15-905

15-905. School district budgets; notice;
adoption; aggregate budget limit; summary; adjustments; impact aid
fund; definition

A. Not later than July 5 of each year or no later than the publication of notice of
the public hearing and board meeting as required by this section, the governing board of
each school district shall prepare and furnish to the superintendent of public
instruction and the county school superintendent, unless waived by the county school
superintendent, a proposed budget in electronic format for the budget year, which shall
contain the information and be in the form as provided by the department of education.
The proposed budget shall include the following:

1. The total amount of revenues from all sources that was necessary to meet the
school district's budget for the current year.

2. The total amount of revenues by source that will be necessary to meet the
proposed budget of the school district, excluding property taxes. The governing board
shall prepare the proposed budget and a summary of the proposed budget. Both documents
shall be kept on file at the school district office and shall be made available to the
public upon request. The auditor general in conjunction with the department of education
shall prescribe the form of the summary of the proposed budget for use by governing
boards. School district governing boards may include in the proposed budget any items or
amounts which are authorized by legislation filed with the secretary of state and which
will become effective during the budget year. If subsequent events prevent the
legislation from becoming effective, school district governing boards must reduce their
budgets by the amounts budgeted pursuant to the legislation which did not become
effective.

B. The governing board of each school district shall prepare a notice fixing a time
not later than July 15 and designating a public place within each school district at
which a public hearing and board meeting shall be held. The governing board shall
present the proposed budget for consideration of the residents and the taxpayers of the
school district at such hearing and meeting.

C. The governing board of each school district shall publish or mail, prior to the
hearing and meeting, a copy of the proposed budget or the summary of the proposed budget
and, in addition, a notice of the public hearing and board meeting no later than ten days
prior to the meeting. The proposed budget and the summary of the proposed budget shall
contain the percentage of increase or decrease in each budget category of the proposed
budget as compared to each category of the budget for the current year. Notification
shall be either by publication in a newspaper of general circulation within the school
district in which the size of the newspaper print shall be at least eight-point type, by
electronic transmission of the information to the department of education for posting on
the department's website or by mailing the information to each household in the school
district. The cost of publication, website posting or mailing shall be a charge against
the school district. The publisher's affidavit of publication shall be filed by the
governing board with the superintendent of public instruction within thirty days after
publication. If the budget or proposed budget and notice are posted on a website
maintained by the department of education or mailed, the board shall file an affidavit
with the superintendent of public instruction within thirty days after the mailing or the
date that the information is posted on the website. If a truth in taxation notice and
hearing is required under section 15-905.01, the governing board may combine the notice
and hearing under this section with the truth in taxation notice and hearing.

D. At the time and place fixed in the notice, the governing board shall hold the
public hearing and present the proposed budget to the persons attending the
hearing. Upon request of any person, the governing board shall explain the budget, and
any resident or taxpayer of the school district may protest the inclusion of any item. A
governing board member who has a substantial interest, as defined in section 38-502, in a
specific item in the school district budget shall refrain from voting on the specific
item. A governing board member may participate without creating a conflict of interest
in adoption of a final budget even though the member may have substantial interest in
specific items included in the budget.

E. Immediately following the public hearing the president shall call to order the
governing board meeting for the purpose of adopting the budget. The governing board shall
adopt the budget, which shall not exceed the general budget limit, the unrestricted
capital budget limit or the soft capital allocation limit, making such deductions as it
sees fit but making no additions to the proposed budget total for maintenance and
operations or capital outlay, and shall enter the budget as adopted in its minutes. Not
later than July 18, the budget as finally adopted shall be filed by the governing board
with the county school superintendent who shall immediately transmit a copy to the board
of supervisors. Not later than July 18, the budget as finally adopted shall be submitted
electronically to the superintendent of public instruction. On or before October 30, the
superintendent of public instruction shall review the budget and notify the governing
board if the budget is in excess of the general budget limit, the unrestricted capital
budget limit or the soft capital allocation limit. The governing board shall revise the
budget as follows:

1. If the governing board receives notification that the budget exceeds the general
budget limit, the unrestricted capital budget limit or the soft capital allocation limit
by one per cent of the general budget limit or one hundred thousand dollars, whichever is
less, it shall adopt on or before December 15, after it gives notice and holds a public
meeting in a similar manner as provided in subsections C and D of this section, a revised
budget for the current year, which shall not exceed the general budget limit, the
unrestricted capital budget limit or the soft capital allocation limit.

2. If the governing board receives notification that the budget exceeds the general
budget limit, the unrestricted capital budget limit or the soft capital allocation limit
by less than the amount prescribed in paragraph 1 of this subsection, the governing board
shall adjust the budget and expenditures so as not to exceed the general budget limit,
the unrestricted capital budget limit or the soft capital allocation limit for the
current year.

3. On or before December 18, the governing board shall file the revised budget it
adopts with the county school superintendent who shall immediately transmit a copy to the
board of supervisors. Not later than December 18, the budget as revised shall be
submitted electronically to the superintendent of public instruction. School districts
that are subject to section 15-914.01 are not required to send a copy of revised budgets
to the county school superintendent. Procedures for adjusting expenditures or revising
the budget shall be as prescribed in the uniform system of financial records.

F. The governing board of each school district may budget for expenditures within
the school district budget as follows:

1. Amounts within the general budget limit, as provided in section 15-947,
subsection C, may only be budgeted in the following sections of the budget:

(a) The maintenance and operation section.

(b) The capital outlay section.

2. Amounts within the unrestricted capital budget limit, as provided in section
15-947, subsection D, may only be budgeted in the unrestricted capital outlay subsection
of the budget. Monies received pursuant to the unrestricted capital budget limit shall be
placed in the unrestricted capital outlay fund. The monies in the fund are not subject
to reversion.

3. The soft capital allocation limit, as provided in section 15-947, subsection E,
may only be budgeted in the soft capital allocation subsection of the budget.

G. The governing board may authorize the expenditure of monies budgeted within the
maintenance and operation section of the budget for any subsection within the section in
excess of amounts specified in the adopted budget only by action taken at a public
meeting of the governing board and if the expenditures for all subsections of the section
do not exceed the amount budgeted as provided in this section

H. The aggregate budget limit is the sum of the following:

1. The general budget limit as determined in section 15-947 for the budget year.

2. The unrestricted capital budget limit as determined in section 15-947 for the
budget year.

3. The soft capital allocation limit for the budget year as determined in section
15-947.

4. Federal assistance, excluding title VIII of the elementary and secondary
education act of 1965 monies.

I. School districts which overestimated tuition revenues as provided in section
15-947, subsection C, paragraph 2 shall adjust the general budget limit and expenditures
based upon tuition revenues for attendance of nonresident pupils during the current
fiscal year. School districts which underestimated tuition revenues may adjust their
budgets prior to May 15 based upon tuition revenues for attendance of nonresident pupils
during the current fiscal year. School districts which overestimated revenues as
provided in section 15-947, subsection C, paragraph 2, subdivision (a), items (iii), (iv)
and (v) and subdivision (d) shall adjust the general budget limit and expenditures based
on actual revenues during the current fiscal year. School districts which underestimated
such revenues may adjust their budgets before May 15 based on actual revenues during the
current fiscal year. Procedures for completing adjustments shall be as prescribed in the
uniform system of financial records. Not later than May 18, the budget as adjusted shall
be submitted electronically to the superintendent of public instruction.

J. A common school district not within a high school district whose estimated
tuition charge for high school pupils exceeds the actual tuition charge for high school
pupils shall adjust the general budget limit and expenditures based on the actual tuition
charge. Not later than May 18, the budget as adjusted shall be submitted electronically
to the superintendent of public instruction. A common school district not within a high
school district whose estimated tuition charge for high school pupils is less than the
actual tuition charge for high school pupils may adjust its budget before May 15 based on
the actual tuition charge. Procedures for completing adjustments shall be as prescribed
in the uniform system of financial records. If the adjusted general budget limit
requires an adjustment of state aid and if the adjustment to state aid is not made in the
current year, the superintendent of public instruction shall adjust by August 15 of the
succeeding fiscal year the apportionment of state aid to the school district to correct
any overpayment or underpayment of state aid received during the current year.

K. The governing board may include title VIII of the elementary and secondary
education act of 1965 assistance allocated for children with disabilities, children with
specific learning disabilities, children residing on Indian lands and children residing
within the boundaries of an accommodation school that is located on a military
reservation and that is classified as a heavily impacted local educational agency
pursuant to 20 United States Code section 7703 which is in addition to basic assistance
when determining the general budget limit as prescribed in section 15-947, subsection C.
The increase in the general budget limit for children residing within the boundaries of
an accommodation school that is located on a military reservation and that is classified
as a heavily impacted local education agency shall equal the dollar amount calculated
pursuant to 20 United States Code section 7703(b)(2). The governing board may adjust
before May 15 the budget for the current year based on any adjustments which result in
increases over the amount estimated by the superintendent of public instruction for title
VIII of the elementary and secondary education act of 1965 assistance for such pupils for
the fiscal year preceding the current year. The governing board shall adjust before May
15 the budget for the current year based on any adjustments which result in decreases in
the amount estimated by the superintendent of public instruction for title VIII of the
elementary and secondary education act of 1965 assistance for such pupils for the fiscal
year preceding the current year. Not later than May 18, the budget as adjusted shall be
submitted electronically to the superintendent of public instruction. Procedures for
complying with this subsection shall be as prescribed in the uniform system of financial
records.

L. The department of education shall notify the state board of education if
expenditures by any school district exceed the general budget limit prescribed in section
15-947, subsection C, the unrestricted capital budget limit, the soft capital allocation
limit prescribed in section 15-947, subsection E, the school plant fund limits prescribed
in section 15-1102, subsection B, the maintenance and operation section of the budget or
the capital outlay section of the budget. If the expenditures of any school district
exceed these limits or sections of the budget without authorization as provided in
section 15-907, and if the state board of education determines that the equalization
assistance for education received by the school district as provided in section 15-971
does not conform with statutory requirements, the state board of education shall reduce
the state aid for equalization assistance for education for the school district computed
as provided in section 15-971 during the fiscal year subsequent to the fiscal year in
which the excess equalization assistance for education was received by an amount equal to
the excess equalization assistance for education, except that in case of hardship to the
school district, the superintendent of public instruction may approve reductions partly
in the first subsequent year and partly in the second subsequent year. If the state board
of education determines that the equalization assistance for education received by the
school district conforms with statutory requirements, the state board of education shall
not reduce the district's equalization assistance for education pursuant to this
subsection but the district shall reduce the budget limits as required in subsection M of
this section. A school district that disagrees with the department of education's
determination regarding an excess expenditure under this subsection may request a hearing
before the state board of education.

M. The governing board of a school district shall reduce the general budget limit,
the unrestricted capital budget limit or the soft capital allocation limit for the year
subsequent to the year in which the expenditures were in excess of the applicable limit
or section of the budget by the amount determined in subsection L of this section, except
that in case of hardship to the school district, the superintendent of public instruction
may approve reductions partly in the first subsequent year and partly in the second
subsequent year. The reduction in the limit is applicable to each school district which
has exceeded the general budget limit, the unrestricted capital budget limit, the soft
capital allocation limit or a section of the budget even if the reduction exceeds the
state aid for equalization assistance for education for the school district.

N. Except as provided in section 15-916, no expenditure shall be made by any school
district for a purpose not included in the budget or in excess of the aggregate budget
limit prescribed in this section, except that if no budget has been adopted, from July 1
to July 15 the governing board may make expenditures if the total of the expenditures
does not exceed ten per cent of the prior year's aggregate budget limit. Any expenditures
made from July 1 to July 15 and prior to the adoption of the budget shall be included in
the total expenditures for the current year. No expenditure shall be made and no debt,
obligation or liability shall be incurred or created in any year for any purpose itemized
in the budget in excess of the amount specified for the item irrespective of whether the
school district at any time has received or has on hand funds in excess of those required
to meet the expenditures, debts, obligations and liabilities provided for under the
budget except expenditures from cash controlled funds as defined by the uniform system of
financial records and except as provided in section 15-907 and subsection G of this
section. This subsection does not prohibit any school district from prepaying insurance
premiums or magazine subscriptions, or from prepaying any item which is normally prepaid
in order to procure the service or to receive a discounted price for the service, as
prescribed by the uniform system of financial records.

O. The governing board of a school district which is classified as a heavily
impacted school district having twenty per cent or more pupils pursuant to 20 United
States Code section 238(d)1(A) may determine its eligibility to increase the amount that
may be included in determining the general budget limit as provided in subsection K of
this section and may increase the amount as follows:

1. For fiscal year 1988-1989:

(a) Multiply one thousand ninety-four dollars by the number of children with
disabilities or children with specific learning disabilities, excluding children who also
reside on Indian lands, reported to the division of impact aid, United States department
of education in the district's application for fiscal year 1987-1988.

(b) Multiply five hundred forty-seven dollars by the number of children residing on
Indian lands, excluding children who have disabilities or also have specific learning
disabilities, reported to the division of impact aid, United States department of
education in the district's application for fiscal year 1987-1988.

(c) Multiply one thousand nine hundred fourteen dollars by the number of children
residing on Indian lands who have disabilities or also have specific learning
disabilities reported to the division of impact aid, United States department of
education in the district's application for fiscal year 1987-1988.

(d) Add the amounts determined in subdivisions (a) through (c).

(e) If the amount of title VIII of the elementary and secondary education act of
1965 assistance as provided in subsection K of this section is less than the sum
determined in subdivision (d) of this paragraph, the district is eligible to use the
provisions of this subsection.

2. For budget years after 1988-1989, use the provisions of paragraph 1 of this
subsection, but increase each dollar amount by the growth rate for that year as
prescribed by law, subject to appropriation and use the number of children reported in
the appropriate category for the current fiscal year.

3. If the district is eligible to use the provisions of this subsection, subtract
the amount of title VIII of the elementary and secondary education act of 1965 assistance
determined in subsection K of this section from the sum determined in paragraph 1,
subdivision (d) of this subsection. The difference is the increase in the amount that may
be included in determining the general budget limit as provided in subsection K of this
section, if including this amount does not increase the district's primary tax rate for
the budget year. If the amount of title VIII of the elementary and secondary education
act of 1965 assistance determined in subsection K of this section is adjusted for the
current year, the increase determined in this paragraph shall be recomputed using the
adjusted amount and the recomputed increase shall be reported to the department of
education by May 15 on a form prescribed by the department of education.

4. If a district uses the provisions of this subsection, the district is not
required to adjust its budget for the current year based on adjustments in the estimated
amount of title VIII of the elementary and secondary education act of 1965 assistance as
provided in subsection K of this section.

P. A school district, except for an accommodation school, which applies for title
VIII of the elementary and secondary education act of 1965 assistance during the current
year may budget an amount for title VIII of the elementary and secondary education act of
1965 administrative costs for the budget year. The amount budgeted for title VIII of the
elementary and secondary education act of 1965 administrative costs is exempt from the
revenue control limit and may not exceed an amount determined for the budgeted year as
follows:

1. Determine the minimum cost. The minimum cost for fiscal year 1990-1991 is two
thousand three hundred forty-three dollars. For fiscal year 1991-1992 and thereafter, the
minimum cost is the minimum cost for the prior year increased by the growth rate as
prescribed by law, subject to appropriation.

2. Determine the hourly rate. The hourly rate for fiscal year 1990-1991 is nine
dollars thirty-eight cents. For fiscal year 1991-1992 and thereafter, the hourly rate is
the hourly rate for the prior year increased by the growth rate as prescribed by law,
subject to appropriation.

3. Determine the title VIII of the elementary and secondary education act of 1965
revenues available by subtracting the amount of title VIII of the elementary and
secondary education act of 1965 assistance used to increase the general budget limit as
provided in subsections K and O of this section for the current fiscal year from the
total amount of title VIII of the elementary and secondary education act of 1965 revenues
received in the current fiscal year.

4. Determine the total number of administrative hours as follows:

(a) Determine the sum of the following:

(i) 1.00 hours for each high impact pupil who is not disabled or does not have
specific learning disabilities.

(ii) 1.25 hours for each high impact pupil who is disabled or has specific learning
disabilities.

(iii) 0.25 hours for each low impact pupil who is not disabled or does not have
specific learning disabilities.

(iv) 0.31 hours for each low impact pupil who is disabled or has specific learning
disabilities.

(b) For the purposes of this paragraph:

(i) "High impact pupil" means a pupil who resides on Indian lands or a pupil who
resides on federal property or in low rent housing and whose parent is employed on
federal property or low rent housing property or is on active duty in uniformed service,
as provided in title VIII of the elementary and secondary education act of 1965, section
8003(a) (20 United States Code section 7703) and as reported in the application for title
VIII of the elementary and secondary education act of 1965 assistance in the current
year.

(ii) "Low impact pupil" means a pupil who resides on nonfederal property and has a
parent who is employed on federal property or low rent housing property or is on active
duty in a uniformed service or a pupil who resides on federal property or in low rent
housing and who does not have a parent who is employed on federal property or low rent
housing property or is on active duty in uniformed service, as provided in title VIII of
the elementary and secondary education act of 1965, section 8003(a) (20 United States
Code section 7703) and as reported in the application for title VIII of the elementary
and secondary education act of 1965 assistance in the current year.

5. Multiply the total number of administrative hours determined in paragraph 4 of
this subsection by the hourly rate determined in paragraph 2 of this subsection.

6. Determine the greater of the minimum cost determined in paragraph 1 of this
subsection or the product determined in paragraph 5 of this subsection.

7. Add to the amount determined in paragraph 6 of this subsection the amount, if
any, to be expended by the school district in the budget year through an
intergovernmental agreement with other school districts or the department of education to
provide title VIII of the elementary and secondary education act of 1965 technical
assistance to participating districts.

8. Determine the lesser of the amount determined in paragraph 7 of this subsection
or the revenues available as determined in paragraph 3 of this subsection.

9. The amount determined in paragraph 8 of this subsection is the maximum amount
which may be budgeted for title VIII of the elementary and secondary education act of
1965 administrative costs for the budget year as provided in this subsection.

10. If the governing board underestimated the amount that may be budgeted for title
VIII of the elementary and secondary education act of 1965, section 8007 administrative
costs for the current year, the board may adjust the general budget limit and the budget
before May 15. If the governing board overestimated the amount that may be budgeted for
title VIII of the elementary and secondary education act of 1965 administrative costs for
the current year, the board shall adjust the general budget limit and the budget before
May 15.

Q. If a school district governing board has adopted a budget for a fiscal year
based on forms and instructions provided by the auditor general and the department of
education for that fiscal year and if, as a result of the enactment or nonenactment of
proposed legislation after May 1 of the previous fiscal year, the budget is based on
incorrect limits, does not include items authorized by law or does not otherwise conform
with law, the governing board may revise its budget at a public hearing on or before
September 15 to conform with the law. Not later than September 18, the budget as
adjusted shall be submitted electronically to the superintendent of public instruction.
If the governing board does not revise the budget on or before September 15 and if the
budget includes any items not authorized by law or if the budget exceeds any limits, the
governing board shall adjust or revise the budget as provided in subsection E of this
section.

R. Notwithstanding any other law, if a school district receives assistance pursuant
to title VIII of the elementary and secondary education act of 1965, the school district
shall establish a local level fund designated as the impact aid fund and deposit the
impact aid monies received in the fund. The school district shall separately account for
monies in the fund and shall not combine monies in the fund with any other source of
local, state or federal assistance. Monies in the fund shall be expended pursuant to
federal law only for the purposes allowed by this title. The school district shall
account for monies in the fund according to the uniform system of financial records as
prescribed by the auditor general. The superintendent of public instruction shall
separately account for monies in each school district's impact aid fund, if an impact aid
fund is established, in the annual report required by section 15-255. Monies in the fund
are considered federal monies and are not subject to legislative appropriation.

S. For the purposes of this section, "title VIII of the elementary and secondary
education act of 1965 assistance" means, for the current year, an amount equal to the
final determination of title VIII of the elementary and secondary education act of 1965
assistance for the fiscal year preceding the current year as confirmed by the division of
impact aid, United States department of education or, if a final determination has not
been made, the amount estimated by the superintendent of public instruction as confirmed
by the division of impact aid, United States department of education and, for the budget
year, an amount equal to the determination of title VIII of the elementary and secondary
education act of 1965 assistance for the fiscal year preceding the budget year as
estimated by the superintendent of public instruction.