802

802.1 Local, State, and Federal Income

F. C. SCHOOL BOARD POLICIES
 
Series 800 - Business Procedures
 
Local, State, and Federal Income                       Code No. 802.1
 
Revenues of the school district shall be received by the board treasurer or designee.  Other persons receiving revenues on behalf of the school district shall promptly receipt the money and deposit the money in a timely manner.
 
Revenue, from whatever source, shall be accounted for and classified under the official accounting system of the school district.  it shall be the responsibility of the board treasurer to deposit the revenues received by the school district in a timely manner.  To aid the process of collecting revenues, ACH payment for school fees, tuition, and insurance payments for retirees will be allowed and any other payments due to the district.  School district funds from all sources shall not be used for private gain or political purposes.  
 
The board may charge materials fees for the use or purchase of educational materials in accordance with state code.  Materials fees received by the school district shall be deposited in the general fund.  It shall be the responsibility of the superintendent, or designee, to recommend to the board when materials fees will be charged and the amount of the materials fees.
 
Rental fees received by the school district for the rental of school district equipment or facilities shall be deposited in the general fund.  It shall be the responsibility of the superintendent, or designee, to recommend to the board a fee schedule for renting school district property.
 
The board grants the superintendent, or designee, the authority to contract with a collection agency to collect non-sufficient funds (NSF) checks and unpaid student fees.  The use of a collection agency must be communicated to all Forest City CSD patrons in accordance with all state and federal Laws.
 
Proceeds from the sale of real property shall be placed in the Physical Plant and Equipment Levy (PPEL) fund.  The proceeds from the sale of other school district property shall be placed in the general fund.
 
It shall be the responsibility of the superintendent, or designee, to bring to the board's attention additional sources of revenue for the school district.  
 
 
Adoption: 6-24-75
                                 
Review: 3-14-94 7-12-99    08-12-10  2-8-16  10-8-18
                                                     
Revision:  10-8-18
                                                                                                  
Cross References: 802.7
 
Legal References:  Chapters 291.12; 452; 453

802.2 Tuition Fees

F. C. SCHOOL BOARD POLICIES
 
Series 800 - Business Procedures
 
Tuition Fees                                         Code No. 802.2 
 
The Board of Directors shall, upon the recommendation of the superintendent of schools, adopt a schedule of tuition fees for the school district's adult education and summer school programs for the ensuing school year.
 
For nonresident students attending elementary or secondary school through open enrollment during the regular school year, the fee shall be the students resident district cost  or the receiving district cost per student, whichever is lower.
 
 
Adoption: 3-13-89
                                 
Review: 7-17-89    7-12-99   08-12-10  2-8-16
                                
Revision: 3-14-94
                                                                                    
Cross References:501.6; 602.5; 602.11
    
Legal References:  282.6; 282.24; 282.2; 442.4; AC 282 

802.3 Educational Material Fees

F. C. SCHOOL BOARD POLICIES
 
Series 800 - Business Procedures
 
Educational Material Fees                             Code No. 802.3
 
The superintendent of schools or his designated officer shall set up the necessary regulations to administer educational fees.  The Board of Directors shall officially adopt a fee schedule prior to each school year.  The fees will be approved annually.
 
 
 
 
 
Adoption:  6-24-75
                                 
Review: 7-17-89  7-12-99     08-12-10  2-8-16
                                                              
Revision: 3-14-94 2-8-16
 
Cross References:
 
Legal References:   A.G. Ruling

802.4 Sale of Bonds

F. C. SCHOOL BOARD POLICIES
 
Series 800 - Business Procedures
 
Sale of Bonds Code No. 802.4
 
The board may conduct an election for the authority to issue bonded indebtedness.  Revenues generated from an approved bond issue shall be used only for the purpose stated on the ballot.  Once the purpose on the ballot is completed, any balance remaining in a capital projects fund may be retained for future capital projects in accordance with the purpose stated on the ballot or any remaining balance may be transferred by board resolution to the debt service fund or the physical plant and equipment levy fund.  Voter approval is required to transfer monies to the general fund from the capital projects fund.
 
Revenues received from the issuing of bonded indebtedness shall be deposited into the capital projects fund.
 
 
 
Adoption: 3-13-89
                                 
Review: 3-14-94   7-12-99   08-12-10 2-8-16
                                                                
Revision: 10-12-06
                                                                                    
Cross Reference:
 
Legal References: Iowa Code §§ 74-76; 278.1; 298; 298A (1997).

802.4-1 Post Issuance Compliance Policy for Tax-Exempt Obligations

F.C SCHOOL BOARD POLICIES
 
Series 800 – Business Procedures
 
Post-Issuance Compliance Policy for Tax-Exempt Obligations    Code No. 802.4-1
 
1. Compliance Coordinator:
 
a) The Board Secretary/Business Manager ("Coordinator") shall be responsible for monitoring post-issuance compliance.
 
b) The Coordinator will maintain a copy of the transcript of proceedings in connection with the issuance of any tax-exempt obligations.  Coordinator will obtain such records as are necessary to meet the requirements of this policy.
 
c) The Coordinator shall consult with bond counsel, a rebate consultant, financial advisor, IRS publications and such other resources as are necessary to understand and meet the requirements of this policy.
 
d) Training and education of Coordinator will be sought and implemented upon the occurrence of new developments and upon the hiring of new personnel to implement this policy.
 
2.  Financing Transcripts.  The Coordinator shall confirm the proper filing of an 8038 Series return, and maintain a transcript of proceedings for all tax-exempt obligations issued by the Forest City Community School District, including but not limited to all tax-exempt bonds, notes and lease-purchase contracts.  Each transcript shall be maintained until eleven (11) years after the tax-exempt obligation it documents has been retired.  Said transcript shall include, at a minimum:
 
a) Form 8038s; 
b) minutes, resolutions, and certificates; 
c) certifications of issue price from the underwriter; 
d) formal elections required by the IRS; 
e) trustee statements; 
f) records of refunded bonds, if applicable; 
g) correspondence relating to bond financings; and 
h) reports of any IRS examinations for bond financings.     
 
3.  Proper Use of Proceeds.  The Coordinator shall review the resolution authorizing issuance for each tax-exempt obligation issued by the Forest City Community School District, and that the Forest City Community School District shall:
 
a) obtain a computation of the yield on such issue from the Forest City Community School District’s financial advisor;  
 
 
 
Post-Issuance Compliance Policy for Tax-Exempt Obligations   (Code No. 802.4-1 cont.)
 
b) create a separate Project Fund (with as many sub-funds as shall be necessary to allocate proceeds among the projects being funded by the issue) into which the proceeds of issue shall be deposited; 
 
c) review all requisitions, draw schedules, draw requests, invoices and bills requesting payment from the Project Fund; 
 
d) determine whether payment from the Project Fund is appropriate, and if so, make payment from the Project Fund (and appropriate sub-fund if applicable); 
 
e) maintain records of the payment requests and corresponding records showing payment;
 
f) maintain records showing the earnings on, and investment of, the Project Fund;
 
g) ensure that all investments acquired with proceeds are purchased at fair market value;
 
h) identify bond proceeds or applicable debt service allocations that must be invested with a yield-restriction and monitor the investments of any yield-restricted funds to ensure that the yield on such investments does not exceed the yield to which such investments are restricted; 
 
i) maintain records related to any investment contracts, credit enhancement transactions, and the bidding of financial products related to the proceeds;
 
4.  Timely Expenditure and Arbitrage/Rebate Compliance.  The Coordinator shall review the Tax-Exemption Certificate (or equivalent) for each tax-exempt obligation issued by the Forest City Community School District and the expenditure records provided in Section 2 of this policy, above, and shall:
 
a) monitor and ensure that proceeds of each such issue are spent within the temporary period set forth in such certificate; 
 
b) if the Forest City Community School District does not meet the “small issuer” exception for said obligation, monitor and ensure that the proceeds are spent in accordance with one or more of the applicable exceptions to rebate as set forth in such certificate;
 
c) not less than 60 days prior to a required expenditure date confer with bond counsel and a rebate consultant if the Forest City Community School District will fail to meet the applicable temporary period or rebate exception expenditure requirements of the Tax-Exemption Certificate; and 
 
Post-Issuance Compliance Policy for Tax-Exempt Obligations   (Code No. 802.4-1 cont.)
 
d) in the event the Forest City Community School District fails to meet a temporary period or rebate exception:
 
i. procure a timely computation of any rebate liability and, if rebate is due, file a Form 8038-T and arrange for payment of such rebate liability; 
 
ii. arrange for timely computation and payment of “yield reduction payments” (as such term is defined in the Code and Treasury Regulations), if applicable.
 
5.  Proper Use of Bond Financed Assets.  The Coordinator shall:  
 
a) maintain appropriate records and a list of all bond financed assets.  Such records shall include the actual amount of proceeds (including investment earnings) spent on each of the bond financed assets; 
 
b) with respect to each bond financed asset, the Coordinator will monitor and confer with bond counsel with respect to all proposed:
 
i. management contracts,
ii. service agreements,
iii. research contracts,
iv. naming rights contracts,
v. leases or sub-leases,
vi. joint venture, limited liability or partnership arrangements,
vii. sale of property; or
viii. any other change in use of such asset;
 
c) maintain a copy of the proposed agreement, contract, lease or arrangement, together with the response by bond counsel with respect to said proposal for at least three (3) years after retirement of all tax-exempt obligations issued to fund all or any portion of bond financed assets; and
 
d) In the event the Forest City Community School District takes an action with respect to a bond financed asset, which causes the private business tests or private loan financing test to be met, the Coordinator shall contact bond counsel and ensure timely remedial action under IRS Regulation Sections 1.141-12.
 
6.  General Project Records.  For each project financed with tax-exempt obligations, the Coordinator shall maintain, until three (3) years after retirement of the tax-exempt obligations or obligations issued to refund those obligations, the following:
 
a) appraisals, demand surveys or feasibility studies,
b) applications, approvals and other documentation of grants,
c) depreciation schedules,
Post-Issuance Compliance Policy for Tax-Exempt Obligations   (Code No. 802.4-1 cont.)
 
d) contracts respecting the project.
 
7.  Advance Refundings. The Coordinator, shall be responsible for the following current, post issuance and record retention procedures with respect to advance refunding bonds:
 
a) Identify and select bonds to be advance refunded with advice from internal financial personnel, and a financial advisor;
 
b) The Coordinator shall identify, with advice from the financial advisor and bond counsel, any possible federal tax compliance issues prior to structuring any advance refunding;
 
c) The Coordinator shall review the structure with the input of the financial advisor and bond counsel, of advance refunding issues prior to the issuance to ensure (i) that the proposed refunding is permitted pursuant to applicable federal tax requirements if there has been a prior refunding of the original bond issue; (ii) that the proposed issuance complies with federal income tax requirements which might impose restrictions on the redemption date of the refunded bonds; (iii) that the proposed issuance complies with federal income tax requirements which allow for the proceeds and replacement proceeds of an issue to be invested temporarily in higher yielding investments without causing the advance refunding bonds to become “arbitrage bonds”; and (iv) that the proposed issuance will not result in the issuer’s exploitation of the difference between tax exempt and taxable interest rates to obtain an financial advantage nor overburden the tax exempt market in a way that might be considered an abusive transaction for federal tax purposes.
 
d) The Coordinator shall collect and review data related to arbitrage yield restriction and rebate requirements for advance refunding bonds. To ensure such compliance, the Coordinator shall engage a rebate consultant to prepare a verification report in connection with the advance refunding issuance. Said report shall ensure said requirements are satisfied. 
 
e) The Coordinator shall, whenever possible, purchase SLGS to size each advance refunding escrow. The financial advisor shall be included in the process of subscribing SLGS. To the extent SLGS are not available for purchase, the Coordinator shall, in consultation with bond counsel and the financial advisor, comply with IRS regulations.
 
f) To the extent as issuer elects to the purchase a guaranteed investment contract, the Coordinator shall ensure, after input from bond counsel, compliance with any bidding requirements set forth by the IRS regulations.
 
g) In determining the issue price for any advance refunding issuance, the Coordinator shall obtain and retain issue price certification by the purchasing underwriter at closing.
Post-Issuance Compliance Policy for Tax-Exempt Obligations    (Code No. 802.4-1 cont.)
 
h) After the issuance of an advance refunding issue, the Coordinator shall ensure timely identification of violations of any federal tax requirements and engage bond counsel in attempt to remediate same in accordance with IRS regulations.
 
8.  Continuing Disclosure. The Coordinator shall assure compliance with each continuing disclosure certificate and annually, per continuing disclosure agreements, file audited annual financial statements and other information required by each continuing disclosure agreement.  The Coordinator will monitor material events as described in each continuing disclosure agreement and assure compliance with material event disclosure.  Events to be reported shall be reported promptly, but in no event not later than ten (10) Business Days after the day of the occurrence of the event.  Currently, such notice shall be given in the event of:
 
a) Principal and interest payment delinquencies;
 
b) Non-payment related defaults, if material;
 
c) Unscheduled draws on debt service reserves reflecting financial difficulties;
 
d) Unscheduled draws on credit enhancements relating to the bonds reflecting financial difficulties;
 
e) Substitution of credit or liquidity providers, or their failure to perform;
 
f) Adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material notices or determinations with respect to the tax-exempt status of the bonds, or material events affecting the tax-exempt status of the bonds;
 
g) Modifications to rights of Holders of the Bonds, if material;
 
h) Bond calls (excluding sinking fund mandatory redemptions), if material, and tender offers;
 
i) Defeasances of the bonds;
 
j) Release, substitution, or sale of property securing repayment of the bonds, if material;
 
k) Rating changes on the bonds;
 
l) Bankruptcy, insolvency, receivership or similar event of the Issuer;
 
 
Post-Issuance Compliance Policy for Tax-Exempt Obligations   (Code No. 802.4-1 cont.)
 
m) The consummation of a merger, consolidation, or acquisition involving the Issuer or the sale of all or substantially all of the assets of the Issuer, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms, if material; and
 
n) Appointment of a successor or additional trustee or the change of name of a trustee, if material.
 
 
 
Adoption  11-12-12                                 Cross References:
Review    7-17-89   3-14-94  7-12-99  2-8-16              Revenue                                    
Revision  8-10-92                                 Treasurer
 

802.4-1 Post-Inssuance Compliance Policy for Tax-Exempt Obligations

F.C SCHOOL BOARD POLICIES
 
Series 800 – Business Procedures
 
Post-Issuance Compliance Policy for Tax-Exempt Obligations    Code No. 802.4-1
 
  1. Compliance Coordinator:
 
  1. The Board Secretary/Business Manager ("Coordinator") shall be responsible for monitoring post-issuance compliance.
  2. The Coordinator will maintain a copy of the transcript of proceedings in connection with the issuance of any tax-exempt obligations.  Coordinator will obtain such records as are necessary to meet the requirements of this policy.
  3. The Coordinator shall consult with bond counsel, a rebate consultant, financial advisor, IRS publications and such other resources as are necessary to understand and meet the requirements of this policy.
  4. Training and education of Coordinator will be sought and implemented upon the occurrence of new developments and upon the hiring of new personnel to implement this policy.
 
  1. Financing Transcripts.  The Coordinator shall confirm the proper filing of an 8038 Series return, and maintain a transcript of proceedings for all tax-exempt obligations issued by the Forest City Community School District, including but not limited to all tax-exempt bonds, notes and lease-purchase contracts.  Each transcript shall be maintained until eleven (11) years after the tax-exempt obligation it documents has been retired.  Said transcript shall include, at a minimum:
 
  1. Form 8038s; 
  2. minutes, resolutions, and certificates; 
  3. certifications of issue price from the underwriter; 
  4. formal elections required by the IRS; 
  5. trustee statements; 
  6. records of refunded bonds, if applicable; 
  7. correspondence relating to bond financings; and 
  8. reports of any IRS examinations for bond financings.     
 
  1. Proper Use of Proceeds.  The Coordinator shall review the resolution authorizing issuance for each tax-exempt obligation issued by the Forest City Community School District, and that the Forest City Community School District shall:
 
  1. obtain a computation of the yield on such issue from the Forest City Community School District’s financial advisor;  
  2. create a separate Project Fund (with as many sub-funds as shall be necessary to allocate proceeds among the projects being funded by the issue) into which the proceeds of issue shall be deposited; 
  3. review all requisitions, draw schedules, draw requests, invoices and bills requesting payment from the Project Fund; 
  4. determine whether payment from the Project Fund is appropriate, and if so, make payment from the Project Fund (and appropriate sub-fund if applicable); 
  5. maintain records of the payment requests and corresponding records showing payment;
  6. maintain records showing the earnings on, and investment of, the Project Fund;
  7. ensure that all investments acquired with proceeds are purchased at fair market value;
  8. identify bond proceeds or applicable debt service allocations that must be invested with a yield-restriction and monitor the investments of any yield-restricted funds to ensure that the yield on such investments does not exceed the yield to which such investments are restricted; 
  9. maintain records related to any investment contracts, credit enhancement transactions, and the bidding of financial products related to the proceeds;
 
  1. Timely Expenditure and Arbitrage/Rebate Compliance.  The Coordinator shall review the Tax-Exemption Certificate (or equivalent) for each tax-exempt obligation issued by the Forest City Community School District and the expenditure records provided in Section 2 of this policy, above, and shall:
 
  1. monitor and ensure that proceeds of each such issue are spent within the temporary period set forth in such certificate; 
  2. if the Forest City Community School District does not meet the “small issuer” exception for said obligation, monitor and ensure that the proceeds are spent in accordance with one or more of the applicable exceptions to rebate as set forth in such certificate;
  3. not less than 60 days prior to a required expenditure date confer with bond counsel and a rebate consultant if the Forest City Community School District will fail to meet the applicable temporary period or rebate exception expenditure requirements of the Tax-Exemption Certificate; and 
  4. in the event the Forest City Community School District fails to meet a temporary period or rebate exception:
 
  1. procure a timely computation of any rebate liability and, if rebate is due, file a Form 8038-T and arrange for payment of such rebate liability; 
  2. arrange for timely computation and payment of “yield reduction payments” (as such term is defined in the Code and Treasury Regulations), if applicable.
 
  1. Proper Use of Bond Financed Assets.  The Coordinator shall:  
 
  1. maintain appropriate records and a list of all bond financed assets.  Such records shall include the actual amount of proceeds (including investment earnings) spent on each of the bond financed assets; 
  2. with respect to each bond financed asset, the Coordinator will monitor and confer with bond counsel with respect to all proposed:
 
i. management contracts,
ii. service agreements,
iii. research contracts,
iv. naming rights contracts,
v. leases or sub-leases,
vi. joint venture, limited liability or partnership arrangements,
vii. sale of property; or
viii. any other change in use of such asset;
 
  1. maintain a copy of the proposed agreement, contract, lease or arrangement, together with the response by bond counsel with respect to said proposal for at least three (3) years after retirement of all tax-exempt obligations issued to fund all or any portion of bond financed assets; and
  2. In the event the Forest City Community School District takes an action with respect to a bond financed asset, which causes the private business tests or private loan financing test to be met, the Coordinator shall contact bond counsel and ensure timely remedial action under IRS Regulation Sections 1.141-12.
 
  1. General Project Records.  For each project financed with tax-exempt obligations, the Coordinator shall maintain, until three (3) years after retirement of the tax-exempt obligations or obligations issued to refund those obligations, the following:
 
  1. appraisals, demand surveys or feasibility studies,
  2. applications, approvals and other documentation of grants,
  3. depreciation schedules,
  4. contracts respecting the project.
 
  1. Advance Refundings. The Coordinator, shall be responsible for the following current, post issuance and record retention procedures with respect to advance refunding bonds:
 
  1. Identify and select bonds to be advance refunded with advice from internal financial personnel, and a financial advisor;
  2. The Coordinator shall identify, with advice from the financial advisor and bond counsel, any possible federal tax compliance issues prior to structuring any advance refunding;
  3. The Coordinator shall review the structure with the input of the financial advisor and bond counsel, of advance refunding issues prior to the issuance to ensure (i) that the proposed refunding is permitted pursuant to applicable federal tax requirements if there has been a prior refunding of the original bond issue; (ii) that the proposed issuance complies with federal income tax requirements which might impose restrictions on the redemption date of the refunded bonds; (iii) that the proposed issuance complies with federal income tax requirements which allow for the proceeds and replacement proceeds of an issue to be invested temporarily in higher yielding investments without causing the advance refunding bonds to become “arbitrage bonds”; and (iv) that the proposed issuance will not result in the issuer’s exploitation of the difference between tax exempt and taxable interest rates to obtain an financial advantage nor overburden the tax exempt market in a way that might be considered an abusive transaction for federal tax purposes.
  4. The Coordinator shall collect and review data related to arbitrage yield restriction and rebate requirements for advance refunding bonds. To ensure such compliance, the Coordinator shall engage a rebate consultant to prepare a verification report in connection with the advance refunding issuance. Said report shall ensure said requirements are satisfied. 
  5. The Coordinator shall, whenever possible, purchase SLGS to size each advance refunding escrow. The financial advisor shall be included in the process of subscribing SLGS. To the extent SLGS are not available for purchase, the Coordinator shall, in consultation with bond counsel and the financial advisor, comply with IRS regulations.
  6. To the extent as issuer elects to the purchase a guaranteed investment contract, the Coordinator shall ensure, after input from bond counsel, compliance with any bidding requirements set forth by the IRS regulations.
  7. In determining the issue price for any advance refunding issuance, the Coordinator shall obtain and retain issue price certification by the purchasing underwriter at closing.
  8. After the issuance of an advance refunding issue, the Coordinator shall ensure timely identification of violations of any federal tax requirements and engage bond counsel in attempt to remediate same in accordance with IRS regulations.
 
  1. Continuing Disclosure. The Coordinator shall assure compliance with each continuing disclosure certificate and annually, per continuing disclosure agreements, file audited annual financial statements and other information required by each continuing disclosure agreement.  The Coordinator will monitor material events as described in each continuing disclosure agreement and assure compliance with material event disclosure.  Events to be reported shall be reported promptly, but in no event not later than ten (10) Business Days after the day of the occurrence of the event.  Currently, such notice shall be given in the event of:
 
  1. Principal and interest payment delinquencies;
  2. Non-payment related defaults, if material;
  3. Unscheduled draws on debt service reserves reflecting financial difficulties;
  4. Unscheduled draws on credit enhancements relating to the bonds reflecting financial difficulties;
  5. Substitution of credit or liquidity providers, or their failure to perform;
  6. Adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material notices or determinations with respect to the tax-exempt status of the bonds, or material events affecting the tax-exempt status of the bonds;
  7. Modifications to rights of Holders of the Bonds, if material;
  8. Bond calls (excluding sinking fund mandatory redemptions), if material, and tender offers;
  9. Defeasances of the bonds;
  10. Release, substitution, or sale of property securing repayment of the bonds, if material;
  11. Rating changes on the bonds;
  12. Bankruptcy, insolvency, receivership or similar event of the Issuer;
  13. The consummation of a merger, consolidation, or acquisition involving the Issuer or the sale of all or substantially all of the assets of the Issuer, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms, if material; and
  14. Appointment of a successor or additional trustee or the change of name of a trustee, if material.
 
 
 
Adoption: 11-12-12
                                
Review:   7-17-89   3-14-94  7-12-99
                                                  
Revision:  8-10-92
                               
Cross References:

802.4-R1POST – ISSUANCE COMPLIANCE REGULATION FOR TAX-EXEMPT OBLIGATIONS

REGULATIONS
 
SERIES 800 – BUSINESS PROCEDURES
 
POST – ISSUANCE COMPLIANCE REGULATION
FOR TAX-EXEMPT OBLIGATIONS                     Code No. 802.4-R1
 
  1. Role of Compliance Coordinator/Board Treasurer
The board treasurer shall:
  1. Be responsible for monitoring post-issuance compliance;
  2. Maintain a copy of the transcript of proceedings or minutes in connection with the issuance of any tax-exempt obligations and obtain records that are necessary to meet the requirements of this regulation;
  3. Consult with bond counsel, a rebate consultant, financial advisor, IRS publications and such other resources as are, necessary to understand and meet the requirements of this regulation;
  4. Seek out training and education to be implemented upon the occurrence of new developments in the area and upon the hiring of new personnel to implement this regulation.
 
  1. Financing Transcripts’ Filling and Retention
The board treasurer shall confirm the proper filing of an IRS 8038 Series return and maintain a transcript of proceedings and minutes for all tax-exempt obligations issued by the school district including but not limited to all tax-exempt bonds, notes and lease-purchase contracts.  Each transcript shall be maintained until 11 years after the tax-exempt obligation documents have been retired.  The transcript shall include, at a minimum:
  1. Form 8038;
  2. Minutes, resolutions, and certificates;
  3. Certifications of issue price from the underwriter;
  4. Formal elections required by the IRS;
  5. Trustee statements;
  6. Records of refunded bonds, if applicable;
  7. Correspondence relating to bond financings; and
  8. Reports of any IRS examinations for bond financings.
 
  1. Proper Use of Proceeds
The board treasurer shall review the resolution authorizing issuance for each tax-exempt obligation issued by the school district, and the school district shall:
  1. Obtain a computation of the yield on such issue from the school district’s financial advisor;
  2. Create a separate Project Fund (with as many sub-funds as shall be necessary to allocate proceeds among the projects being funded by the issue) into which the proceeds of issue shall be deposited;
  3. Review all requisitions, draw schedules, draw requests, invoices and bills requesting payment from the Project Fund;
  4. Determine whether payment from the Project fund is appropriate and, if so, make payment from the Project Fund (and appropriate sub-fund if applicable);
  5. Maintain records of the payment requests and corresponding records showing payment;
  6. Maintain records showing the earnings on, and investment of, the Project Fund;
  7. Ensure that all investments acquired with proceeds are purchased at fair market value;
  8. Identify bond proceeds or applicable debt service allocations that must be invested with a yield-restriction and monitor the investments of any yield-restricted funds to ensure that the yield on such investments do not exceed they yield to which such investments are restricted;
  9. Maintain records related to any investment contracts, credit enhancement transactions, and the bidding of financial products related to the proceeds.
 
  1. Timely Expenditure and Arbitrage/Rebate Compliance
The board treasurer shall review the Tax-Exemption Certificate (or equivalent) for each tax-exempt obligation issued by the school district and the expenditure records provided in Section 2 of this regulation, above, and shall:
 
  1. Monitor and ensure that proceeds of each such issue are spent within the temporary period set forth in such certificate;
  2. Monitor and ensure that the proceeds are spent in a accordance with one or more of the applicable exceptions to rebate as set forth in such certificate if the school district does not meet the “small issuer” exception for said obligation;
  3. Not less than 60 days prior to a required expenditure date confer with bond counsel and a rebate consultant if the school district will fail to meet the applicable temporary period or rebate exception expenditure requirements of the Tax-Exemption Certificate.  In the event the school district fails to meet a temporary period or rebate exception:

 

  1. Procure a timely computation of any rebate liability and, if rebate is due, file a Form 8038-T and arrange for payment of such rebate liability;
  2. Arrange for timely computation and payment of yield reduction payments” (as such term is defined in the Code and Treasury Regulations), if applicable.
 
  1. Proper Use of Bond Financed Assets
The board treasurer shall:
 
  1. Maintain appropriate records and a list of all bond-financed assets.  Such records shall include the actual amount of proceeds (including investment earnings) spent on each of the bond financed assets;
  2. Monitor and confer with bond counsel with respect to all proposed with respect to each bond financed asset:
I. management contracts;
II. service agreements;
III. research contracts;
IV. naming rights;
V. contracts;
VI. leases or sub-leases;
VII. joint venture, limited liability or partnership arrangements;
VIII. sale of property; or
IX. any other change in sue of such asset.
  1. Maintain a copy of the proposed agreement, contract, lease, or arrangement, together with the response by bond counsel with respect to said proposal for at least three years after retirement of all tax-exempt obligations issued to fund all or any portion of bond financed assets; and
  2. Shall contact bond counsel and ensure timely remedial action under IRS Regulation Sections 1.141-12 in the event the school district takes an action with respect to a bond financed asset, which causes the private business tests or private loan financing test to be met.
 
  1. General Project Records
For each project financed with tax-exempt obligations, the board treasurer shall maintain, until three years after retirement of the tax-exempt obligations or obligations issued to refund those obligations, the following:
 
  1. Appraisals, demand surveys or feasibility studies;
  2. Applications, approvals and other documentation of grants:
  3. Deprecation schedules:
  4. Contracts respecting he project.
 
  1. Advance Refundings
The board treasurer shall be responsible for the following current, post issuance and record retention procedures with respect to advance refunding bonds.  The board treasurer shall:
 
  1. Identify and select bonds to be advance refunded with advice from internal financial personnel, and a financial advisor;
  2. Identify, with advice from the financial advisor and bond counsel, any possible federal tax compliance issues prior to structuring and advance refunding:
  3. Review the structure with the input of the financial advisor and bond counsel, of advance refunding issues prior to the issuance to ensure (i) that the proposed refunding is permitted pursuant to applicable federal tax requirements if there has been a prior refunding of the original bond issue; (ii) that the proposed issuance complies with federal income tax requirements which might impose restrictions on the redemption date of the refunded bonds; (iii) that the proposed issuance complies with federal income tax requirements which allow for the proceeds and replacement proceeds of an issue to be invested temporarily in higher yielding investments without causing the advance refunding bonds to become “arbitrage bonds”; and (iv) that the proposed issuance will not result in the issuer’s exploitation of the difference between tax exempt and taxable interest rates to obtain an financial advantage nor overburden the tax exempt market in a way that might be considered an abusive transaction for federal tax purposes;
  4. Collect and review data related to arbitrage yield restriction and rebate requirements for advance refunding bonds.  To ensure such compliance, the board treasurer shall engage a rebate consultant to prepare a verification report in connection with the advance refunding issuance.  Said report shall ensure said requirements are satisfied;
  5. Whenever possible, purchase State and Local Government Series (SLGS) to size each advance refunding escrow.  The financial advisor shall be included in the process of subscribing SLGS.  To the extent SLGS are not available for purchase, the Board treasurer shall, in consultation with bond counsel and the financial advisor, comply with IRS regulations:
  6. Ensure, after input from bond counsel, compliance with any bidding requirements set forth by the IRS regulations to the extent as issuer elects to the purchase a guaranteed investment contract;
  7. In determining the issue price for any advance refunding issuance, obtain and retain issue price certification by the purchasing underwriter at closing;
  8. After the issuance of any advance refunding issue, ensure timely identification of violations of any federal tax requirements and engage bond counsel in attempt to remediate same in accordance with IRS regulations.
 
  1. Continuing Disclosure
The board treasurer shall assure compliance with each continuing disclosure certificate and annually, per continuing disclosure agreements, file audited annual financial statements and other information required by each continuing disclosure agreement.  The board treasurer will monitor material events as described in each continuing disclosure agreement and assure compliance with material event disclosure.  Events to be reported shall be reported promptly, but in no even not later than 10 business days after the day of the occurrence of the event.
Currently, such notice shall be given in the event of:
 
  1. Principal and interest payment delinquencies;
  2. Non-payment related defaults, if material;
  3. Unscheduled draws on debt service reserves reflecting financial difficulties;
  4. Unscheduled draws on credit enhancements relating to the bonds reflecting financial difficulties;
  5. Substitution of credit or liquidity providers, r their failure to perform;
  6. Adverse tax options, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material notices or determinations with respect to the tax-exempt status of the bonds, or material events affecting the tax-exempt status of the bonds;
  7. Modifications to rights of Holders of the Bonds, if material;
  8. Bond calls (excluding sinking fund mandatory redemptions), if material, and tender offers;
  9. Defeasances of the bonds;
  10. Release, substitution, or sale of property securing repayment of the bonds, if material;
  11. Rating changes on the bonds;
  12. Bankruptcy, insolvency, receivership or similar event of the Issuer;
  13. The consummation of a merger, consolidation, or acquisition involving the Issuer or the sale of all or substantially all the assets of the Issuer, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms, if material; and
  14. Appointment of a successor or additional trustee or the change of name of a trustee, if material.
 
Adoption: 4-9-12
                                
Review:  2-8-16
     
Revision:
                                                                                                  
Cross References:
 
Legal References:   Iowa Code §§ 257.31 (4); 279.8; 297.22-25; 298A (2011).

802.5 Investments

F. C. SCHOOL BOARD POLICIES
 
Series 800 - Business Procedures
 
Investments Code No. 802.5
 
School district funds in excess of current needs shall be invested in compliance with this policy.  The goals of the school district's investment portfolio in order of priority are:
  • To provide safety of the principal;
  • To maintain the necessary liquidity to match expected liabilities; 
  •  To obtain a reasonable rate of return.
 
In making investments, the school district shall exercise the care, skill, prudence and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with such matters would use to meet the goals of the investment program.
 
School district funds are monies of the school district, including operating funds.  "Operating funds" of the school district are funds which are reasonably expected to be used during a current budget year or within fifteen months of receipt.  When investing operating funds, the investments must mature within three hundred and ninety-seven days or less.  If, during the current budget year an amount of public funds will exceed operating funds by at least thirty-three percent, the amount of public funds that exceed operating funds by greater than thirty-three percent may be invested in certificates of deposit at federally insured depository institutions which mature within sixty-three months or less, in accordance with state and federal laws.  When investing funds other than operating funds, the investments must mature according to the need for the funds.
 
The board authorizes the treasurer to invest funds in excess of current needs in the following investments:
 
  • Interest bearing savings, money market, and checking accounts at the school district's authorized depositories;
  • Iowa Schools Joint Investment Trust Program (ISJIT);
  • Certificates of deposit and other evidences of deposit at federally insured Iowa depository institutions.
 
It shall be the responsibility of the treasurer to oversee the investment portfolio in compliance with this policy and the law.
 
 
The treasurer is responsible for reporting to and reviewing with the board at it's regular meetings the investment portfolio's performance, transaction activity and current investments.
 
It is the responsibility of the superintendent to deliver a copy of this policy to the school district's depositories, auditor and outside persons doing investment business with the school district.  
 
It will also be the responsibility of the superintendent, in conjunction with the treasurer, to develop a system of investment practices and internal controls over the investment practices.  The investment practices shall be designed to prevent losses, to document the officers and employees responsibility for elements of the investment process and address the capability of the management.
 
 
 
Adoption: 6-24-75
                               
Review: 3-14-94  7-12-99    08-12-10  2-8-16  11-12-18
                                      
Revision: 8-10-92 11-12-18
                                                                  
Cross References: Revenue Treasurer
 
Legal References:  Iowa Code 11.2, .6; 12.62; 22.1, .13; 28E.2; 257;  279.29; 283A; 285; 452.10; 453; 502.701; 633.123 (1993) 1992 Iowa Acts

802.6 Gifts, Grants, and Bequests

F. C. SCHOOL BOARD POLICIES
 
Series 800 - Business Procedures
 
Gifts, Grants, and Bequests                           Code No. 802.6
 
If approved by the Board of Directors, gifts, grants, or bequests involving money, equipment, or furnishings may be accepted by the school district.  All gifts, grants, or bequests shall be administered in accordance with the terms of the gift or bequest, and shall become the property of the school district under the control of the Board of Directors.
 
 
Adoption: 3-13-89
                                
Review:  7-14-89   3-14-94  7-12-99    08-12-10  2-8-16
 
Revision:
                                                                                                  
Cross References:
 
Legal References:   565.6

802.7 Depository of Funds

F. C. SCHOOL BOARD POLICIES
 
Series 800 - Business Procedures
 
Depository of Funds                                   Code No. 802.7
 
At the annual meeting, the Board of Directors shall designate by resolution, which shall be entered in the official minutes of the board, the name and location of the bank or banks selected as the official school district depository or depositories.  The board shall also designate the maximum amount that may be kept on deposit in each bank.
 
 
Adoption:  3-13-89  
                              
Review:    7-17-89   3-14-94 7-12-99    08-12-10  2-8-16
                                             
Revision:
                                                                                                  
Cross References: 204.5
 
Legal References:  279.33; 453.1-453.3; Chapter 454

802.8 Financial Records

F. C. SCHOOL BOARD POLICIES
 
Series 800 - Business Procedures
 
Financial Records Code No. 802.8
 
Financial records of the school district shall be maintained in accordance with generally accepted accounting principles (GAAP) as required or modified by law. School district monies shall be received and expended from the appropriate fund and/or account.  The funds and accounts of the school district shall include, but not be limited to:
Governmental fund type:
  • General fund
  • Special revenue fund
    • Management levy fund
    • Public education and recreation levy fund
    • Student activity fund
  • Capital projects fund
    • ​Physical plant and equipment levy fund
    • Secure and Advanced Vision for Education (SAVE)
  • Debt service fund
Proprietary fund type:
  • Enterprise fund
    • School nutrition fund
    • Child care fund
  • Internal service fund
Fiduciary funds:
  • Trust or agency funds
    • Expendable trust funds
    • Nonexpendable trust funds
    • Agency funds
    • Pension trust funds
Account groups:
  • General fixed assets account group
  • General long-term debt account group
 
As necessary the board may, by board resolution, create additional funds within the governmental, proprietary and fiduciary fund types.  The resolution shall state the type of fund, name of the fund and purpose of the fund.
 
The general fund is used primarily for the education program.  Special revenue funds are used to account for monies restricted to a specific use by law.  Capital projects funds are used to account for financial resources to acquire or construct major capital facilities (other than those of proprietary funds and trust funds) and to account for revenues from SAVE.  A debt service fund is used to account for the accumulation of resources for, and the payment of, general long-term debt principal and interest.  Proprietary funds account for operations of the school district operated similar to private business, or they account for the costs o providing goods and services provided by one department to other departments on a cost reimbursement basis.  Fiduciary funds are used to account for monies or assets held by the school district on behalf of, or in trust for, another entity.  The account groups are the accounting records for fixed assets and long-term debt.  
 
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 proviced by state law.  The status of each fund must be included in the annual report.
 
It is the responisbility of the superintendent to implement this policy and bring necessary changes in the maintenance of the school district's financial records to the atention of the board.  
 
 
 
 
 
 
Adoption: 10-12-06
  
Review:   08-12-10  2-8-16  2-13-17
 
Revision: 2-13-17
  
Cross References:
 
Legal Reference: Iowa Code §§ 11.23; 298A (1997).

802.9 Capital Assets

F. C. SCHOOL BOARD POLICIES
 
Series 800 - Business Procedures
 
Capital Assets Code No. 802.9
 
The school district will establish and maintain a capital assets management system for reporting capitalized assets owned or under the jurisdiction of the school district in its financial reports in accordance with generally accepted accounting principles (GAAP) as required or modified by law; to improve the school district's oversight of capital assets by assigning and recording them to specific facilities and programs and to provide for proof of loss of capital assets for insurance purposes. Code802o9
 
Capital assets, including tangible and intangible assets, are reported in the government-wide financial statements (Le. governmental activities and business type activities) and the proprietary fund financial statements. Capital assets reported include school district buildings and sites, construction in progress, improvements other than buildings and sites, land and machinery and equipment. Capital assets reported in the financial reports will include individual capital assets with an historical cost equal to or greater than $3,000.  The Federal regulations governing school lunch programs require capital assets attributable to the school lunch program with a historical cost of equal to or greater than $500 be capitalized. Additionally, capital assets are depreciated over the useful life of each capital asset. 
 
All intangible assets with a purchase price equal to or greater than $25,000 with useful life of two or more years, are included in the intangible asset inventory for capitalization purposes. Such assets are recorded at actual historical cost and amortized over the designated useful lifetime applying a straight-line method of depreciation. If there are no legal, contractual, regulatory, technological or other factors that limit the useful life of the asset, then the intangible asset needs to be considered to have an indefinite useful life and no amortization should be recorded. 
 
Phase III districts, as determined under GASB 34, will retroactively report intangible assets. If actual historical cost cannot be determined for intangible assets due to lack of sufficient records, estimated historical cost will be used. 
 
This policy applies to all intangible assets. If an intangible asset that meets the threshold criteria is fully amortized, the asset must be reported at the historical cost and the applicable accumulated amortization must also be reported. It is not appropriate to "net" the capital asset and amortization to avoid reporting. For internally generated intangible assets, outlays incurred by the government's personnel, or by a third-party contractor on behalf of the government, and for development of internally generated intangible assets should be capitalized. 
 
The capital assets management system must be updated monthly to account for the addition/acquisition, disposal, relocation/transfer of capital assets. It is the responsibility of the superintendent to count and reconcile the capital assets with capital assets management system on June 30 each year.
 
It is the responsibility of the superintendent to develop administrative regulations implementing this policy. It will also be the responsibility of the superintendent to educate employees about this policy and its supporting administrative regulations. 
 
 
NOTE:  It is suggested the board consider a capitalization threshold consistent with the GASB 34 Committee Recommendations which recommended "districts and AEAs implement capitalization levels that would capture at least 80% of the value of assets.  However, the threshold should not be greater than $5,000."  In addition, Boards may wish to establish guidelines at lower thresholds for keeping track of capital assets for internal control and insurance purposes. 
 
In determining the capital asset capitalization threshold, the size of the school district, the property insurance deductible and the time and effort necessary to account for and track capital assets with a lesser value should be considered. It is strongly recommended the board consult with the school auditor prior to setting the capitalization threshold. 
 
An intangible asset should be recognized in the statement of net assets only if it is identifiable which means the asset is either separable or, arose from contractual or other legal rights, regardless of whether those rights are transferable or separable. The intangible asset must also possess all of the following characteristics/criteria: 
  • lack of physical substance; 
  • be of a non-financial nature (not in monetary form like cash or investment securities); and, 
  • the initial useful life extending beyond a single reporting period. 
Examples of intangible assets include easements, land use rights, patents, trademarks and copyrights. In addition, intangible assets include computer software purchased, licensed or internally generated, including web sites, as well as outlays associated with an internally generated modification of computer software. 
 
Intangible assets can be purchased or licensed, acquired through non-exchange transactions or internally generated. Intangible assets exclude assets acquired or created primarily for purposes of directly obtaining income, assets from capital lease transactions reported by lessees, and goodwill created through the combination of a government and another entity. 
 
A school district could, and many do, use bar code identification tags to control capital assets, such as VCRs, technology equipment, etc., even though these capital assets have a cost below the capitalization threshold. In tracking these capital assets only the information necessary to control the location and use of them needs to be maintained. Some school districts video-tape each classroom/office annually to save time and effort tracking capital assets below the capitalization threshold. The video tape is also helpful for insurance claims. Whether a school district chooses to track capital assets with a cost below the capitalization threshold or not, capital assets with a cost below the capitalization threshold should not be included in the capital assets listing for reporting purposes. 
 
This policy provides for valuing capital assets at historical cost as required by GAAP. This policy bases the capitalization threshold on the historical/acquisition cost of the individual asset. The school district can choose to use the historical cost of all the items included in a purchase order as the basis for determining whether to capitalize the capital asset. The cost of improvements may be added to the historical cost of a capital asset. Deciding whether to add the costs of an improvement to a capital asset's historical cost is a judgment call which should be made after consulting with the school auditor. 
 
Adoption:  09-09-10
               
Review:  2-8-16
 
Revision: 
 
Cross References:703   701.2
 
Legal References: Iowa Code §§ 257.31(4); 279.8; 297.22-.25; 298A (2009).

802.9-R1 Capital Assets Regulation

REGULATIONS
Series 800 - Business Procedures
 
Capital Assets Regulation Code No. 802.9-R1
 
  1. Capital Assets Management System 
The superintendent, and/or other designated staff, shall: 
  • Conduct the fixed assets physical count; 
  • Develop the fixed assets listing; 
  • Tag fixed assets included in the fixed assets management system with a bar code identification number; 
  • Make a recommendation of a computer software program for managing the fixed assets management system; 
  • Enter the necessary data into the fixed capital assets management system and compile the appropriate reports; 
  • Develop forms and procedures for maintaining the integrity of the fixed capital assets management system; and, 
  • Maintain responsibility for an accurate fixed capital assets management system. 
  1. Determining historical cost 
  • The historical cost of a capital asset is based on the actual costs expended in making the capital assets serviceable. 
  • Gifts of capital assets are valued at the estimated fair market value at the addition/acquisition date. 
  • Fixed assets purchased under a capital lease are valued at historical cost of their net present value of the minimum lease payments on the addition/acquisition date. 
  • The historical cost of capital assets must include capitalized interest. 
  1. Annual capital assets listing reconciliation 
  • The superintendent, and/or other designated staff, in conjunction with the capital assets management team, will conduct an annual capital assets physical count to develop the annual capital assets listing in a manner similar to the initial capital assets listing process in B above. At least every three years, someone other than the person in custody of the capital assets in the building/department/room will perform the capital assets physical count for the building/department/room. 
  • Upon completion of the annual capital assets listing, the capital assets listing is reconciled to the capital assets management system data base. 
  • Capital assets found to have been excluded from the data base are added to the capital assets management system. The capital assets management system process should be reviewed to prevent future incidents of excluding a capital asset. 
  • Capital assets unaccounted for are reported to the superintendent who contacts the supervisor of and the individual in charge/control/custody of the capital asset. The individual in charge/control/custody of the capital asset has thirty days to account for the capital asset. 
  • Capital assets unaccounted for after thirty days are reported to the superintendent for appropriate action and documentation. "Appropriate action" may include discipline, up to and including discharge, and may require the employee/person in charge/control/custody of the capital asset to replace the asset. 
  • The superintendent is responsible for documenting the reasons each asset was not reconciled to the capital assets management system. 
  1. Addition/acquisition of capital assets. 

  1. The school district's purchasing policy and administrative regulations must be followed when acquiring capital assets. The school district's policy and administrative regulations must be followed for receiving a gift of capital assets. 
  2. The capital assets addition/acquisition documentation must be completed for each additional capital assets with an addition/acquisition cost of equal to or greater than $3,000.  The following information should be collected, if applicable: 
  • Name of location-building/department/room; 
  • Location-building/department/room code; 
  • Balance sheet accounting/class code; 
  • Government or BT A program~ 
  • Addition/acquisition date; 
  • Check/purchase order number or gift; 
  • Bar code identification number assigned to and placed on the capital asset; 
  • Serial/model number; 
  • Cost-historical; 
  • Fair market value on acquisition date (donated assets only); 
  • Estimated useful life; 
  • Vendor; 
  • Purchasing fund and function; 
  • Description of capital asset; 
  • Department/person charged with custody, 
  • Method of addition/acquisition-purchase, trade, gift etc., 
  • Quantity; 
  • Replacement cost; 
  • Addition/acquisition authorization; and, 
  • Function for depreciation. 
  1. Capital assets acquired in a month must be entered into the capital assets management system in the same month. 
  2. The actual costs of construction in progress, other than infrastructure, is entered into the capital assets management system in the month in which costs are incurred until the total cost of addition/acquisition is entered. Upon completion of construction, the total costs accumulated over the period of construction are reclassified to buildings. 
  3. Capital assets acquired in a month must be entered into the capital assets management system in the same month. 
 
  1. Relocation/transfer of machinery and equipment capital assets. 
  • A capital assets relocation/transfer documentation must be completed prior to removing machinery and equipment capital assets from their current location. The following information must be collected: 

 

  • Relocation/transfer date; 
  • Quantity; 
  • Bar code identification number; 
  • Current location-building/department/room code; 
  • Name of current location-building/department/room; 
  • New location-building/department/room code; 
  • Name of new location-building/department/room; 
  • Date placed at new location-building/department/room; 
  • Department/person charged with custody; and 
  • Relocation/transfer authorization. 
  • Capital assets relocated/transferred in a month must be entered into the capital assets management system in the same month. 
  1. Disposal of capital assets 
  1. A Capital Assets disposal documentation must be completed prior to disposing of real property. The following information must be collected:
  • Disposal date; 
  • Quantity; 
  • Bar code tag identification number; 
  • Legal description,  Location/Address; 
  • Purchaser; 
  • Disposal methods for real property trade, sale, stolen, etc.; and, 
  • Disposal authorization. 
  • Capital assets disposed of in a month must be entered into the capital assets management system in the same month. 
  • When assets are sold or disposed of, it is necessary to calculate and report a gain or loss in the statement of activities. The gain/loss is calculated by subtracting the net book value (historical cost less any accumulated amortization) from the net amount realized on the sale or disposal. 
  1. Lost, damaged or stolen capital assets. 

 

  • A Lost, Damaged or Stolen Capital Assets Report must be completed when a capital asset has been lost, damaged or stolen. The following information must be collected: 
  • Date of loss, damage or theft; 
  • Employee/person discovering; 
  • Quantity; 
  • Description of capital asset; 
  • Bar code tag identification number; 
  • Location-building/department/room; 
  • Description of loss, damage, etc.; 
  • Filing of police report-yes or no; 
  • Filing of insurance report-yes or no; 
  • Sent for repair-yes or no; 
  • Date returned from repair; 
  • Date returned to location-building/department/room; 
  • Department/person charged with custody; and, 
  • Authorization. 
  • Capital assets damaged, lost or stolen in a month must be entered into the capital assets management system in the same month. 
  1. Capital assets reports 
  • Annual reports for June 30 each year. 
  • Capital assets listing including the following items: 
  • Balance sheet accounting/class code; 
  • Purchasing fund, function and depreciation function; 
  • Bar code tag identification number; 
  • Description of the capital asset; 
  • Historical cost or other;
  • Location; 
  • Current year depreciation/expense; and, 
  • Accumulated depreciation/amortization
  • capital assets listing by location/building; 
  • capital assets listing by department/employee/person charged with custody; and, 
  • capital assets listing by replacement cost. 
 
NOTE: This sample administrative regulation provides a sample capital asset management system. It is important the administrative regulations adopted by a school district reflect is its actual practice. The school district may choose to employ a service provider to conduct the annual capital assets physical count, annual capital assets listing and to implement a capital assets management system for capital assets required to be capitalized under board policy. Should the board employ a service provider, it is important to have the school attorney review the request for proposals and to draft the service provider contract. 
 
This sample administrative regulation provides for valuing capital assets at historical cost as required by GAAP. This administrative regulation also requires the school district to maintain the replacement value of capital assets. Should the school district decide not to maintain replacement values for its capital assets, the requirement should be deleted from the administrative regulation. 
 
Some school districts in completing their initial capital assets listing consider a room a unit.' For example, 25 student desks, one teacher's desk, one teacher's chair, wastebasket, two storage/file cabinets and so forth could be considered a room unit with a value of $35,000. The unit is included as one item on the capital assets listing. 
 
This may be a difficult element of a capital assets management system. Capital assets have a tendency to be moved around and the employees moving them generally do not remember to complete the paperwork or even to inform the superintendent. A quality annual reconciliation process must be done to ensure a valid assets listing. Some school districts require a designated person at each building to complete the paperwork upon the disposal of a capital asset. School districts with a local area network can save paperwork by allowing each building to enter the information regarding disposal of capital assets as long as the appropriate checks and balances exist to verify the information. 
 
The school auditor may, at a minimum, require a capital assets listing with the historical or other cost basis and balance sheet accounting/class code for each capital asset in the capital assets listing. It is important for the school district to consult with the district's auditor prior to determining the school district's requirements for this annual report. The other items listed above are optional unless recommended by the school auditor to meet the school district's needs. 
 
The capital assets listing total dollar amount must equal the amount entered on the school district's Certified Annual Report (CAR). This amount is calculated as follows: 
 
Capital assets listing prior year by balance sheet accounting/class code 
+ Additions/Acquisitions by balance sheet accounting/class code 
- Disposal by balance sheet accounting/class code 
= Capital assets listing current year by balance sheet accounting/class code 
 
The last three reports may be used by school districts for many different purposes. For example, the "capital assets listing by location/building" and "capital assets listing by department/employee/person charged with custody" are used by school districts for the annual capital assets listing reconciliation to compare the actual capital assets in a building or department/room with the information in the capital assets management system. 

802.9-R2 Capital Assets Management System Definitions

REGULATIONS
Series 800 - Business Procedures
 
Capital Assets Management System Definitions       Code No. 802.9-R2
 
Back trending/standard costing - an estimate of the historical original cost using a known average installed cost for like units as of the estimated addition/ acquisition date. This cost is only applied to the capital assets initially counted upon implementation of the capital assets management system when the historical original cost cannot be determined. It is inappropriate to apply the back trending/standard costing method to any capital assets acquired after the assets management system implementation date.
 
Balance sheet accounting/class codes - the codes set out for assets in the Iowa Department of Education Uniform Accounting Manual. They are: 200-capital assets; 211-land and land improvements; 221-site improvements; 222¬accumulated depreciation on site improvements; 231-buildings and building improvements; 232-accumulated depreciation on buildings and building improvements; 241-machinery and equipment; 242-accumulated depreciation on machinery and equipment, 251-works of art and historical treasures; 252-accumulated depreciation on works of art and historical treasures, 261-infrastructure, 262-accumulated depreciation on infrastructure, and 271-construction in progress. 
 
Book value - the value of capital assets on the records of the school district, which can be the cost or, the cost less the appropriate allowances, such as depreciation. 
Buildings and building improvements - a capital assets account reflecting the addition/acquisition cost of permanent structures owned or held by a government and the improvements thereon. 
Business-type activities - one of two classes of activities reported in the government-wide financial statements. Business-type activities are financed in the whole or in part by fees charged to external parties for goods or services. These activities are usually reported in enterprise funds.
 
Capital expenditures/expenses - expenditures/expenses resulting in the addition/acquisition of or addition/acquisition to the school district's capital assets.
 
Capital assets - Capital assets with a value of equal to or greater than $3,000 based on the historical cost include: long-lived assets obtained or controlled as a result of past transactions, events or circumstances. Capital assets include buildings, construction in progress, improvements other than facilities, land, machinery and equipment, and intangible assets. 
 
Capitalization policy - the criteria used by the school district to determine which capital assets will be reported as capital assets on the school district's financial statements and records 
 
Capitalization threshold - The dollar value at which a government elects to capitalize tangible or intangible assets that are used in operations and that have initial useful lives extending beyond a single reporting period. 
 
Capitalized interest - interest accrued and reported as part of the cost of the capital assets during the construction phase of a capital project. The construction phase extends from the initiation of pre-construction activities until the time the asset is placed in service. 
 
Construction in progress - buildings in the process of being constructed other than infrastructure. 
 
Cost - the amount of money or other consideration exchanged for goods or services. 
 
 
 
Depreciation! Amortization - expiration in the service life of capital assets, other than wasting assets, attributable to wear and tear, deterioration, action of the physical elements, inadequacy and obsolescence. In accounting for depreciation/amortization, the cost of a capital asset, less any salvage value, is prorated over the estimated service life of such an asset, and each period is charged with a portion of such cost. 
 
Fixtures - attachments to buildings that are not intended to be removed and cannot be removed without damage to the buildings. Those fixtures with a useful life presumed to be as long as that of the building itself are considered a part of the building. Other fixtures are classified as machinery and equipment. 
 
General capital assets - capital assets that are not capital assets of any fund, but of the governmental unit as a whole. Most often these capital assets arise from the expenditure of the financial resources of governmental funds. 
General capital assets account group (GFAAG) - a self-balancing group of accounts established to account for capital assets of the school district, not accounted for through specific proprietary funds. 
 
Government activities - activities generally financed through taxes, intergovernmental revenues, and other non-exchange revenues. These activities are usually reported in governmental funds and internal service funds. 
 
Government-wide financial statements - Financial statements that incorporate all of a government's governmental and business-type activities, as well as its non-fiduciary component units. There are two basic government-wide financial statements the statement of net assets and the statement of activities. Both basic government-wide financial statements are presented using the economic resources measurement focus and the accrual basis of accounting. 
 
Historical (acquisition) cost - the actual costs expended to place a capital asset into service. For land and buildings, costs such as legal fees, recording fees, surveying fees, architect fees and similar fees are included in the historical cost. For machinery and equipment, costs such as freight and installation fees and similar fees are included in the historical cost. 
 
Improvements - In addition made to, or change made in, a capital asset, other than maintenance, to prolong its life or to increase the efficiency or capacity. The cost of the addition or change is added to the book value of the asset. 
 
Improvements other than buildings - attachments or annexation to land that are intended to remain so attached or annexed, such as sidewalks, trees, drives, tunnels, drains and sewers. Sidewalks, curbing, sewers and highways are sometimes referred to as "betterments," but the term "improvements" is preferred.
 
Infrastructure -long-lived capital assets that normally are stationary in nature and normally can be preserved for a significantly greater number of years than most capital assets. Examples of infrastructure assets include; roads, bridges, tunnels, drainage systems, tater and sewer systems, dams, and lighting systems. 
 
Investment in general capital assets - an account in the GFAAG representing the school district's investment in general capital assets. The balance in this account generally is subdivided according to the source of the monies that finance the capital assets addition/acquisition, such as general fund revenues and special assessments. 
 
 
 
Land and buildings - real property owned by the school district.
 
Machinery and equipment - capital assets which maintain their identity when removed from their location and are not changed materially or consumed immediately (e.g., within one year) by use. Machinery and equipment are often divided into specific categories such as: transportation machinery and equipment which includes school buses and school district owned automobiles, trucks and vans; other motor machinery and equipment which includes lawn maintenance machinery and equipment, tractors, motorized carts, maintenance machinery and equipment, etc.; other machinery and equipment which includes furniture and machinery and equipment contained in the buildings whose original cost is equal to or greater than ($ capitalization threshold), and capital assets under capital leases and capital assets being acquired under a lease/purchase agreement. 
 
Proprietary funds - Funds that focus on the determination of operating income, changes in net assets (or cost recovery), financial position, and cash flows. There are two different types of proprietary funds: enterprise funds and internal service funds. 
 
Replacement cost - the amount of cash or other consideration required today to obtain the same ~ capital assets or its equivalent. 

802.10 Governmental Accounting Practices & Regulations

F. C. SCHOOL BOARD POLICIES
Series 800 - Business Procedures
 
Governmental Accounting Practices And Regulations Code No. 802.10 
 
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 board secretary 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, or designee, to develop administrative regulations implementing this policy.  It is also the responsibility of the superintendent, or designee, 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.
 
 
 
Approved:  08/08/11
 
Reviewed: 801.7 Budget
 
Revised:
 
Cross Reference:   802.8 Financial Records
 
Legal Reference: Iowa Code §§ 257.31(4); 279.8; 297.22-.25; 298A (2011).

802.11 Expenditures For A Public Purpose

 

F. C. SCHOOL BOARD POLICIES

Series 800 - Business Procedures

 

 

Expenditures For A Public Purpose                          Code No. 802.11 

 

 

The board recognizes that school district funds are public funds, and as such, should be used to further a public purpose and the overall educational mission of the school community.  The district is committed to managing and spending public funds in a transparent and responsible manner.  Prior to making a purchase with public funds, an individual should be comfortable defending the purchase/reimbursement to the taxpayers in the district.  If the individual is uncomfortable doing so, the purchase may not fulfill a public purpose and additional guidance should be sought before the purchase is made. 

 

Individuals who have concerns about the public purpose of a purchase or reimbursement should utilize the district’s Internal Controls policy and regulation as a resource for questioning a purchase.  Concerns should be reported to the superintendent and/or the board president.  

 

The superintendent shall develop a process for approving expenditures of public funds.  The board will review expenditures and applicable reports as necessary to ensure proper oversight of the use of public funds.  To the extent possible, expenditures shall be pre-approved by the district prior to expending the funds.  Purchases of food and refreshment for district staff, even within district, should comply with the district’s Employee Travel Compensation policy, and all other applicable policies.  All purchases/reimbursements shall comply with applicable laws, board policies and district accounting requirements. 

 

Additional guidance regarding appropriate expenditures of school funds is provided in the regulation accompanying this policy. 

 

NOTE:  All use of public funds should directly serve a public purpose in a clear and transparent manner.  Districts should consider what purchasing and reimbursement flexibility is needed for their district and apply all restrictions equally.  

 

Approved 6-10-19

Reviewed 5-13-19 6-10-19

Revised ____________Cross Reference:  802.8 Financial Record  801.7 Budget

Legal References:  Iowa Constitution Art. III, sec. 31; Iowa Code §§ 68A.505; 279.8; 721.2. 281 I.A.C. 98.70 1979 Op. Atty. Gen., No. 79-4-26 Cross References: 401.7 Employee Travel Compensation 704.1  Local-State-Federal-Miscellaneous Revenue 704.5 Student Activities Fund 705.1 Purchasing-Bidding 705.2 Purchasing on Behalf of Employees 705.3 Payment for Goods and Services 707.5  Internal Controls

802.11-R1 Use of Public Funds Regulation

F. C. SCHOOL BOARD POLICIES

Series 800 - Business Procedures

 

 

Use of Public Funds Regulation                           Code No. 802.11-R1 

 

The following is a list of examples organized by activity for what is allowable, or not allowable as a purchase/reimbursement using public funds.  This regulation is intended as guidance and there may be situations that are not listed here.  Any questions regarding the appropriateness of an expenditure should be submitted to administration prior to expending funds.  

 

Reimbursements to an Individual 

• Use of Credit Card:  All purchases through a district-owned credit or procurement card shall be pre-approved and comply with the district’s policy 401.10 – Credit Cards. 

• Mileage:  Individuals who are required to travel (other than to and from work) as part of fulfilling their job duties to the district shall be reimbursed for mileage costs in accordance with the requirements stated in the district’s Employee Travel Compensation policy. 

• Travel accommodations:  Employees who are required to travel and stay overnight as part of fulfilling their job duties to the district shall be reimbursed for costs in accordance with the requirements stated in the district’s Employee Travel Compensation policy. 

• Alcohol:  Alcohol is a personal expense and is never allowable for purchase or reimbursement using public funds. 

• Food/Refreshments:  Food and refreshments are typically a personal expense.  Meetings spanning meal times should be avoided when possible.  When a district meeting is required to take place spanning a customary meal time, the superintendent or designee shall determine whether food and/or refreshment will be provided to employees whose presence is required during the meeting.  The cost of food and refreshment for employees shall be reasonable, and when possible, a separate itemized receipt for each employee is required.  If an itemized receipt is not available, approval is required by the school business official prior to reimbursement.  In all cases, the names and number of employees shall be noted on the receipt.  

• Apparel/Personal Items:  Apparel and personal items including, but not limited to items such as t-shirts, hats, mugs, etc. provide personal benefit to individuals and are a personal expense.  These items shall not be purchased or reimbursed with public funds.  

• Gifts:  Gift cards or gifts given to individuals are personal expenses and public funds should not be used (except for recognition/staff retirement, listed below) for these purposes.  Voluntary collections from staff would be an acceptable way of purchasing gifts. 

• Retirement and Recognition Gifts:  Recognizing an employee or volunteer’s years of dedication to educating the community and commitment to the district serves a public purpose by honoring individuals with a token gift, or honorarium, in recognition of their service.  The same is true for individual awards, mementos, or items purchased in recognition of employee service to the district.  These purchases may use public funds, provided the expenditures are modest and approved by the superintendent.  

• Honoraria:  District employees may at times receive an honorarium from an outside source as compensation for the employee’s time devoted to preparing and delivering a presentation within the scope of their professional field.  Honorariums may only be accepted by employees when the employee has used their personal time outside of their work for the district to prepare and deliver the presentation.  If the employee uses district time or resources to prepare or deliver a presentation, any honorarium shall be given to the district.  

• Break Room Supplies:  The purchase of perishable or disposable supplies for employee break rooms is primarily designed for individual consumption and is a personal expense.  This includes items such as coffee, coffee filters, plates, cups, spoons, napkins, etc.  

 

Supplies for Public Areas 

• Limited refreshments such as water and coffee may be available in public reception areas of the district including, but not limited to the central office, the building administrator’s office, etc.  These refreshments may be purchased with the use of public funds, as they provide light refreshment to members of the community.

Staff Parties/Receptions 

• Parties and receptions to benefit individual staff members are considered a personal expense and should not be purchased or reimbursed with public funds.  This includes but is not limited to holiday parties. 

• Hosting a group reception to honor all employees retiring from the district in a given school year is allowable as a public expense. Hosting a retirement reception provides a direct benefit to the community as an opportunity for the community to attend and honor the retiring employees’ years of dedication and service to the district. 

School/ Student Activity Banquets 

• School/student activity banquets are typically a personal expense and will not be purchased or reimbursed with public funds unless the public purpose is submitted for review and pre-approved by the superintendent. 

Memorial Gifts 

• Memorial flowers to convey sympathy or congratulations are allowable as a public expense if they have been approved by the superintendent.  

• Memorial cards are always appropriate. Memorial gifts of any sort other than flowers and a card are a personal expense. 

Student Incentives 

• It is within the discretion of the building principal to authorize the purchase of awards holding a nominal value to commemorate the achievements of a student or group of students.  These awards should be designed to reward behavior and values that exemplify the educational and community mission of the district.  Awards should not be gift cards or other monetary awards. 

• Flowers and decorations for school dances held as part of the district’s student activity program are an allowable expense paid out of the student activity fund, provided the purchases are approved by the building principal.  

Meetings 

• To the extent possible, meetings which span normal meal times should be avoided.  

• Meetings of the district’s board of directors and board committees are made up of individuals who volunteer a large amount of their personal time to serve the needs of the school community.  These meetings are also scheduled at time most convenient for the public, and often span normal meal hours.  Food and refreshment purchased for board members is an acceptable use of public funds.  The service of these unpaid volunteers directly benefits the entire school community.  The superintendent has discretion to purchase/reimburse reasonable expenses for providing food and refreshment to these unpaid volunteers during these meetings.  

 

Some expenditures will be considered personal expenses regardless of the context.  These include purchase or reimbursement of alcohol, and personal items not included as retirement or memorial gifts listed above