Use of School Property Proceeds

About this Service

 

Education Code Section 17462 provides guidance for school districts to transfer surplus site sale proceeds into their general fund account.  School districts that utilize the authority authorized by Education Code Section 17462 are prohibited from participating in any State Allocation Board (SAB) administered programs for five years, as outlined in Education Code Section 17462(d).  Prior to transferring site sale proceeds into their general fund account, school districts must submit the following documents to the Office of Public School Construction (OPSC) in order for their request to be processed:

1. A letter to the Executive Officer of OPSC requesting authorization, pursuant to Education Code Section 17462, from the SAB to transfer site sale proceeds into the district’s general fund account for a one-time general fund purpose.
2. A school board resolution stating the following:
• The school district has presented a plan to the local school board detailing the source and use of the funds and explaining why the expenditure will not result in on-going fiscal obligations for the district.
• The school district certifies to the SAB that:
• The District has no major deferred maintenance needs that cannot be covered by existing capital outlay resources.
• The sale of the property does not violate the provisions of any local bond act.
• The District has no anticipated need for additional sites or construction for the next ten years.
• The proceeds of the sale will be used for a one-time general fund purpose.
• The school district acknowledges that it will be ineligible for any SAB-administered program funding for at least five years after the transfer of funds into its general fund.
• The school district acknowledges that the SAB will reduce any state funding received by the district by the amount of any remaining funds derived from the sale of the surplus property and any unencumbered interest earned on those funds.
3. A copy of the original site purpose agreement that delineates the original purchase price, the number of acres on the site, and the sources of funds used to purchase the site.
4. Documentation of the number of acres being sold from the site.

The school districts’ request must be presented to the SAB for approval prior to the funds being transferred by the school district.

 

Education Code Section 17463.7 provides guidance for school districts to transfer surplus site sale proceeds into their general fund account. Prior to transferring site sale proceeds into their general fund account, school districts must submit the following documents to OPSC in order for their request to be processed:

1. A letter to the Executive Officer of the State Allocation Board and the OPSC requesting authorization, pursuant to EC Section 17463.7, from the Board to transfer site sale proceeds into the school district’s general fund account for a one-time general fund purpose.
2. A school board resolution stating the following:
• The school district has presented a plan to the local school board at a public meeting detailing the source and intended use of the surplus property proceeds and describing why the expenditure will not result in ongoing fiscal obligations for the district.
• The school district certifies to the Board that:
• The sale of the property does not violate the provisions of any local bond act.
• The real property is not suitable to meet projected school construction needs for the next ten years.
• The property sold was purchased entirely with nonstate funds.
• The proceeds of the sale will be used for a one-time general fund purpose.
• The school district acknowledges that the Board will reduce any state financial hardship funding received by the district equal to the amount of the sale of surplus real property used for a one-time expenditure.
3. A copy of the original site purchase agreement that delineates the original purchase price, the number of acres on the site, and the sources of funds used to purchase the site.
4. Documentation of the number of acres being sold from the site.

 

 Reports

• Interim Report on the Use of Surplus Site Sale Proceeds (6/7/2022)