Depository Contracts for School Districts

A school district must have a depository bank into which the Texas Education Agency (TEA) can deposit funds for the district. The district creates a depository relationship with a bank by executing a depository contract with the bank.

Related Texas Statutes and Rules

    Recent Changes

    Changes to Depository Contract Rules, Effective June 4, 2019

    TEC, §45.208(e), was amended by Senate Bill 1376. As a result, as of June 4, 2019, a school district is not required to submit to TEA its:

    • Depository Contract for Funds of ISDs,
    • Texas Surety Bond form, if applicable, or
    • Board Resolution Extending the Depository Contract for Funds of ISDs.

    All remaining depository contract rules are still in effect. If a school district makes changes to its direct deposit account, the district still must electronically submit a Direct Deposit Authorization form to TEA.

    Procedure for Depository Contract—School District

    Each school district's depository contract must be renewed every two years. The next cycle is 2021-2023. The district must choose to select a depository either by bid or by request for proposals. The school district should review the following documents before sending out forms for bids or requests for proposal to banks:

    The forms for bids and requests for proposal are provided in the following links:

    The depository contract form and surety bond form are provided in the following links:

    For links to the vendor Direct Deposit Authorization form and instructions, see Account Information Update below.

    Electronic Submission of Depository Contract Files

    If a school district makes changes to its direct deposit account, the district still must electronically submit a Direct Deposit Authorization form to TEA using the TEA Login (TEAL) AUDIT application.

    Please review Depository Contracts Electronic Submission Process (PDF, 659 KB) for instructions on submitting depository contract files to TEA.

    Extension of Depository Contract

    A school district may extend its depository contract for three (3) additional two-year terms if:

    • the district did not file an extension in the three previous bienniums and
    • the district and the depository bank agree to extend the current depository contract with or without changes to the contract if both the district and bank mutually agree to the existing and/or new terms. 

    To extend the term of its depository contract, the district and depository bank must execute the following form:

    Board Resolution Extending Depository Contract for Funds of Independent School Districts (PDF, 390 KB)

    A list of ISDs that are eligible for a contract extension has been provided in previous years. Due to changes to TEC, § 45.208(e), the information required to assemble the listing will no longer be submitted to TEA. A final listing of all districts eligible for a contract extension for the 2021–2023 biennium is provided below. Please note: a district that is not on the list may still be eligible if they have a District of Innovation exemption concerning their depository contract. 

    Districts Eligible for a Depository Contract Extension for FY2021-2023 (PDF, 574 KB)

    Account Information Update

    If the school district is making changes to the direct deposit account, then the district must submit a vendor direct deposit authorization form:

     

    Contact Information

    Thanh Quach (512) 463-7652 or thanh.quach@tea.texas.gov

    Financial Compliance Division

    Phone: (512) 463-9095

    Fax: (512) 463-1777

    Email: DepositoryContract@tea.texas.gov