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Public School Fund Accounting Changes

By Brock J. Bowsher, Manager, August 09, 2017

Indiana public schools’ annually budgeted funds will be combined into four funds in accordance of HEA 1009 effective January 1, 2019: Education, Operations, Debt Service and Pension Debt Service. 

According to HEA 1009, current school General Funds will be split into Education and Operations Funds.  The Capital Projects, Transportation, Bus Replacement, Art Association, Historical Society and Public Playground Funds will also be consolidated into the Operations Fund. 

On December 31, 2018, schools will transfer the General Fund cash balance proportionally to the Education and Operations Funds.  Beginning in 2019, school funding generated through the Indiana Department of Education funding formula will be allocated to the Education Fund. 

The Operations Fund will be funded by local property tax revenue which will be the combined current Transportation and Bus Replacement Fund max levies and the Capital Projects Fund tax rate levy.  After 2019, the Operations Fund levy will be increased by the 6-year non-farm income assessed value quotient that is established annually by the Department of Local Government Finance. 

2019 Operations Fund Levy = Max levies for Transportation & Bus Replacement Funds + Capital Projects Fund Tax Rate Levy

Transfers can be made from the Education Fund to Operations Fund, but must be approved at a Board of School Trustee public meeting.  Money transferred from Education Fund to Operations is removed from consideration for purposes of collective bargaining. 

Rainy Day, Operating Referendum and Capital Referendum Funds will remain as separate funds after January 1, 2019. 

HEA 1009 also includes a provision that public schools with enrollment of 15,000 or more may not issue bonds after August 15, 2020, unless the school corporation has for its preceding budget year (2019) prepared an annual financial report using modified accrual basis of accounting in accordance with generally accepted accounting principles (GAAP). 


If you would like more information on preparing for these changes, please contact us at .(JavaScript must be enabled to view this email address).





Information in this article was believed current as of the date of publication. As you know, changes occur frequently. The information presented is of a general educational nature. Before applying to your specific circumstances, please contact us at


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