February 9, 1989
Mr. Deming Smith
Attorney at Law
513 South Main Avenue
P. O. Box 1030
Sioux Falls, South Dakota 57101-1030
OFFICIAL OPINION NO. 89-06
Dear Mr. Smith:
The School Board of the Sioux Falls School District has directed that you request my official opinion on the following matter:
FACTS:
A School District acquired sites, including real property and buildings, which have been used as sites in which educational programs of the District have been conducted. Following their acquisition by the School District, the buildings on the sites have been developed and improved to varying degrees. The sites will no longer be utilized by the School District in its educational programs, and the District intends to declare them surplus property pursuant to SDCL 6-13.
Based upon the foregoing facts you have asked the following question:
QUESTION:
Are the improved sites "property created as a result of an educational program in a school" as that term is used in SDCL 6-13-3 through SDCL 6-13-5?
RESPONSE:
In 1988 the South Dakota Legislature combined all of the statutes relating to political subdivisions' disposal of surplus government property and placed them in SDCL ch. 6-13. To accomplish this as it relates to school districts, SDCL 13-21-1 through 7, inclusive, were repealed. The foregoing statutes previously controlled the disposal of surplus property in school districts. Almost no substantive changes were made in the provisions relating to disposal of school property. The Legislature did, however, create a separate class of property known as "property created as a result of an educational program in a school." Prior to the enactment of chapter 6-13, governmental property was essentially categorized as either real property or personal property.
SDCL 6-13-3, 4, and 5 provide:
6-13-3. Any improvements on land shall be appraised separately from the land. Equipment or supplies which are to be traded for other property, property which is to be destroyed, property which is to be transferred to another political subdivision pursuant to 6-5-1, property being sold which was created as a result of an educational program in a school and property which is to be sold at public auction need not be appraised pursuant to this chapter.
6-13-4. Any surplus property appraised pursuant to 6-13-2 at five hundred dollars or less may be sold by the governing board at a private or public sale without notice. The governing board of such political subdivision shall give notice of the sale of all other surplus property, including property created as a result of an educational program in a school, by publishing a notice of such sale in the official newspaper of such political subdivision at least once each week for at least two consecutive weeks. The first such publication may not be less than fifteen days prior to the date of the sale. Such notice shall describe the property to be sold and shall state the appraised value of such property and the time when bids will be opened by the governing board. Property to be transferred to another political subdivision pursuant to 6-5-1 need not be advertised.
6-13-5. Sealed bids received on the surplus property shall be filed with the fiscal officer of the political subdivision and shall be opened at a governing board meeting at the time specified in the notice required by 6-13-4. The governing board shall sell such property to the highest bidder if such bid is equal to, or greater than, ninety percent of the appraised value of the surplus property. If no bids are received that are equal to or greater than ninety percent of the appraised value, the governing board may have the surplus property reappraised pursuant to @ 6-13-2, or may, within twelve months thereafter, sell the property at private sale for not less than ninety percent of the appraised value without further publication or appraisal. If the property to be sold was created as a result of an educational program in a school, the school board may accept the highest bid or it may reject all bids and may within twelve months thereafter sell the property at private sale without further publication. [Emphasis supplied.]
The statutes above refer to property being created through an education program "in a school." That language would appear to refer to property being created as a result of a school program and not as a result of board action to acquire property for operation of a school program. There are numerous types of property that might be created in a school program. For example, a vocational technical course at the secondary or post-secondary level might build a house, feed bunks, or other structures. After the structure has been created by the program, the property is no longer of any value to the school and must be disposed of. The language adopted by the Legislature would appear to recognize the existence of property of this sort and allow considerable flexibility in its disposal.
In addition to the plain words of the statute, prior to its passage, my Office had regularly received inquiries from school districts regarding disposal of property created by educational programs. These questions related to matters such as the structures discussed above, in addition to much less significant items such as shelves created in a shop class or clothes created in a home economics lab where the students did not provide the raw materials. Based upon the prior statutes in chapter 13-21, I was forced to inform the schools that there was no alternative to the rather awkward provisions of that chapter. It would appear that the language under discussion was adopted by the Legislature in response to such concerns.
Finally, although not cognizable by a court, members of my staff were privy to committee discussion on the bill which created chapter 6-13 and it appeared that the contemplation of the Legislature, at least as disclosed in committee discussions, related to sale of property created by school programs rather than sale of property purchased for school programs.
Accordingly, based upon the plain words of the statute, the problem to be addressed, and the legislative discussion, it is my opinion that property purchased for educational programs by school boards, including real property and associated buildings, are not "property created as a result of an educational program in a school." The answer to your question is "No."
Respectfully submitted,
ROGER A. TELLINGHUISEN
ATTORNEY GENERAL
RAT:mas
