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2001 Opinions

Date:   August 14, 2001
Prepared By:   Margaret O'Sullivan Parker
Phone:   (850) 488-7707
Suncom:   278-7707
Opinion No.:   01-14
Staff Contact:
  Spessard Boatright
Diane McCain
MEMORANDUM OPINION
TO: Francisco M. Negron, Jr., Escambia County School Board Attorney
FROM: James A. Robinson, General Counsel
SUBJECT: Charter School Capital Outlay Funds
RE: Letter of August 6, 2001

QUESTION PRESENTED: Is a school district required to release charter school capital outlay funds pursuant to Section 228.0561, Florida Statutes (2000), upon request of the charter school and a showing of compliance with the requirements of that section? Does a school district have any discretion in withholding from a charter school capital outlay funds for the purchase of real property in excess of the appraised fair market value of the real property?

CONCLUSION: District is not required to disburse the capital outlay funds without satisfactory documentation of the expenditure. Charter school capital outlay plan may be denied if the district considers it to be an unjustified expenditure under Section 228.0561, Florida Statutes.

DISCUSSION: Section 228.0561(1), Florida Statutes, directs the transmission of capital outlay funds to school districts on behalf of charter schools. Pursuant to subsection (4), the Commissioner of Education has specified the procedures for the submission and approval of charter schools' capital outlay projects. I have enclosed a copy of those procedures for reference purposes.

Paragraph 11 requires the district finance officer to use, among other items, construction contracts, lease-purchase agreements and bills of sale to document the expenditure. Paragraph 7 permits the district finance officer to reject an individual project.

Inherent in these procedures is the notion that the district, as the entity that is accountable for reviewing and disbursing capital outlay monies, should have some review of the financial propriety of the use of state funds. A district is not required to disburse the capital outlay funds without satisfactory documentation of the expenditure. At the very least, adequate information must be available for audit purposes. I confirmed the contents of this letter with the Department of Education's Bureau of Educational Facilities. That office has advised districts in similar situations that a charter school's capital outlay plan may be denied if the district considers it to be an unjustified expenditure under Section 228.0561, Florida Statutes. In one particular case, a district denied the use of funds to purchase a parcel of land that did not comply with county and city zoning requirements. As it is the responsibility of the school district to monitor expenditures of a charter school, the district may reject an inappropriate expenditure.

In this case, you have advised that the charter school has not explained the difference between the appraised fair market value of $60,000 and the purchase price of $100,000. If the district's finance office believes that the purchase has not been adequately documented, perhaps a request for further information or meeting of district and charter school officials can provide sufficient justification to support the release of funds for the land purchase.

My office and members of the Department's School Business Services and School Choice offices are available to provide any further information or technical assistance on this issue.

Enclosure

cc: Spessard Boatwright, Bureau of Educational Facilities
Diane McCain, School Choice Office

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