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2001 Opinions

Date:   July 11, 2001
Prepared By:   Margaret O'Sullivan Parker
Phone:   (850) 488-7707
Suncom:   278-7707
Opinion No.:   01-11
Staff Contact:   David Morris
TO: Jeffrey McInnis, Okaloosa County School Board Attorney
FROM: James A. Robinson, General Counsel
SUBJECT: Expenditure of Internal School Funds Submitted on Behalf of the School Board of Okaloosa County
RE: Your letter

QUESTION PRESENTED: In accordance with the provision of "Financial and Program Cost Accounting and Reporting for Florida Schools, 1997" regulations, can a public school collect private donations and maintain them in their internal school accounts under a "Trust Fund" line item for school nursing services and then transfer and expend those monies in the school's general operating budget for the payment of salaries and other employment benefits to a district non-instructional employee providing nursing services?

CONCLUSION: The proposed funding and accounting method would not be contrary to the regulations found in the "Financial and Program Cost Accounting and Reporting for Florida Schools, 1997." However, as indicated by the second and third questions in your letter, there are several considerations that should be taken into account.

DISCUSSION: Your letter poses two additional questions if the answer to the first question is affirmative, which relate to administrative issues such as the collection and allocation of funds prior to the beginning of the school year and the appropriate accounting requirements for the trust fund account. The "Financial and Program Cost Accounting and Reporting for Florida Schools, 1997" manual, also known as the "Redbook," provides districts with a uniform standards for budgeting, financial reporting and accounting. The manual is incorporated by reference into Rule 6A-1.001, Florida Administrative Code.

Chapter Seven of the Redbook addresses school internal funds. Chapter 7, Section 3, Paragraph 3.5.(a)(5) provides:

The following expenditures from internal funds are deemed inappropriate and shall not be made except from trust funds collected for a specifically identified purpose:

(5) Salaries or other compensation for duties or assignments which are the responsibility of the school district.

This office issued an opinion (No. 94-009) where we advised that internal funds could not be used to pay compensation for an instructor to train teachers in technology. Citing the above portion of the Redbook, the opinion concluded that instruction related to curriculum activities is the responsibility of the school district, and could therefore not be paid for out of a school's internal funds.

However, the situation presented by your inquiry would not be prohibited. As indicated in your letter, Okaloosa County has not mandated the employment of nurses; the option is left up to each school. Therefore, salaries for the nurses would not be considered to arise from duties or assignments that are the responsibility of the school board. Moreover, an exception is permitted if the trust funds are collected for a specific purpose, as your letter proposes.

As indicated by the second and third questions in your letter, the district must ensure that the funds are collected in a separate trust account established for the purpose of supporting a school nurse position. The funds may only be spent for the purposes collected. (See Chapter 7, Section 3, Paragraph 2.4(a) and (b) of the Redbook). Other funding issues are not covered by state regulation, but should be considered on a local decision-making level in order to ensure proper planning and budgetary review. For example, while districts are not required to collect funds for this purpose before the fiscal year, it would be prudent to do so before a school makes the commitment to employ a nurse for the full year. Additionally, the district payroll system should be used to ensure compliance with state and federal regulations.

I have discussed this issue with David Morris of the Department's Office of Funding and Financial Reporting, who concurs with the conclusions of this memorandum. Please contact me if you have any further questions on this issue, or wish to discuss this letter in further detail.

cc: David Morris

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