Question: We have a community college interested in becoming fiscally accountable. What responsibilities does the county office of education have with regard to fiscally accountable community colleges? What responsibilities exist for a COE if a community college does not have this status? Is there any type of checklist or manual available that can assist in ensuring that this process is handled properly and completely?
Response: Fiscally accountable status is a means by which school districts, both K-12 and community college, can control the process of issuing their warrants. Education Code section 85266 provides the process for community college districts to obtain such status, as well as the roles and responsibilities of both the district and the county office of education in managing the process once the status is approved.
This code section provides that a county office of education must do the following in processing an application for fiscally accountable status:
- Receive an application (on forms prescribed by the county superintendent) by September 1
- Cause an audit to be conducted by an independent auditor of the districts internal controls (may be based on guidelines published by the Department of Finance), to be filed by January 1
- Review the application and render a determination (by March 1, in order to implement the following July 1)
-- If approved, advise of the effective date
-- If disapproved, advise of the specific steps necessary to receive approval
Once approved and operable, a county office must do the following:
- Receive retirement and other reports from the district, as prescribed by law, in a form prescribed by the county superintendent
- Provide a periodic review of the districts internal controls and processes (see Ed Code section 85237.5 mentioned below), if concerned about such status
Once approved and operable, a county office may do the following:
- Prescribe the process for issuing warrants
- Provide fiscal, budgetary and DP services to the district via a contract
- Receive a warrant listing from the district the day warrants are issued
- Receive a financial statement from the district each month (budgeted, received, expended to date, available balance)
- Validate the issuance of a performance bond by the district
County offices are not responsible for providing reports, statements or other data regarding the designated payments of the district.
As noted above, per Education Code section 85237.5, a county superintendent may conduct an audit of a fiscally accountable district and, based on such audit, may revoke the status at their discretion. Obviously, there must be a significant concern regarding the district's management of its status before the superintendent would reach such a conclusion.
Education Code section 85230 et seq. provides guidance for the roles and responsibilities of county offices of education for those districts that do not have such status. We recommend reviewing these code sections.
We do not know of a single resource (checklist/manual) that will guide you through the above, but a thorough reading of and adherence to the Education Code sections should keep your county office and the district on the correct path.
6/1/09
