Article 7. Disposition Of Records, Funds, Property, And Obligations When Reorganized of California Education Code >> Division 3. >> Title 2. >> Part 21. >> Chapter 3. >> Article 7.

When a school district is reorganized, both of the following shall apply:
  (a) When the allocation of funds, property, and obligations is not fixed by terms, conditions, or recommendations as provided by law, the funds, property, and obligations of a former district, except for bonded indebtedness, shall be allocated as follows:
  (1) The real property and personal property and fixtures normally situated thereat shall be the property of the district in which the real property is located.
  (2) All other property, funds, and obligations, except bonded indebtedness, shall be divided pro rata among the districts in which the territory of the former district is included. The basis for the division and allocation shall be the assessed valuation of the part of the former district which is included within each of the districts.
  (b) Any qualified special taxes may continue to be imposed pursuant to Section 50079.2 of the Government Code.

Any funds derived from the sale of the school bonds issued by the former district shall be used for the acquisition, construction, or improvement of school property only in the territory which comprised the former district or to discharge bonded indebtedness of the former district, except that if the bonded indebtedness is assumed by the new district, the funds may be used in any area of the new district for the purposes for which the bonds were originally voted.

If all the territory of any school district becomes part of two or more districts of any type, and the inclusion in the two or more new school districts of the several portions of territory comprising the whole of the original district is effective for all purposes on the same date, the records of the original district shall be disposed of as follows:
  (a) All records of the original district which are required by law to be kept on file shall be deposited with the governing board of the district which, after the reorganization has become effective for all purposes, has located within its boundaries the former office of the superintendent of the original district.
  (b) Records of employees shall be transferred to the district thereafter employing the personnel or thereafter maintaining the last place of employment.
  (c) Records of pupils shall be transferred to the district which, after the date on which the reorganization becomes effective for all purposes, maintains the school in which a pupil was last enrolled.

(a) If all of the territory of any school district becomes part of two or more school districts of any type, and the inclusion in the two or more new school districts of the several portions of territory comprising the original district is effective for all purposes on the same date, the county superintendent of schools having jurisdiction over the original district shall assume responsibility for all of the following:
  (1) Completing all records and reports of the original district.
  (2) Paying all outstanding obligations, except obligations resulting from contracts which are to be assumed by a succeeding district.
  (3) Preparing for proper filing all records of the district required to be kept permanently by the provisions of any applicable code.
  (4) Distributing records as provided in Section 35562.
  (5) Employing an auditor as required in Section 41020.
  (6) Discharging such other functions as he or she shall deem necessary to the dissolution of the district.
  (b) In discharging these duties, the county superintendent may request the services of employees of the original or succeeding district, and the succeeding districts shall release such employees to the county superintendent for the purpose of accomplishing the requirements of this section. The salaries of such employees and all other necessary expenses of completing the requirements of this section shall be charged against the accumulated funds of the dissolved district prior to the final distribution of such funds to the succeeding districts.

If the reorganization of a school district under this chapter results in the relocation of district boundaries so that a portion of the pupils will not be residents of the district thereafter maintaining a school previously attended by the pupils, and if there is in the school an organized student body, the property, funds, and obligations of the student body shall be divided as determined by the county committee, except that the share shall not exceed an amount equal to the ratio which the number of pupils leaving the school bears to the total number of pupils enrolled. The ownership of the property, funds, and obligations, which is the proportionate share of each segment of the student body, shall be transferred to the student body of the school or schools in which the pupils are enrolled after the reorganization. Funds from devises, bequests, or gifts made to the organized student body of a school shall remain the property of the organized student body of that school and shall not be divided.

If a dispute arises between the governing boards of the districts concerning the division of funds, property, or obligations, a board of arbitrators shall be appointed which shall resolve the dispute. The board shall consist of one person selected by each district from which territory is withdrawn pursuant to a reorganization action under this chapter, one person selected by each district of which territory has become a part pursuant to that reorganization action, and either one or two persons, such that the board of arbitrators contains an odd number of persons, appointed by the county superintendent of schools of the county in which the districts are located. The districts involved may mutually agree that a person appointed as arbitrator by the county superintendent of schools may act as sole arbitrator of the matters to be submitted to arbitration. The necessary expenses and compensation of the arbitrators shall be divided equally between the districts, and the payment of the portion of the expenses is a legal charge against the funds of the school districts. The arbitrator or arbitrators shall make a written finding on the matter submitted to arbitration. The written finding and determination of a majority of the board of arbitrators is final and binding upon the school districts submitting the question to the board of arbitration.

Notwithstanding any provisions of this article, exchanges of property tax revenues between school districts as a result of reorganization shall be determined pursuant to subdivision (i) of Section 99 of the Revenue and Taxation Code if one or more affected school districts receive only basic aid apportionments required by Section 6 of Article IX of the California Constitution.