These rates can be more or less than the tax-free rate that the IRS has set. The question of filing a critical hardship application is one that has a ticking time clock. Applications for this purpose are due to the State Allocation Board by March 31, 1996. At least one half of the amount set aside must go to districts with prior year ADA of less than 2,501. A critical project in the five year plan that is not completed in one year would result in serious damage to the remainder of the facility or a hazard to the health and safety of students 3.
District deposited funds are insufficient to complete the project.
If your district is considering filing for a critical hardship apportionment, contact the project manager in the Office of Public School Construction immediately. The Internal Revenue Code makes no provisions for the issuance of exemption letters to instrumentalities of a state or municipal government since Section 115 of the Code excludes their income from the definition of gross income. The above information is not tax advice but a starting place for your investigation. Any sources of information on this subject would be appreciated. These references have been prepared by school district staff who have had success stories and want to pass them along.