District Funds

Colorado law requires that district money be deposited and disbursed through specified funds. The general fund, special building fund and bond redemption fund are specified in law. [C.R.S. § 22-45-103.]

General fund

Expenditures for day-to-day district operations are accounted for in the general fund. This includes all transactions not accounted for in another fund. Although the law provides that expenditures for certain purposes may be made out of other district funds, money may be expended out of the general fund for any purpose for which the board is authorized to expend money. In other words, money in the general fund may be budgeted and spent for any lawful purpose.

Bond redemption fund

The revenue for satisfying bonded indebtedness obligations, both principal and interest, is deposited in the bond redemption fund. The fund may include subsidiary accounts for each obligation of bonded indebtedness.

In this fund, the revenue from each separate tax levy is held in trust to satisfy the obligations of bonded indebtedness for which the levy is made. Revenue remaining in an account after all obligations have been satisfied shall be transferred to another account in the fund that still has outstanding obligations. If all obligations of the bond redemption fund have been satisfied, the board may transfer the balance in the fund to the general fund.

The board must select a third party custodian to administer this fund, unless the county treasurer maintains the accounts and funds of the school district. This third party custodian is responsible for making payments from the bond redemption fund, for administering the fund and for investing the moneys as provided by law and upon the direction of the school district.

Capital reserve fund

The board determines the amount to be maintained in its capital reserve fund. [C.R.S. § 22-45-103; 22-54-105.] Money received from gifts, donations and tuition receipts also may be deposited in this fund. The money in this fund may be accumulated from year to year and used when needed. Expenditures are limited to long-range capital outlay expenditures and may be made only for the following purposes:

  • Acquiring land, making improvements, constructing structures or adding to existing structures and acquiring equipment and furnishings
  • Alterations and improvements to existing structures
  • Acquiring school buses or other equipment
  • Any installment purchase agreement or lease agreement with an option to purchase for a period not to exceed 20 years and any lease agreement without an option to purchase
  • Any software licensing agreement
  • Acquiring computer equipment

The board, through adoption of an appropriate resolution, must authorize expenditures from the fund. The law requires that the resolution set forth in detail the purpose of the expenditure and the estimated total cost and location of the project. It is advised that boards look closely at the detailed provisions of the law before authorizing capital reserve fund expenditures.

Unencumbered moneys in this fund may be transferred to a fund or account within the general fund by action of the board.

Special building and technology fund

The board of education can call a special election to ask the voters for authority to set a mill levy for a special building fund. The levy must not exceed 10 mills in any year or exceed three years in duration.

Expenditures from the special building fund are limited to acquiring land; acquiring or constructing structures; maintain structure to enhance their function, protect their value and extend their economic life; and the purchase and installation of instructional and informational technology, including expenditures for software and staff training related to the new technology.

Transportation fund

The revenues from a voter-approved transportation tax or fee imposed to pay excess transportation costs must be deposited in the transportation fund. Expenditures in the fund are limited to payment of transportation costs. Any moneys remaining in the fund at the end of any fiscal year must remain in the fund and be used to reduce the levy for transportation costs in future years.

Full-day kindergarten fund

The revenues from a tax levy for the purpose of paying excess full-day kindergarten program costs shall be deposited in the district’s full-day kindergarten fund. Expenditures for the fund are limited to payment of excess full-day kindergarten program costs, as authorized in the district’s budget.