Enacted<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />
ASSEMBLY BILL No. 1200
CHAPTER 1213
Eastin
An act to amend Sections 1240, 35035, 39602, 39603, 41320.1, 42100,
42103, 42127, 42127.1, 42127.2, 42127.3, and 42127.4 of, to amend and
renumber Section 35014 of, to add Sections 42127.6, 42127.8, 42127.9,
42132, 42133, and 42134 to, to add Article 2.5 (commencing with Section
41325) to Chapter 3 of Part 24 of, to add Article 3 (commencing with
Section 42130) to Chapter 6 of Part 24 of, to repeal and add Article 2
(commencing with Section 1620) of Chapter 5 of Part 2 of, and to repeal
Sections 35015, 42102, and 42120 of, the Education Code, and to add
Section 3547.5 to the Government Code, relating to school finance, and
making an appropriation therefor.
[Approved by Governor October 14, 1991. Filed with
Secretary of State October 14, 1991.]
LEGISLATIVE COUNSEL'S DIGEST
AB 1200, Eastin. School district budget review.
(1) Under existing law, each county superintendent of schools is required annually to submit to the county board of education certain reports regarding the financial and budgetary status of the county board
of education.
This bill would revise the reporting dates for those annual reports,and would make related changes,thereby imposing a state‑mandated local program.
Under existing law, each county board of education is required annually to submit its budget for approval to the Superintendent of Public Instruction, in accordance with specified procedures and criteria.
This bill would require that the public hearing on that budget be held prior to the submittal of the budget to the Superintendent of Public Instruction on or before July 1, and that the budget be filed also with the county board of supervisors and the county auditor,
thereby imposing a state‑mandated local program. The bill would require that the Superintendent of Public Instruction approve or disapprove the budget no later than August 1, and would make related changes.
The bill also would require, except as specified, that, on or before September 1 of each year, the county board of education make certain revisions to the county office of education budget, adopt the revised budget, and file the revised budget for review by the Superintendent of Public Instruction. The bill would thereby impose a state‑mandated local program.
Under existing law, if a budget review committee recommends approval of the budget of the county office of education, the Superintendent of Public Instruction is required to approve that budget. If the budget
review committee disapproves that budget, the superintendent, with the agreement of the budget review committee, may adopt an alternative budget for the county office of education.
This bill would authorize the Superintendent of Public Instruction to approve or disapprove the budget of a county office of education whether or not the budget review committee recommends approval of that
budget. If the Superintendent of Public Instruction disapproves the budget, this bill would authorize the superintendent or his or her designee, for the remainder of the fiscal year, to adopt a fiscal plan and budget to govern the county office of education, to stay or rescind actions of the county office of education that are inconsistent with the fiscal plan or budget, and otherwise to monitor and review the operation of the county office of education. This bill also would authorize the Superintendent of Public Instruction or his or her designee to exercise those powers as to any county office of education having a negative or
qualified certification pursuant to the annual reports described above.
The requirement that a county office of education comply with that authority, including the payment of resulting administrative costs,would impose a state‑mandated local program.
The bill also would direct the Superintendent of Public Instruction to monitor the operation of each county office of education pursuant to an adopted budget and, if he or she determines that the county office of
education will be unable to meet its financial obligations, to recommend appropriate remedial action. The bill would authorize the superintendent, subsequent to that notification, to revise the county office of education budget, as specified, and to stay or rescind any action that is inconsistent with those revisions. The requirement that a county office of education comply with that authority, including the payment of resulting administrative costs, would impose a state‑mandated
local program.
(2) Under existing law, each school district is required annually,no later than July 1, to submit a tentative budget for the current fiscal year for review and approval, pursuant to designated deadlines,by the county superintendent of schools, the Superintendent of Public Instruction and, under specified circumstances, by a budget review committee established for that purpose. Existing law requires each district to adopt a final budget no later than September 15.
This bill would eliminate the requirement that each school district submit a tentative budget and, instead, would require each school district to submit an adopted budget no later than July 1. The bill would revise the deadlines for the approval or disapproval of the budget
by the county superintendent of schools. The bill would require, except as specified, that, on or before September 1 each year, the school district governing board make certain revisions to the budget, adopt the
revised budget, and file the revised budget for review by the county superintendent of schools. The bill would thereby impose a state‑mandated local program. The bill also would require that the budget review committee complete its review of the school district budget no later than October 31, except as specified. The bill would thereby impose a state‑mandated local program.
(3) Existing law authorizes the Superintendent of Public Instruction, in the event that a school district budget is disapproved by the budget review committee, to either approve the budget or prepare an alternative budget to be agreed to jointly by the county office of education and the budget review committee.
This bill would repeal that authority and would authorize the school district governing board to respond to recommendations of the budget review committee made pursuant to its disapproval of the budget. The bill also would require, if a school district budget is disapproved by the Superintendent of Public Instruction, that the county superintendent of schools exercise certain governance over the school district for the current fiscal year, thus imposing a state‑mandated local program, with the authority to monitor and review the operation of the district, to develop and adopt a fiscal plan and budget for the district, and to stay and rescind actions that are inconsistent with that budget, as specified. The bill would impose a state‑mandated local program by requiring the district to pay for the resulting administrative costs.That governance would be subject to a specified appeal procedure. In addition, the bill would revise the procedure for the selection and convening of a budget review committee, including the alternative that a regional review committee be appointed for this purpose by the county superintendent of schools.
The bill also would impose a state‑mandated local program by directing the county superintendent of schools to monitor the operation of each school district pursuant to an adopted budget and, if he or she
determines that a school district will be unable to meet its financial obligations, to recommend appropriate remedial action and, if necessary,to notify the Superintendent of Public Instruction. The bill would
authorize the county superintendent of schools, subsequent to that notification, to request additional information regarding the district's budget or operations, to revise the school district budget, as
specified, and to stay or rescind any action that is inconsistent with those revisions. The bill would impose a state‑mandated local program by requiring the district to pay for the resulting administrative costs.
The bill would appropriate $500,000 for the 1991‑92 fiscal year for apportionment to county superintendents of schools for the above
purposes.
(4) Under existing law, the governing board of each school district is required in each fiscal year, within 45 days after the close of each of 2 designated reporting periods, to certify to the Controller and the
Superintendent of Public Instruction whether it is able to meet its financial obligations for the remainder of the fiscal year. Existing law also requires each county superintendent of schools, within 75 days ofthe close of each reporting period, to comment to those entities as to any district certification that is classified as qualified or negative, as specified.
The bill would impose a state‑mandated local program by requiring the superintendent of each school district annually to submit 2 periodic reports to the school district governing board regarding the financial
and budgetary status of the district, as specified, to serve as the basis for the certification described above.
This bill would revise that certification, and would require that each school district governing board that files a certification that is qualified or negative, as specified, provide a financial statement of projected year‑end funding balances to the county superintendent of schools, the Controller, and the Superintendent of Public Instruction no later than June 1. The bill would thereby impose a state‑mandated local program.
As to any school district having a negative certification, as specified, the bill would authorize a county superintendent of schools,for the remainder of the current fiscal year, to develop and adopt a budget to govern the school district, to stay or rescind any action that is consistent with that budget, and to exercise other specified powers.The requirement that a school district comply with that authority would impose a state‑mandated local program.
The bill also would specify that certain authority that is currently exercised in this regard by the State Department of Education be exercised by the Superintendent of Public Instruction.
The bill also would impose a state‑mandated local program by revising the reporting and commenting responsibilities of the county superintendent of schools, as described above, to occur no later than 60
days after the close of each reporting period.
(5) The bill would prohibit a school district having a qualified or negative certification, as described above, in any fiscal year from issuing, in that year or the next fiscal year, certain debt instruments,or submitting certain information reports regarding the debt instruments, unless the county superintendent of schools determines that the repayment of the indebtedness is probable. The bill similarly would
prohibit a county office of education having a qualified or negative certification in any fiscal year from issuing, in that year or the next fiscal year, debt instruments, or submitting certain information reports
regarding the debt instruments, unless the Superintendent of Public Instruction determines that the repayment of the indebtedness is probable. The bill would require the Superintendent of Public Instruction, no later than March 31, 1992, to develop and adopt criteria and standards to govern that determination.
(6) Under existing law, as set forth in the California Constitution,
state and local governments, including school districts, are prohibited,
as specified, from expending during any fiscal year an amount that
exceeds the appropriations limit for that governmental entity for that
fiscal year.
This bill would require each school district and county office of
education annually to adopt a resolution to identify its estimated
appropriations limit for the current fiscal year and its actual
appropriations limit for the preceding fiscal year, as specified.
(7) Existing law permits the governing board of any school district
to request an emergency loan through the Superintendent of Public
Instruction, subject to specified conditions including the appointment of a trustee to supervise the district. That trustee serves at the pleasure of, and reports directly to, the Superintendent of Public Instruction, until the loan is repaid.
This bill would require the Superintendent of Public Instruction to exercise, through an administrator appointed by the superintendent, the powers and responsibilities of the governing board of any school
district that accepts an emergency loan in an amount equal to 200% of
the amount of the fiscal reserve recommended for the district under
designated state standards. The bill would grant that authority for not
less than one complete fiscal year, pursuant to specified conditions.
The bill would require the preparation of a management review and
recovery plan and a financial recovery plan for the district, and would
require the repayment of any state loans to the district over a 10‑year
period.
In addition, as of the date of that acceptance, the bill would
authorize the administrator to terminate the employment of any district
superintendent of schools, or deputy, associate, or assistant
superintendent of schools for the district, pursuant to specified
criteria and appropriate notice and hearing procedures.
The bill would make related changes to existing law.
(8) The bill would require a governing board having designated
membership to establish a unit of persons having extensive experience in
school district finance and operations to provide assistance as
requested to participating county offices of education, which could be
required to pay an annual fee, and to school districts, which would be
charged for certain of the costs incurred by the unit pursuant to
established rates. The bill would direct the Superintendent of Public
Instruction and the Secretary of Child Development and Education to
select a county office of education to direct that unit.
The bill would appropriate $500,000 for the 1991‑92 fiscal year for
apportionment to county offices of education to meet the costs of that
participation.
The bill also would require the Superintendent of Public Instruction
to publish annually a multiyear projection of the revenues that will be
available to school districts and county offices of education from state
and local sources, as specified, to be made available to those entities
for the preparation of annual budgets and financial certifications.
(9) Under existing law, school districts are authorized to establish
a self‑insurance fund for various losses, payments, and liabilities, as
specified, and for employee health and welfare benefits. Existing law
requires a school district, prior to funding health and welfare benefits
in that manner, to secure the services of an actuary to evaluate the
future annual costs of those benefits.
This bill would direct that, upon commencing the funding of health
and welfare benefits pursuant to that authority, a school district
secure the services of an actuary to evaluate the annual costs of those
benefits every 3 years.
(10) Existing law sets forth standards and procedures that govern the collective bargaining process between local educational agencies and their employees.
This bill would require that, prior to entering into a written agreement pursuant to that process, the local educational agency disclose at a public meeting the major provisions of the agreement,including the costs that would be incurred by the agency under the
agreement. This requirement would impose a state‑mandated local program.
(11) The bill would make related technical changes to existing law.
(12) The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that
reimbursement, including the creation of a State Mandates Claims Fund to pay the costs of mandates which do not exceed $1,000,000 statewide and
other procedures for claims whose statewide costs exceed $1,000,000.
This bill would provide that, if the Commission on State Mandates
determines that this bill contains costs mandated by the state,
reimbursement for those costs shall be made pursuant to those statutory
procedures and, if the statewide cost does not exceed $1,000,000, shall
be made from the State Mandates Claims Fund.
Appropriation: yes.
The people of the State of California do enact as follows:
SECTION 1. Section 1240 of the Education Code is amended to read:
1240. The superintendent of schools of each county shall:
(a) Superintend the schools of his or her county.
(b) Visit and examine each school in his or her county at reasonable
intervals to observe its operation and to learn of its problems. He or
she may annually present a report of the state of the schools in his or
her county, and of his or her office, including, but not limited to, his
or her observations while visiting the schools, to the board of
education and the board of supervisors of his or her county.
(c) Distribute all laws, reports, circulars, instructions, and
blanks that he or she may receive for the use of the school officers.
(d) Keep in his or her office the reports of the Superintendent of
Public Instruction.
(e) Keep a record of his or her official acts, and of all the
proceedings of the county board of education, including a record of the
standing, in each study, of all applicants for certificates who have
been examined, which shall be open to the inspection of any applicant or
his or her authorized agent.
(f) Enforce the course of study.
(g) Enforce the use of state textbooks and of high school textbooks
regularly adopted by the proper authority.
(h) Preserve carefully all reports of school officers and teachers.
(i) Deliver to his or her successor, at the close of his or her
official term, all records, books, documents, and papers belonging to
the office, taking a receipt for them, which shall be filed with the
State Department of Education.
(j) Submit two reports during the fiscal year to the county board of
education in accordance with the following:
(1) The first report shall cover the financial and budgetary status
of the county office of education for the period ending October 31. The
second report shall cover the period ending January 31. Both reports
shall be reviewed by the county board of education and approved by the
county superintendent of schools no later than 45 days after the close
of the period being reported.
(2) As part of each report, the superintendent shall certify in
writing whether or not the county office of education is able to meet
its financial obligations for the remainder of the fiscal year and,
based on current forecasts, for the subsequent fiscal year. The
certifications shall be classified as positive, qualified, or negative,
pursuant to standards prescribed by the Superintendent of Public
Instruction, for the purposes of determining subsequent state agency
actions pursuant to Section 1240.1. For purposes of this subdivision, a
negative certification shall be assigned to any county office of
education that likely will be unable to meet its financial obligations
for the remainder of the fiscal year or for which existing expenditures
practices jeopardize the ability of the county office of education to
meet its multiyear financial commitments. In accordance with those
standards, the Superintendent of Public Instruction may reclassify any
certification. As to any county office of education having a negative
certification, the Superintendent of Public Instruction or his or her
designee may exercise the authority set forth in subdivision (b) of
Section 1630. Copies of each certification, and of the report containing
that certification, shall be sent to the Superintendent of Public
Instruction at the time the certification is submitted to the county
board of education. Copies of each qualified or negative certification,
and of the report containing that certification, shall be sent to the
Controller at the time the certification is submitted to the county
board of education.
(3) All reports and certifications required under this subdivision
shall be in a format or on forms prescribed by the Superintendent of
Public Instruction, and shall be based on standards and criteria for
fiscal stability adopted by the State Board of Education pursuant to
Section 33127. The reports, and supporting data, shall be made available
by the county superintendent of schools to any interested party upon
request.
(4) This subdivision does not preclude the submission of additional
budgetary or financial reports by the superintendent to the county board
of education or to the Superintendent of Public Instruction.
(k) When so requested, act as agent for the purchase of supplies for
the city and high school districts of his or her county.
(l) For purposes of Section 44421.5, report to the Commission on
Teacher Credentialing the identity of any certificated person who
knowingly and willingly reports false fiscal expenditure data relative
to the conduct of any educational program. This requirement applies only
if, in the course of his or her normal duties, the county superintendent
of schools discovers information that gives him or her reasonable cause
to believe that false fiscal expenditure data relative to the conduct of
any educational program has been reported.
SEC. 2. Article 2 (commencing with Section 1620) of Chapter 5 of
Part 2 of the Education Code is repealed.
SEC. 3. Article 2 (commencing with Section 1620) is added to
Chapter 5 of Part 2 of the Education Code, to read:
Article 2. County Office of Education Budget Approval
1620. On or before July 1 each fiscal year, the county board of
education shall hold a public hearing on the proposed county school
service fund budget for that fiscal year (the "budget year"). The public
hearing shall be held prior to the adoption of the budget by the county
board of education, and shall occur not less than three days following
the availability of the proposed budget for public inspection. At the
hearing, any taxpayer directly affected by the county school service
fund budget may appear before the county board of education and speak on
the proposed budget or any item therein.
1621. (a) The single‑fund budget shall be prepared in the form
prescribed and furnished by the Superintendent of Public Instruction and
shall be the county school service fund budget. The budget shall show a
complete plan and itemized statement of all proposed expenditures in
each fund of the county office of education, of estimated cash balances,
and of all estimated revenues for the budget year, and shall include an
estimate of those figures, unaudited, for the fiscal year immediately
preceding the budget year.
(b) The budget may contain an amount to be known as the general
reserve, in such sum as the county board of education may deem
sufficient to meet the cash requirements of the fiscal year next
succeeding the budget year until adequate proceeds of the taxes levied
or of the apportionment of state funds are available.
(c) The budget may contain a fund balance designated for any
specific purpose as determined by the county board of education. Those
funds shall be available for appropriation by a majority vote of the
members of the county board of education.
1622. (a) On or before July 1 each fiscal year, the county board of
education shall adopt an annual budget for the budget year and shall
file that budget with the Superintendent of Public Instruction, the
county board of supervisors, and the county auditor. The budget, and
supporting data, shall be maintained and made available for public
review. The budget shall indicate the date, time, and location at which
the county board of education held the public hearing required under
Section 1620.
(b) The Superintendent of Public Instruction shall examine the
budget to determine whether it complies with the standards and criteria
adopted by the State Board of Education pursuant to Section 33127 for
application to final local educational agency budgets, and shall
identify any technical corrections to the budget that must be made. On
or before August 1, the Superintendent of Public Instruction shall
approve or disapprove the budget and, in the event of a disapproval,
transmit to the county office of education in writing his or her
recommendations regarding revision of the budget and the reasons for
those recommendations.
(c) On or before September 1, the county board of education shall
revise the county office of education budget to reflect changes in
projected income or expenditures subsequent to July 1, and to include
any response to the recommendations of the Superintendent of Public
Instruction, shall adopt the revised budget, and shall file the revised
budget with the Superintendent of Public Instruction, the county board
of supervisors, and the county auditor. Prior to revising the budget,
the county board of education shall hold a public hearing regarding the
proposed revisions, which shall be made available for public inspection
not less than three working days prior to the hearing. The revised
budget, and supporting data, shall be maintained and made available for
public review.
(d) The Superintendent of Public Instruction shall examine the
revised budget to determine whether it complies with the standards and
criteria adopted by the State Board of Education pursuant to Section
33127 for application to final local educational agency budgets and, no
later than September 15, shall approve or disapprove the revised budget.
If the Superintendent of Public Instruction disapproves the budget, he
or she shall call for the formation of a budget review committee
pursuant to Section 1623.
(e) Notwithstanding any other provision of this section, the budget
review for a county office of education shall be governed by paragraphs
(1), (2), and (3) of this subdivision, rather than by subdivisions (c)
and (d), if the county board of education so elects, and notifies the
Superintendent of Public Instruction in writing of that decision, no
later than October 31 of the immediately preceding calendar year.
(1) In the event of the disapproval of the budget of a county office
of education pursuant to subdivision (b), on or before September 1, the
county superintendent of schools and the county board of education shall
review the recommendations of the Superintendent of Public Instruction
at a regularly scheduled meeting of the county board of education and
respond to those recommendations. That response shall include the
proposed actions to be taken, if any, as a result of those
recommendations.
(2) No later than five working days after receiving the response
required under paragraph (1), the Superintendent of Public Instruction
shall review that response and either approve or disapprove the budget
of the county office of education. If the Superintendent of Public
Instruction disapproves the budget, he or she shall call for the
formation of a budget review committee pursuant to Section 1623.
(3) Not later than 45 days after the Governor signs the annual
Budget Act, the county office of education shall make available for
public review any revisions in revenues and expenditures that it has
made to its budget to reflect the funding made available by that Budget
Act.
1623. (a) The budget review committee shall be composed of three
persons and shall be selected by the county superintendent of schools
and the county board of education solely from a list of no fewer than
five candidates provided by the Superintendent of Public Instruction.
The candidates shall be persons who have expertise in the management of
a school district or county office of education, including, but not be
limited to, the fiscal and educational aspects of that management.
(b) No later than five working days after the receipt of the
candidate list described in subdivision (a), the county superintendent
of schools and the county board of education shall select the budget
review committee. If the county superintendent of schools and the county
board of education fail to select a committee within the period of time
permitted by this subdivision, the Superintendent of Public Instruction
instead shall select and convene the budget review committee no later
than 10 working days after the receipt by the county superintendent of
schools and the county board of education of the candidate list.
(c) No later than October 31, the budget review committee shall
review the proposed budget of the county office of education and the
underlying fiscal policies of that county office of education, and shall
transmit to the Superintendent of Public Instruction, the county
superintendent of schools, and the county board of education either of
the following:
(1) The recommendation that the budget be approved.
(2) A report disapproving the budget and setting forth
recommendations for revisions to the budget that would enable the county
office of education to meet its financial obligations both in the budget
year and with regard to multiyear financial commitments.
(d) Upon the request of the budget review committee, the
Superintendent of Public Instruction may extend the deadline set forth
in subdivision (c) for a period of not more than 15 working days.
(e) The Superintendent of Public Instruction shall develop criteria
and procedures governing the performance by budget review committees of
their duties under this section.
(f) The members of the budget review committee shall be reimbursed
for their services and associated expenses while on official business,
at rates established by the State Board of Education.
1624. (a) If the budget review committee established pursuant to
Section 1623 disapproves the budget of the county office of education,
within five working days following the receipt of the committee's
report, the county superintendent of schools and the county board of
education may submit a response to the Superintendent of Public
Instruction, including any revisions to the adopted budget and any other
proposed action to be taken as a result of the recommendations of the
budget review committee.
(b) Based upon the recommendations of the budget review committee
provided pursuant to subdivision (c) of Section 1623, and any response
provided pursuant to subdivision (a), the Superintendent of Public
Instruction shall either approve or disapprove the budget of the county
office of education. If the Superintendent of Public Instruction
disapproves the budget, the superintendent or his or her designee may do
any of the following for the remainder of the current fiscal year:
(1) On or before November 30, develop and adopt, in consultation
with the county superintendent of schools and the county board of
education, a fiscal plan and budget for the county office of education
that will allow the county office of education to meet its financial
obligations both in the budget year and with regard to the multiyear
financial commitments. The county board of education and the county
superintendent of schools shall govern the operation of the county
office of education for the budget year in accordance with that fiscal
plan and budget. The deadline set forth in this paragraph shall be
modified to reflect any extension granted under subdivision (d) of
Section 1623.
(2) Cancel purchase orders, prohibit the issuance of nonsalary
warrants, and otherwise stay or rescind any action that is inconsistent
with the fiscal plan and budget adopted pursuant to paragraph (1). The
Superintendent of Public Instruction shall inform the county board of
education and the county superintendent of schools in writing of his or
her justification for any exercise of authority under this paragraph.
(3) Monitor and review the operation of the county office of
education.
(c) The county office of education shall pay reasonable fees charged
by the Superintendent of Public Instruction for actual administrative
expenses incurred pursuant to subdivision (b).
(d) This section shall not be construed to authorize the
Superintendent of Public Instruction to abrogate any provision of a
collective bargaining agreement that was entered into by a county office
of education prior to the date upon which the Superintendent of Public
Instruction disapproved the budget of the county office of education
pursuant to subdivision (b).
(e) As he or she deems necessary for the purposes set forth in
subdivision (b), the Superintendent of Public Instruction may seek from
the county office of education, or otherwise obtain, additional
information regarding the budget or operations of the county office of
education, through a financial or management review of the county office
of education, a cash‑flow projection, or other appropriate means.
1625. The county superintendent of schools for any county office of
education that reports a negative unrestricted fund balance or a
negative cash balance in the annual report required by Section 1622 or
in the audited annual financial statements required by Section 41020
shall include, with the budget submitted in accordance with Section 1622
and the certifications required by subdivision (e) of Section 1241, a
statement identifying the reasons for the negative unrestricted fund
balance or negative cash balance and the steps that will be taken to
ensure that the negative balance will not occur at the end of the budget
year.
1626. Until the time the county office of education receives
approval of its budget under this article, the county office of
education shall continue to operate on the basis of the last budget
adopted or revised for the county office of education for the fiscal
year immediately preceding the budget year.
1627. The county school service fund shall be audited annually by a
public accountant or a certified public accountant selected by the
county superintendent of schools. The cost of the audit shall be a legal
charge against the county school service fund.
1628. On or before September 15 each year, the county