without the use of a consent agenda.
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8. Initials CH/JA SB 1763
9. 3/25/2026 Page 0 Caucus & COW
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