Missouri Statute | Act | Code |Education And Libraries| US Code - US Statute

1. The following funds are created for the accounting of all
school moneys: teachers' fund, incidental fund, capital projects fund and
debt service fund. The treasurer of the school district shall open an
account for each fund specified in this section, and all moneys received
from the county school fund and all moneys derived from taxation for
teachers' wages shall be placed to the credit of the teachers' fund. All
tuition fees, state moneys received under section 163.031, RSMo, and all
other moneys received from the state except as herein provided shall be
placed to the credit of the teachers' and incidental funds at the
discretion of the district board of education, except as provided in
subsection 6 of section 163.031, RSMo. Money received from other
districts for transportation and money derived from taxation for
incidental expenses shall be credited to the incidental fund. All money
derived from taxation or received from any other source for the erection
of buildings or additions thereto and the remodeling or reconstruction of
buildings and the furnishing thereof, for the payment of lease-purchase
obligations, for the purchase of real estate, or from sale of real
estate, schoolhouses or other buildings of any kind, or school furniture,
from insurance, from sale of bonds other than refunding bonds shall be
placed to the credit of the capital projects fund. All moneys derived
from the sale or lease of sites, buildings, facilities, furnishings, and
equipment by a school district as authorized under section 177.088, RSMo,
shall be credited to the capital projects fund. Money derived from
taxation for the retirement of bonds and the payment of interest thereon
shall be credited to the debt service fund, which shall be maintained as
a separate bank account. Receipts from delinquent taxes shall be
allocated to the several funds on the same basis as receipts from current
taxes, except that where the previous years' obligations of the district
would be affected by such distribution, the delinquent taxes shall be
distributed according to the tax levies made for the years in which the
obligations were incurred. All refunds received shall be placed to the
credit of the fund from which the original expenditures were made. Money
donated to the school districts shall be placed to the credit of the fund
where it can be expended to meet the purpose for which it was donated and
accepted. Money received from any other source whatsoever shall be placed
to the credit of the fund or funds designated by the board.

2. The school board may transfer any portion of the unrestricted balance
remaining in the incidental fund to the teachers' fund. Any district that
uses an incidental fund transfer to pay for more than twenty- five
percent of the annual certificated compensation obligation of the
district and has an incidental fund balance on June thirtieth in any year
in excess of fifty percent of the combined incidental teachers' fund
expenditures for the fiscal year just ended shall be required to transfer
the excess from the incidental fund to the teachers' fund. If a balance
remains in the debt service fund, after the total outstanding
indebtedness for which the fund was levied is paid, the board may
transfer the unexpended balance to the capital projects fund. If a
balance remains in the bond proceeds after completion of the project for
which the bonds were issued, the balance shall be transferred from the
incidental or capital projects fund to the debt service fund. After
making all placements of interest otherwise provided by law, a school
district may transfer from the capital projects fund to the incidental
fund the interest earned from undesignated balances in the capital
projects fund. A school district may borrow from one of the following
funds: teachers' fund, incidental fund, or capital projects fund, as
necessary to meet obligations in another of those funds; provided that
the full amount is repaid to the lending fund within the same fiscal year.

3. Tuition shall be paid from either the teachers' or incidental funds.
Employee benefits for certificated staff shall be paid from the teachers'
fund.

4. Other provisions of law to the contrary notwithstanding, the school
board of a school district that meets the provisions of subsection 6 of
section 163.031, RSMo, may transfer from the incidental fund to the
capital projects fund the sum of:

(1) The amount to be expended for transportation equipment that is
considered an allowable cost under state board of education rules for
transportation reimbursements during the current year; plus

(2) Any amount necessary to satisfy obligations of the capital projects
fund for state-approved area vocational-technical schools; plus

(3) Current year obligations for lease-purchase obligations entered into
prior to January 1, 1997; plus

(4) The amount necessary to repay costs of one or more guaranteed energy
savings performance contracts to renovate buildings in the school
district, provided that the contract is only for energy conservation
measures as defined in section 640.651, RSMo, and provided that the
contract specifies that no payment or total of payments shall be required
from the school district until at least an equal total amount of energy
and energy-related operating savings and payments from the vendor
pursuant to the contract have been realized by the school district; plus

(5) An amount not to exceed the greater of:

(a) One hundred sixty-two thousand three hundred twenty-six dollars; or

(b) Seven percent of the state adequacy target multiplied by the
district's weighted average daily attendance, provided that transfer
amounts in excess of current year obligations of the capital projects
fund authorized under this subdivision may be transferred only by a
resolution of the school board approved by a majority of the board
members in office when the resolution is voted on and identifying the
specific capital projects to be funded directly by the district by the
transferred funds and an estimated expenditure date.

5. Beginning in the 2006-07 school year, a district meeting the
provisions of subsection 6 of section 163.031, RSMo, and not making the
transfer under subdivision (5) of subsection 4 of this section, nor
making payments or expenditures related to obligations made under section
177.088, RSMo, may transfer from the incidental fund to the debt service
fund or the capital projects fund the greater of:

(1) The state aid received in the 2005-06 school year as a result of no
more than eighteen cents of the sum of the debt service and capital
projects levy used in the foundation formula and placed in the respective
debt service or capital projects fund, whichever fund had the designated
tax levy; or

(2) Five percent of the state adequacy target multiplied by the
district's weighted average daily attendance.

6. Beginning in the 2006-07 school year, the department of elementary and
secondary education shall deduct from a school district's state aid
calculated pursuant to section 163.031, RSMo, an amount equal to the
amount of any transfer of funds from the incidental fund to the capital
projects fund or debt service fund performed during the previous year in
violation of this section; except that the state aid shall be deducted
over no more than five school years following the school year of an
unlawful transfer based on a plan from the district approved by the
commissioner of elementary and secondary education.

7. A school district may transfer unrestricted funds from the capital
projects fund to the incidental fund in any year in which that year's
June thirtieth combined incidental and teachers' funds unrestricted
balance compared to the combined incidental and teachers' funds
expenditures would be less than ten percent without such transfer. (L.
1963 p. 200 § 6-1, A.L. 1977 H.B. 130, A.L. 1992 S.B. 581, A.L. 1993 S.B.
380, A.L. 1994 S.B. 676, A.L. 1995 S.B. 255, A.L. 1996 S.B. 795, et al.,
A.L. 1997 H.B. 604 merged with H.B. 641 & 593, A.L. 1998 H.B. 1469 merged
with S.B. 658 merged with S.B. 781, A.L. 1999 H.B. 889, A.L. 2000 S.B.
944, A.L. 2001 S.B. 543, A.L. 2003 S.B. 686, A.L. 2005 S.B. 287)

(Source: RSMo 1959 § 165.110)

*Effective 7-1-06

1. The following funds are created for the accounting of all
school moneys: teachers' fund, incidental fund, free textbook fund,
capital projects fund and debt service fund. The treasurer of the school
district shall open an account for each fund specified in this section,
and all moneys received from the county school fund and all moneys
derived from taxation for teachers' wages shall be placed to the credit
of the teachers' fund. All tuition fees, state moneys received under
sections 162.975, RSMo, and 163.031, RSMo, and all other moneys received
from the state except as herein provided shall be placed to the credit of
the teachers' and incidental funds at the discretion of the district
board of education. The portion of state aid received by the district
pursuant to section 163.031, RSMo, based upon the portion of the tax rate
in the debt service or capital projects fund, respectively, which is
included in the operating levy for school purposes pursuant to section
163.011, RSMo, shall be placed to the credit of the debt service fund or
capital projects fund, respectively. Money received from other districts
for transportation and money derived from taxation for incidental
expenses shall be credited to the incidental fund. Money apportioned for
free textbooks shall be credited to the free textbook fund. All money
derived from taxation or received from any other source for the erection
of buildings or additions thereto and the remodeling or reconstruction of
buildings and the furnishing thereof, for the payment of lease-purchase
obligations, for the purchase of real estate, or from sale of real
estate, schoolhouses or other buildings of any kind, or school furniture,
from insurance, from sale of bonds other than refunding bonds shall be
placed to the credit of the capital projects fund. All moneys derived
from the sale or lease of sites, buildings, facilities, furnishings and
equipment by a school district as authorized under section 177.088, RSMo,
shall be credited to the capital projects fund. Money derived from
taxation for the retirement of bonds and the payment of interest thereon
shall be credited to the debt service fund which shall be maintained as a
separate bank account. Receipts from delinquent taxes shall be allocated
to the several funds on the same basis as receipts from current taxes,
except that where the previous years' obligations of the district would
be affected by such distribution, the delinquent taxes shall be
distributed according to the tax levies made for the years in which the
obligations were incurred. All refunds received shall be placed to the
credit of the fund from which the original expenditures were made. Money
donated to the school districts shall be placed to the credit of the fund
where it can be expended to meet the purpose for which it was donated and
accepted. Money received from any other source whatsoever shall be placed
to the credit of the fund or funds designated by the board.

2. The school board may expend from the incidental fund the sum that is
necessary for the ordinary repairs of school property and an amount not
to exceed the sum of expenditures for classroom instructional capital
outlay, as defined by the department of elementary and secondary
education by rule, in state-approved area vocational-technical schools
and the greater of twenty-five percent of the guaranteed tax base for the
preceding year or two and one-fourth percent of the district's
entitlement for the preceding school year as established pursuant to line
1 of subsection 6 of section 163.031, RSMo, as of June thirtieth of the
preceding school year for classroom instructional capital outlay,
including but not limited to payments authorized pursuant to section
177.088, RSMo. Any and all payments authorized under section 177.088,
RSMo, except as otherwise provided in this subsection, for the purchase
or lease of sites, buildings, facilities, furnishings and equipment and
all other expenditures for capital outlay shall be made from the capital
projects fund. If a balance remains in the free textbook fund after books
are furnished to pupils as provided in section 170.051, RSMo, it shall be
transferred to the teachers' fund. The board may transfer the portion of
the balance remaining in the incidental fund to the teachers' fund that
is necessary for the total payment of all contracted obligations to
teachers. If a balance remains in the debt service fund, after the total
outstanding indebtedness for which the fund was levied is paid, the board
may transfer the unexpended balance to the capital projects fund. If a
balance remains in the bond proceeds after completion of the project for
which the bonds were issued, the balance shall be transferred from the
incidental or capital projects fund to the debt service fund. After
making all placements of interest otherwise provided by law, a school
district may transfer from the capital projects fund to the incidental
fund the interest earned from undesignated balances in the capital
projects fund. All other sections of the law notwithstanding, a school
district may transfer from the incidental fund to the capital projects
fund an amount equal to the capital expenditures for school safety and
security purposes. A school district may borrow from one of the following
funds: teachers' fund, incidental fund or capital projects fund, as
necessary to meet obligations in another of those funds; provided that
the full amount is repaid to the lending fund within the same fiscal year.

3. Tuition shall be paid from either the teachers' or incidental funds.

4. Other provisions of law to the contrary notwithstanding, the school
board of a school district that satisfies the criteria specified in
subsection 5 of this section may transfer from the incidental fund to the
capital projects fund the sum of:

(1) The amount to be expended for transportation equipment that is
considered an allowable cost under state board of education rules for
transportation reimbursements during the current year; plus

(2) Any amount necessary to satisfy obligations of the capital projects
fund for state-approved area vocational-technical schools; plus

(3) An amount not to exceed the greater of:

(a) The guaranteed tax base for the preceding year; or

(b) Nine percent of the district's entitlement for the preceding school
year as established pursuant to line 1 of subsection 6 of section
163.031, RSMo, as of June thirtieth of the preceding school year, less
any amount expended from the incidental fund for classroom instructional
capital outlay pursuant to subsection 2 of this section; provided that
transfer amounts authorized pursuant to this subdivision may only be
transferred by a resolution of the school board approved by a majority of
the board members in office when the resolution is voted upon and
identifying the specific capital projects to be funded directly by the
district by the transferred funds and an estimated expenditure date; and
provided that if a district did not maintain compliance with the
requirements of section 165.016 the preceding year without recourse to a
waiver for that year or a base year adjustment received that year or a
fund balance exclusion unless the fund balance exclusion had also been
used the second preceding year, the transfer amount pursuant to this
subdivision may be transferred only to the extent required to meet
current year obligations of the capital projects fund.

5. In order to transfer funds pursuant to subsection 4 of this section, a
school district shall:

(1) Meet the minimum criteria for state aid and for increases in state
aid for the current year established pursuant to section 163.021, RSMo;

(2) Not incur a total debt, including short-term debt and bonded
indebtedness in excess of fifteen percent of the guaranteed tax base for
the preceding payment year multiplied by the number of resident and
nonresident eligible pupils educated in the district in the preceding
year;

(3) Set tax rates pursuant to section 164.011, RSMo;

(4) First apply any voluntary rollbacks or reductions to the total tax
rate levied to the teachers' and incidental funds;

(5) In order to be eligible to transfer funds for paying lease purchase
obligations:

(a) Incur such obligations, except for obligations for lease purchase for
school buses, prior to January 1, 1997;

(b) Limit the term of such obligations to no more than twenty years;

(c) Limit annual installment payments on such obligations to an amount no
greater than the amount of the payment for the first full year of the
obligation, including all payments of principal and interest, except that
the amount of the final payment shall be limited to an amount no greater
than two times the amount of such first-year payment;

(d) Limit such payments to leasing nonathletic, classroom, instructional
facilities as defined by the state board of education through rule; and

(e) Not offer instruction at a higher grade level than was offered by the
district on July 12, 1994.

6. A school district shall be eligible to transfer funds pursuant to
subsection 7 of this section if:

(1) Prior to August 28, 1993:

(a) The school district incurred an obligation for the purpose of funding
payments under a lease purchase contract authorized under section
177.088, RSMo;

(b) The school district notified the appropriate local election official
to place an issue before the voters of the district for the purpose of
funding payments under a lease purchase contract authorized under section
177.088, RSMo; or

(c) An issue for funding payments under a lease purchase contract
authorized under section 177.088, RSMo, was approved by the voters of the
district; or

(2) Prior to November 1, 1993, a school board adopted a resolution
authorizing an action necessary to comply with subsection 9 of section
177.088, RSMo. Any increase in the operating levy of a district above the
1993 tax rate resulting from passage of an issue described in paragraph
(b) of subdivision (1) of this subsection shall be considered as part of
the 1993 tax rate for the purposes of subsection 1 of section 164.011,
RSMo.

7. Prior to transferring funds pursuant to subsection 4 of this section,
a school district may transfer, pursuant to this subsection, from the
incidental fund to the capital projects fund an amount as necessary to
satisfy an obligation of the capital projects fund that satisfies at
least one of the conditions specified in subsection 6 of this section,
but not to exceed its payments authorized under section 177.088, RSMo,
for the purchase or lease of sites, buildings, facilities, furnishings,
equipment, and all other expenditures for capital outlay, plus the amount
to be expended for transportation equipment that is considered an
allowable cost under state board of education rules for transportation
reimbursements during the current year plus any amount necessary to
satisfy obligations of the capital projects fund for state-approved area
vocational-technical schools. A school district that is in compliance
with section 165.016 during the second preceding year or has paid all
penalties for the second preceding year may transfer from the incidental
fund to the capital projects fund the amount necessary to meet the
obligation plus the transfers pursuant to subsection 4 of this section.

8. Beginning in the 1995-96 school year, the department of elementary and
secondary education shall deduct from a school district's state aid
calculated pursuant to section 163.031, RSMo, an amount equal to the
amount of any transfer of funds from the incidental fund to the capital
projects fund performed during the previous year in violation of this
section; except that the state aid shall be deducted in equal amounts
over the five school years following the school year of an unlawful
transfer provided that:

(1) The district shall provide written notice to the state board of
education, no later than June first of the first school year following
the school year of the unlawful transfer, stating the district's
intention to comply with the provisions of subdivisions (1) to (4) of
this subsection and have state aid deducted for that unlawful transfer
over a five-year period;

(2) On or before September first of the second school year following the
school year of the unlawful transfer, the district shall approve an
increase to the district's operating levy for school purposes to the
greater of: two dollars and seventy-five cents per one hundred dollars
assessed valuation or the levy which produces an increase in total state
and local revenues, as determined by the department, in comparison to the
first school year following the school year of the unlawful transfer
which is equal to or greater than the amount of state aid to be deducted
pursuant to this subsection each school year for such unlawful transfer,
provided that increases required pursuant to this subdivision for
subsequent unlawful transfers shall be made in comparison to the latter
tax rate described in this subdivision;

(3) During each school year after the school year in which the operating
levy is increased pursuant to subdivision (2) of this subsection and in
which state aid is deducted pursuant to subdivisions (1) to (4) of this
subsection, the district shall maintain an operating levy for school
purposes which produces total state and local revenues for the district
which are no less than the total state and local revenues produced by the
levy required pursuant to subdivision (2) of this subsection;

(4) During each school year state aid is deducted pursuant to
subdivisions (1) to (4) of this subsection except for the 1998-99 school
year, the district shall maintain compliance with the requirements of
section 165.016 without any recourse to waivers or base-year adjustments
and without the option to demonstrate compliance based upon the
district's fund balances; and

(5) If, in any school year state aid is deducted pursuant to subdivisions
(1) to (4) of this subsection, the district fails to comply with any
requirement of subdivisions (1) to (4) of this subsection, the full,
remaining amount of state aid to be deducted pursuant to this subsection
shall be deducted from the district's state aid payments by the
department during such school year.

9. On or before June 30, 1999, a school district may transfer to the
capital projects fund from the balances of the teachers' and incidental
funds any amount, but only to the extent that the amount transferred is
equal to or less than the amount that the teachers' and incidental funds'
unrestricted balances on June 30, 1995, exceeded eight percent of
expenditures from the teachers' and incidental funds for the year ending
June 30, 1995.

10. (1) Other provisions of law to the contrary notwithstanding, a school
district which satisfies all conditions specified in subdivision (2) of
this subsection may make the transfer allowed in subdivision (3) of this
subsection.

(2) To make the transfer allowed under subdivision (3) of this
subsection, a school district shall:

(a) Have a membership count for school year 1997-98 which is at least
sixteen percent greater than the district's membership count for the
1991-92 school year; and

(b) Have passed a full waiver of Proposition C tax rate rollback pursuant
to section 164.013, RSMo, or approved an increase to the district's tax
rate ceiling on or after June 1, 1994; and

(c) Be in compliance or have paid all penalties required pursuant to
section 165.016 for the 1994-95, 1995-96 and 1996-97 school years without
waiver or adjustment of the base school year certificated salary
percentage; and

(d) After all transfers, have a remaining balance on June 30, 1998, in
the combined teachers' and incidental funds which is no less than ten
percent of the combined expenditures from those funds for the 1997-98
school year.

(3) A district which satisfies all of the criteria specified in
paragraphs (a) to (d) of subdivision (2) of this subsection may, on or
before June 30, 1998, make a one-time combined transfer from the
teachers' and incidental funds to the capital projects fund of an amount
no greater than the sum of the following amounts:

(a) The product of the district's equalized assessed valuation for 1994
times the difference of the district's equalized operating levy for
school purposes for 1994 minus the district's equalized operating levy
for school purposes for 1993;

(b) The product of the district's equalized assessed valuation for 1995
times the difference of the district's equalized operating levy for
school purposes for 1995 minus the district's equalized operating levy
for school purposes for 1993;

(c) The product of the district's equalized assessed valuation for 1996
times the difference of the district's equalized operating levy for
school purposes for 1996 minus the district's equalized operating levy
for school purposes for 1993;

(d) The product of the district's equalized assessed valuation for 1997
times the difference of the district's equalized operating levy for
school purposes for 1997 minus the district's equalized operating levy
for school purposes for 1993; provided that the remaining balance in the
incidental fund shall be no less than twelve percent of the total
expenditures during that fiscal year from the incidental fund.

(4) A district which makes a transfer pursuant to subdivision (3) of this
subsection shall be subject to compliance with the requirements of
section 165.016 for fiscal years 1999, 2000 and 2001, without the option
to request a waiver or an adjustment of the base school year certificated
salary percentage.

(5) Other provisions of section 165.016 to the contrary notwithstanding,
the transfer of an amount of funds from either the teachers' or
incidental fund to the capital projects fund pursuant to subdivision (3)
of this subsection shall not be considered an expenditure from the
teachers' or incidental fund for the purpose of determining compliance
with the provisions of subsections 1 and 2 of section 165.016.

11. In addition to other transfers authorized under subsections 1 to 9 of
this section, a district may transfer from the teachers' and incidental
funds to the capital projects fund the amount necessary to repay costs of
one or more guaranteed energy savings performance contracts to renovate
buildings in the school district; provided that the contract is only for
energy conservation measures, as defined in section 640.651, RSMo, and
provided that the contract specifies that no payment or total of payments
shall be required from the school district until at least an equal total
amount of energy and energy-related operating savings and payments from
the vendor pursuant to the contract have been realized by the school
district.

12. In addition to other transfers authorized pursuant to subsections 1
to 9 of this section, any school district that has undergone at least a
twenty-percent increase in assessed valuation from the preceding year
because of the construction of a power plant may make a one-time transfer
on the basis of each such increase to the capital projects fund from the
balances of the teachers' and incidental funds' unrestricted balances in
an amount equal to twice the amount of such transfer otherwise permitted
pursuant to this section for the year in which such one-time transfer is
made; provided that such transfer shall be made prior to the end of the
second fiscal year following the fiscal year in which the increase in
assessed valuation is effective. Such one-time transfer may be made
without regard to whether the transferred funds are used for current
expenditures. No transfer shall be made pursuant to this subsection after
June 30, 2003.

13. A school district may transfer unrestricted funds from the capital
projects fund to the incidental fund in any year in which that year's
June thirtieth combined incidental and teachers' funds unrestricted
balance compared to the combined incidental and teachers' funds
expenditures would be less than ten percent without such transfer.

14. School districts that have issued qualified zone academy bonds
pursuant to 26 U.S.C. Section 1397E, also known as the Taxpayers Relief
Act of 1997, prior to December 31, 2002, and have placed bond proceeds
into an interest-bearing account in the capital projects fund without
meeting the requirement to set a levy in the debt service fund as
required in section 164.161, RSMo, shall be permitted to make transfers
to the debt service fund in an amount up to but not exceeding the
original amount of bond proceeds invested, under the following conditions:

(1) The district has an unrestricted balance in the capital projects fund
equivalent to the original amount of bond proceeds invested that may be
transferred to the debt service fund; or

(2) If the district does not have sufficient unrestricted funds in the
capital projects fund pursuant to subdivision (1) of this subsection,
then additional funds may be transferred from the incidental fund to the
debt service fund up to the amount needed to equal the original amount of
bond proceeds invested, but such transfer in combination with other
district expenditures may not reduce the ending fund balance in the
combined teachers' and incidental funds below ten percent balance of the
expenditures in those funds;

(3) If the transfers allowed pursuant to subdivisions (1) and (2) of this
subsection are not sufficient to equal the original amount of bond
proceeds invested, the district shall provide an annual tax in the debt
service fund sufficient to generate the amount required within five years
from June 23, 2003;

(4) The district shall report the following information as prescribed by
the department of elementary and secondary education on the annual
secretary of the board report required to be submitted pursuant to
section 162.821, RSMo, for the fiscal year ending June 30, 2003:

(a) Documentation of the establishment of the local academy/business
partnership and the ten percent business match for qualified zone academy
bonds pursuant to 26 U.S.C. Section 1397E;

(b) A detailed schedule of completed and planned expenditures for the
projects as specified in the department-approved qualified zone academy
bond application, identified by building with certification by the
district that a minimum of ninety-five percent of the voter-approved
qualified zone academy bonds will be expended within ten years from the
date of the sale of bonds; and

(c) The business name, office location, state of incorporation, and names
of any representative of the bonding institution and bond counsel, if
applicable, who handled the qualified zone academy bond issuance,
including all individuals who signed correspondence to or made
presentations to the school district concerning such bonds; and providing
the amount of fees or costs of issuance paid to the bonding institution
and bond counsel stated as a whole dollar amount and as a percentage of
the qualified zone academy bond;

(5) Any transfer made pursuant to subdivision (1) or (2) of this
subsection shall be reported on the district's fiscal year 2003 financial
records;

(6) If the district fails to provide the information in the manner
prescribed by the department on the annual secretary of the board report
by December 31, 2003, the amount of unrestricted fund balance transferred
into the debt service fund from the capital projects fund or incidental
fund shall be returned to the original fund from which the transfer was
made and an annual tax established in the debt service fund sufficient to
pay the principal and interest of the bonds as they fall due.

15. On or before August 31, 2005, a school district located in a county
of the third classification without a township form of government and
with more than thirty-seven thousand two hundred but less than thirty-
seven thousand three hundred inhabitants and in a county of the third
classification without a township form of government and with more than
nine thousand four hundred fifty but less than nine thousand five hundred
fifty inhabitants and a school district with an assessed valuation of no
less than twenty-one million seven hundred fifty thousand dollars and no
more than twenty-two million dollars located in a county of the third
classification without a township form of government and with more than
forty thousand eight hundred but less than forty thousand nine hundred
inhabitants shall be permitted to make a one-time additional transfer
from the incidental fund to the capital projects fund in an appropriate
amount for the specific purpose of completing a sewer project in order to
comply with regulations established by the department of natural
resources.

16. On or before August 31, 2005, a school district with an assessed
valuation of at least thirty-one million dollars and less than thirty-two
million dollars located in a county of the third classification without a
township form of government and with more than thirty-one thousand but
less than thirty-one thousand one hundred inhabitants shall be permitted
to make a one-time additional transfer from the incidental fund to the
capital projects fund in an appropriate amount for the specific purpose
of improving the library media and technology center that serves the
district's high school and middle school.

17. In addition to other transfers authorized pursuant to this section,
an eligible school district may transfer from the incidental fund to the
capital projects fund to make expenditures which decrease the total
interest cost of payments for a lease-purchase obligation authorized by
section 177.088, RSMo. An eligible school district shall:

(1) Have never made a previous transfer pursuant to this subsection;

(2) Have ending cash reserves during the year of the transfer in
incidental and teachers' funds combined equal to or greater than fifteen
percent of expenditures;

(3) Decrease the interest cost of all remaining lease-purchase payments
by at least the cost of refinancing plus ten percent;

(4) Make payments equal to or greater than the amount of the transfer for
a lease-purchase obligation meeting an eligibility requirement of
subsection 5 or 6 of this section;

(5) Levy in the incidental and teachers' funds a levy greater than two
dollars and seventy-five cents during the year of the transfer and each
of the two previous years;

(6) Demonstrate compliance with the requirements of section 165.016 or
have paid all outstanding penalties to eligible staff for five
consecutive years prior to the year of the transfer; and

(7) Have an average salary for teachers in the district which equals or
exceeds for three consecutive years prior to the year of the transfer at
least one of the following:

(a) The average salary for teachers statewide; or

(b) The average salary for teachers in its senatorial district. (L. 1963
p. 200 § 6-1, A.L. 1977 H.B. 130, A.L. 1992 S.B. 581, A.L. 1993 S.B. 380,
A.L. 1994 S.B. 676, A.L. 1995 S.B. 255, A.L. 1996 S.B. 795, et al., A.L.
1997 H.B. 604 merged with H.B. 641 & 593, A.L. 1998 H.B. 1469 merged with
S.B. 658 merged with S.B. 781, A.L. 1999 H.B. 889, A.L. 2000 S.B. 944,
A.L. 2001 S.B. 543, A.L. 2003 S.B. 686)

(Source: RSMo 1959 § 165.110)

Effective 6-23-03

*This section was amended by S.B. 287, 2005, effective 7-1-06.

1. Each school district shall annually report to the department
of elementary and secondary education, within thirty days, the following
district information as of December thirty-first of the current school
year:

(1) The district's unrestricted fund balance in the incidental fund and
in the teacher's fund;

(2) The amount of tax anticipation borrowed funds placed in the
incidental fund and in the teacher's fund since the beginning of the
school year; and

(3) The net amount of transfer from the incidental fund and teacher's
fund to the capital projects fund and to the debt service fund since the
beginning of the school year.

2. For the 2005-06 school year, each school district shall also provide
the same information required under subsection 1 of this section as of
December 31, 2003, and as of December 31, 2004.

3. The information reported under this section shall be included on the
department's web site, for the current school year and for each of the
preceding four school years to the extent that such information was
required to be reported under subsections 1 and 2 of this section. (L.
2005 S.B. 287)

Effective 7-1-06

1. Notwithstanding the provisions of subsection 8 of section
165.011 to the contrary, any repayment of moneys pursuant to subsection 8
of section 165.011 may be completed no later than the fifth fiscal year
following the year of violation.

2. Notwithstanding the provisions of subsection 8 of section 165.011 of
Senate Substitute No. 2 for House Committee Substitute for House Bill No.
889, as truly agreed and finally passed by the first regular session of
the ninetieth general assembly, any school district that made an illegal
transfer of funds from the incidental fund to the capital projects fund
that occurred in both fiscal years 1998 and 1999 shall not be allowed to
make a repayment of funds after April 30, 2000, pursuant to the
provisions of this section or subsection 8 of section 165.011 of Senate
Substitute No. 2 for House Committee Substitute for House Bill No. 889,
as truly agreed and finally passed by the first regular session of the
ninetieth general assembly unless the voters of such district approve an
operating levy increase to the greater of two dollars and eighty-five
cents or the levy which produces an increase in total state and local
revenues as determined by the department of elementary and secondary
education which is equal to or greater than the amount of state aid to be
deducted pursuant to subsection 8 of section 165.011 by April 30, 2000.
If the voters of such district fail to approve such levy such district
shall repay any funds that were illegally transferred by December 31,
2000. (L. 1999 S.B. 394 § 1)

*This section was repealed by S.B. 287, 2005, effective 7-1-06. Consult
RSMo 2000 for existing section.

CROSS REFERENCES: Accounting of funds and allowance of transfers to and
from incidental fund, RSMo 165.011 Determination of state aid, RSMo
163.031

1. A school district shall expend as a percentage of current
operating cost, for tuition, teacher retirement and compensation of
certificated staff, a percentage that is for the 1994-95 and 1995-96
school years no less than three percentage points less than the base
school year certificated salary percentage and for the 1996-97 school
year, no less than two percentage points less than the base school year
certificated salary percentage. A school district may exclude
transportation and school safety and security expenditures from the
current operating cost calculation of the base year and the year or years
for which the compliance percentage is calculated. The base school year
certificated salary percentage shall be the two-year average percentage
of the 1991-92 and 1992-93 school years except as otherwise established
by the state board under subsection 4 of this section; except that, for
any school district experiencing, over a period of three consecutive
years, an average yearly increase in average daily attendance of at least
three percent, the base school year certificated salary percentage may be
the two-year average percentage of the last two years of such period of
three consecutive years, at the discretion of the school district.

2. Beginning with the 1997-98 school year, a school district shall:

(1) Expend, as a percentage of current operating cost, as determined in
subsection 1 of this section, for tuition, teacher retirement and
compensation of certificated staff, a percentage that is no less than two
percentage points less than the base school year certificated salary
percentage; or

(2) For any year in which no payment of a penalty is required for the
district under subsection 6 of this section, have an unrestricted fund
balance in the combined incidental and teachers' funds on June thirtieth
which is equal to or less than ten percent of the combined expenditures
for the year from those funds.

3. Beginning with the 1999-00 school year:

(1) As used in this subsection, "fiscal instructional ratio of
efficiency" or "FIRE" means the quotient of the sum of the district's
current operating costs, which for this section shall mean all
expenditures for instruction and support services, excluding capital
outlay and debt service expenditures less the revenue from federal
categorical sources, food service, student activities, and payments from
other districts, for all kindergarten through grade twelve direct
instructional and direct pupil support service functions plus the costs
of improvement of instruction and the cost of purchased services and
supplies for operation of the facilities housing those programs, and
excluding student activities, divided by the sum of the district's
current operating cost, as defined in this subdivision, for kindergarten
through grade twelve, plus all tuition revenue received from other
districts minus all noncapital transportation and school safety and
security costs;

(2) A school district shall show compliance with this section in school
year 1998-99 and thereafter by the method described in subsections 1 and
2 of this section, or by maintaining or increasing its fiscal
instructional ratio of efficiency compared to its FIRE for the 1997-98
base year.

4. (1) The state board of education may exempt a school district from the
requirements of this section upon receiving a request for an exemption by
a school district. The request shall show the reason or reasons for the
noncompliance, and the exemption shall apply for only one school year.
Requests for exemptions under this subdivision may be resubmitted in
succeeding years.

(2) A school district may request of the state board a one-time,
permanent revision of the base school year certificated salary
percentage. The request shall show the reason or reasons for the revision.

5. Any school district requesting an exemption or revision under
subsection 4 of this section must notify the certified staff of the
district in writing of the district's intent. Prior to granting an
exemption or revision, the state board shall consider comments from
certified staff of the district. The state board decision shall be final.

6. Any school district which is determined by the department to be in
violation of the requirements of subsection 1 or 2 of this section, or
both, shall compensate the building-level administrative staff and
nonadministrative certificated staff during the year following the notice
of violation by an additional amount which is equal to one hundred ten
percent of the amount necessary to bring the district into compliance
with this section for the year of violation. In any year in which a
penalty is paid, the district shall pay the penalty specified in this
subsection in addition to the amount required under this section for the
current school year.

7. Any additional transfers from the teachers' or incidental fund to the
capital projects fund beyond the transfers authorized by state law and
state board policy in effect on January 1, 1996, shall be considered
expenditures from the teachers' or incidental fund for the purpose of
determining compliance with the provisions of subsections 1, 2 and 3 of
this section.

8. The provisions of this section shall not apply to any district wherein
the local effort is greater than its weighted average daily attendance
multiplied by the state adequacy target multiplied by the dollar value
modifier under section 163.031, RSMo.

9. The provisions of subsections 1 to 8 of this section shall not apply
to any district that has unrestricted fund balances in the combined
incidental and teacher funds on June thirtieth of the preceding year
which are equal to or less than seventeen percent of the combined
expenditure for the preceding year from these funds in any year in which
state funds distributed pursuant to subsections 1 and 2 of section
163.031, RSMo, are no more than ninety-six percent of such state funds
distributed in fiscal year 2002.

10. The provisions of subsections 1 to 8 of this section shall not apply
to any district which meets the following criteria:

(1) With ten percent or more of its assessed valuation that is owned by
one person or corporation as commercial or personal property who is
delinquent in a property tax payment;

(2) With unrestricted fund balances in the combined incidental and
teacher funds on June thirtieth of the preceding year which are equal to
or less than one-half of the local property tax revenue for the previous
year; and

(3) In any year in which state funds distributed pursuant to subsections
1 and 2 of section 163.031, RSMo, are no more than ninety-six percent of
such state funds distributed in fiscal year 2002.

11. The provisions of this section shall terminate on June 30, 2007. (L.
1996 S.B. 795, et al., A.L. 1998 S.B. 781, A.L. 2000 S.B. 944, A.L. 2003
S.B. 686, A.L. 2005 S.B. 287)

*Effective 7-1-06

Expires 6-30-07

1. A school district shall expend as a percentage of current
operating cost, for tuition, teacher retirement and compensation of
certificated staff, a percentage that is for the 1994-95 and 1995-96
school years no less than three percentage points less than the base
school year certificated salary percentage and for the 1996-97 school
year, no less than two percentage points less than the base school year
certificated salary percentage. A school district may exclude
transportation and school safety and security expenditures from the
current operating cost calculation of the base year and the year or years
for which the compliance percentage is calculated. The base school year
certificated salary percentage shall be the two-year average percentage
of the 1991-92 and 1992-93 school years except as otherwise established
by the state board under subsection 4 of this section; except that, for
any school district experiencing, over a period of three consecutive
years, an average yearly increase in average daily attendance of at least
three percent, the base school year certificated salary percentage may be
the two-year average percentage of the last two years of such period of
three consecutive years, at the discretion of the school district.

2. Beginning with the 1997-98 school year, a school district shall:

(1) Expend, as a percentage of current operating cost, as determined in
subsection 1 of this section, for tuition, teacher retirement and
compensation of certificated staff, a percentage that is no less than two
percentage points less than the base school year certificated salary
percentage; or

(2) For any year in which no payment of a penalty is required for the
district under subsection 6 of this section, have an unrestricted fund
balance in the combined incidental and teachers' funds on June thirtieth
which is equal to or less than ten percent of the combined expenditures
for the year from those funds.

3. Beginning with the 1999-2000 school year:

(1) As used in this subsection, "fiscal instructional ratio of
efficiency" or "FIRE" means the quotient of the sum of the district's
current operating costs, as defined in section 163.011, RSMo, for all
kindergarten through grade twelve direct instructional and direct pupil
support service functions plus the costs of improvement of instruction
and the cost of purchased services and supplies for operation of the
facilities housing those programs, and excluding student activities,
divided by the sum of the district's current operating cost for
kindergarten through grade twelve, plus all tuition revenue received from
other districts minus all noncapital transportation and school safety and
security costs;

(2) A school district shall show compliance with this section in school
year 1998-99 and thereafter by the method described in subsections 1 and
2 of this section, or by maintaining or increasing its fiscal
instructional ratio of efficiency compared to its FIRE for the 1997-98
base year.

4. (1) The state board of education may exempt a school district from the
requirements of this section upon receiving a request for an exemption by
a school district. The request shall show the reason or reasons for the
noncompliance, and the exemption shall apply for only one school year.
Requests for exemptions under this subdivision may be resubmitted in
succeeding years.

(2) A school district may request of the state board a one-time,
permanent revision of the base school year certificated salary
percentage. The request shall show the reason or reasons for the revision.

5. Any school district requesting an exemption or revision under
subsection 4 of this section must notify the certified staff of the
district in writing of the district's intent. Prior to granting an
exemption or revision, the state board shall consider comments from
certified staff of the district. The state board decision shall be final.

6. Any school district which is determined by the department to be in
violation of the requirements of subsection 1 or 2 of this section, or
both, shall compensate the building-level administrative staff and
nonadministrative certificated staff during the year following the notice
of violation by an additional amount which is equal to one hundred ten
percent of the amount necessary to bring the district into compliance
with this section for the year of violation. In any year in which a
penalty is paid, the district shall pay the penalty specified in this
subsection in addition to the amount required under this section for the
current school year.

7. Any additional transfers from the teachers' or incidental fund to the
capital projects fund beyond the transfers authorized by state law and
state board policy in effect on January 1, 1996, shall be considered
expenditures from the teachers' or incidental fund for the purpose of
determining compliance with the provisions of subsections 1, 2 and 3 of
this section.

8. The provisions of this section shall not apply to any district
receiving state aid pursuant to subsection 6 of section 163.031, RSMo,
based on its 1992-93 payment amount per eligible pupil, which is less
than fifty percent of the statewide average payment amount per eligible
pupil paid during the previous year.

9. The provisions of subsections 1 to 8 of this section shall not apply
to any district that has unrestricted fund balances in the combined
incidental and teacher funds on June thirtieth of the preceding year
which are equal to or less than seventeen percent of the combined
expenditure for the preceding year from these funds in any year in which
state funds distributed pursuant to section 163.031, RSMo, lines 1 to 10
plus line 14 are no more than ninety-six percent of such state funds
distributed in fiscal year 2002.

10. The provisions of subsections 1 to 8 of this section shall not apply
to any district which meets the following criteria:

(1) With ten percent or more of its assessed valuation that is owned by
one person or corporation as commercial or personal property who is
delinquent in a property tax payment;

(2) With unrestricted fund balances in the combined incidental and
teacher funds on June thirtieth of the preceding year which are equal to
or less than one-half of the local property tax revenue for the previous
year; and

(3) In any year in which state funds distributed pursuant to section
163.031, RSMo, lines 1 to 10 plus line 14 are no more than ninety-six
percent of such state funds distributed in fiscal year 2002. (L. 1996
S.B. 795, et al., A.L. 1998 S.B. 781, A.L. 2000 S.B. 944, A.L. 2003 S.B.
686)

Effective 6-23-03

*This section was amended by S.B. 287, 2005, effective 7-1-06.

1. All moneys received by a school district shall be disbursed
only for the purposes for which they were levied, collected or received.

2. School district moneys shall be disbursed only upon checks drawn by
the treasurer of the district pursuant to orders of the board of
education or upon orders for payment issued by the treasurer of the
district pursuant to orders of the board of education. Each check shall
show the legal identification of the district by name and address, the
depositary upon which the check is drawn, shall specify the amount to be
paid, to whom payment is made, from what fund, for what purpose, the date
of payment and the number of the check. Each check must be signed by the
president and the treasurer of the board. The board by resolution may
direct that the signatures be affixed to the checks in facsimile in the
manner and with the effect provided by sections 105.273 to 105.278, RSMo.

3. The checks drawn shall be in substantially the following form: ( Name
of District ) ( Check number ) ( Address ) .........

Date of payment Pay to the Order of .....................
$......................

( Payee ) ( amount in figures )
............................................ dollars Out of
......................... Fund

(name) Purpose .................. ...................

President of board

...................

Treasurer of board

4. No check shall be drawn, or order for payment issued, for the payment
of any school district indebtedness unless there is sufficient money in
the treasury and in the proper fund for the payment of the indebtedness.

5. Each and every check and order for payment shall be paid from its
appropriate fund or funds, as provided by law.

6. No school district treasurer shall draw any check or issue any order
for payment against any school district that is in excess of the income
and revenue of the school district for the school year beginning on the
first day of July and ending on the thirtieth day of June following. (L.
1963 p. 200 § 6-2, A.L. 1973 H.B. 158, A.L. 1977 S.B. 111 & H.B. 130)

(Source: RSMo 1959 § 165.110)

If a check issued by any school district in this state is lost
or destroyed and satisfactory proof of the loss or destruction is made to
the board of the school district which has issued the check, and the
depositary upon which the check was drawn certifies that the check has
not been presented for payment, the board of the district may cause to be
issued a duplicate check of like number, date and amount, in favor of the
payee named in the original check. The words, "this duplicate, the
original unpaid", shall be inserted in the check after the name of the
payee and the board immediately shall cause the depositary to be notified
of the issue of the duplicate and the depositary shall pay the duplicate,
but not the original, when presented for payment under the conditions
which would have entitled the original to payment. The applicant for the
duplicate check also shall execute and deliver to the treasurer a bond
payable to the school district in the amount of the check with good and
sufficient security to be approved by the treasurer and conditioned that
the applicant will indemnify the school district, or any legal holder of
the original check, for any loss which occurs in case the original check
is produced or presented for payment. The bond may be enforced by suit in
the name of obligee to its own use or to the use of the party entitled to
the benefit thereof. Any municipal corporation or other political
subdivision of the state to which, or to whose fiscal officer, any
original lost or destroyed school check was payable, pursuant to
resolution of its governing body, may execute the bond, and in such cases
the bond may be accepted without surety or other security. (L. 1963 p.
200 § 6-3, A.L. 1973 H.B. 232, A.L. 1977 S.B. 111 & H.B. 130)

(Source: RSMo 1959 § 165.113)

If any school district has money in the teachers', incidental,
capital projects or debt service fund not needed within a reasonable
period of time for the purpose for which the money was received, the
school board in the district, if it deems it advisable, may invest the
funds in either open time deposits or certificates of deposit secured
under the provisions of sections 110.010 and 110.020, RSMo; or in bonds,
redeemable at maturity at par, of the state of Missouri, of the United
States, or of any wholly owned corporation of the United States; or in
other short term obligations of the United States, or in any instrument
permitted by law for the investment of state moneys. No open time
deposits shall be made or bonds purchased to mature beyond the date that
the funds are needed for the purpose for which they were received by the
school district. Interest accruing from the investment of the surplus
funds in such deposits or bonds shall be credited to the fund from which
the money was invested. (L. 1963 p. 200 § 6-5, A.L. 1977 H.B. 130, A.L.
1992 S.B. 581, A.L. 1993 S.B. 380, A.L. 1996 S.B. 795, et al., A.L. 1999
S.B. 386)

(Source: RSMo 1959 §§ 165.110, 165.243, 165.247)

CROSS REFERENCES: Bi-state development agency, bonds of, investment in
authorized, RSMo 70.377 Multinational banks, securities and obligations
of, investment in, when, RSMo 409.950 Savings accounts in insured savings
and loan associations, investment in authorized, RSMo 369.194

From and after the approval of his bond as such, the treasurer
of each seven-director school district shall receive all moneys belonging
to the district, from whatever source derived, and deposit and pay out
the same upon checks or orders for payment as provided in section
165.021. He shall also be custodian of all bonds and other securities
belonging to the school district. (L. 1963 p. 200 § 6-6, A.L. 1977 S.B.
111 & H.B. 130)

(Source: RSMo 1959 § 165.400)

1. At least once in every month the county collector in all
counties of the first and second classifications and the collector-
treasurer in counties having township organization shall pay over to the
treasurer of the school board of all seven-director districts all moneys
received and collected by the collector-treasurer to which the board is
entitled and take duplicate receipts from the treasurer, one of which the
collector-treasurer shall file with the secretary of the school board and
the other the collector-treasurer shall file in his or her settlement
with the county commission.

2. The county collector in counties of the third and fourth
classification, except in counties under township organization, shall pay
over to the county treasurer at least once in every month all moneys
received and collected by the county collector which are due each school
district and shall take duplicate receipts therefor, one of which the
county collector shall file in his or her settlement with the county
commission. The county treasurer in such counties shall pay over to the
treasurer of the school board of seven-director districts, at least once
in every month, all moneys so received by the county treasurer to which
the board is entitled. Upon payment the county treasurer shall take
duplicate receipts from the treasurer of the school board, one of which
the county treasurer shall file with the secretary of the school board,
and the other he shall file in his or her settlement with the county
commission. (L. 1963 p. 200 § 6-7, A.L. 2005 H.B. 58 merged with S.B. 210)

(Source: RSMo 1959 §§ 165.347, 165.348)

The county treasurer shall pay over to the treasurer of each
seven-director school district any state or county school moneys received
by him to which the district is entitled, at least once in every month
and take duplicate receipts from the treasurer one of which he shall file
with the secretary of the board, and the other he shall file in his
settlement with the county commission. (L. 1963 p. 200 § 6-8)

(Source: RSMo 1959 §§ 165.343, 165.460)

No money belonging to the school district shall be paid by any
depositary or from any investment account maintained pursuant to section
165.051 except upon the check of the treasurer and president of the board
of the school district or order for payment duly issued by the treasurer.
The board, by resolution, may direct that the signatures be affixed to
the checks in facsimile in the manner and with the effect provided in
sections 105.273 to 105.278, RSMo. (L. 1963 p. 200 § 6-9, A.L. 1977 S.B.
111, A.L. 1995 S.B. 301)

(Source: RSMo 1959 §§ 165.349, 165.443)

Effective 6-27-95

The treasurer of each seven-director school district annually,
not later than the first day of August, shall settle with the school
board and account to the board for all school moneys received in each
fund of the district, and the amount paid out for school purposes in the
seven-director school district. The settlement, if found correct by the
board, shall be approved by the board; and when approved the treasurer
shall present his settlement to the clerk of the county commission. The
clerk shall make a careful examination of the settlement, and if found
correct he shall certify the same. The certificate shall be prima facie a
discharge of the liability of the treasurer for the funds expressed in
the vouchers. At the expiration of his term of office the treasurer shall
deliver over to his successor in office all books and papers, with all
moneys or other property in his hands, and also all orders, checks, bonds
and coupons he has paid or redeemed since his last annual settlement with
the board and with the county clerk, and shall take the duplicate
receipts of his successor therefor, one of which he shall deposit with
the secretary of the board and the other with the county clerk. (L. 1963
p. 200 § 6-10, A.L. 1977 S.B. 111 & H.B. 130)

(Source: RSMo 1959 §§ 165.350, 165.453)

1. The school board of each district, for any year for which it
does not cause an audit to be performed by October thirty-first after the
close of the school year, shall make and publish, not later than
September first, in some newspaper as described in section 493.050, RSMo,
published in the school district, and if there is none then in some
newspaper of general circulation within the district, a statement of all
receipts of school moneys, when and from what source derived, and all
expenditures, and on what account; also, the present indebtedness of the
district and its nature, and the rate of taxation for all purposes for
the year. The statement shall be duly attested by the president and
secretary of the board, and the secretary shall forward a copy to the
state board of education on forms prescribed by the board.

2. The state board of education shall not release the state aid
apportioned to the district for the next ensuing school year until a copy
of the required statement has been received at its office in Jefferson
City and has been approved by it. Any school board which fails, refuses
or neglects to order the statement to be made, and any officer of the
board who fails, refuses, or neglects to prepare, publish and forward the
statement, as required by this section, when ordered by the board, is
guilty of a misdemeanor and punishable by a fine not to exceed one
hundred dollars. Annual or biennial audit summaries shall be published
according to section 165.121. (L. 1963 p. 200 § 6-11, A.L. 1988 S.B. 789,
A.L. 1996 S.B. 926)

(Source: RSMo 1959 § 165.360)

1. The school board of each seven-director district shall cause
an audit examination to be made at least biennially of all financial,
transportation and attendance records of the districts. Such examination
shall be made in accordance with generally accepted auditing standards
applicable in the circumstances, including such reviews and tests of the
system of internal check and control and of the books, records and other
underlying data as are necessary to enable the independent accountant
performing the audit to come to an informed opinion as to the financial
affairs (including attendance and transportation transactions) of the
district. An independent auditor who is not regularly engaged as an
employee of the school board shall perform the audit and make a written
report of his findings.

2. The board shall supply each member thereof with a copy of the report
and in addition shall furnish one copy each to the state department of
elementary and secondary education and to the superintendent of schools
of the county in which the district is located. The cost of the audit and
report shall be paid for out of the incidental fund of the district.

3. The report shall contain the following information:

(1) A statement of the scope of examination;

(2) The auditor's opinion as to whether the audit was made in accordance
with generally accepted auditing standards applicable in the
circumstances;

(3) The auditor's opinion as to whether the financial statements included
in the audit report present fairly the results of the operations during
the period audited;

(4) The auditor's opinion as to whether the financial statements
accompanying the audit report were prepared in accordance with generally
accepted accounting principles applicable to school districts;

(5) The reason or reasons an opinion is not rendered with respect to
items (3) and (4) in the event the auditor is unable to express an
opinion with respect thereto;

(6) The auditor's opinion as to whether the district's budgetary and
disbursement procedures conform to the requirements of chapter 67, RSMo;

(7) The auditor's opinion as to whether attendance and transportation
records are so maintained by the district as to disclose accurately
average daily attendance and average daily transportation of pupils
during the period of the audit;

(8) Financial statements presented in such form as to disclose the
operations of each fund of the school district and a statement of the
operations of all funds.

4. The school board shall furnish the state department of elementary and
secondary education with its copy of the audit report not later than
October thirty-first following the close of the fiscal period covered by
the audit unless, for good cause shown prior to such date, the
commissioner of education or some officer of the department of elementary
and secondary education designated by him for this purpose grants an
extension of time, not to exceed sixty additional days, for the filing of
the report. In the event the report in the approved form is not filed
within the period or extension thereof, further state aid to the district
shall thereafter be withheld until the audit report has been received by
the department of elementary and secondary education.

5. Within thirty days of the receipt of the audit report the school board
shall cause a summary of the report to be prepared which shall include,
together with any other matter the board deems appropriate, the following:

(1) A summary statement of fund balances and receipts and disbursements
by major classifications of each fund and all funds;

(2) A summary statement of the scope of the audit examination;

(3) The auditor's opinion on the financial statements included in the
audit report. Immediately upon the completion of the summary, the school
board shall cause it to be published once in a newspaper within the
county in which all or a part of the district is located which has
general circulation within the district or, if there is none, then the
board shall cause the summary to be posted in at least five public places
within the district. The publication shall contain information as to
where the audit report is available for inspection and examination. The
report shall be kept available for such purposes thereafter. (L. 1963 p.
200 § 6-12)

(Source: RSMo 1959 § 165.115)

(1973) Held that this section does not supersede § 29.230, RSMo.
Consolidated School Dist. No. 1 of Jackson Co. v. Bond (A.), 500 S.W.2d
18.

1. The commissioner of education may cause an audit examination
to be performed, pursuant to this section, of the enrollment and average
daily attendance records of any school district. Such examination shall
be made in accordance with generally accepted auditing standards
applicable in the circumstances, including such reviews and tests of the
system of internal check and control and of the books, records and other
underlying data as are necessary to enable the independent accountant
performing the audit to come to an informed opinion as to the enrollment
and attendance and reporting of the district. A physical count of
students shall be a part of the audit. Such physical count shall occur on
a date randomly selected without notice to the district. An independent
auditor who is not regularly engaged as an employee of the school board
shall perform the audit and make a written report of his findings to the
commissioner of education and the district school board.

2. The actual and necessary costs of the audit shall be paid by the
department. (L. 1998 S.B. 781)

The board of education of any school district in this state,
upon a vote of a majority of the members of the board, may borrow funds
for the use of the various funds of the district, including the debt
service fund, and may issue negotiable notes in evidence thereof, payable
out of the revenues derived from school taxes or other school revenues,
for the purposes of the funds of any year in which the notes are issued.
The notes may be issued at any time and from time to time in any year. A
separate note shall be issued to evidence the borrowing for the benefit
of each fund, and shall bear on its face appropriate reference to or
designation of the fund for the use of which the funds evidenced by the
note are borrowed. Beginning with the fiscal year commencing on July 1,
1994, the aggregate outstanding principal amount of the notes issued in
any year for the use or benefit of any fund shall not exceed the amount
of the school board's estimate of the requirements for the fund for such
year. The notes shall be payable in not to exceed twelve months from date
of issuance, and shall not exceed the terms as set forth in section
108.170, RSMo. The proceeds of the notes shall be placed to the credit of
the respective funds for the use and benefit of which the borrowing was
made, as evidenced by the notes, and subject to the right to make
transfers from and to funds as otherwise permitted by law, the proceeds
of the notes shall be used and expended only in payment of the expenses
and obligations properly payable from the funds, respectively, and
incurred or to be incurred against the funds during the year for the
expenses of the year, or in payment of principal and interest on the
notes. The notes may be payable to bearer or to the order of a named
payee, and may be in substantially the following form:

TAX AND REVENUE ANTICIPATION NOTE FOR ...... FUND...... School District
of ........ County, State of Missouri No. ..... Date of issue ........
$......

The ...... School District of ...... County, Missouri, will pay on ......
at the office of the Treasurer of said School District, or at the ......
Bank in ......, to (bearer; or ...... or order), the sum of ...... with
interest thereon from date of issue at the rate of ....% per annum,
payable at maturity, out of funds derived from taxes and other school
revenues for school purposes for the ...... fund, for the school year
beginning July 1, 19.., upon due and proper endorsement and presentment
hereof.

THE ...... SCHOOL DISTRICT

BY..........................

President ATTEST: ................ Clerk or Secretary (L. 1963 p. 200 §
6-13, A.L. 1973 H.B. 158, A.L. 1977 H.B. 130, A.L. 1984 H.B. 856 & 1358,
A.L. 1994 H.B. 1218)

(Source: RSMo 1959 § 165.070)

*Original rolls show this section as "161.131", an apparent typographical
error.

1. The notes shall be known as tax anticipation notes of the
school district and shall be signed by the president of the school board
and attested by the clerk or secretary. The clerk or secretary of the
school board shall certify on the back of each note that the note is
issued pursuant to an order of the school board of the district and the
aggregate principal amount of all prior notes and warrants issued against
the fund referred to in the note which are unpaid at the date of the
certificate. All notes issued under this section and section 165.131
shall be registered, without fee, before delivery in the office of the
county treasurer of the county in which the school district lies. The
registry shall show the number, date, amount and interest rate of each
note, the fund for which issued, date of sale and name of the payee, if
any, or of the purchaser if payable to bearer. Upon payment and
cancellation the notes shall be submitted to the county treasurer who
shall record the date of payment and cancellation in his record of
registry.

2. The secretary of the school district shall keep true and correct
record of the issuance, and of the fact and date of payment of all notes,
and deliver a duplicate thereof to the treasurer of the school district.
The notes upon payment shall be canceled and it shall not be lawful for
the school district to purchase and reissue any of the notes. (L. 1963 p.
200 § 6-14)

(Source: RSMo 1959 § 165.073)

All disbursements of the board of education in metropolitan
districts shall be made by checks drawn or orders for payment issued upon
a designated depositary in the form and subject to the regulations that
the board provides. (L. 1963 p. 200 § 6-16, A.L. 1967 p. 238, A.L. 1977
S.B. 111 & H.B. 130)

(Source: RSMo 1959 § 165.623)

The board of education in metropolitan districts shall determine
and provide for the auditing of the accounts of the board and its various
departments and operations, at the times and in the manner that the board
deems necessary. The board in such districts may employ independent
auditors to make the audit, or may appoint an auditor for this purpose
and provide for the employees that the auditor's duties require. The
board may remove the auditor from office by vote of a majority of its
members. Complete reports as to the audits shall be furnished to the
members of the board and the superintendent of schools and shall be made
available for inspection by any interested party. (L. 1963 p. 200 § 6-17,
A.L. 1967 p. 238)

(Source: RSMo 1959 § 165.627)

At the close of each fiscal school year, the mayor of the city
shall appoint one or more expert accountants, who shall examine the
books, accounts and vouchers of the treasurer and all other departments
of expenditure of the board of the metropolitan district and shall make
due report thereof to the mayor and the board of education of the city.
All the officers and employees of the board shall produce and submit to
the accountants for examination all books, papers, documents, vouchers
and accounts in their office belonging or pertaining to the office, and
shall in every way assist the accountants in their work. In the report to
be made by the accountants they may make any recommendation they deem
proper as to the business methods of the officers and employees. A
reasonable compensation for the services shall be paid by the board. (L.
1963 p. 200 § 6-18, A.L. 1967 p. 238)

(Source: RSMo 1959 § 165.633)

If at the time bids should be received or the selection of
depositaries should be made in seven-director districts in accordance
with the provisions of sections 165.211 to 165.291, it is unlawful for
banking institutions to pay interest upon demand deposits, or if there is
not a sufficient number of bids submitted, the board may name
depositaries of all or any part, not less than one-sixteenth part
thereof, of its funds, without advertising for bids and without requiring
the payment of any interest. Each depositary selected within ten days
after its selection in accordance with the provisions of this section
shall deposit securities required for the deposit of school funds as
provided in sections 110.010 and 110.020, RSMo. (L. 1963 p. 200 § 6-20)

(Source: RSMo 1959 § 165.427)

In all seven-director districts, the school board shall select
depositaries of the moneys and funds of the school district. Depositaries
may be selected annually or the school district and depositary may enter
into a one- to five-year contract or agreement for the deposit of the
district's moneys or funds at the discretion of the local board of
education. Such contract or agreement may be terminated by the mutual
consent of both parties at any time. The school board, in each year in
which depositaries are to be selected, shall receive sealed proposals
from banking institutions in the county or in adjoining counties which
desire to be selected as depositaries of the moneys and funds of the
school district. Notice that bids will be received shall be published by
the secretary of the board at least twenty days before the date selected
by the school board for the acceptance of bids in some newspaper
published in the county at least five days in each week, or if there is
none, then in a newspaper of general circulation within the county. (L.
1963 p. 200 § 6-21, A.L. 1980 S.B. 733, A.L. 1992 S.B. 581, A.L. 1998
H.B. 955)

(Source: RSMo 1959 § 165.417)

For the purpose of letting the funds the board shall divide the
funds into not less than two nor more than ten equal parts. Each bidder
may bid for any number of the parts, but the bid for each part shall be
separate. Any banking institution in the county or in an adjoining county
desiring to bid shall deliver to the secretary of the board, on or before
the date selected for the acceptance of bids, a sealed bid, stating the
rate of interest, or method by which the interest will be determined,
that the banking institution offers to pay on one part of the funds and
moneys of the school district for the term of one to five years, as the
case may be, next ensuing the date of the bid; or if the selection is
made for a less term as provided in sections 165.201 to 165.291, then for
the time between the date of the bid and the next regular time for the
selection of depositaries, as fixed by section 165.211. Each bid shall be
accompanied by a check in favor of the school district, on some solvent
banking institution in the county or an adjoining county, duly certified,
for not less than two thousand five hundred dollars, as a guaranty of
good faith on the part of the bidder that if any of its bids are accepted
by the board it will deposit the security required by law. It is a
misdemeanor for the secretary of the board to directly or indirectly
disclose the amount of any bid before all bids are opened at a public
depositary bid opening. (L. 1963 p. 200 § 6-22, A.L. 1980 S.B. 733, A.L.
1992 S.B. 581, A.L. 1998 H.B. 955)

(Source: RSMo 1959 § 165.420)

The school board or their designee in seven-director districts,
on the date selected for the acceptance of bids, shall publicly open the
bids and cause each bid to be verbally read and documented. Following
discussion and clarification of bids with the financial institutions, the
board of education shall cause each bid to be entered upon the records of
the board and shall select from among the bidders, as depositaries of the
funds and moneys of the school district, those whose bids are accepted,
and shall notify each of the bidders so selected. The board may reject
any and all bids. The interest upon the funds and moneys shall be
computed upon the daily balances to the credit of the school district
with each depositary and shall be payable by each depositary on the first
day of each month to the treasurer of the school district, who shall
place the same to the credit of the district. Each depositary, by at
least the fifth day of the current month, shall render to the secretary
of the board a statement, in writing, showing the amount of interest paid
by the depositary. The secretary of the board shall return the certified
checks accompanying the bids to the banking institutions whose bids which
they accompanied were rejected and, upon the approval of the security
provided for in sections 110.010 and 110.020, RSMo, return the certified
checks accompanying the accepted bids to the banking institutions
respectively, from which they were received. (L. 1963 p. 200 § 6-23, A.L.
1980 S.B. 733, A.L. 1998 H.B. 955)

(Source: RSMo 1959 § 165.423)

On or before ten days after notice to any depositary of its
selection, the depositary shall deliver or deposit securities in
accordance with sections 110.010 and 110.020, RSMo, and the securities if
delivered to the fiscal officer of the seven-director school district may
be deposited for safekeeping with any federal reserve bank located in
this state or with any banking institution located in the county and
approved by order of the school board entered of record on its minutes.
If at the time for selecting depositaries it is unlawful for banking
institutions to pay interest upon demand deposits the school board at its
option either may select depositaries as provided by law or may enter
into written agreement with any or all depositaries acting as such during
the preceding period for renewal and continuation of the depositary
relationship for the ensuing period with power and authority to renew and
continue the same for successive periods thereafter, subject however to
termination as provided by law. The rights and obligations of the parties
and of any trustee joining in a renewal agreement shall be deemed
continuous throughout the periods of the renewals. Each depositary at all
times shall maintain the security in kind and amount required by sections
110.010 and 110.020, RSMo, with right in the depositary when not in
default to make substitutions thereof and to withdraw interest coupons
therefrom as they mature. (L. 1963 p. 200 § 6-24)

(Source: RSMo 1959 § 165.430)

If the board of a seven-director district at any time deems it
necessary for the protection of the school district, by resolution it may
require a depositary to deposit additional security, and upon failure to
do so within five days after the service of a copy of the resolution upon
the depositary the board may proceed to select another depositary in its
place in the manner provided herein. (L. 1963 p. 200 § 6-25)

(Source: RSMo 1959 § 165.433)

If for any reason a selection of depositaries for all the funds
and moneys of a seven-director district is not made at the time fixed by
sections 165.201 to 165.291, the board, at any subsequent time, after
twenty days' notice, as herein provided, may receive bids and select
depositaries for the parts of the funds and moneys of the districts for
which no depositary has been selected; and the banking institutions
selected shall remain depositaries until the next regular time for the
selection of depositaries as provided by section 165.211, unless the
order selecting the depositaries is revoked for the causes specified in
sections 165.201 to 165.291. (L. 1963 p. 200 § 6-26)

(Source: RSMo 1959 § 165.437)

1. As soon as the securities are deposited and approved by the
board of a seven-director district, an order shall be made designating
the banking institution depositing the securities as a depositary of the
part of the funds and moneys of the school district of which it has been
selected as the depositary, until the time fixed by sections 165.201 to
165.291 for another selection. The treasurer of the school district
immediately upon the making of the order shall transfer to the depositary
the parts of all funds and moneys belonging to the school district that
the depositary is entitled to receive by virtue of its designation.

2. In case any bonds, coupons or other indebtedness of the district are
payable, by the terms of the bonds, coupons or other evidences of
indebtedness, at any particular place outside the district, nothing
contained in sections 165.201 to 165.291 shall prevent the board from
causing the treasurer to place a sufficient sum of money to meet the same
at the place where the debts are payable at the time of their maturity.

3. The treasurer of a seven-director district, as the funds and moneys of
the school district come into his hands from time to time, shall deposit
them with the depositaries to the credit of the school district, and at
all times shall keep on deposit with each depositary approximately that
proportion of all the funds and moneys of the district for which the
board accepted the bid of the depositary. If at any time the amount of
funds and moneys on deposit with any depositary to the credit of the
school district is either more or less than the proportion thereof for
which the board accepted the bid of the depositary, that fact shall not
impair or in any manner affect the liability of the depositary to
faithfully perform all the duties and obligations devolving by law upon
the depositary.

4. If any banking institution, after being selected as depositary and
notified thereof, fails to deposit the security within the time provided
by section 165.241, the certified check accompanying the accepted bid of
the banking institution shall be forfeited to the school district as
liquidated damages, and the board, after twenty days' notice in the
manner herein provided, shall proceed to receive new bids and select
another depositary in lieu of the one failing to deposit the security.
(L. 1963 p. 200 § 6-27)

(Source: RSMo 1959 §§ 165.440, 165.443)

For every failure to pay a check drawn or order for payment
issued upon a depositary by the treasurer of a seven-director school
district, when moneys and funds sufficient for the payment thereof are in
the depositary to the credit of the appropriate funds of the school
district, the depositary shall forfeit and pay to the holder of the check
or the payees of the order for payment ten percent of the amount thereof,
and the board may revoke the order designating it as depositary. (L. 1963
p. 200 § 6-28, A.L. 1977 S.B. 111 & H.B. 130)

(Source: RSMo 1959 § 165.447)

The treasurer of each seven-director district is not responsible
for the loss of any funds and moneys of the district through the
negligence or default of any depositary; but nothing in sections 165.201
to 165.291 shall release the treasurer from liability for any loss
resulting from any official misconduct on his part or from any
responsibility for the funds and moneys of the school district until the
time the depositaries are selected and the funds and moneys deposited
therein, or from liability for any misappropriation by him in any manner
of funds and moneys. (L. 1963 p. 200 § 6-29)

(Source: RSMo 1959 § 165.450)

1. Subject to the provisions of section 110.030, RSMo, the board
of education in each metropolitan district shall at least once every five
years advertise for bids from the banking institutions in the city for
the deposits of the board of education to be secured as provided in
sections 110.010 and 110.020, RSMo. The bids shall specify the rate of
interest to be allowed to the board on the deposits and the nature of the
security offered. The deposits shall be awarded to the banking
institutions that offer, with the required security, the highest rate of
interest therefor. The board may select as many depositaries for its
deposits as it deems necessary and the board shall cause contracts to be
made with the banking institutions receiving award of deposits. The board
shall cause all funds received to be paid into the designated
depositaries, allocating funds to the depositaries, if more than one
depositary has been designated, as the board deems proper.

2. The president of the board immediately after the selection of the
depositary or depositaries of the school moneys shall notify the
treasurer of the state of Missouri and the collector of school taxes in
the city of the name of the depositary to which they are to make all
payments of money apportioned, belonging to or distributed to the board;
and the officers upon making deposits shall take from the depositary
duplicate receipts therefor, one of which shall be retained by the
officer making the deposits and one delivered to the treasurer of the
board. (L. 1963 p. 200 § 6-30, A.L. 1967 p. 238, A.L. 1980 S.B. 733, A.L.
2004 S.B. 968 and S.B. 969)

(Source: RSMo 1959 § 165.610)

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