US Laws, Codes, Statutes & Cases

Chapter 294 — County and Municipal Financial Administration

 

2007 EDITION

 

MUNICIPAL FINANCIAL ADMINISTRATION

 

PUBLIC FINANCIAL ADMINISTRATION

 

GENERAL PROVISIONS

 

294.004     Definitions

 

COUNTY AND MUNICIPAL FINANCIAL ADMINISTRATION

 

(Generally)

 

294.005     Definitions for ORS 294.005 to 294.025

 

294.010     Surrender of warrants upon payment

 

294.015     Payment on lost, stolen or destroyed warrants upon affidavit of owner, payee or representative

 

294.025     Effect of wrongful payment; liability of officer

 

294.027     Provisions relating to warrants and payment of claims

 

294.028     Payment of warrants by depository

 

294.029     Provisions of ORS 294.027 and 294.028 not mandatory

 

294.030     Deductions for bonds from compensation of municipal and other employees; purchasing bonds in advance

 

294.033     Investment of deferred compensation funds

 

294.035     Investment of surplus funds of political subdivisions; approved investments

 

294.040     Restriction on investments under ORS 294.035

 

294.046     List of approved securities for investment under ORS 294.035; distribution

 

294.047     Loss of principal on liquidation of investments

 

294.048     Borrowing money when premature withdrawal or liquidation of certain investments would cause loss

 

294.050     County borrowing money from county general road fund

 

294.052     Definitions; investment by municipality of proceeds of bonds

 

294.053     Investment by county in master warrants of county

 

294.055     Use by counties of moneys received from federal government under the Mineral Leasing Act

 

294.060     Apportionment of moneys received by counties from federal forest reserves to road and school funds

 

294.065     Use by counties of moneys received from federal government under the federal Flood Control Act

 

294.070     Expenditure of Taylor Grazing Act funds; advisory board

 

294.080     Disposition of interest earned on funds held by county treasurer

 

294.085     Examining books and papers of county officers

 

294.090     County orders and vouchers to be numbered to correspond to warrants drawn

 

294.095     Action or proceeding with respect to budget or levy; fiscal year with respect to which taken

 

294.100     Public official expending money in excess of amount or for different purpose than provided by law unlawful; civil liability

 

294.120     Use of facsimile signatures

 

294.125     Investment of funds authorized by order of governing body; limitations

 

294.135     Investment maturity dates

 

294.145     Prohibited conduct for custodial officer

 

294.155     Annual audit report; monthly report

 

294.160     Opportunity for public comment on new fee or fee increase

 

COUNTY ASSESSMENT FUNDING ASSISTANCE PROGRAM

 

294.175     Definitions; county expenditures for assessment; determination of adequacy; certification of adequacy; appeal of denial of certification; effect of certification

 

294.178     Assessment grant to county; determination of grant amount

 

294.181     Alternative method for certification

 

294.184     County Assessment Function Funding Assistance Account; sources; purpose

 

294.187     County Assessment and Taxation Fund; sources; purpose

 

PUBLICATION OF FINANCIAL REPORTS

 

294.250     Publication by county governing body of schedule of expenditures and statement of proceedings; manner of publication; notice

 

LOCAL BUDGET LAW

 

294.305     Sections constituting Local Budget Law

 

294.311     Definitions for ORS 294.305 to 294.565

 

294.316     Application

 

294.321     Purposes

 

294.323     Budget period

 

294.326     Compliance with Local Budget Law required prior to expenditure or tax certification; exceptions

 

294.331     Budget officer

 

294.336     Budget committee

 

294.341     Governing body of certain municipal corporations to be budget committee; exception

 

294.352     Estimates of expenditures required; form and contents

 

294.356     Preparation of estimates by school, education service and community college districts and by municipal corporations operating public utility or hospital

 

294.361     Contents of estimate of budget resources

 

294.366     Reserving receipts from revenue-producing property or facility; deposit in special fund

 

294.371     Estimate of unappropriated ending fund balance for each fund

 

294.376     Expenditure and resource estimate sheets; made part of budget document

 

294.381     Determination of estimated tax revenues

 

294.386     Financial summary

 

294.391     Budget message

 

294.396     Time of making budget message and document

 

294.401     Budget committee meeting; distribution of budget message and document; copies of document to be available

 

294.406     Budget committee hearings; approval of budget document

 

294.411     Submission of budget document to tax supervising and conservation commission in certain cases prior to publication and approval by budget committee

 

294.413     Format for notices and summaries

 

294.416     Publication of budget summary, financial summary, statement of accounting basis and notices of meeting and availability of budget document

 

294.418     Alternative budget publication procedure

 

294.421     Manner of publication; alternative requirements in certain cases

 

294.425     Sufficiency of publication of budget documents; notice to governing body and assessor of publication error

 

294.430     Hearing by governing body on budget document as approved by budget committee; alternative procedure in certain cases

 

294.435     Governing body to adopt budget, make appropriations, declare and categorize property tax amount or rate; greater tax, encumbrance or expenditure limited; exception

 

294.437     Local option tax approved after adoption of budget; supplemental budget

 

294.440     School or community college district expending federal or state funds in emergency

 

294.443     Certain interest to be included in budget; method

 

294.445     Basis of accounting used by municipal corporation; change of basis

 

294.447     Inclusions in accrued revenues of school districts, education service districts, community college districts and community college service districts using accrual basis of accounting; State School Fund grant calculations

 

294.450     Transfers of appropriations within fund or from one fund to another; appropriation of pass-through revenues

 

294.455     Authorization to expend or borrow moneys after destruction of property or natural disaster; authorization by chief executive officer to protect public health or safety

 

294.460     Loans from one fund to another; commingling cash balances of funds

 

294.470     Internal service funds

 

294.475     Elimination of unnecessary fund; disposition of balance

 

294.480     Supplemental budget in certain cases; no increase in property taxes permitted

 

294.483     Supplemental budget not required in certain cases

 

294.485     Tax certification contrary to law voidable by Oregon Tax Court; appeal procedure

 

294.490     Department of Revenue not to interfere with fiscal policy of municipal corporation

 

294.495     Department of Revenue to construe Local Budget Law; rules

 

294.500     Declaratory ruling by Department of Revenue as to its rules under Local Budget Law

 

294.505     Division of Audits to issue notification of budgetary irregularities; Department of Revenue to advise municipal corporation of correct procedures

 

294.510     Order for revision of budgetary procedures; enforcement

 

294.515     Appeal by municipal corporation from Department of Revenue order

 

294.520     Priority of appeals under Local Budget Law

 

294.525     Reserve fund established without vote; review of need for reserve fund; unexpended balances; application to system development charges

 

294.555     Filing copy of budget and certain documents with county assessor and Department of Revenue

 

294.565     Failure to file copy of required budget, reports or other documents; effect

 

TAX SUPERVISING AND CONSERVATION COMMISSION

 

294.605     Definitions for ORS 294.605 to 294.705

 

294.608     Populous counties; commission establishment or financial summary publication

 

294.610     Tax supervising and conservation commission; members; appointment; qualifications; term; removal; filling vacancies

 

294.615     Oath of commissioner

 

294.620     Office of commission; employment and compensation of assistants

 

294.625     Jurisdiction of commission

 

294.630     Tax supervising and conservation commission account

 

294.635     Submission of budget estimates by levying boards

 

294.640     Hearing on budget

 

294.645     Consideration of budget by commission; certifying objections or recommendations to levying board; procedure where municipality holds hearing in place of commission

 

294.650     Striking unauthorized items from budget; reducing total amount to within limits permitted by law and Constitution

 

294.655     Hearing on special tax levies and bond issues proposed for elector approval

 

294.660     Compiling information as to indebtedness; including in annual report

 

294.665     Levying board to submit audit report or financial statements annually

 

294.670     Commission may inquire into management, books and systems; rules

 

294.675     Calling joint meetings of levying boards

 

294.680     Certifying excessive or unauthorized expenditures to district attorney; action by district attorney

 

294.685     Annual report by commission

 

294.690     Records and files of commission open to public inspection

 

294.695     Attorney General as legal advisor and counsel to commission

 

294.700     Proceedings to collect penalties

 

294.705     Tax supervising and conservation fund

 

294.710     Procedures for establishing commission; annual appropriations

 

LOCAL GOVERNMENT EMPLOYER BENEFIT TRUST FUND

 

294.725     Definitions for ORS 294.725 to 294.755

 

294.730     Fund created; State Treasurer as custodian; use of moneys; distribution of earnings

 

294.735     Payments to fund by political subdivisions; benefit cost rate determinations; effect of negative balance; refunds

 

294.740     Refund of account balances; payment of deficits; erroneous benefit payments

 

294.745     Analysis of fund receipts and expenditures; report to Legislative Assembly

 

294.750     Experience and liability of successor political subdivisions; unpaid assessment

 

294.755     Payment on quarterly basis; remedies for collection

 

LOCAL GOVERNMENT INVESTMENT POOL

 

294.805     Definitions for ORS 294.805 to 294.895

 

294.810     Local governments authorized to place limited funds in pool

 

294.815     Period of investments; withdrawal of funds

 

294.820     Establishment of investment pools by intergovernmental agreement; conditions; powers

 

294.825     State Treasurer as investment officer; bond; employment of personnel; rules

 

294.831     Investment objective; limit on maturity dates

 

294.835     Standard of care; investment in certain stocks prohibited

 

294.840     Investment policies; review; separate policies for individual public bodies

 

294.845     Investment officer to invest, reinvest pool funds

 

294.847     Prohibited conduct for investment officer

 

294.850     Contracts with persons to perform investment functions; compensation; bond

 

294.855     Legal opinions; investment counseling services; mortgage services

 

294.860     Custody of investment documents; collection of income; distribution to local governments; calculation and allocation of profit and loss; defaulted payments of principal and interest, collection, compromise

 

294.865     Monthly deductions from income received for payment of expenses

 

294.870     Separate accounts for local governments; reports on investment changes and monthly financial statements required

 

294.875     Monthly report of investments of pool funds; distribution

 

294.880     Program examination and audit; report; distribution

 

294.882     Merger or subsequent separation of local government investment pool and state investment fund; preconditions

 

294.885     Oregon Short Term Fund Board; members; appointment; term; vacancies

 

294.890     Board members serve without compensation; selection of chairperson

 

294.895     Board duties, generally

 

COUNCILS OF GOVERNMENTS

 

294.900     “Council of governments” defined

 

294.905     Budget committee; membership; term; vacancies; officers; meetings to be public

 

294.910     Estimates of expenditures; organization and format; matters to be included

 

294.915     Notice of budget committee meeting; public availability of documents

 

294.920     Hearing on budget document

 

294.925     Supplemental budget; conditions; term; publication

 

294.930     Authority of Department of Revenue; budget records maintained by council of governments

 

MISCELLANEOUS

 

294.950     County revenue sharing with cities

 

294.960     Collection and disposition of amounts due counties

 

PENALTIES

 

294.990     Penalties

 

GENERAL PROVISIONS

 

      294.004 Definitions. For the purposes of this chapter, unless the context requires otherwise:

      (1) “Local government” means any county, municipality, political subdivision or school district.

      (2) “Custodial officer” means the officer having custody of the funds of any county, municipality, political subdivision or school district.

      (3) “Deferred compensation plan” means a plan, established by any employer that is a county, municipality, political subdivision or school district, that has as its purposes the deferral of compensation to employees of such employer and the deferral of income taxation on such deferred compensation.

      (4) “Deferred employee compensation” means funds under an agreement providing for payment at a future date by a municipal corporation for services currently rendered by an eligible employee in fixed or variable amounts for life or for a guaranteed number of years after retirement or termination of employment.

      (5) “Nationally recognized statistical rating organization” has the meaning given that term in Rule 15c3-1 under the Securities Exchange Act of 1934, as amended.

      (6) “Surplus funds” means all funds that are not pension funds and that are not required for immediate expenditure. [1975 c.359 §2; 1977 c.470 §1; subsection (4) enacted as 1977 c.102 §1; 1995 c.245 §1; 1997 c.179 §25]

 

COUNTY AND MUNICIPAL FINANCIAL ADMINISTRATION

 

(Generally)

 

      294.005 Definitions for ORS 294.005 to 294.025. As used in ORS 294.005 to 294.025, unless the context requires otherwise:

      (1) “Warrant” means a warrant issued by a subdivision.

      (2) “Subdivision” means any county, municipal corporation, quasi-municipal corporation, or civil or political subdivision in this state.

 

      294.010 Surrender of warrants upon payment. Subject to ORS 294.015, no warrant issued by a subdivision shall be paid unless such warrant is surrendered and delivered to the officer charged with the payment thereof, contemporaneously with payment or prior thereto.

 

      294.015 Payment on lost, stolen or destroyed warrants upon affidavit of owner, payee or representative. A warrant may be paid without surrender or delivery thereof if the one claiming to be the lawful owner of the warrant:

      (1) Satisfies the officer by whom payment is to be made that the warrant has been lost, stolen or destroyed prior to the owner having received value therefor or having negotiated the warrant; and

      (2) Furnishes to the issuing officer a written statement signed by such person specifically alleging that the owner is the lawful owner, payee or legal representative of the lawful owner or payee of the original instrument giving the date of issue, the number, amount, for what services or claim the original instrument was issued and that the original instrument has been lost, destroyed or stolen, and has not been paid. However, if the lawful owner, payee or legal representative is (a) a bank or national bank, (b) the federal government or (c) this state or any board, department, commission or subdivision of this state, or any officer thereof in the officer’s official capacity, a certificate may be furnished in lieu of an affidavit or affirmation. The issuing officer may also, in the officer’s discretion, require the bank or national bank to furnish a satisfactory indemnity agreement executed by the bank or national bank. [Amended by 1979 c.763 §6]

 

      294.020 [Repealed by 1979 c.763 §7]

 

      294.025 Effect of wrongful payment; liability of officer. When any warrant is paid, other than as authorized by ORS 294.005 to 294.025, such wrongful payment does not relieve the political body issuing the warrant from liability to the true and lawful owner thereof. However, the officer or person making such wrongful payment and the sureties on the official bond of the officer or person, if any, shall be responsible to the political body represented by the officer or person in making such payment, for the full amount of the loss occasioned thereby. [Amended by 2005 c.22 §222]

 

      294.027 Provisions relating to warrants and payment of claims. (1) In addition to any other provisions of law for the issuance and payment of warrants of any municipal or quasi-municipal corporation or civil subdivision of this state other than school districts, the governing body thereof may by resolution authorize such practices with respect to the form, issuance, delivery, indorsement and payment of warrants as it shall deem convenient, efficient and in the public interest, conforming substantially to those specified in subsection (1) or (2) of this section or in ORS 294.028.

      (2) Such governing body may authorize the use of check-warrant forms, to be drawn by its appropriate warrant issuing officer or officers upon the custodian of its funds, so prepared that such custodian may, by subscribing a direction to the depository of such funds to pay the same to the order of the payee, convert the instrument to a check or, by subscribing an indorsement that such warrant is not paid for want of funds, convert the same to an interest-bearing warrant and such governing body may direct that such check-warrants shall not be delivered to the payees therein named until such direction or indorsement shall have been subscribed by the custodian of its funds.

      (3) Such governing body may provide that when funds are available for the payment of approved claims, the approval of claims for payment shall, without the issuance of any warrant, be authority to the custodian of its funds to pay such claims by check. [1953 c.664 §1]

 

      294.028 Payment of warrants by depository. When authorized by the governing body, any custodian of funds of any municipal or quasi-municipal corporation or civil subdivision of this state other than a school district may direct the depository of such funds to pay any warrant drawn upon such custodian upon presentment of such warrant to such depository, to the same extent and with the same effect as though such warrant were a check drawn upon such depository by such custodian. Such direction shall be in writing and shall identify by name and signature the warrant issuing officer or officers and such depository may rely upon such direction and identification in the payment of such warrants. [1953 c.664 §2]

 

      294.029 Provisions of ORS 294.027 and 294.028 not mandatory. Nothing contained in ORS 294.027 or 294.028 shall be deemed to require any municipal or quasi-municipal corporation or civil subdivision of this state or any custodian of public funds to exercise any of the powers conferred by such sections. [1953 c.664 §3]

 

      294.030 Deductions for bonds from compensation of municipal and other employees; purchasing bonds in advance. (1) The governing body of a municipal corporation, quasi-municipal corporation or civil subdivision of the state may, with the approval of the relevant employees of the municipal corporation, quasi-municipal corporation or civil subdivision, make deductions from their salaries and wages for the purpose of purchasing for them United States War Savings Bonds or other federal obligations.

      (2) The governing body shall take proper precautions for the depositing, securing and disbursing of the sums so deducted and for the delivering of all bonds or other obligations purchased.

      (3) Balances to the credit of the accounts in which the sums so deducted are deposited may be used for the purchase in advance, from the federal government or from any federal reserve bank or other authorized federal agency, of war savings bonds or other obligations of the federal government, either in blank or in inscribed form, in convenient denominations to meet the requirements of the purchasers thereof.

 

      294.033 Investment of deferred compensation funds. Funds set aside by any local government pursuant to a deferred compensation plan may be invested in any investment enumerated in ORS 294.035 and are not subject to the collateral requirements of ORS chapter 295. [1977 c.470 §3; 1997 c.179 §26; 2005 c.91 §1]

 

      294.035 Investment of surplus funds of political subdivisions; approved investments. (1) Subject to ORS 294.040 and 294.135 to 294.155, the custodial officer may invest any sinking fund, bond fund or surplus funds in the custody of the custodial officer in the bank accounts, classes of securities at current market prices, insurance contracts and other investments listed in this section, but only after obtaining from the governing body of the county, municipality, political subdivision or school district a written order that has been entered in the minutes or journal of the governing body.

      (2) This section does not:

      (a) Limit the authority of the custodial officer to invest surplus funds in other investments when the investment is specifically authorized by another statute.

      (b) Apply to a sinking fund or a bond fund established in connection with conduit revenue bonds issued by a county, municipality, political subdivision or school district for private business entities or nonprofit corporations.

      (3) Investments authorized by this section are:

      (a) Lawfully issued general obligations of the United States, the agencies and instrumentalities of the United States or enterprises sponsored by the United States Government.

      (b) Lawfully issued debt obligations of the agencies and instrumentalities of the State of Oregon and its political subdivisions that have a long-term rating of A or an equivalent rating or better or are rated on the settlement date in the highest category for short-term municipal debt by a nationally recognized statistical rating organization.

      (c) Lawfully issued debt obligations of the States of California, Idaho and Washington and political subdivisions of those states if the obligations have a long-term rating of AA or an equivalent rating or better or are rated on the settlement date in the highest category for short-term municipal debt by a nationally recognized statistical rating organization.

      (d) Time deposit open accounts, certificates of deposit and savings accounts in insured institutions as defined in ORS 706.008, in credit unions as defined in ORS 723.006 or in federal credit unions, if the institution or credit union maintains a head office or a branch in this state.

      (e) Share accounts and savings accounts in credit unions in the name of, or for the benefit of, a member of the credit union pursuant to a plan of deferred compensation.

      (f) Fixed or variable life insurance or annuity contracts as defined by ORS 731.170 and guaranteed investment contracts issued by life insurance companies authorized to do business in this state.

      (g) Trusts in which deferred compensation funds from other public employers are pooled, if:

      (A) The purpose is to establish a deferred compensation plan;

      (B) The trust is a public instrumentality of such public employers and described in section (2)(b) of the Investment Company Act of 1940, 15 U.S.C. 80a-2(b), as amended, in effect on September 20, 1985, or the trust is a common trust fund described in ORS 709.170;

      (C) Under the terms of the plan the net income from or gain or loss due to fluctuation in value of the underlying assets of the trust, or other change in such assets, is reflected in an equal increase or decrease in the amount distributable to the employee or the beneficiary thereof and, therefore, does not ultimately result in a net increase or decrease in the worth of the public employer or the state; and

      (D) The fidelity of the trustees and others with access to such assets, other than a trust company, as defined in ORS 706.008, is insured by a surety bond that is satisfactory to the public employer, issued by a company authorized to do a surety business in this state and in an amount that is not less than 10 percent of the value of such assets.

      (h)(A) Banker’s acceptances, if the banker’s acceptances are:

      (i) Guaranteed by, and carried on the books of, a qualified financial institution;

      (ii) Eligible for discount by the Federal Reserve System; and

      (iii) Issued by a qualified financial institution whose short-term letter of credit rating is rated in the highest category by one or more nationally recognized statistical rating organizations.

      (B) For the purposes of this paragraph, “qualified financial institution” means:

      (i) A financial institution that is located and licensed to do banking business in the State of Oregon; or

      (ii) A financial institution that is wholly owned by a financial holding company or a bank holding company that owns a financial institution that is located and licensed to do banking business in the State of Oregon.

      (C) A custodial officer shall not permit more than 25 percent of the moneys of a local government that are available for investment, as determined on the settlement date, to be invested in banker’s acceptances of any qualified financial institution.

      (i)(A) Corporate indebtedness subject to a valid registration statement on file with the Securities and Exchange Commission or issued under the authority of section 3(a)(2) or 3(a)(3) of the Securities Act of 1933, as amended. Corporate indebtedness described in this paragraph does not include banker’s acceptances. The corporate indebtedness must be issued by a commercial, industrial or utility business enterprise, or by or on behalf of a financial institution, including a holding company owning a majority interest in a qualified financial institution.

      (B) Corporate indebtedness must be rated on the settlement date P-1 or Aa or better by Moody’s Investors Service or A-1 or AA or better by Standard & Poor’s Corporation or equivalent rating by any nationally recognized statistical rating organization.

      (C) Notwithstanding subparagraph (B) of this paragraph, the corporate indebtedness must be rated on the settlement date P-2 or A or better by Moody’s Investors Service or A-2 or A or better by Standard & Poor’s Corporation or equivalent rating by any nationally recognized statistical rating organization when the corporate indebtedness is:

      (i) Issued by a business enter