ut-20261001-R277-113: R277-113. LEA Fiscal and Auditing Policies

1. Agency Information

Title catchline: Education, Administration Building: Board of Education Street address: 250 E 500 S City, state: Salt Lake City, UT 84111 Mailing address: PO Box 144200 City, state and zip: Salt Lake City, UT 84114-4200 UTAH STATE BULLETIN, October 01, 2026, Vol. 2026, No. 19 73 NOTICES OF PROPOSED RULES

2. Contact Persons

Name: Phone: Email: Ben Rasmusssen 801-538-7992 ben.Rasmussen@schools.utah.gov Please address questions regarding information on this notice to the persons listed above.

A. Rule or section catchline:

R277-113. LEA Fiscal and Auditing Policies

B. Purpose of the new rule or reason for the change:

This rule is being amended to remove the oversight category.

C. Summary of the new rule or change:

The amendments specifically update the Section R277-113-3 title and clarify the responsibilities of the Superintendent and the Internal Audit Department. The amendments also remove an oversight category 3 from this rule. 5. Fiscal Information Provide an estimate and written explanation of the aggregate anticipated cost or savings to:

A. State budget:

This rule change is not expected to have fiscal impact on state government revenues or expenditures. The amendments remove Oversight Category 3 from this rule, update the title of Section R277-113-3, shift training provision responsibilities from the Superintendent to the Internal Audit Department, and correct the title of Legislative Fiscal Analysts. Because these changes solely reassign existing duties between internal state departments and remove an obsolete oversight categorization, there are no incremental costs or savings associated with this change.

B. Local governments:

This rule change is not expected to have fiscal impact on local governments' revenues or expenditures. The amendments strictly update state-level administrative titles and internal department responsibilities. Because these modifications do not alter the fiscal, accounting, or auditing requirements required of Local Educational Agencies (LEAs), there are no incremental costs or savings on local governments.

C. Small businesses ("small business" means a business employing 1-49 persons):

This rule change is not expected to have fiscal impact on small businesses' revenues or expenditures. This rule governs LEA fiscal and auditing policies and internal Board of Education responsibilities. Because the amendments do not interact with, regulate, or require services from small businesses, there are no incremental costs or savings.

D. Non-small businesses ("non-small business" means a business employing 50 or more persons):

There are no non-small businesses in the industry in question, Elementary and Secondary Schools (North American Industry Classification System (NAICS) 611110). Because there are no non-small businesses, they do not account for any service delivery for Elementary and Secondary Schools. Therefore, non-small businesses are not expected to receive increased or decreased revenues per year. This proposed rule change is not expected to have any fiscal impact on non-small businesses' revenues or expenditures because there are no applicable non-small businesses, and it does not require any expenditures of, or generate revenue for non-small businesses. 74 UTAH STATE BULLETIN, October 01, 2026, Vol. 2026, No. 19 NOTICES OF PROPOSED RULES E. Persons other than small businesses, non-small businesses, state, or local government entities ("person" means any individual, partnership, corporation, association, governmental entity, or public or private organization of any character other than an agency): This rule change is not expected to have fiscal impact on revenues or expenditures for persons other than small businesses, businesses, or local government entities. Because no individuals, partnerships, or non-governmental entities are regulated or affected by the internal transfer of training responsibilities or the removal of the oversight category, there are no incremental costs or savings.

F. Compliance costs for affected persons:

There are no compliance costs for affected persons. The amendments do not mandate any new actions, reporting requirements, or operational changes for any affected persons or entities outside of the Utah State Board of Education (USBE). Because no new compliance actions are generated by the stricken or added language, there are no incremental compliance costs. 6. Regulatory Impact Summary Table Enter the cost or savings in the relevant cell. If there is no cost or savings, enter, "$0." If a cost or savings is inestimable, enter, "inestimable." Fiscal Cost FY2027 FY2028 FY2029 FY2030 FY2031 State Budget $0 $0 $0 $0 $0 Local Governments $0 $0 $0 $0 $0 Small Businesses $0 $0 $0 $0 $0 Non-Small Businesses $0 $0 $0 $0 $0 Other Persons $0 $0 $0 $0 $0 Total Fiscal Cost $0 $0 $0 $0 $0 Fiscal Benefits FY2027 FY2028 FY2029 FY2030 FY2031 State Budget $0 $0 $0 $0 $0 Local Governments $0 $0 $0 $0 $0 Small Businesses $0 $0 $0 $0 $0 Non-Small Businesses $0 $0 $0 $0 $0 Other Persons $0 $0 $0 $0 $0 Total Fiscal Benefits $0 $0 $0 $0 $0 Net Fiscal Benefits $0 $0 $0 $0 $0 7. Regulatory Impact Analysis Approval The State Superintendent of the Utah State Board of Education, Molly Hart, has reviewed and approved this regulatory impact analysis. 8. Family Impact Information

A. The agency has considered this rule's impact on family health, stability, and fo☒mation:

9. Citation Information Provide citations to the statutory authority for the rule. If there is also a federal requirement for the rule, provide a citation to that requirement: Utah Constitution, Article X, SectioSubsection 53E-3-401(4) Subsection 53E-3-501(1)(e) UTAH STATE BULLETIN, October 01, 2026, Vol. 2026, No. 19 75 NOTICES OF PROPOSED RULES 11. Public Notice Information The public may submit written or oral comments to the agency identified in box 1.

A. Comments will be accepted until: 11/02/2026

12. Effective Date Information This rule change MAY become effective on: 11/09/2026 (NOTE: This is the date the agency anticipates making the filing effective. It is NOT the effective date) 13. Agency Authorization Information Agency head or Ben Rasmussen, Director of Policy Date: 09/15/2026 designee and title: R277. Education,Administration. R277-113. LEAFiscal andAuditing Policies. R277-113-1. Authority[,] and Purpose[, and Oversight Category]. (1) This rule is authorized by: (a) Utah ConstitutionArticle X, Section 3, which vests general control and supervision over public education in the Board; (b) Subsection 53E-3-401(4), which allows the Board to make rules to execute the Board's duties and responsibilities under the Utah Constitution and state law; (c) Subsection 53E-3-501(1)(e)(i), which directs the Board to establish rules and minimum standards for school productivity and cost effectiveness measures; (d) Subsection 53E-3-501(1)(e)(iv), which allows the Board to adopt rules regarding financial, statistical, and student accounting requirements; (e) Section 53E-3-602, which allows the Board to approve auditing standards for LEAgoverning boards; (f) Section 53E-3-603, which requires the Board to verify accounting procedures of LEA governing boards for determining the allocation of Uniform School Funds; (g) Section 53E-5-202, which directs the Board to adopt rules to implement a statewide accountability system; (h) Subsection 53G-5-404(4), which requires charter schools to make the same annual reports required of other public schools, including an annual financial audit report; (i) Subsection 53F-2-209(2), which requires the Board to make rules for flexible use of restricted funds; and (j) ESSA, which requires states to revise and redesign school accountability systems. (2) The purpose of this rule is to: (a) require LEAs to formally adopt and implement policies regarding the management and use of public funds; (b) provide minimum standards, procedures, and definitions for LEApolicies; (c) direct that LEAs make policies, procedures, and training materials available to the public and readily accessible on LEAor public school websites, to the extent of resources available; (d) require LEAs to train employees in: (i) appropriate financial practices; (ii) necessary accounting procedures; and (iii) ethical financial practices; (e) specify uniform budgeting, accounting, and auditing procedures for LEAs consistent with GAAP, GAAS, and GAGAS; and (f) establish reporting and accounting requirements for LEAs to enable the Board to comply with ESSA. [ (3) This Rule R277-113 is categorized as Category 3 as described in Rule R277-111.] R277-113-2. Definitions. (1) "Administration" means: (a) an LEAsuperintendent or director; (b) a deputy or associate superintendent or director; (c) a business administrator or manager; or (d) another LEAeducational administrator, designated staff, or a designated educational service provider. (2) "Arm's length transaction" means a transaction between two unrelated, independent, and unaffiliated parties or a transaction between two parties acting in their own self interest that is conducted as if the parties were strangers so that no conflict of interest exists. (3) "Cash" or "cash receipts" means cash, checks, credit cards, electronic payments via a website or a mobile payment application, or other items used for payment. (4) "Exclusive contract or arrangement" means an agreement requiring a buyer to purchase or exchange needed goods or services from one seller. (5) "GAAP" means Generally Accepted Accounting Principles or a common framework of accounting rules and standards for financial reporting promulgated by GASB. 76 UTAH STATE BULLETIN, October 01, 2026, Vol. 2026, No. 19 NOTICES OF PROPOSED RULES (6) "GAAS" means GenerallyAcceptedAuditing Standards or a set of auditing standards and guidelines promulgatedby theAuditing Standards Board of theAmerican Institute of Certified PublicAccountants. (7) "GAGAS" means GenerallyAccepted GovernmentAuditing Standards or a set of auditing standards and guidelines promulgated by the GovernmentAccountability Office. (8) "GASB" means the Governmental Accounting Standards Board whose purpose is to establish GAAP for state and local governments within the United States. (9) "Internal controls" means a process, implemented by an entity's governing body, administration, or other personnel, designed to: (a) provide reasonable assurance regarding the achievement of objectives in the following categories: (i) effectiveness and efficiency of operations; (ii) reliability of reporting for internal and external use; and (iii) compliance with applicable laws and regulations; (b) provide reasonable assurance regarding the achievement of the following objectives over state and federal awards: (i) proper recording and accounting for transactions, to: (A) permit the preparation of reliable financial statements and state and federal reports; (B) maintain accountability over assets; and (C) demonstrate compliance with state and federal statutes, regulations, and the terms and conditions of state and federal awards; and (ii) execution of transactions in compliance with: (A) state and federal statutes and regulations; and (B) the terms and conditions of state or federal awards; and (c) safeguard funds, property, and other against loss from unauthorized use or disposition. (10) "Non-operating LEA" means an LEAthat has not received minimum school program funds or federal funds and is not providing educational services during a fiscal year, such as an LEAin a start-up period. (11) "N-size" means the minimum size necessary to disclose or display data to ensure maximum student group visibility while protecting student privacy. (12) "Operating LEA" means an LEA that has received state minimum school program funds or federal funds and is providing educational services during a fiscal year. (13)(a) "Provided, sponsored, or supported by a school" has the same meaning as defined in Section R277-407-2. (b) "Provided, sponsored, or supported by a school" does not apply to non-curricular clubs specifically authorized and meeting the requirements of Sections 53G-7-704 through 53G-7-707. (14) "Public funds" has the same meaning as that terms is defined in Subsection 51-7-3(26). (15) "Title IX" refers to that portion of the United States Education Amendments of 1972 codified as 20 U.S.C. 1681 through 20 U.S.C. 1688. (16) "Utah Public Officers' and Employees' EthicsAct," meansTitle 67, Chapter 16, which provides standards of conduct for officers and employees of the state of Utah and its political subdivisions in areas where there are actual or potential conflicts of interest between public duties and private interests. R277-113-3. Superintendent and the InternalAudit Department Responsibilities. (1) The Superintendent shall provide training, informational materials, and model policies for use by LEAs in developing LEA and public school-specific financial policies. (2) The Superintendent shall provide online training and resources for LEAs regarding the use and management of public funds and ethical practices for licensed Utah educators who manage, control, participate in fundraising, or expend public funds. (3) [The Superintendent]The InternalAudit Department shall provide training and informational materials for use by LEAgoverning boards in establishing their audit committees and internal audit programs in compliance with Section 53G-7-402. (4) The Superintendent shall provide and establish a cycle for state review of LEAfiscal policies and standards. (5) The Superintendent shall work with and provide information upon request to the Utah State Auditor's Office, the Legislative Fiscal [Auditors]Analysts, the Office of the LegislativeAuditor General, and other state agencies with the right to information from the Board. R277-113-4. LEAAudit Responsibilities. (1) The presiding officer of an LEA governing board shall ensure that the members of the governing board and audit committee are provided with training on the requirements of Title 53G, Chapter 7, Part 4, InternalAudits, and this Section R277-113-4 as part of the member on-boarding process. (2) The training described in Subsection (1) shall: (a) comply with Title 63G, Chapter 22, State Training and Certification Requirements; and (b) use the online training and informational materials provided by the Superintendent in accordance with Subsection R277-113- 3(3). (3) An LEAgoverning board shall: (a) designate board members to serve on an audit committee, consistent with Subsection 53G-7-401(1); and (b) maintain the following information on the LEA's website: (i) names of the governing board members who serve on the audit committee; and (ii) if required by Subsection 53G-7-402(2); (A) the name and contact information of the internal audit director; and UTAH STATE BULLETIN, October 01, 2026, Vol. 2026, No. 19 77 NOTICES OF PROPOSED RULES (B) a copy of the LEA's annual audit plan. (4) An LEAaudit committee shall: (a) ensure the LEA obtains all audits, agreed-upon procedures, engagements, and financial reports required by Section 51-2a-201 and Subsection 53G-5-404(4); (b) provide an independent forum for internal auditors, internal audit contractors, and other regulatory bodies to report findings of fraud, waste, abuse, non-compliance, or control weaknesses, particularly if LEAadministration is involved; (c) ensure that corrective action on findings, concerns, issues and exceptions reported by independent external auditors, internal auditors, or other regulatory bodies are resolved in a timely manner by LEAadministration; (d) present, as appropriate, information and reports from the audit committee's meetings to the LEAboard; and (e) receive, as appropriate, reports of reviews, monitoring, or investigations conducted by LEAadministration and ensure appropriate corrective action is taken in a timely manner. (5) With regards to engagements completed by an independent external auditor, an LEAaudit committee shall: (a) manage the audit procurement and quality process in compliance with Title 63G, Chapter 6a, State Procurement Code and Rule R123-5; (b) ensure that the independent external auditor has access to directly communicate with the audit committee; (c) review disagreements between independent external auditors and LEAadministration; (d) consider LEAresponses to audits or agreed-upon procedures; and (e) determine the scope and objectives of other non-audit services, as necessary. (6) An LEAaudit committee shall if required by Section 53G-7-402: (a) establish an internal audit program that provides internal audit services for the programs administered by the LEA; (b) advise the LEA board in the appointment of an audit director or in contracting for internal audit services in accordance with Subsection 53G-7-402(3); (c) conduct or advise the LEA board in an annual evaluation of the internal audit director or contractors providing internal audit services; (d) prioritize the internal audit plan based on risk; (e) receive regular updates on the internal audit plan and internal audit project progress; and (f) receive final internal audit reports from internal auditors or contractors providing internal audit services. R277-113-5. LEAFiscal Responsibilities and Required Fiscal Policies. (1) An LEAshall review the LEA's fiscal policies and procedures regularly. (2) An LEAshall develop a plan for annual training of LEAand public school employees on policies and procedures enacted by the LEAspecific to job function. (3) LEA fiscal policies and procedures shall be available at each LEA main office, at individual public schools, and be publicly available on the LEA's website. (4) LEA fiscal policies, procedures, and training may have different components, specificity, and levels of complexity for public elementary and secondary schools. (5) An LEAmay have one or more policies to satisfy the minimum requirements of this Rule R277-113. (6) An LEA fiscal policy may reference specific training manuals or other resources that provide detailed descriptions of business practices which are too lengthy or detailed to include in the LEApolicy. (7) Apublic education foundation established by an LEAshall follow the requirements set forth in Section 53E-3-403. (8)(a) An LEA shall ensure that the LEA's written fiscal policies and procedures address applicable state and federal statutes and regulations. (b) The requirements set forth in this Section R277-113-5 are minimum requirements. (c) An LEAmay include other related items, provide LEAspecific policy and guidance, and set polices that are more restrictive and inclusive than the minimum provisions established by Board rule. (9) LEAfiscal policies shall include the following: (a) a program accounting policy that establishes internal controls and procedures to record program revenues and expenditures in accordance with: (i) GAAP; and (ii) the school fee provisions in Section R277-407-12; (b) a program accounting policy that: (i) accurately reflects the use of funds for allowable costs and activities; (ii) requires that transactions be recorded when they occur; (iii) allows adjusting journal entries during the year and at the end of the year, in accordance with GAAP; and (iv) requires that initial transactions, and adjusting entries if applicable, be recorded in the proper program, utilizing the following codes as established by the Board approved chart of accounts: (A) fund; (B) function; (C) program; (D) location; and (E) object or revenue code, as applicable; 78 UTAH STATE BULLETIN, October 01, 2026, Vol. 2026, No. 19 NOTICES OF PROPOSED RULES (c) a cash handling policy, which shall address cash receipts, including cash, checks, credit cards, electronic payments via a website or a mobile payment application, and other items used for payment, collected at the LEAand individual public schools and shall include: (i) establishment of internal controls and procedures over the collection, deposit, and reconciliation of cash receipts received; and (ii) compliance with Subsection 51-4-2(2) regarding deposits. (d) an expenditure policy, which shall address expenditures made by the LEAand individual public schools and shall include: (i) establishment of internal controls and procedures over the initiation, approval and monitoring of expenditures, including: (A) credit, debit, or purchase card transactions; (B) employee reimbursements; (C) travel; and (D) payroll; (ii) directives regarding the appropriate use of the LEA's tax exempt status number; (iii) compliance with Section 63G-6a-1204 regarding length of multi-year contracts; (iv) compliance with: (A) Title 63G, Chapter 6a, Utah Procurement Code; (B) Board rule regarding construction and improvements; and (C) federal Title IX requirements, found in 20 U.S.C. 1681, et seq.; (v) requirements for LEAcontracts, including: (A) inclusion of specific scope of work language; (B) inclusion of federal requirements; (C) inclusion of language regarding data privacy and use, where appropriate; and (D) legal review before LEAapproval; and (vi) procedures and documentation maintained by the LEA if the LEA chooses to enter into exclusive contracts or arrangements consistent with state procurement law and the LEAprocurement policy; and (vii) procedures for determining allowability of costs in accordance with relevant regulations and terms and conditions of awards; (e) a fundraising policy that: (i) establishes procedures for LEAand public school fundraising in general; (ii) establishes an approval process for fundraising activities for school sponsored activities; (iii) provides for compliance with the requirements of Rule R277-408; and (iv) includes: (A) specific designation of employees by title or job description who are authorized to approve fundraising and school sponsored fundraising activities; (B) establishmentofinternalcontrolsandproceduresovertheapprovaloffundraisingandschoolsponsoredactivitiesandcompliance with associated cash handling and expenditure policies; (C) directives regarding the appropriate use of the LEA's tax exempt status number and issuance of charitable donation written disclosure in accordance with IRS regulations; (D) procedures governing LEAor public school employee interaction with parents, donors, and organizations doing fundraisers not provided, supported, or sponsored, by a school or LEA; (E) disclosure requirements for LEA and public school employees approving, managing, or overseeing fundraising activities, who also have a financial or controlling interest or access to bank accounts in the fundraising organization or company; (F) provisions establishing compliance with: (I) Utah Constitution,Article X, Section 2, establishing a free public education system; (II) Rule R277-408; and (III) federal Title IX requirements, found in 20 U.S.C. 1681, et seq. (v) may include procedures governing: (A) student participation and incentives offered to students; (B) allowable types of individual or group fundraising activities; and (C) participation in school sponsored activities by volunteer or outside organizations; (f) an LEAdonation and gift policy that includes: (i) an acceptance and approval process for: (A) monetary donations; (B) donations and gifts with donor restrictions; (C) donations of gifts, goods, materials, or equipment; and (D) donation of funds or items designated for construction or improvements of facilities; (ii) establishment of internal controls and procedures over the acceptance and approval of donations and gifts and compliance with associated cash handling and expenditure policies; (iii) directives regarding the appropriate use of the LEA's tax exempt status number, and issuance of charitable donation written disclosure in accordance with IRS regulations; (iv) procedures regarding the objective valuation of donations or gifts if advertising or other services are offered to the donor in exchange for a donation or gift; (v) procedures governing LEAor public school employee conduct with parents, donors, and nonschool sponsored organizations; (vi) procedures establishing provisions for direct donations or gifts to the LEAor LEAprograms, individual public school or public school programs; UTAH STATE BULLETIN, October 01, 2026, Vol. 2026, No. 19 79 NOTICES OF PROPOSED RULES (vii) provisions restricting donations from being directed at specific LEA employees, individual students, vendors, or brand name goods or services; (viii) compliance with: (A) Title 63G, Chapter 6a, Utah Procurement Code; (B) state law and Board rule regarding construction and improvements; (C) IRS regulations and tax deductible directives; and (D) Title IX; (ix) procedures for: (A) accepting donations and gifts through an LEA's legally organized foundation, if applicable; (B) recognition of donors; or (C) granting naming rights; and (g) an LEAFinancial Reporting policy, which shall include the following: (i) a requirement that the LEA shall ensure external audits of LEAfinancial reporting, compliance, and performance, in accordance with GAAS and GAGAS; (ii)(A) a requirement that the LEA shall provide financial reporting in a manner consistent with the basis of accounting as required by GAAP, as applicable to the entity; and (B) a requirement that the basis of accounting will be GASB; and (iii) a requirement that the LEA shall provide data and information consistent with budgeting, accounting, including the uniform chart of accounts for LEAs, and auditing standards for Utah LEAs provided online annually by the Superintendent. (10) The Superintendent shall maintain a School Finance website with applicable Utah statutes, Board rules, and uniform rules for: (a) budgeting; (b) financial accounting, including a chart of accounts required for an LEA; (c) student membership and attendance accounting; (d) indirect costs and proration; (e) financial audits; (f) statistical audits; and (g) compliance and performance audits. R277-113-6. LEAGoverning Board Fiscal Responsibilities. An LEAgoverning board shall have the following responsibilities: (1) approve written fiscal policies and procedures required by Section R277-113-5; (2) ensure, considering guidance in "Standards for Internal Control in the Federal Government," issued by the Comptroller General of the United States or the "Internal Control Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission, that LEAadministration establish, document, and maintain an effective internal control system for the LEA; (3) develop a process to regularly discuss and review LEA: (a) budget and financial reporting practices; (b) financial statements and annual financial and program reports; (c) financial position; (d) expenditure of restricted funds to ensure administration is complying with applicable laws, regulations, and award terms and conditions; and (e) systems and software applications for compliance with financial and student privacy laws; (4) receive the results of required annual audits from the external auditor in accordance with Section R123-5-5; (5) overseeprocurementprocessesincompliancewithTitle63G,Chapter6a,UtahProcurementCode,andRuleR277-115,including: (a) reviewing the scope and objectives of LEA contracts or subawards with entities that provide business or educational services; and (b) receiving reports regarding the compliance and performance of entities with contracts or subawards; (6) ensure the procurement process for an external auditor is in compliance with Section R123-5-4; and (7) ensure LEA administration implements sufficient internal controls over the functions of entities with contracts or subawards to perform services on behalf of the LEA. R277-113-7. Reporting of School Level Expenditures. (1) In accordance with ESSA, the Superintendent shall make public the per pupil expenditures of federal, state, and local funds, for each LEAand each school in the state. (a) The Superintendent shall exclude expenditures that: (i) are non-current; (ii) do not reflect the day-to-day operations of an LEAor school; (iii) do not contribute to k-12 education; or (iv) are significant, unique expenditures that may skew data in certain years and thwart year-to-year comparison. (b) The Superintendent shall publish and make available a comprehensive list of expenditures that are excluded from per pupil expenditure information. (2) The Superintendent's school level report for each school shall include: (a) average daily membership for the fiscal year covered by the report; 80 UTAH STATE BULLETIN, October 01, 2026, Vol. 2026, No. 19 NOTICES OF PROPOSED RULES (b) an indicator if the school is: (i) a Title I School; or (ii) a Necessarily Existent Small School; (c) grade levels served by each school; (d) student demographics; (e) expenditures recorded at the school level and central expenditures allocated to each school by: (i) federal program expenditures; and (ii) state and local combined expenditures; (f) calculated per pupil expenditures; and (g) average teacher salary. (3) The Superintendent may not report expenditure data for a school with an n-size of less than 10. R277-113-8. LEAAccounting Requirements. (1) Each LEAshall: (a) record revenues and expenditures in compliance with the Board approved chart of accounts; (b) record expenditures using school location codes that can be mapped to official school location codes used in the Board system of record; (c) record expenditures using approved district and school codes in the Board system of record; (d) submit expenditures using location codes in the Utah Public Education Financial System; (e) perform program accounting in accordance with GAAP and this rule; and (f) ensure that fee and fee waiver accounting aligns with GASB34. (2) Each LEAshall record and report the following expenditures for each school annually: (a) salaries; (b) benefits; (c) supplies; (d) contracted services; and (e) equipment. (3) If an LEA pays for contracted services that occur at the school level, the LEAshall record the payments to the contractors in the appropriate function and object codes established under Subsection (2) at the school level. (4)(a) An LEAshall record centralized administrative costs to the administrative location code. (b) The Superintendent shall allocate such costs to each school based on school enrollment. (5) The Superintendent shall present one expenditure report for a school receiving more than one report card under Subsection R277- 497-4(8). (6) If an LEAreports expenditures in programs, the LEAshall report the expenditures to one or more schools. (7) Each LEAshall request reimbursement for federal programs no less than semi-annually as funds are available. (8) Each LEA shall submit an intent to fully expend or waive a federal award nine months before the end of the federal program grant award period. R277-113-9. Activities Provided, Sponsored, or Supported by a School. (1) An LEAor school shall comply with this Section R277-113-9 for all activities provided, sponsored, or supported by a school. (2) An LEA shall ensure that revenues raised from or during activities provided, sponsored, or supported by a school are classified, recorded, and deposited as public funds in compliance with LEA cash handling, program accounting, and expenditure of funds policies as required by Section R277-113-5. (3) An LEAshall: (a) maintain records in sufficient detail to: (i) track individual contributions and expenditures; (ii) track overall financial outcomes; and (iii) verify compliance with relevant regulations; and (b) make records of activities available to parents, students, and donors, except as restricted by state or federal law; (4) An LEAmay establish LEAspecific rules or policies: (a) designating categories of activities or groups as provided, sponsored, or supported by the school; and (b) regarding use of facilities or LEAresources. (5) An LEA shall document their annual review of fundraising activities that support or subsidize LEA or public school-authorized clubs, activities, sports, classes, or programs to determine if the activities are provided, sponsored, or supported by a school. (6)(a) An LEAmay enter into contractual agreements to allow for fundraising and use of LEAfacilities. (b) An agreement under Subsection (6)(a) shall take into consideration the LEA's fiduciary responsibility for the management and use of public funds, resources, and assets. (c) An LEAshall review an agreement under Subsection (6)(a) with the LEA's insurer or legal counsel to consider risk to the LEA. (7) An LEAshall comply with this Subsection (7) for any activity not provided, sponsored, or supported by a school: (a) an LEAshall conduct transactions at arm's length; (b) an LEAmay not co-mingle revenue and expenditures with public funds; and UTAH STATE BULLETIN, October 01, 2026, Vol. 2026, No. 19 81 NOTICES OF PROPOSED RULES (c) a public school employee may only provide educational services outside of the employee's regular employment consistent with Rule R277-107. R277-113-10. LEAPolicies and Compliance with State and Federal Law. (1) An LEAis responsible to ensure that its policies comply with the following: (a) Utah ConstitutionArticle X, Section 3; (b) Title 63G, Chapter 6a, Utah Procurement Code; (c) Title 51, Chapter 4, Deposit of Funds Due State; (d) Title 67, Chapter 16, Utah Public Officers' and Employees' EthicsAct; (e) Family Educational Rights and PrivacyAct, 20 U.S.C. 1232g; (f) Title 63G, Chapter 2, Government RecordsAccess and ManagementAct; (g) Title 53G, Chapter 7, Part 5, Student Fees; (h) Title 53G, Chapter 7, Part 6, Textbook Fees; (i) Section 53E-3-403, Establishment of Public Education Foundations; (j) Title 53G, Chapter 7, Part 7, Student ClubsAct; (k) Title 51, Chapter 2a,Accounting Reports from Political Subdivisions, Interlocal Organizations, and Other Local EntitiesAct; (l) Additional state legal compliance guides for operating LEAs and non-operating LEAs as published by the office of the state Auditor; (m) Subsection 51-7-3(26), Definition of Public Funds; (n) Title 53G, Chapter 7, Part 4, InternalAudits; (o) Rule R277-407, School Fees; (p) Rule R277-107, Educational Services Outside of Educator's Regular Employment; (q) Rule R277-217, Utah Educator Standards; (r) Rule R277-605, Coaching Standards andAthletic Clinics; (s) Rule R123-5,Audit Requirements forAudits of Political Subdivisions and Governmental Nonprofit Corporations; and (t) 2 CFR. 200, UniformAdministrative Requirements, Cost Principles, andAudit Requirements for FederalAwards (2020). (2) An LEAshall include the following requirements of Title IX in LEApolicies: (a) Fundraising shall equitably benefit males and females; (b) Males and females shall have reasonably equal access to facilities, fields, and equipment; (c) School sponsored activities shall be reasonably equal for males and females. R277-113-11. LEARecordkeeping for Flexible Use of Restricted Funds. (1) An LEAmay reallocate funds for flexible uses as described in Section 53F-2-209. (2) An LEA that makes flexible adjustments as described in Subsection (1) shall report accounting transactions and adjust entries utilizing the Board approved chart of accounts, including: (a) a dedicated program code; (b) dedicated other financing codes for program transfers of state restricted funds; and (c) expenditure details, if applicable. (3) An LEAthat makes flexible adjustments under this section shall ensure that the LEAcontinues to meet: (a) federal maintenance of effort requirements; and (b) otherstateorfederalrequirementson restrictedfunding,including requirementsfor program-specific effort,matching,andequity. (4) The Superintendent shall publish online a list of eligible state restricted programs meeting requirements of Section 53F-2-209 no later than May 30 of each year. R277-113-12. Applicability to the Utah Schools for the Deaf and the Blind. The Utah Schools for the Deaf and the Blind shall comply with: (1) Subsection R277-113-5(9)(f); (2) Section R277-113-9; (3) Section R277-113-10; and (4) Section R277-113-11. KEY: school sponsored activities, public funds, fiscal policies and procedures, audit committee Date of Last Change: 2026[July 8, 2025] Notice of Continuation: September 9, 2021 Authorizing, and Implemented or Interpreted Law: Art X, Sec 3; 53E-3-401(4); 53E-3-501(1)(e) NOTICE OF SUBSTANTIVE CHANGE TYPE OF FILING: Amendment Filing ID: 58239