Chapter 3301-92 Distribution of State Aid
Cite as Ohio Admin. Code 3301-92-01
Five Year Review (FYR) Dates: 02/05/2016
Promulgated Under: 119.03
Statutory Authority: 3301.07, 3315.17
Rule Amplifies: 3315.17 , 3315.171
Prior Effective Dates: 6/22/98, 12/24/05, 4/23/2011
(A) As used in this rule, "capital improvements and maintenance" means the acquisition, replacement, enhancement, maintenance or repair of permanent improvements as those terms are defined in this rule.
(2) "Acquisition" means addition of or assuming possession of an asset.
(3) "Replacement" means the substitution of one asset for another of substantially similar value or quality.
(4) "Enhancement" means the modification of an existing asset that increases its value, quality or life expectancy.
(5) "Maintenance or repair" means the act of keeping a permanent improvement in normal working condition. "Maintenance or repair" includes preventative maintenance, periodic repairs and replacement of parts, structural components and other activities needed to maintain the asset but does not include routine janitorial and utility costs. Any non-routine janitorial cost shall be substantiated through a work order.
(B) In each fiscal year, except as provided in division (D) of section 3315.18 of the Revised Code, the school district shall set aside for capital improvements and maintenance, the amount required by division (A) of section 3315.18 of the Revised Code according to the schedule set forth in rule 117-6-03 of the Administrative Code unless the board of education elects, by board resolution, to set aside funds for capital improvements and maintenance in accordance with section 3315.19 of the Revised Code.
The required set aside may be reduced in any fiscal year by any amount received during the same fiscal year from a permanent improvement levy as authorized under section 5705.21 of the Revised Code.
(C) If the board of education elects to set aside funds in accordance with section 3315.19 of the Revised Code, the amount of the set aside shall equal three per cent of all revenues received by the district for operating expenses for the prior fiscal year.
For a city, local or exempted village school district, "all revenues received by the district for operating expenses" means the school district's general fund revenue in the prior fiscal year from property taxes as provided for in Chapter 5705. of the Revised Code plus income taxes as provided in Chapter 5748. of the Revised Code after adjusting for payments for students participating in an open enrollment agreement pursuant to section 3313.98 of the Revised Code, students attending a community school pursuant to Chapter 3314. of the Revised Code, or students receiving an educational choice scholarship pursuant to Chapter 3310. of the Revised Code plus any amount of this revenue that would have been allocated to the general fund but was allocated to the debt service fund for payment of tax or revenue anticipation notes.
For a joint vocational school district, "all revenues received by the district for operating expenses" means the school district's general fund revenue in the prior fiscal year from property taxes as provided for in Chapter 5705. of the Revised Code plus income taxes as provided for in Chapter 5748. of the Revised Code plus funds provided to the district pursuant to division (B) of section 3317.16 of the Revised Code plus any amount of this revenue that would have been allocated to the general fund but was allocated to the debt service fund or payment of tax or revenue anticipation notes.
(D) The amount set aside for capital improvements and maintenance shall be accounted for within the school district's general fund using a generally accepted accounting method. The school district shall appropriate from the amount set aside for capital improvements and maintenance and maintain appropriate accounting records for amounts expended. Any unexpended balance shall carry forward to the subsequent fiscal year. Any unexpected balance carried forward to the subsequent fiscal year does not reduce the amount of the set aside required by paragraph (B) of this rule. This requirement to set aside an amount for capital improvements and maintenance applies only to those school districts as defined in division (A) of section 3315.18 of the Revised Code.
(E) As part of each school district's annual financial report, the school district shall prepare a supplemental schedule pursuant to reporting procedures prescribed by the auditor of state to demonstrate compliance with this rule. The supplemental schedule shall include the following:
(1) The balance of the set aside carried forward from the previous fiscal year;
(2) The current fiscal year set aside amount;
(3) Qualifying expenditures;
(5) The balance of the set aside carried forward to the subsequent fiscal year.
(F) Restricted revenue including, but not limited to, funding received from e-tech Ohio, state aid for bus purchases and specific state and federal grants may not be used to meet the amount required to be set aside for capital improvements and maintenance.
(G) Acceptable costs for acquisitions, replacements and enhancements of permanent improvements include, but are not limited to: acquisition price; direct materials, labor and overhead incurred during a qualifying project; professional fees necessary to complete a qualifying project; site preparation; demolition or removal of any existing assets; freight and handling; and principal included as part of the cost of a capital lease. Acquisitions, replacements and enhancements of permanent improvements does not include debt service on a long-term debt whose proceeds were used for capital improvements and maintenance.
Cite as Ohio Admin. Code 3301-92-02
Five Year Review (FYR) Dates: 02/05/2016 and 06/13/2021
Promulgated Under: 119.03
Statutory Authority: 3301.07, 3315.18
Rule Amplifies: 3315.18
Prior Effective Dates: 6/22/98, 12/24/2005, 4/23/2011
Rescinded eff 9-24-05
(A) Upon the adoption of an annual appropriation measure but no later than October thirty-first of each fiscal year, a board of education shall submit to the department of education a five-year projection of revenues and expenditures for the current fiscal year and the ensuing four fiscal years.
(B) The projection and all updates shall contain information and be in a format as prescribed by the department of education and auditor of state.
(C) The department of education or auditor of state may require historical financial information as part of the report.
(D) The department of education shall examine, at no cost to the district, the five-year projections and determine whether any further fiscal analysis is needed to ascertain whether a district has the potential to incur a deficit during the first three years of the five-year period. The auditor of state may conduct further audits or analyses and shall notify the department of education of the district's fiscal condition. If after further analysis, the department of education finds that a potential deficit exists in any one of the first three years of the five-year period, the department of education shall notify the district and the auditor of state pursuant to section 5705.391 of the Revised Code. Notification shall consist of a letter from the department of education to the board of education, with a copy to the auditor, identifying the year in which the potential deficit begins.
(E) A board of education notified under division (A) of section 5705.391 of the Revised Code shall submit a district approved written plan in a timely manner as required to the department of education to eliminate any current deficits and avoid the projected future deficits.
(F) Effective with the fiscal year beginning July 1, 2002, a board of education shall update its five-year projection between April first and May thirty-first of each fiscal year and submit it to the department of education. Nothing precludes a board of education from filing other updates to its five-year projection at any time in addition to the filings required by paragraphs (A) and (F) of rule 3301-92-04 of the Administrative Code.
Cite as Ohio Admin. Code 3301-92-04
(A) "Qualifying contract" has the same meaning as in section 5705.412 of the Revised Code. Expenditures that, if they meet the criteria in divisions (A)(1) and (A)(2) of section 5705.412 of the Revised Code, are to be qualifying contracts include, but are not limited to:
(1) Negotiated agreements;
(2) Contracts for benefits; and
(1) Qualifying contracts;
(2) Appropriation measures; and
(3) Increased salary or wage schedules.
(1) Property taxes;
(a) For current year revenues, estimates may be based on assessed values and effective tax rates.
(b) For future years, revenue growth may be based on historical patterns including, but not limited to, reappraisal, updates, unusual growth or declines in valuation, collection rates and refunds.
(2) Income taxes;
(a) Income tax estimates may be based on estimates provided by the department of taxation.
(b) Certifications of appropriation measures under section 5705.412 of the Revised Code shall not anticipate the approval to extend a current income tax beyond its expiration nor anticipate the revenue from a new levy.
(3) State aid;
(a) Estimates may be based on the most current annual estimate of state funding and historical patterns and modifications may be made based on changes in average daily membership, valuation, and other factors that may result in significant adjustments to funding levels. These other factors include, but are not limited to, parity aid or other similar programs for which the school district can reasonably assume continued funding.
(4) Property tax allocation; and
(a) Calculate the average percentage of property tax allocation receipts to property tax receipts over the prior three fiscal years. For each year of the certification, multiply estimated property tax receipts by the average percentage of property tax allocation receipts to calculate the estimate.
(5) State and federal grants.
(a) Estimates may include the continuation of existing programs that are reasonably expected to continue.
(b) Estimates shall not include new programs that have not been approved by the granting authority.
(D) A school district may include anticipated proceeds from the issuance of debt as estimated revenue for the purpose of certification.
(E) A school district shall not include:
(1) Each school district shall maintain a continuing record of the contracts which have been certified. This record includes, but is not limited to, vendor name, contract amount, contract amount allocated by year, purchase order number and date; and
(2) All information, records and documentation used to estimate available resources or any change made to the five-year projection including, but not limited to, the current annual estimate of state funding, property tax calculations, fee schedules and average daily membership calculations shall be retained by the school district and be made available to the auditor of state or the independent public accountant at the time the school district is audited pursuant to section 117.11 of the Revised Code.
(G) The certification under section 5705.412 of the Revised Code shall be based on the current five-year projection. If the revenue assumptions or the revenue estimates used as a basis for the certificate differ from the current five-year projection, the projection needs to be updated to reflect the new information. If the certificate is associated with a contract or obligation that results in additional costs or changes in the expenditure assumptions in the current five-year projection, the projection must be updated to reflect the new information. Any change to the five-year projection must be approved by the board of education. Each school district shall maintain sufficient documentation to support these changes.
Cite as Ohio Admin. Code 3301-92-05