15-1107. Litigation recovery fund; disposition of proceeds
A. Monies received for and derived from settlement of legal controversies or from recovery of costs, attorney fees or damages by a school district in litigation by or against the school district shall be deposited with the county treasurer who shall credit the deposits to the litigation recovery fund of the school district. The litigation recovery fund is a continuing fund that is not subject to reversion.
B. If a school district receives monies as provided in subsection A of this section for the purpose of replacing or repairing school buildings or other school property, the governing board, or the superintendent or chief administrative officer with the approval of the governing board, may apply the proceeds only to:
1. Reimburse the building renewal grant fund established by section 41-5731 or the emergency deficiencies correction fund established by section 41-5721 to the extent that monies were received from those funds for replacing or repairing school buildings or other school property that was the subject of the dispute and the monies recovered by the school district pursuant to subsection A of this section are designated for the replacement or repair. The school district shall prioritize the reimbursement as described in this paragraph, if applicable.
2. Pay any outstanding bonded indebtedness of the school district that is payable from the levy of taxes on property within the school district.
3. Construct, acquire, improve, repair or furnish school buildings after notice. If the proceeds are applied to a project that costs more than $250, 000, the governing board, or the superintendent or chief administrative officer with the approval of the governing board, may apply the proceeds after notice and a hearing.
4. Replace or repair the school property other than school buildings.
C. Except as provided in subsection B of this section, the governing board, or the superintendent or chief administrative officer with the approval of the governing board, may apply the proceeds of litigation recoveries to procure legal services or for the costs of litigation.