CONNECT Treasurer Advisory Meeting Barbara Shaner OASBO Advocacy

CONNECT Treasurer Advisory Meeting Barbara Shaner, OASBO Advocacy Specialist March 6, 2019

HB 491 • House Bill (HB) 491 takes effect March 19, 2019, • The bill changes the circumstances under which school treasurers are liable for a loss of public funds, and • Under which such loss may be considered a violation of a treasurer’s professional duties. • It also modifies procedures that schools, including their superintendents and treasurers, must follow to pay teachers.

History • Historically, school treasurers have generally been subject to “strict liability” • Meaning they have been liable for any loss of a school’s funds regardless of the reason for the loss. • This liability is set forth in an Ohio statute (ORC 9. 39), which provides that “public officials are liable for all public money received or collected by them or their subordinates under color of office” • And based on prior Ohio case law. • However, some judges have noted a need for the legislature to enact “curative statutes” providing appropriate relief from liability for losses that did not result from an official’s negligence or wrongdoing.

History • The legislature has already provided some relief (ORC 131. 18) by authorizing certain public bodies, including boards of education, to release a treasurer from liability under limited circumstances including when the loss of public funds is due to: • • • Fire, Robbery, Burglary, Flood, or Inability of a bank to refund public money. All provided the loss did not result from the treasurer’s negligence or other wrongful act. • Otherwise, treasurers have remained strictly liable for losses, regardless of whether a loss is due to their negligence or other wrongful act.

Changes to Treasurer Liability Under HB 491 • Under HB 491, a school treasurer will no longer be strictly liable for a loss of public funds, but instead, generally will be liable when a loss of public funds results from the treasurer’s negligence or other wrongdoing. On a general basis and also, more specifically: • With respect to losses resulting from reliance on nonfinancial information or data, and • With respect to losses resulting from teacher payments provided the treasurer complies with required procedures. • Similarly, a superintendent will not be liable for losses resulting from teacher payments provided the superintendent complies with required procedures.

HB 491 & ORC 3313. 25 • Based on the changes to ORC 3313. 25, a school treasurer will not be liable for a loss of public funds when: • The treasurer performs all required official duties with reasonable care, and • Instead will be liable only when the loss results from the treasurer’s negligence or other wrongful act. • In addition, the Ohio Department of Education will not consider such a loss to violate the treasurer’s professional duties • Provided the loss does not result from the treasurer’s negligence or other wrongful act.

HB 491 & ORC 3313. 31 • Currently Ohio law (ORC 3313. 31) specifies that “no treasurer shall be required to verify the accuracy of nonfinancial information or data of the school district” unless other- wise required by law. • The revisions to this law further confirm that a school treasurer will not be liable for a loss of public funds resulting from reliance on the accuracy of such nonfinancial information or data, including: • • Reports in the education management information system, Pupil transportation reports, and Licensure or other credentialing information, Unless the loss results from the treasurer’s negligence or other wrongful act.

HB 491 & 3319. 36 • With the changes to ORC 3319. 36, a school treasurer and superintendent will not be liable for a loss of public funds • For teacher payments provided the payments follow required procedures, • Unless the loss results from the treasurer’s or superintendent’s negligence or other wrongful act. • Currently, before a payment can be made, the law requires: • A teacher to file with the treasurer all required reports, and • A written statement from the superintendent that the teacher has filed with the treasurer a legal license to teach the subjects or grades taught.

HB 491 & Teacher Payments • A teacher must file with the superintendent (or superintendent’s designee) all reports required by the Ohio Department of Education, the school district, and the superintendent, along with the teacher’s license; • The treasurer must receive a written statement from the superintendent (or designee) that the teacher has complied, and • The treasurer must receive a written statement from the superintendent (or designee) that the teacher has filed a legal license to teach the subjects or grades taught and the dates of its validity.

Continuing Law • Current exceptions to this procedure will remain in place. For example • During the initial two months of employment when certain requirements are met: • • Certain teachers with permits, Teachers, Substitute teachers conditionally, and Substitute educational assistants.

Preparing for HB 491 • The superintendent should designate the individual with whom teachers are required to file required reports and licenses; • The superintendent and treasurer should implement a procedure for the superintendent (or designee) to submit the required written statements to the treasurer. Remember ~ the treasurer can still be found liable if inappropriate payments are made knowingly, even if the superintendent has submitted a signed statement. • FYI ~ HB 291 allows districts to purchase liability insurance in lieu of a surety bond. OASBO is working with the AOS to get information on implementation questions.

Statehouse News • Governor presented State of the State address on Tuesday March 5 th • Promised funding for: • • Early childhood education Prevention education support Economically disadvantaged student education Roads and Bridges (through an increased gas tax) Water quality Public health Mental health services • Main operating budget due by March 15 th • Expect only an outline of the budget proposal on the 15 th; bill language to come out later.

Miscellaneous bills introduced • HB 43 ~ Remove “right of first refusal” for community schools • HB 75 ~ Provisions from HB 343 in the last GA • HB 76 ~ Ballot language changes (similar to HB 342 from the last GA) • HB 83, HB 89 & HB 105 ~ School bus stop safety • HB 122 ~ Voucher expansion • SB 4 ~ Additional $100 million appropriated for school facilities for the current biennium • SB 36 ~ Regarding taxable value for rental property with federal subsidies

QUESTIONS? ?

Contact Information Barbara Shaner, OASBO Advocacy Specialist barbaracshaner@gmail. com 614 -325 -9562