§ 3651. Reserve fund.
1.A reserve fund may be established by the\nschool authorities of any school district, provided, however, that no\nsuch fund shall be established (a) until approved by a majority vote of\nthe qualified voters of the district voting on a proposition therefor\nsubmitted at a regular or special school district meeting, or in school\ndistricts which do not have such meetings, at an election called for\nsuch purpose, and (b) unless the notice of such meeting or election\nshall have stated that a proposition to establish a reserve fund would\nbe so submitted, the purpose of the fund, the ultimate amount thereof,\nits probable term and the source from which the funds would be obtained.\nSuch reserve fund may be established for financing, in whole or in part,\nthe cost of
Free access — add to your briefcase to read the full text and ask questions with AI
§ 3651. Reserve fund. 1. A reserve fund may be established by the\nschool authorities of any school district, provided, however, that no\nsuch fund shall be established (a) until approved by a majority vote of\nthe qualified voters of the district voting on a proposition therefor\nsubmitted at a regular or special school district meeting, or in school\ndistricts which do not have such meetings, at an election called for\nsuch purpose, and (b) unless the notice of such meeting or election\nshall have stated that a proposition to establish a reserve fund would\nbe so submitted, the purpose of the fund, the ultimate amount thereof,\nits probable term and the source from which the funds would be obtained.\nSuch reserve fund may be established for financing, in whole or in part,\nthe cost of any object or purpose for which bonds may be issued by, or\nfor the objects or purposes of, the school district pursuant to the\nlocal finance law. The proposition shall specify the purpose for which\nthe fund is established, the ultimate amount, the probable term and the\nsource from which the funds are to be obtained. There shall be paid into\nany such fund an annual amount sufficient to meet the requirements of\nthe proposition. In addition, the voters may from time to time direct\nthe school authorities to pay into such fund moneys derived from any\nother source.\n 1-a. Notwithstanding the provisions of subdivision one of this\nsection, any school district may establish a reserve fund for the\npayment of judgments and claims in tax certiorari proceedings in\naccordance with article seven of the real property tax law, without\napproval by the qualified voters of the district, provided, however,\nthat the total of the monies held in such reserve fund shall not exceed\nthat amount which might reasonably be deemed necessary to meet\nanticipated judgments and claims arising out of such tax certiorari\nproceedings. Any monies deposited to such reserve fund which are not\nexpended for the payment of judgments or claims arising out of such tax\ncertiorari proceedings for the tax roll in the year such monies are\ndeposited to the said fund and/or which will not reasonably be required\nto pay any such judgment or claim shall be returned to the general fund\non or before the first day of the fourth fiscal year following the\ndeposit of such monies to said reserve fund. For purposes of this\nsubdivision, such monies shall be deemed reasonably required to pay any\nsuch judgment or claim if the proceeding or claim has not been finally\ndetermined or otherwise terminated or disposed of after the exhaustion\nof all appeals.\n 1-b. Notwithstanding the provisions of subdivision one of this\nsection, where the city or county is not required to pay to the\ntreasurer of a city school district unpaid taxes during the fiscal year\nfor which such real property taxes are levied, the board of education of\nsuch city school district may establish a reserve for uncollected taxes\nwithout approval of the qualified voters of the school district,\nprovided that the ratio of the amount of such reserve to the total\nprincipal amount of the district's tax levy for such fiscal year shall\nnot be less than the ratio of the principal amount of the school\ndistrict taxes as levied by the school district for the last completed\nfiscal year but not received by the district before the end of such\nfiscal year to the total principal amount of the tax levy for such last\ncompleted fiscal year. If the city or county is not required to pay to\nthe treasurer of a city school district unpaid taxes pursuant to section\nthirteen hundred thirty-two of the real property tax law, the board of\neducation of the city school district shall establish a reserve pursuant\nto this subdivision, provided that such reserve shall not be less than\nthe amount of taxes for the fiscal year for which such budget is being\nprepared which are estimated to be unpaid during such fiscal year under\nthe aforesaid provisions of the real property tax law.\n 2. The moneys in each such fund shall be deposited in one or more of\nthe banks or trust companies designated as depositories of the funds of\nsuch school district and shall be known as the "________reserve fund" of\nsuch district. The school authorities may direct the treasurer of such\nschool district to invest the moneys in each such fund in the manner\nprovided in section thirty-six hundred fifty-two of this article. Any\ninterest earned or capital gains realized on the money so deposited or\nso invested shall accrue to and become a part of each such fund. The\nseparate identity of each such fund shall be maintained whether its\nassets consist of cash or investments or both.\n 3. An expenditure shall be made from a reserve fund only by\nauthorization of the voters and for the specific purpose specified in\nthe proposition.\n 3-a. Notwithstanding the provisions of subdivision three of this\nsection, any school district which establishes a reserve fund in\naccordance with subdivision one-a of this section may make expenditures\nfrom such fund for the purposes specified in such subdivision without\nauthorization of the voters.\n 4. The voters may authorize the transfer of all or any part of any\nreserve fund to any other reserve fund established pursuant to this\nsection.\n 5. Whenever the voters shall determine that the original purpose for\nwhich a reserve fund has been established is no longer desirable, the\nschool authorities may liquidate the fund by first applying its proceeds\nto any outstanding bonded indebtedness and applying the balance, if any,\nto the annual tax levy, provided, however, that the amount so applied in\nany one year shall not be greater than the amount which will reduce the\ntax rate for school purposes below five mills on actual valuation;\nprovided, however, that the school authorities in any school district\nhaving no outstanding bonded indebtedness may, in any year in which no\nstate aid is payable thereto under the provisions of this chapter,\nliquidate such fund by applying the balance thereof to the annual tax\nlevy, regardless of the tax rate for school purposes, subject to the\napproval of a majority of the qualified electors of the district voting\non a proposition therefor submitted at a regular or special school\ndistrict meeting, or in school districts which do not have such\nmeetings, at an election called for such purpose.\n 6. The school authorities shall cause a separate account to be kept of\neach fund established. Such account shall show:\n a. The date and amount of each sum paid into the fund.\n b. The interest earned by such fund.\n c. The capital gains or losses resulting from the sale of investments\nof the fund.\n d. The interest or capital gains which have accrued to the fund.\n e. The amount and date of each withdrawal from the fund.\n f. The assets of the fund indicating the cash balance therein and a\nschedule of the amounts invested in federal or state obligations.\n 7. The school authorities shall render annually a detailed report of\nthe operation and conditions of each of such funds. Copy of such report\nshall be filed with the commissioner of education.\n 8. a. Notwithstanding the foregoing provisions of this section, if in\nany city any taxes raised on real estate for the purposes of the school\ndistrict must be included in computing the amount which the city may\nraise by tax on real estate for city purposes pursuant to the provisions\nof section ten of article eight of the constitution, the establishment\nof a reserve fund by the school authorities of the school district shall\nbe subject to the consent of the legislative body of the city.\n b. Notwithstanding the foregoing provisions of this section, in any\nschool district which is wholly or partly in the Adirondack park and has\nwithin its boundaries state lands subject to taxation assessed at more\nthan thirty per centum of the aggregate taxable assessed valuation of\nthe real property within the bounds of such school district, the school\ndistrict shall not establish a reserve fund unless, on the\nrecommendation of the commissioner of education, the state comptroller,\non behalf of the state, shall consent thereto. Upon the expiration of\nfifteen days from the date of the filing in his office of the\napplication for such consent, together with the recommendation of the\ncommissioner of education, and upon reaching a determination, the state\ncomptroller shall make an order, in triplicate, granting or denying such\nconsent. One copy of such order shall be filed in the office of the\nstate department of audit and control at Albany, New York, another in\nthe state department of education at Albany, New York, and the third in\nthe office of the clerk of such school district.\n 9. Notwithstanding the foregoing provisions of this section, in a city\nschool district in a city having a population of one hundred twenty-five\nthousand inhabitants or more, such a reserve fund may be established,\nexpenditures may be made therefrom, moneys may be paid into such fund,\nall or any part of such fund may be transferred to any other reserve\nfund established under this section, and such reserve fund may be\nliquidated, all pursuant to the provisions of this section, except that\nany such action may be authorized or taken by the board of education of\nsuch city school district, without approval or authorization of the\nqualified voters of such district.\n