HB 671: Regards school districts that challenge foundation funding
The state of Ohio will enact a new law regarding school districts and their foundation funding. This law creates a new section in the revised code that outlines the withholding of state foundation funding for school districts involved in a legal action against the state. School districts that bring a legal action against the state to challenge the calculation and distribution of foundation funding will have their state foundation funding withheld. The withheld funds will be transferred into a new state escrow fund. The withheld funds will only be released to the school district when the legal action is terminated or the district withdraws from the action. The state escrow fund will be administered by the department of education and workforce. During fiscal years 2026 and 2027, the director of education and workforce will certify the amounts necessary to make payments from the state escr…
| Feb. 04, 2026 | Referred to committee: Finance |
| Feb. 03, 2026 | Introduced |
As Introduced
136th General Assembly
Regular Session
2025-2026
H. B. No. 671
Representative Callender
To enact section 3317.50 of the Revised Code regarding school districts that bring a legal action against the state challenging the calculation and distribution of foundation funding and to make an appropriation.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section 1.
That section 3317.50 of the Revised Code be enacted to read as follows:
Sec. 3317.50. The department of education and workforce shall withhold state foundation funding calculated under this chapter for any school district that is a complainant or a member of a complainant in a legal action against the state that challenges or otherwise seeks to change, invalidate, or declare void the calculation or distribution, or both, of foundation funding under this chapter, including funding for state scholarship programs as defined in section 3301.0711 of the Revised Code. The department shall certify the amount of withheld funds to the director of budget and management. The director of budget and management shall transfer the amount certified into the state foundation funding escrow fund established under this section. The department of education and workforce shall release withheld funds to the school district
H. B. No. 671
As Introduced
Page 2
only upon the termination of the legal action or the district's withdrawal from the action.
The state foundation funding escrow fund is created in the state treasury, to consist of such amounts withheld from school districts by the department of education and workforce under this section. The fund shall be administered by the department of education and workforce.
Section 2.
During fiscal years 2026 and 2027, if the Director of Education and Workforce is required to release withheld funds under section 3317.50 of the Revised Code, the Director shall certify to the Director of Budget and Management the amounts necessary to make payments under that section from the State Foundation Funding Escrow Fund. The amounts certified are hereby appropriated.
Section 3.
Within the limits set forth in this act, the Director of Budget and Management shall establish accounts indicating the source and amount of funds for each appropriation made in this act, and shall determine the manner in which appropriation accounts shall be maintained. Expenditures from operating appropriations contained in this act shall be accounted for as though made in, and are subject to all applicable provisions of, H.B. 96 of the 136th General Assembly.