Brief ⁽¹⁾

SB 161 pertains to school district use of credit cards and acceptance of the use of credit or debit cards.

School District Purchases. School district boards are authorized to adopt a policy which provides for the acquisition of credit cards in the name of the school district for use by its designated officers and employees. The policy must prescribe limitations and restrictions on the use of these cards and on the amounts and categories of expenses which may be paid with them. The policy must also establish a special fund from which expenditures for payment of charges incurred by school districts' use of credit cards would be made, authorize a district officer or employee to administer the special fund, and designate the amount of money to be maintained in the fund.

Provisions of the cash basis and budget laws are not to be applied so as to prevent the policy in this bill from being effective.

The school district's policy must assure compliance with provisions of law regarding purchases of products and services offered by the Blind Division and Rehabilitation Services and Rehabilitation Facilities. If the State Board of Education finds that the school district has repeatedly and willfully violated these purchasing requirements, it will suspend the district's authority to use the credit card for a period of 12 months, beginning July 1 following the violations.

School District Collection of Fees, Tuition, or Other Charges. School district boards also are authorized to adopt a policy for accepting payment by credit or debit card of fees, tuition, or other charges imposed by the school district. The policy may include an additional fee to recover the actual costs the district incurs in connection with this payment method. The policy also may provide for secure Internet sockets to allow payment by credit or debit card through the Internet.

Transactions under this bill are exempt from KSA 16a-2-403, which contains a prohibition on credit card surcharges.

Effective Date. The bill becomes effective upon publication in the Kansas Register.

Background

SB 161 includes two concepts that were contained separately in SB 157 and SB 158.

The Deputy Superintendent of DeSoto (USD 232), the Executive Director of Business and Finance of Blue Valley (USD 229), and the Associate Superintendent of Piper (USD 203) presented testimony in support of the bill. These amendments make it clear that school districts legally may use credit cards to make purchases and accept credit or debit card payments for charges a district imposes. The conferees explained that use of credit cards would shorten the time between identifying an item to be purchased and when the item becomes available for use. Further, some discount suppliers are unwilling to accept purchase orders or to bill school districts periodically. Also, it was stated that it is very difficult for school personnel to travel in relation to their duties as many hotels, motels, and airlines will book only on a credit card.

The Kansas Association of School Boards expressed support for the bill. A spokesperson for Envision suggested amendments to ensure that the measure does not have the effect of permitting school districts to circumvent requirements pertaining to purchase of products from the Kansas Industries for the Blind Division and Rehabilitation Services or rehabilitation facilities. Written correspondence on behalf of American Express, among other things, urged removal of language that requires a school district to impose an additional fee to recover actual amounts of costs incurred by a school district in connection with accepting credit card payments. (A Committee amendment made this provision permissive rather than mandatory.)

The fiscal note on SB 161 indicates that the measure would have no impact on the State Department of Education.

Senate Education Committee amendments removed several of the procedural requirements contained in the bill, as introduced, but retained the bill's main concepts.

House E-Government Committee amendments inserted the bill's original language establishing a special fund from which expenditures for payment of charges incurred by school districts' use of credit cards would be made, and added wording specifying that a school district's violation of the provisions of KSA 75-3317 through 75-3322 would result in a suspension of that district's use of credit cards. It was explained that the amendments were designed to ensure that school districts would closely examine from whom they make purchases.

1. *Supplemental notes are prepared by the Legislative Research Department and do not express legislative intent. The supplemental note and fiscal note for this bill may be accessed on the Internet at http://www.ink.org/public/legislative/fulltext.cgi