Many rural school districts are running up balances in Early Childhood Family Education (ECFE) budgets and deficits in School Readiness budgets. For this fiscal year only, districts in this situation can request the Commissioner of Education to approve the transfer of funds from ECFE to School Readiness.
Because both ECFE and School Readiness funds are “within” the Community Service Fund (Fund 4), these transfers would not be a transfer “from” the community service fund to a different fund. MREA supports this authority, which came to light in testimony regarding SF 333 which would give school districts this authority in any fiscal year.
Steps for School Boards
Here are steps school boards must take to make this transfer from ECFE to School Readiness:
1. Determine that a transfer of funds is necessary for the continued operation of the school district and that such transfer will not diminish the instructional opportunities for the students of Independent School District;
2. Determine the dollar amount of the one-time transfer; and
Your district must then submit by June 30, 2015:
- your Board resolution,
- a copy of the Board minutes approving the resolution,
- and the completed Request for Fund Transfer form.
The Commissioner must approve this request so long as the transfer does not increase state obligations nor increase property tax authority of the district. It is MREA’s opinion that since both of these programs are formula only with no attached levy authority, these conditions are met and the Commissioner by law must approve the transfer requests.
Thanks to Minnesota Schools Boards Association (MSBA) for providing the model resolution.
Statutory Language from 2013 Ch 116, Article 7:
FUND TRANSFER; FISCAL YEARS 2014 AND 2015 ONLY.
(a) Notwithstanding Minnesota Statutes, section 123B.80, subdivision 3, for fiscal years 2014 and 2015 only, the commissioner must approve a request for a fund transfer if the transfer does not increase state aid obligations to the district or result in additional property tax authority for the district. This section does not permit transfers from the community service fund, the food service fund, or the reserved account for staff development under section 122A.61.
(b) A school board may approve a fund transfer under paragraph (a) only after adopting a resolution stating the fund transfer will not diminish instructional opportunities for students.
This section is effective July 1, 2013.