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As Introduced
136th
General Assembly
Regular
Session
S. B. No. 173
2025-2026
Senators Schaffer, Brenner
To
amend section 3311.06 of the Revised Code
regarding
school district territory annexations.
BE
IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section
1.
That
section 3311.06 of the Revised Code be amended to read as follows:
Sec.
3311.06.
(A)
As used in this section:
(1)
"Annexation" and "annexed" mean annexation for
municipal purposes under sections 709.02 to 709.37 of the Revised
Code.
(2)
"Annexed territory" means territory that has been annexed
for municipal purposes to a city served by an urban school district,
but on September 24, 1986, has not been transferred to the urban
school district.
(3)
"Urban school district" means a city school district with
an average daily membership for the 1985-1986 school year in excess
of twenty thousand that is the school district of a city that
contains annexed territory.
(4)
"Annexation agreement" means an agreement entered into
under division (F) of this section that has been approved by the
state board of education or an agreement entered into prior to
September 24, 1986, that meets the requirements of division (F) of
this section and has been filed with the state board.
(5)
"Megaproject" has the same meaning as in section 122.17 of
the Revised Code.
(B)
The territory included within the boundaries of a city, local,
exempted village, or joint vocational school district shall be
contiguous except where a natural island forms an integral part of
the district, where the state board of education authorizes a
noncontiguous school district, as provided in division (E)(1) of this
section, or where a local school district is created pursuant to
section 3311.26 of the Revised Code from one or more local school
districts, one of which has entered into an agreement under section
3313.42 of the Revised Code.
(C)(1)
When all of the territory of a school district is annexed to a city
or village, such territory thereby becomes a part of the city school
district or the school district of which the village is a part, and
the legal title to school property in such territory for school
purposes shall be vested in the board of education of the city school
district or the school district of which the village is a part.
(2)
When
Except
as provided in division (C)(3) of this section, when
the
territory so annexed to a city or village comprises part but not all
of the territory of a school district, the said territory becomes
part of the city school district or the school district of which the
village is a part only upon approval by the state board of education,
unless the district in which the territory is located is a party to
an annexation agreement with the city school district.
Any
urban school district that has not entered into an annexation
agreement with any other school district whose territory would be
affected by any transfer under this division and that desires to
negotiate the terms of transfer with any such district shall conduct
any negotiations under division (F) of this section as part of
entering into an annexation agreement with such a district.
Any
school district, except an urban school district, desiring state
board approval of a transfer under this division shall make a good
faith effort to negotiate the terms of transfer with any other school
district whose territory would be affected by the transfer. Before
the state board may approve any transfer of territory to a school
district, except an urban school district, under this section, it
must receive the following:
(a)
A resolution requesting approval of the transfer, passed by at least
one of the school districts whose territory would be affected by the
transfer;
(b)
Evidence determined to be sufficient by the state board to show that
good faith negotiations have taken place or that the district
requesting the transfer has made a good faith effort to hold such
negotiations;
(c)
If any negotiations took place, a statement signed by all boards that
participated in the negotiations, listing the terms agreed on and the
points on which no agreement could be reached.
(3)
Except as provided in division (C)(4) of this section, when the
territory so annexed to a city comprises part but not all of the
territory of a school district, such territory becomes a part of the
city school district serving the annexing city if all of the
following apply:
(a)
A majority of the annexing city's residents live in the city school
district serving that city.
(b)
The annexed territory is located in an unincorporated area in a
county in which a megaproject is located.
(c)
The school district from which the territory is being annexed objects
to the acceptance of students for any new homes constructed within
the annexed area.
Transfers
of territory under division (C)(3) of this section occur without the
approval of the city school district serving the annexing city or the
state board of education and take effect for the school year
following the annexation.
(4)
Division (C)(3) of this section does not apply to annexations of
territory that meet both of the following:
(a)
The annexed territory is fully subdivided and approved by all
applicable city and county agencies for residential property.
(b)
At least twenty per cent of the annexed territory consists of
regularly occupied, fully constructed houses that have been
transferred from the builder to individuals in arm's length
transactions.
(D)
The state board of education shall adopt rules governing negotiations
held by any school district except an urban school district pursuant
to division (C)(2) of this section. The rules shall encourage the
realization of the following goals:
(1)
A discussion by the negotiating districts of the present and future
educational needs of the pupils in each district;
(2)
The educational, financial, and territorial stability of each
district affected by the transfer;
(3)
The assurance of appropriate educational programs, services, and
opportunities for all the pupils in each participating district, and
adequate planning for the facilities needed to provide these
programs, services, and opportunities.
Districts
involved in negotiations under such rules may agree to share revenues
from the property included in the territory to be transferred,
establish cooperative programs between the participating districts,
and establish mechanisms for the settlement of any future boundary
disputes.
(E)(1)
If territory annexed after September 24, 1986, is part of a school
district that is a party to an annexation agreement with the urban
school district serving the annexing city, the transfer of such
territory shall be governed by the agreement. If the agreement does
not specify how the territory is to be dealt with, the boards of
education of the district in which the territory is located and the
urban school district shall negotiate with regard to the transfer of
the territory which shall be transferred to the urban school district
unless, not later than ninety days after the effective date of
municipal annexation, the boards of education of both districts, by
resolution adopted by a majority of the members of each board, agree
that the territory will not be transferred and so inform the state
board of education.
If
territory is transferred under this division the transfer shall take
effect on the first day of July occurring not sooner than ninety-one
days after the effective date of the municipal annexation. Territory
transferred under this division need not be contiguous to the
district to which it is transferred.
(2)
Territory annexed prior to September 24, 1986, by a city served by an
urban school district shall not be subject to transfer under this
section if the district in which the territory is located is a party
to an annexation agreement or becomes a party to such an agreement
not later than ninety days after September 24, 1986. If the district
does not become a party to an annexation agreement within the
ninety-day period, transfer of territory shall be governed by
division (C)(2) of this section. If the district subsequently becomes
a party to an agreement, territory annexed prior to September 24,
1986, other than territory annexed under division (C)(2) of this
section prior to the effective date of the agreement, shall not be
subject to transfer under this section.
(F)
An urban school district may enter into a comprehensive agreement
with one or more school districts under which transfers of territory
annexed by the city served by the urban school district after
September 24, 1986, shall be governed by the agreement. Such
agreement must provide for the establishment of a cooperative
education program under section 3313.842 of the Revised Code in which
all the parties to the agreement are participants and must be
approved by resolution of the majority of the members of each of the
boards of education of the school districts that are parties to it.
An agreement may provide for interdistrict payments based on local
revenue growth resulting from development in any territory annexed by
the city served by the urban school district.
An
agreement entered into under this division may be altered, modified,
or terminated only by agreement, by resolution approved by the
majority of the members of each board of education, of all school
districts that are parties to the agreement, except that with regard
to any provision that affects only the urban school district and one
of the other districts that is a party, that district and the urban
district may modify or alter the agreement by resolution approved by
the majority of the members of the board of that district and the
urban district. Alterations, modifications, terminations, and
extensions of an agreement entered into under this division do not
require approval of the state board of education, but shall be filed
with the board after approval and execution by the parties.
If
an agreement provides for interdistrict payments, each party to the
agreement, except any school district specifically exempted by the
agreement, shall agree to make an annual payment to the urban school
district with respect to any of its territory that is annexed
territory in an amount not to exceed the amount certified for that
year under former section 3317.029 of the Revised Code as that
section existed prior to July 1, 1998; except that such limitation of
annual payments to amounts certified under former section 3317.029 of
the Revised Code does not apply to agreements or extensions of
agreements entered into on or after June 1, 1992, unless such
limitation is expressly agreed to by the parties. The agreement may
provide that all or any part of the payment shall be waived if the
urban school district receives its payment with respect to such
annexed territory under former section 3317.029 of the Revised Code
and that all or any part of such payment may be waived if the urban
school district does not receive its payment with respect to such
annexed territory under such section.
With
respect to territory that is transferred to the urban school district
after September 24, 1986, the agreement may provide for annual
payments by the urban school district to the school district whose
territory is transferred to the urban school district subsequent to
annexation by the city served by the urban school district.
(G)
In the event territory is transferred from one school district to
another under this section, an equitable division of the funds and
indebtedness between the districts involved shall be made under the
supervision of the state board of education and that board's decision
shall be final. Such division shall not include funds payable to or
received by a school district under Chapter 3317. of the Revised Code
or payable to or received by a school district from the United States
or any department or agency thereof. In the event such transferred
territory includes real property owned by a school district, the
state board of education, as part of such division of funds and
indebtedness, shall determine the true value in money of such real
property and all buildings or other improvements thereon. The board
of education of the school district receiving such territory shall
forthwith pay to the board of education of the school district losing
such territory such true value in money of such real property,
buildings, and improvements less such percentage of the true value in
money of each school building located on such real property as is
represented by the ratio of the total enrollment in day classes of
the pupils residing in the territory transferred enrolled at such
school building in the school year in which such annexation
proceedings were commenced to the total enrollment in day classes of
all pupils residing in the school district losing such territory
enrolled at such school building in such school year. The school
district receiving such payment shall place the proceeds thereof in
its sinking fund or bond retirement fund.
(H)
The state board of education, before approving such transfer of
territory, shall determine that such payment has been made and shall
apportion to the acquiring school district such percentage of the
indebtedness of the school district losing the territory as is
represented by the ratio that the assessed valuation of the territory
transferred bears to the total assessed valuation of the entire
school district losing the territory as of the effective date of the
transfer, provided that in ascertaining the indebtedness of the
school district losing the territory the state board of education
shall disregard such percentage of the par value of the outstanding
and unpaid bonds and notes of said school district issued for
construction or improvement of the school building or buildings for
which payment was made by the acquiring district as is equal to the
percentage by which the true value in money of such building or
buildings was reduced in fixing the amount of said payment.
(I)
No transfer of school district territory or division of funds and
indebtedness incident thereto, pursuant to the annexation of
territory to a city or village shall be completed in any other manner
than that prescribed by this section regardless of the date of the
commencement of such annexation proceedings, and this section applies
to all proceedings for such transfers and divisions of funds and
indebtedness pending or commenced on or after October 2, 1959.
(J)
Notwithstanding anything to the contrary in the Revised Code,
including section 3311.24 of the Revised Code, and any annexation
agreement or any other agreement, beginning on
the
effective date of this amendment
September
29, 2017,
until
October 1, 2021, no school district that is a party to an annexation
agreement shall transfer territory that is or will be used for
nonresidential purposes to another school district that is a party to
the annexation agreement without the approval of the boards of
education of each of the school districts after
the
effective date of this amendment
September
29, 2017
,
unless the school district territory of one of those boards of
education overlaps with a new community authority created prior to
January 1, 1993, under Chapter 349. of the Revised Code.
Section
2.
That
existing section 3311.06 of the Revised Code is hereby repealed.