The bill introduces provisions for temporary interfund loans for school districts that are either in binding conditions or under enhanced financial oversight. Specifically, it allows these districts to borrow from their capital projects fund under certain conditions, such as requiring repayment within one calendar year without interest and ensuring that the loan does not negatively impact any established projects. The board of directors must adopt a resolution detailing the loan specifics, and if the district is under enhanced oversight, approval from a special administrator is also required. Additionally, the Office of the Superintendent of Public Instruction is tasked with adopting necessary rules for implementation.

The bill also amends existing laws regarding school district funds, including the establishment of a depreciation subfund for second-class districts and the conditions under which interfund loans can be utilized. Notably, it specifies that interfund loans cannot be used to balance budgets except in certain circumstances, such as addressing budget destabilization due to the COVID-19 pandemic. Furthermore, it reinforces the role of the financial oversight committee in monitoring financially insolvent districts and outlines the authority of the superintendent of public instruction in implementing enhanced financial oversight measures.

Statutes affected:
Original Bill: 28A.505.130, 28A.315.221