School Laws of Oklahoma
Chapter 4 - Funds and Finance
Article III: Funds
Section 646. Deposits with Federal Instrumentalities. (62 O.S. § 513)
The State Treasurer, and the treasurers of counties, school districts, cities, towns, municipalities and any other political subdivision of the state, and any other officer, board, department or commission having custody and management of any public or trust fund or funds are hereby specifically authorized to deposit said fund or funds in any federally-insured building and loan association wherever located, whether federally or state chartered, in any amount and to the extent that such deposit is fully insured by the Federal Savings and Loan Insurance Corporation or any other instrumentality of the United States Government. When any such insured deposit is made it shall not be necessary for such treasurer, officer, board, department or commission to require any security, and such insurance shall be accepted in lieu of any security, restriction or other limitation now required or imposed by law upon the deposit of public funds.
Section 646.1. Legislature to Present Funding Measures. (62 O.S. § 9.11)
The Legislature shall present measures that provide full funding for the support of common education to the Governor pursuant to Section 11 of Article VI of the Oklahoma Constitution for the Governor’s consideration at least twenty-five (25) days prior to the date established by subsection E of Section 6-101 of Title 70 of the Oklahoma Statutes, but not later than April 1, in order for the boards of education of the school districts of this state to make decisions on teacher contracts.
Section 646.2. Security for Local Public Deposits Act. (62 O.S. § 517.1)
Sections 8 through 14 of this act shall be known and may be cited as the “Security for Local Public Deposits Act”.
Section 646.3. Definitions. (62 O.S. § 517.2)
As used in the Security for Local Public Deposits Act:
1. “Financial institution” means any bank, savings bank, savings and loan association or credit union; and
2. “Public entity” means any county, city, town or board of education of a public school district or vocational-technical school district or other governmental or public entity of a local nature which is required or permitted by law to collateralize its deposits.
Section 646.4. Public Deposits by Treasurer. (62 O.S. § 517.3)
A. All public deposits made by a treasurer of a public entity in financial institutions shall be secured as provided for in the Security for Local Public Deposits Act. As used in this section, “public deposits” means all forms of demand deposits or time deposits, but shall not include other investments authorized by statute which are made by a treasurer of a public entity.
B. The treasurer of every public entity shall deposit daily, not later than the immediately next banking day, all funds and monies of whatsoever kind that shall come into the possession of the treasurer by virtue of the office, in one or more financial institutions that have been designated as either state or county depositories, or both, and the acceptance of any such deposit from any such treasurer shall be tantamount to adoption, in relation thereto, of the same privileges and conditions, other than collateral security, as are now provided by law in acceptance of designation as state or county depositories. The treasurer may establish a depository or depositories for demand accounts in financial institutions outside of the governmental or municipal area of the treasurer but within this state. The State Treasurer is hereby authorized to be the official depository for the treasurer of any county, and for the treasurer of any city or board of education where such city or school district has a population of five thousand (5,000) or more inhabitants but only for deposit of remaining fund balances in inactive funds and not for checking purposes. The county treasurer is hereby authorized to be official depository for the treasurer of any city, town, or board of education.
Section 646.5. Security for Public Deposits. (62 O.S. § 517.4)
A. A treasurer of a public entity shall require that financial institutions deposit collateral securities or instruments to secure the deposits of the public entity in each such institution. The amount of collateral securities or instruments to be pledged for the security of public deposits shall be established by the treasurer of the public entity consistent with the provisions of the Security for Local Public Deposits Act; provided, such amount shall not be less than the amount of the deposit to be secured, less the amount insured.
B. Upon authorization by the treasurer of a public entity, a financial institution shall place required collateral securities in a restricted account at a Federal Reserve Bank which serves Oklahoma, a Federal Home Loan Bank which serves Oklahoma or with another financial institution located in this state that is not owned or controlled by the same institution or holding company. The State Treasurer shall designate a number of such financial institutions authorized to serve as safekeeping or custodial institutions. The financial institution depositing collateral securities shall deliver to the treasurer of the public entity a power of attorney authorizing the treasurer to transfer or liquidate the securities in the event of a default, financial failure or insolvency of a public depository. The State Treasurer must approve any forms or pledge agreements used by public entities and financial institutions in securing public deposits of public entities.
C. Securities eligible for collateral shall be valued at market value. The treasurer shall review and determine the market value of collateral pledged for security not less than quarterly. The market value of pledged securities shall be provided to the treasurer by either the financial institution holding the deposit or the financial institution holding the collateral securities, which market value must have been obtained from an independent, recognized and documented source. The State Treasurer shall promulgate rules to provide for the valuation of collateral if the market value is not readily determinable. The State Treasurer shall prescribe reporting requirements and forms for financial institutions to list collateral securities pursuant to this section.
D. The State Treasurer shall promulgate rules for the acceptance of collateral instruments described in Section 12 of this act, to secure deposits of the public entity. Such rules shall require that sufficient documentation exists to establish that the provider of the collateral instrument will protect the public entity in the event of a default, financial failure or insolvency of a public depository.
E. All securities purchased by a treasurer of a public entity or held in custody for other departments of the public entity by the treasurer shall be held in financial institutions not involved in such transactions and shall not be held by the treasurer or a broker.
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Section 646.6. Collateral for Public Deposits. (62 O.S. § 517.5)
A. For purposes of securing public deposits, the treasurer of a public entity may accept as collateral only those securities and other instruments listed below. To insure the safety of public funds, the treasurer may establish standards which restrict, or limit further, any of the types or classes of securities or instruments listed below which may be accepted. Any treasurer of a public entity may request the State Treasurer to determine the eligibility of an individual security for pledging under this section. The treasurer may select the following securities and instruments for the purpose of securing public deposits:
1. Obligations, including letters of credit of the United States Government, its agencies and instrumentalities;
2. Obligations of this state or of a county, municipality, or school district of this state or of an instrumentality of this state or a county, municipality or school district of this state;
3. General obligation bonds of any other state of the United States; and
4. A surety bond if:
a. subject to the terms and conditions of the bond, it is irrevocable and absolute,
b. the surety bond is issued by an insurance company authorized to do business in Oklahoma, and which has been approved by the State Treasurer,
c. the issuer of the surety bond does not provide surety bonds for any one financial institution in an amount that exceeds ten percent (10%) of the surety bond insurer’s policyholders’ surplus and contingency reserve, net of reinsurance, and
d. the claims-paying ability of the authorized insurance company is rated, at all relevant times, in the highest category by at least two nationally recognized rating agencies acceptable to the State Treasurer.
B. A financial institution may substitute different forms of collateral from time to time, provided that the collateral is acceptable to the treasurer, and meets the requirements of this section and the rules of the State Treasurer.
Section 646.7. Default or Insolvency of Public Depository. (62 O.S. § 517.6)
In the event of a default or insolvency of a public depository, the treasurer of a public entity shall implement the following procedures:
1. In cooperation with the State Department of Banking and other regulatory officials, the treasurer shall ascertain the amount of public funds on deposit at the defaulting institution and the amount of deposit insurance applicable to such deposit;
2. The potential loss to the public entity shall be calculated by the treasurer. The loss to the public entity shall be satisfied, insofar as possible, first through any applicable deposit insurance and then through the sale of securities pledged, or through the proceeds of collateral instruments pledged, by the defaulting depository institution. Such sales shall be conducted by the treasurer;
3. The securities, bonds or other forms of collateral shall become forfeited to and become the property of the public entity. If the securities, bonds or other forms of collateral are valued at less than the amount of principal and interest due to the public entity plus the cost of the ensuing sale, the securities, bonds and other forms of collateral shall be sold by the treasurer, and the treasurer shall be entitled to recover from the financial institution such balances with costs and attorney’s fees. If the market value of the securities, bonds or other forms of collateral exceeds the principal and interest due to the public entity plus the cost of the ensuing sale, the securities, bonds and other forms of collateral may be sold by the treasurer and the excess of the proceeds shall be returned to the pledging financial institution or its receiver, without further process of law.
Section 646.8. Liability of Treasurer. (62 O.S. § 517.7)
When public deposits are made in accordance with the Security for Local Public Deposits Act, the treasurer of a public entity shall not be liable for any loss resulting from the default or insolvency of a public depository in the absence of negligence, malfeasance, misfeasance or nonfeasance on the part of the treasurer.
Section 647. (Omitted – not applicable to school districts.)
Section 648. When No Funds-Payment Thereafter in Order of Presentation - Penalty for Violation. (62 O.S. § 552)
Whenever a warrant or order shall be presented to any treasurer named in the preceding section, and the same is not paid for the reason that there is not money sufficient in the fund on which same is drawn, the treasurer shall endorse on the back of such warrant or order, “Not paid for want of funds,” number, date and sign the same; and he shall set down in a book to be kept for that purpose, the number, amount, the date and upon what fund drawn, to whom payable, and the date when presented for payment, and such warrants or orders shall be paid in the order of their presentation and registration as shown by such book, and such book shall be known in each such office as the “Warrant Register”, and any such treasurer who shall fail, neglect or refuse to pay any warrant or order drawn on the treasurer in the order of registration as shown by the warrant register, or shall pay any warrant or order so drawn out of its regular order, and give preference to the same over other warrants or orders, shall be deemed guilty of a misdemeanor, and upon conviction shall be subject to a fine of not less than One Hundred Dollars ($100.00) nor more than One Thousand Dollars ($1,000.00).
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Section 649. Purchase of Nonpayable Warrants - Oklahoma Commission on School Funds Management. (60 O.S. § 177.2)
A. No public trust, school district or county shall issue any bonds, notes, certificates of participation, certificates of indebtedness or any other evidence of indebtedness, excluding nonpayable warrants and agreements with a depository bank to honor payment of checks when there are insufficient funds, for the purpose of short-term cash management by any school district or county unless such school district or county shall have been approved for participation by the Oklahoma Commission on School and County Funds Management.
As used in this section, “short-term cash management” means any borrowing or any method employed by a school district or county to obtain funds in advance of the receipt of tax revenue, and shall include, but not be limited to, the issuance of certificates of indebtedness, certificates of participation, tax-anticipation notes, bonds, notes, or any other evidence of indebtedness. It shall not include debt issued pursuant to a vote of the electors of the school district or county pursuant to the Constitution.
B. The Oklahoma Commission on School and County Funds Management, shall consist of the State Superintendent of Public Instruction, the Director of the Oklahoma Department of Career and Technology Education, and the State Bond Advisor. The Commission shall:
1. Receive requests of school districts and counties for authorization to participate in a short-term cash management program where the proceeds will be used to facilitate cash-flow management. The requests must be received by the Commission on or before April 1 in order for the school district or county to be considered for participation during the next fiscal year, unless such date is extended by the Commission;
2. Within five (5) business days of receiving a request, forward the request to the appropriate certifying authority. If the request and accompanying material meet the requirements of this act, the certifying authority must return the request and accompanying information to the Commission with a written review and comment within sixty (60) days of receipt of the request from the Commission. The certifying authority for school districts shall be the State Superintendent of Public Instruction and for technology center school districts, shall be the Director of the Oklahoma Department of Career and Technology Education and for counties, shall be the State Board of Equalization;
3. Approve or reject each request for participation, and forward notice of the decision of the Commission to the requesting school district or county and to the Office of the Governor. The Commission shall approve or reject a request within thirty (30) days following the date it receives the request and accompanying information with a written review and comment from a certifying authority;
4. Certify the need for funds generated by the proposed short-term cash management based on the financial projections of the school district or county, including the projected cash-flow shortfall, estimated income, and anticipated surplus balances on June 30 of the current fiscal year in the general and building funds of the school district or county. Accumulative cash-flow shortfall projections must be determined using the method specified by Section 148 of the Internal Revenue Code;
5. Establish reasonable limits for fees, commissions and other compensation paid to any person or firm involved with the proposed short-term cash management program;
6. Establish participation limitations for a school district or a county using the method specified in Section 148 of the Internal Revenue Code. No school district or county shall participate in a short-term cash management program in an amount which exceeds the determination of need pursuant to the accumulative cash-flow projections as specified in paragraph 4 of this subsection or forty percent (40%) of the approved annual budget of the school district or county, whichever is less;
7. Establish limitations which prohibit school districts and counties which are participating in a short-term cash management program from issuing nonpayable warrants if proceeds are available from the short-term cash management program;
8. Submit an annual report, by December 15 of each year, to the Speaker of the House of Representatives, the President Pro Tempore of the Senate, the Governor, the State Auditor and Inspector and the Attorney General, detailing the participation of each school district and county for the prior fiscal year in the short-term cash management programs authorized by this act; and
9. Prescribe methods and procedures by which school districts or counties may request authorization to participate in short-term cash management programs.
C. School districts and counties desiring to participate in a short-term cash management program as provided in subsection A of this section shall file a request with the Commission on such forms as the Commission shall prescribe. Such request shall be accompanied by:
1. A resolution adopted by the board of education of the school district or by the county commissioners of a county. Such resolution shall state that the school district or county intends to and has need to participate in a short-term cash management program and that the board of education or county commission has authorized the submission of such request;
2. A letter signed by the underwriter of the short-term cash management program that specifies the name and address of all persons and firms receiving compensation, directly or indirectly, involved with the proposed short-term cash management program. All persons and firms designated shall not be paid out of school or county funds. For purposes of this paragraph, school or county funds shall not include the proceeds from certificates of indebtedness or certificates of participation generated from a short-term cash management program;
3. A verification from the Administrator of the Oklahoma Department of Securities that all persons receiving compensation, directly or indirectly, for providing advice to the school districts or counties concerning participation in the program or for endorsing participation in the program are appropriately registered with the Oklahoma Department of Securities as investment advisers or investment adviser representatives, as applicable, and that all persons receiving compensation, directly or indirectly, for the placement of the certificates of participation or like securities with investors are registered as broker-dealers or agents, as applicable;
4. The estimated income and expenditures of the school district or county for the year for which the school district or county wishes to participate in a short-term cash management program. The appropriate certifying authority shall develop and provide an income and expenditure disclosure form for use by a school district or county which desires to participate in a short-term cash management program which follows the applicable portions of the information return required by Section 148 of the Internal Revenue Code. The information supplied in the disclosure form must reflect the ability of the school district or county to pay off an amount equal to the district's or county's liability on the program from the income from the fiscal year of participation, prior to approval for participation by the Commission. If the Commission determines that a question exists concerning any information submitted pursuant to this subsection, the Commission may request any additional information from the school district or county that it deems necessary;
5. A copy of the most recent information return for a short-term cash management program filed with the Internal Revenue Service pursuant to Section 149(e) of the Internal Revenue Code;
6. An affidavit by all persons, firms, corporations or business enterprises of any kind which provide services for compensation on any financing to implement a short-term cash management program, which shall be signed under oath on a form approved by the Commission and which shall state that such persons, firms, corporations or business enterprises have not given any money or other thing of value, other than a bona fide campaign contribution, to any public official or to any public employee of a school district or county participating in such a cash management program. Any such person, firm, corporation or business enterprise shall also file a disclosure statement on a form approved by the Commission, which shall disclose all campaign contributions of any kind made to any public official of a school district or county participating in such a short-term cash management program and shall also disclose the identity of any officer, director, agent or employee of such person, firm, corporation or business enterprise who is an officer or employee of a school or county participating in a short-term cash management program, or who is related to such officers or employees within the third degree of affinity or consanguinity;
7. A notarized sworn affidavit executed by each member of a board of education of a school district, the superintendent of schools and the treasurer of the school district or by each county commissioner of a county and the county treasurer, which states that the person or any member of the immediate family of the person has no direct or indirect financial interest in the short-term cash management program being requested. The affidavit shall be on a form prescribed by the Commission;
8. A summary report detailing all expenses incurred by a school district or county in participating in a short-term cash management program. The report shall be on a form prescribed by the Commission; and
9. Any application and other materials including any other necessary financial information, as may be required by the Commission.
D. If the information required to be submitted pursuant to this section meets all requirements established by the Commission and the Commission has approved such information and participation, and the participation is otherwise in accordance with law, the Oklahoma Commission on School and County Funds Management shall authorize the participation of the school district or county in the short-term cash management program. The Commission shall notify the school district or county in writing, whether the requirements of this section have been satisfied and approved.
E. School districts and counties participating in a short-term cash management program authorized by this section shall report to the Commission the probable income and expenses of anticipated investment income. The report shall not include probable income or expenses related to participation in a short-term cash management program.
F. The ability of a school district or county to issue general obligation bonds shall not be modified by this act.
G. The Office of the Attorney General shall provide legal assistance to the Oklahoma Commission on School and County Funds Management.
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Section 650. Notice of Ability to Pay Registered Warrants - Publication. (62 O.S. § 553)
It shall be the duty of all such treasurers, whenever any money comes into their hands by virtue of their respective office, to set apart a sufficient fund to pay any or all warrants or orders they may have registered in compliance with the provisions of Section 551 et seq. of this title, and to keep the same until called for; and the State Treasurer shall make regular calls, at least every sixty (60) days, by publishing notice in some newspaper of general circulation published at the state capitol, giving notice that he has money in his hands with which to pay warrants, and give the numbers and the several funds, and requesting that the same be presented at the Treasury for payment and cancellation, and every county treasurer, city or town treasurer and the treasurer of every board of education, shall make calls for warrants or orders by posting notices in the manner as provided by Section 475 of this title or by publication of a like notice as that required of the State Treasurer, in some paper of general circulation published in the county, and the interest on any and all warrants or orders called as above specified, shall cease on and after thirty (30) days from the date of the publication of such notice: Provided, that each county treasurer shall transmit to the State Treasurer all state funds or warrants in his hands on the first day of each month: Provided, further, that any treasurer who violates any of the provisions of the Article, shall be guilty of a misdemeanor, and punished as provided in Section 552 of this title: And provided, further, that each school district treasurer shall publish such notice by posting printed or written notices of the same in two or more public places in his district.
Section 651. Non-Payable Warrants - Interest. (62 O.S. § 554)
Every treasurer shall, upon the expiration of his term of office, deliver to his successor in office such warrant register, and each successor in office shall in all things act as though the entries of such warrants or orders were made and registered by himself and the registration of all warrants in such book of warrant registration shall be by each succeeding treasurer continued and no warrant shall draw interest until registered as herein provided for, and not paid for want of sufficient funds; and all warrants registered, as provided by this Article, and not paid for want of sufficient funds, shall draw an annual rate of interest to be fixed by the governing board not to exceed five percent (5%) per annum, except state warrants which shall draw interest at a rate to be fixed by the State Board of Equalization not to exceed four percent (4%) per annum.
Note: For interest rate on bonds, see Sections 619.
Section 652. (Omitted – not applicable to school districts.)
Section 652.1. Levy and Collection of Taxes for Public Purposes Only. (Article 10, § 14, Oklahoma Constitution)
Taxes shall be levied and collected by general laws, and for public purposes only, except that taxes may be levied when necessary to carry into effect Section thirty-one of the Bill of Rights. Except as required by the Enabling Act, the State shall not assume the debt of any county, municipal corporation, or political subdivision of the State, unless such debt shall have been contracted to defend itself in time of war, to repel invasion, or to suppress insurrection.
The Legislature declares the fiscal policy of Oklahoma. The Oklahoma Supreme Court has upheld the constitutionality of Oklahoma non-economic development income tax credits. They are not a gift and do not violate Sections 14 and 15 of Article X of the Oklahoma Constitution. They must, however, have a “reasonable classification and reasonable opportunity for uniform or equal incidence upon the class created.” (AG Op. No. 2010-16)
To be constitutional an Oklahoma economic development income tax credit must have three factors present: 1) it must promote a “public purpose” affecting the inhabitants of the state as a community, and not as individuals; 2) adequate consideration must be present; and 3) there must be adequate controls and safeguards in place. The mere investment of money into a company does not satisfy the three factors for a valid Oklahoma economic development income tax credit. When the three factors are present there is no gift and the Oklahoma economic development income tax credit does not violate Sections 14 and 15 of Article X of the Oklahoma Constitution. (AG Op. No. 2010-16)
A legislator is prohibited from using public funds to send a communication that is nothing more than a personal birthday greeting to voters/constituents in the legislator’s district. In contrast, information contained in a communication relating to the legislator’s work in his or her capacity as a legislator serves a public purpose. September 21, 2005 (AG Op. No 05-32)
This provision prohibits the Legislature from making a gift of public monies to any company, association, or corporation. A “gift” includes all appropriations for which there is no authority or enforceable claim against the State. Orthopedic Hosp. Of Okla. V. The Okla. State Dept. Of Health, 2005 OK CIV APP 43, 118 P.3d216
Any expenditure by a school district for meals, refreshments, membership dues, or other such expenses must be for a lawful “public purpose.” June 27, 2001 (AG Op. No. 01-30)
A school district may use its school activity fund account to deposit and disperse monies raised for the purpose of making charitable and/or benevolent gifts or contributions to individuals or organizations if the board of education has approved the fund-raising activity and the dispersement. The monies deposited in the school activity fund which are raised by student fund raising activities are not public funds subject to the constitutional restrictions. June 12, 1997 (AG Op. No. 97-6)
Economic development is legitimate “public purpose” for which public funds may be expended. Burkhardt v. City of Enid, 771 P.2d 608 (Okla. 1989)
The provisions of Article 10, § 14 prohibit a person from displaying a bumper sticker on a public school district vehicle promoting a candidate for political office. October 28, 1986 (AG Op. No. 86-22)
To constitute a public purpose, purpose must have a public interest and must be performed by state in exercise of its governmental functions. Veterans of Foreign Wars v. Childers, 171 P.2d 618 (Okla. 1946)
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Section 652.2 Pledge or Loan of Credit of State Prohibited - Exceptions. (Article 10, § 15, Oklahoma Constitution)
A. Except as provided by this section, the credit of the State shall not be given, pledged, or loaned to any individual, company, corporation, or association, municipality, or political subdivision of the State, nor shall the State become an owner or stockholder in, nor make donation by gift, subscription to stock, by tax, or otherwise, to any company, association, or corporation.
* * * * *
E. Bonds issued by the board of education of any school district or public institutions of higher education may be guaranteed by the corpus of the permanent school fund, provided:
1. As to bonds issued by the board of education such bonds must be approved by election of the school district upon the question of issuing such bonds;
2. As to bonds issued by an institution within The Oklahoma State System of Higher Education such bonds are issued in accordance with all applicable provisions of law; and
3. Provisions shall be made by the Legislature to guarantee prompt reimbursement to the corpus of the permanent school fund for any payment from the fund on behalf of a school district or on behalf of an institution within The Oklahoma State System of Higher Education. The reimbursement shall include a reasonable rate of interest. The provisions of this paragraph regarding use of the permanent school fund for guarantee of bonds issued by an institution within The Oklahoma State System of Higher Education shall not be self-executing and the Legislature shall provide by law the procedure pursuant to which such obligations may be guaranteed and the procedures for repayments, if any, required to be made to the permanent school fund.
To be constitutional an Oklahoma economic development income tax credit must have three factors present: 1) it must promote a “public purpose” affecting the inhabitants of the state as a community, and not as individuals; 2) adequate consideration must be present; and 3) there must be adequate controls and safeguards in place. The mere investment of money into a company does not satisfy the three factors for a valid Oklahoma economic development income tax credit. When the three factors are present there is no gift and the Oklahoma economic development income tax credit does not violate Sections 14 and 15 of Article X of the Oklahoma Constitution. (AG Op. No. 2010-16)
An assertion of a constitutional violation that is undeveloped and unsupported by clear argument with authority is insufficient to demonstrate infirmity and will not be resolved by the court. Fent v. Contingency Review Board, 2007 OK 27
Any expenditure by a school district for meals, refreshments, membership dues, or other such expenses must be for a lawful “public purpose.” June 27, 2001 (AG Op. No. 01-30)
A school district may use its school activity fund account to deposit and disperse monies raised for the purpose of making charitable and/or benevolent gifts or contributions to individuals or organizations if the board of education has approved the fund-raising activity and the dispersement. The monies deposited in the school activity fund which are raised by student fund raising activities are not public funds subject to the constitutional restrictions. June 12, 1997 (AG Op. No. 97-6)
This section prohibits a school district from paying a tenured teacher at the beginning of the month for services yet to be performed even though such payment is pursuant to a written contract. July 24, 1984 (AG Op. No. 84-87)
The principal of the permanent school fund can be used to guarantee bonds issued by school districts according to the conditions set forth in 70 O.S. §§ 201 et seq. Thus, bond guarantees issued by Commissioners of the Land Office are binding legal obligations which pledge the permanent school fund to guarantee bond issues of school districts. November 8, 1996 (AG Op. No. 96-77)
An indemnity agreement which is for an indefinite term and which is uncertain in amount may result in an obligation which is in excess of unencumbered funds and thus violative of Article X, § 15 of the Oklahoma Constitution. June 27, 1996 (AG Op. No. 96-7)
Section 653. (Omitted – not applicable to school districts.)
Note: See now Section 98.
Section 654. (Omitted – not applicable to school districts.)
Note: See now Section 98.
Section 655. (Omitted – not applicable to school districts.)
Note: See now Section 111.20.
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Section 656. Amount to Be Issued. (62 O.S. § 476)
Warrants and certificates of indebtedness may be issued to the amount of the estimate made and approved by the excise board for the current fiscal year or to the amount authorized for such purpose by a bond issue.
School district warrants issued within the unexpended appropriation for that purpose within the same fiscal year are not rendered invalid because the fund is afterwards misapplied to the payment of warrants issued in a previous year. Joint School District No. 1 v. State Nat. Bank of Woodward, 67 P.2d 942 (Okla. 1937)
Section 657. (Omitted – not applicable to school districts.)
Note: See now Section 111.21.
Section 658. (Omitted – not applicable to school districts.)
Note: See now Section 111.22.
Section 659. (Omitted – not applicable to school districts.)
Note: See now Section 111.23.
Section 660. Violation - Punishment. (62 O.S. § 480)
Any officer willfully or knowingly contracting, incurring, acknowledging, authorizing, allowing or approving any indebtedness, or any officer issuing, drawing, or attesting any warrant or certificate of indebtedness in excess of the estimate made and approved by the excise board for the purpose for such current fiscal year or in excess of the specific amount authorized for such purpose for such current fiscal year or in excess of the specific amount authorized for such purpose by a bond issue, or who violates any other provision of Section 471 et seq. of this title, shall be deemed guilty of a misdemeanor, and upon conviction shall be punished by a fine of not less than One Thousand Dollars ($1,000.00) or imprisoned in the county jail for not to exceed one (1) year, or by both the fine and imprisonment, and shall forfeit and be removed from office pursuant to Section 1181 et seq. of Title 22 of the Oklahoma Statutes or Section 91 et. seq. of Title 51 of the Oklahoma Statutes.
Section 661. (Omitted – not applicable to school districts.)
Note: See now Section 111.24.
Section 662. (Omitted – not applicable to school districts.)
Note: See now Section 111.25.
Section 663. Sinking Fund - Investment. (62 O.S. § 541)
The Treasurer of the State of Oklahoma, the county treasurer in any county when authorized by the board of county commissioners, and the lawful treasurer of any city, town or board of education, when authorized so to do by the lawfully constituted governing body of such city, town, or board of education may invest the sinking funds in his custody in United States bonds, United States Treasury notes, United States Treasury certificates or Postal Savings certificates, to the payment of which the faith and credit of the United States is pledged by the terms of such bonds, notes or certificates, or in State bonds, Public Building Bonds, State Warrants or State Treasury notes of the State of Oklahoma issued under authority of legislative enactment, or in the bonds or judgments of courts of record of the particular and specific municipality whose sinking funds are to be invested, or in current warrants of his own registration, provided the securities so purchased mature prior to the time the money so invested is required by law to be on hand in cash for the purpose of meeting the bonded indebtedness of the state or the municipal subdivision thereof whose sinking funds are so invested, and further, provided the bonds of the particular municipality whose sinking funds are to be so invested or the current warrants of such treasurer’s own registration, can be purchased at not to exceed par and accrued interest. If deemed advisable to invest the sinking funds in the custody of the county treasurer, or in the custody of the lawful treasurer of any city, town or board of education, in lawfully issued county, city, town, township, board of education, or dependent school district bonds issued by a municipal subdivision of the State of Oklahoma, other than the one whose sinking fund is proposed to be invested, or if deemed advisable to invest the sinking fund of such municipal subdivision in its own bonds at the market for more than par and accrued interest, then the county treasurer or the lawful treasurer of such city, town, or board of education, if authorized by the duly constituted governing board to whom he is by law required to render account, either at his own instigation or by the lawfully constituted attorney of such county, city, town or board of education, may file a duplicate application in writing in the district court, in which application he shall set forth the full nature and description of the securities which he proposed to purchase, together with the estimated value thereof, the aggregate amount thereof and the proposed price of purchase; and he shall further disclose in said application, the condition of the sinking fund account so proposed to be invested, and the bond, coupon and judgment indebtedness payable therefrom with maturities and accruals scheduled in detail. Thereupon it shall be the duty of the court clerk of such county to docket such application, without cost, upon the appearance docket of such district court as other civil actions; and it shall be the immediate duty of such court clerk to transmit the duplicate application, schedules, and exhibits to the district attorney who shall enter his appearance in such instance on behalf of the public and who may, at the discretion of the court, require such further information by detailed exhibits, schedules or statistics as may seem advisable. Within three (3) days after the filing of such application, the judge of such district court shall enter an order setting such application for hearing, and directing the court clerk to give such notice to the public of such application and the date of hearing thereof as said district judge may deem proper for the protection of the public and the taxpayers of such county and/or the municipal subdivisions thereof, and, if such notice be directed to be had by publication in some newspaper named by the court, the expense thereof shall be borne out of any appropriation for legal expense of such county, city, town or board of education. It shall be the duty of the district attorney to file in said proceedings, in writing, at the date appointed for such hearing, a correct report setting forth the opinion of such district attorney as to the soundness of such investments and advisability thereof, the validity of such securities, and particularly whether or not the municipality issuing the same has a net bonded indebtedness in excess of five percent (5%) of the net assessed valuation thereof as last certified by the county assessor to its county excise board. Upon the date set for such hearing, any taxpayer shall have the right to appear in person, either with or without the aid of counsel, and make such protest or objection to such investment as he may deem proper for the protection of himself or the taxpayers of such county. Thereupon it shall be the duty of the district judge, informally and in open court to hear any and all evidence and protests, either in support of or opposition to said proposed investment, and at the close of such hearing, to enter an order with reference to such application for investment as may be found and determined by the court for the protection and best interest of the county or municipal subdivision thereof whose sinking funds are proposed to be invested, and to the best interest of the public and taxpayers thereof; and thereupon, such district court may, by journal entry of judgment entered and recorded in such proceedings, either authorize in whole or in part that such investment be made, or deny such application.
Note: See also Section 64, Crediting of Investment Income.
School Laws of Oklahoma | Chapter 4 - Funds and Finance | Article III: Funds | Return to Top of Page
Section 664. Apportionment of Interest - Sinking Fund. (62 O.S. § 544)
On or before the last day of each month the State Treasurer and the treasurer of each county, city, town and board of education shall apportion and place to the credit of the sinking fund or sinking funds in his custody all interest earned and collected from the investment of such sinking funds, as provided in the first and foregoing section of this act; provided, that in counties, where invested securities have heretofore been purchased for the joint use and benefit of the several school districts and/or townships thereof, the amount so credited to each such sinking fund account shall bear the same ratio to the whole amount of interest so collected, as the amount of such investment credited to the sinking fund account of each such school district and/or township bears to the total amount so invested, in which last event the apportionment of such interest earnings shall be made immediately prior to the 30th day of June of each year.
Note: See also Section 64, Crediting of Investment Income.
Section 664.1. (Omitted)
Section 665. Payment of Personnel by Payroll Purchase Order. (62 O.S. § 304.1)
A. The regular personnel of any agency of any county, city, town, school district or board of education may be certified to the governing board thereof for payment by a payroll purchase order in the manner herein provided. For the purpose of this section, regular personnel is hereby defined as those persons whose appointment or employment or election, whether on full or part-time basis, together with the rate of pay unless the same be fixed by law, has been confirmed or otherwise fixed by the governing board, in each instance, and entered in its journal of proceedings or by separate contract of employment properly authenticated and filed of record; provided, for school districts only, regular personnel may be defined as including persons who are employed on a temporary or occasional basis.
B. For each pay period, the duly elected or appointed head of any department, office, sub-office, district, station or school, may execute on behalf of himself and his subordinates, a payroll statement, itemizing in detail the names of such persons, nature of employment or service, rate of pay each, hours worked, and dates of service within the payroll period if less than a full payroll period. This statement shall be verified by affidavit as to:
1. Subordinate relationship of all persons named, other than himself, to be affiant;
2. Record of employment or contract relationship of all persons named;
3. Services performed under direct supervision.
The form of affidavit shall be prepared by the State Auditor and Inspector, and shall provide for entry therein by words, and figures, as to the number of persons certified to in such payroll statement and affidavit.
The statement and affidavit shall be deemed to include the approval of departmental head and receipt acknowledging services of subordinate, where such is required by law; and no further statements for that purpose shall be required. The subordinate employees named therein shall not be required to sign the payroll statement and affidavit unless the governing board, by official order, so requires, in which event, each may sign opposite his own name. Affidavit to any payroll statement may be verified by any officer authorized to take acknowledgments, or by the clerk of the county, city, town, school district or board of education, as the case may be.
C. The payroll statement and affidavit shall be forwarded to the clerk of the county, city, town, school district or board of education, and shall become a permanent part of the financial records of the agency. The total payroll amounts from the payroll statement and affidavit, and the amounts charged to each appropriation and fund of the agency, shall be listed or estimated on the payroll purchase order for consideration and payment by the governing board. The amount to be paid pursuant to a payroll purchase order may be encumbered as of the date the purchase order is considered by the governing board for payment or as of the date payroll payments are made.
D. The encumbering officer or clerk of a municipality, county or school may authorize payment of the following taxes and invoices as they become due without a purchase order or further approval of the governing board:
1. Taxes, including, but not limited to, withholding, social security or unemployment compensation taxes;
2. Retirement or pension fund payments or contributions which are payable pursuant to a resolution, ordinance, contract or other appropriate agreement which has been approved by the governing board; and
3. Payments for insurance or related coverages, including, but not limited to, accident, health or life, workers’ compensation, or any other property, vehicle, marine, surety, liability or casualty coverages, which are payable under a valid contract, policy or other appropriate agreement which has been approved by the governing board.
Section 666. Assignment of Salaries or Wages. (62 O.S. § 304.2)
Assignment of salary or wage earnings in such instance shall be by separate instrument, and by affidavit. It shall be unlawful to issue or authorize the issuance of a municipal warrant for salary or wages to any person other than the person earning the same, or to his assignee or the executor or administrator of his estate or to any person entitled to child support payments pursuant to an income assignment proceeding or a garnishment proceeding. Except as provided by income assignment procedures for the collection of child support, no assignment of a part of salary or wages shall be made, and any assignment of salary or wages before the same has been earned shall be a nullity and shall avail the assignee nothing.
Section 667. Money Due For Property, Royalty or Services - Payment and Crediting. (62 O.S. § 335)
When any money is due any county, city, town or school district in the state from sale, lease or rental of any public property, or royalty, or for compensation for service of public employees or other purpose, it shall be paid over to the lawful treasurer thereof.
The governing board shall have authority to direct by written resolution duly entered in the minutes of its meeting at the time such money is received or prior thereto that such money shall be credited to the fund account from which such property was derived or from which payment has been or will be made for such services rendered or other purposes.
If there be no resolution by the governing board directing the disposition of the money received as contemplated herein it shall be the duty of the treasurer to credit such money so received to the general fund.
The governing board shall have authority to direct that a fund derived for such sources as herein contemplated, where applicable to a public utility, be created and used to repair, relocate or replace any utility or part thereof new or hereafter existing.
Proceeds of sale of school building that was constructed with borrowed money must either be used for the purpose for which the money was borrowed or placed in the district’s sinking fund for payment of the outstanding bonded indebtedness. AG Op. October 25, 1965
Income and rentals from teacherage should be paid over to school district treasurer as provided by this Section. AG Op. December 13, 1961
Proceeds of sale of building constructed with bond money, if not used to construct another building, should be placed in the sinking fund to retire debt that was incurred, and remainder should be placed in general fund. AG Op. June 2, 1961
Section 668. (Omitted – not applicable to school districts.)
Note: See now Section 111.28.
Section 669. Public Utility Billings. (62 O.S. § 305.1)
The governing board of a municipality shall be authorized to allow and pay the regular periodic billings of any municipal utility or of any public utility whose rates are fixed by, and are subject to the approval of, the Oklahoma Corporation Commission or any other public regulatory body or board of any utility cooperative for services furnished by the utility to the municipality without the issuance of a purchase order and filing of an invoice by such municipal or public utility, provided, further, that no municipal or public utility shall attach a late charge or deny a discount on any bill until a thirty-day period has lapsed from the receipt of the bill.
Section 670. Terms Used in Preceding Section Defined. (62 O.S. § 305.2)
The term “municipality” as used herein shall include any county, school district, city or town, and the term “governing board” shall include the board of county commissioners of a county, the board of education or district board of any school district, the city council of a city, and the board of trustees of a town.
School Laws of Oklahoma | Chapter 4 - Funds and Finance | Article III: Funds | Return to Top of Page
