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Finance report: board briefed on Section 127 written plan to reimburse employee education up to $5,250
Summary
Finance staff told the board they will adopt a formal written Section 127 educational assistance plan allowing ACPS to reimburse employees up to $5,250 annually for qualifying education expenses and tighten tax compliance around reimbursements.
During the finance report, Mr. Chuck reviewed January FY26 expenditure percentages across operating and special funds and introduced a formal written Section 127 educational assistance plan for employees. He said the plan is intended to provide tax-exempt reimbursements up to an annual limit of $5,250 and to align the district’s practice with IRS rules and existing local reimbursement regulation (GCBCR).
Mr. Chuck characterized the written plan as tightening up existing practice and helping the division remain compliant with tax codes. He said prior reimbursements typically fit within a working-condition fringe benefit exemption and that the written Section 127 plan clarifies limits and when reimbursements become taxable. He gave the example of keeping typical course reimbursements affordable by steering employees toward cost-efficient options used by the division.
The board discussed the matter and had no additional questions at the time; no vote was recorded on adopting the written plan during this meeting.
Key quote "This plan covers any educational expense regardless of kind of what it's for," Mr. Chuck said when explaining the scope and difference from working-condition fringe benefits.
What happens next Staff will prepare the written Section 127 plan for adoption and continuing compliance review with legal counsel and payroll benefits administration.
