Full course description
A district must ensure all their employees who are required to administer district funds, are adequately bonded. KRS 160.560 (1) requires each board of education to elect a treasurer. The statute also requires the treasurer to execute an official bond for the faithful performance of the duties of their office. The amount of the bond is established by section 2 of the statute stating “…shall be in an amount determined by the board of education in accordance with the administrative regulations promulgated by the Kentucky Board of Education." Further, 702 KAR 3:080, expands the requirement beyond the treasurer, requiring the bond to be submitted to Kentucky Department of Education and establishes minimum bond amounts based upon an exposure factor.
The following are necessary steps to obtain approval of the Fidelity Bond by the commissioner of the KDE. This information is due to KDE by July 1 of each year:
1. The district determines the employees whom they will be bonding in accordance with KRS 160.560 (2) and 702 KAR 3:080 Section 2 (1). The amount of the bond is determined by the Revised Exposure Schedule defined in Section 4 of 702 KAR 3:080. The schedule determines the minimum amount of the bond according to an “Exposure Factor". KDE provides the “Exposure Factor" for each district in a report entitled Exposure Calculation Report. This report is placed on KDE's Fidelity Bond webpage (just below this paragraph) each year by the end of April. It is the responsibility of the district to check this report for any changes in the exposure calculation and adjust the amount of the bond required for their district employees.
2. By July 1 of each year, the treasurer, and any other employees responsible for the district funds, shall execute an official fidelity bond for the faithful performance of the duties of his/her office to be approved by the district's local board and the commissioner of education. The bond shall be guaranteed by a surety company authorized to conduct business in the state of Kentucky and shall be in an amount determined by the board of education in accordance with the administrative regulations promulgated by the Kentucky Board of Education. A copy of the bond shall be filed with the board of education, with the information contained within the bond, submitted electronically through KDE's web-based system for approval with the commissioner of education. No fidelity bond shall be approved which, in the opinion of the commissioner of education, is inadequate to safeguard the funds of the local board of education. The premium shall be paid by the local board of education.
3. Once steps 1 and 2 are completed, information from the Fidelity Bond must be entered online at the following link to complete the SEEK web-based form for completion of the process for KDE.