BILL NUMBER: AB 96 CHAPTERED
BILL TEXT
CHAPTER 135
FILED WITH SECRETARY OF STATE JULY 31, 2001
APPROVED BY GOVERNOR JULY 30, 2001
PASSED THE ASSEMBLY JULY 19, 2001
PASSED THE SENATE JULY 18, 2001
AMENDED IN SENATE JULY 12, 2001
AMENDED IN SENATE JULY 5, 2001
AMENDED IN SENATE JUNE 18, 2001
AMENDED IN ASSEMBLY MARCH 1, 2001
AMENDED IN ASSEMBLY FEBRUARY 20, 2001
INTRODUCED BY Assembly Member Aroner
(Coauthor: Senator Perata)
JANUARY 11, 2001
An act to add Section 35029.1 to the Education Code, relating to
the Emery Unified School District, making an appropriation therefor,
and declaring the urgency thereof, to take effect immediately.
LEGISLATIVE COUNSEL'S DIGEST
AB 96, Aroner. School districts.
(1) Existing law authorizes the governing board of a school
district that determines during a fiscal year that its revenues are
less than the amount necessary to meet its current year expenditure
obligations to request an emergency apportionment through the
Superintendent of Public Instruction subject to requirements and
repayment provisions.
This bill would appropriate $2,300,000 to the Superintendent of
Public Instruction for the purpose of providing the Emery Unified
School District a loan, allocated as specified, with conditions as
specified. The bill would require the Superintendent of Public
Instruction to immediately appoint an administrator, who would have
specified duties and responsibilities. The bill would require the
Controller to conduct audits of the books and accounts of the
district until the Superintendent of Public Instruction determines
that the district is solvent. The duties imposed by the bill on the
district would constitute a state-mandated local program.
The bill would require the Superintendent of Public Instruction to
appoint the Fiscal Crisis and Management Assistance Team to act as a
fiscal adviser for the district, as specified, and would prescribe
related matters.
This bill would declare that due to the unique circumstances
relating to the Emery Unified School District's financial emergency,
a general statute cannot be made applicable.
(2) Existing law prescribes the minimum requirements for the
preliminary services credential with a specialization in
administrative services. Under existing law, a local governing board
may waive any credential requirement for the chief administrative
officer of the school district under its jurisdiction, as specified.
This bill would, notwithstanding those provisions authorizing a
local governing board to waive any credential requirements for a
chief administrative officer, prohibit a local governing board from
hiring an individual for the position of chief administrative officer
of the school district whose credential has been revoked by the
Commission on Teacher Credentialing pursuant to specified provisions.
(3) 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.
This bill would provide that no reimbursement is required by this
act for a specified reason.
(4) This bill would declare that it is to take effect immediately
as an urgency statute.
Appropriation: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. (a) The Legislature finds and declares that because of
the fiscal emergency in which the Emery Unified School District finds
itself, it is necessary for the Superintendent of Public Instruction
to appoint an administrator if the district accepts a loan as
described in this act ; accordingly, the Superintendent of Public
Instruction shall immediately appoint an administrator for the Emery
Unified School District who shall be governed by Article 2.5
(commencing with Section 41325) of Chapter 3 of Part 24 of the
Education Code as well as any conditions stipulated in this act. The
Superintendent of Public Instruction may contract for the services
of one or more persons having legal, accounting, labor negotiation,
or other expertise as necessary to assist the administrator. In
order to facilitate the appointment process, the State Department of
Education is exempt from Part 2 (commencing with Section 10100) of
the Public Contract Code and Article 6 (commencing with Section 999)
of Chapter 6 of Division 4 of the Military and Veterans Code when
contracting for the services of an administrator and other persons as
described in this subdivision.
(b) The Legislature finds and declares that it is impossible to
solve all of the district's fiscal problems immediately. During the
two years immediately following Emery Unified School District's
initial receipt of proceeds from the emergency loan provided by this
act, the Superintendent of Public Instruction, after consultation
with the Alameda County Superintendent of Schools, may approve the
use of timelines, criteria, and standards for the submission and
review of the district's budget, interim reports, and other financial
reports required of the district, that vary from the timelines,
criteria, and standards required pursuant to Sections 33127, 41020,
and 42127 to 42130, inclusive, of the Education Code as necessary to
accomplish the full fiscal recovery of the district.
(c) It is the intent of the Legislature, in enacting this section,
to authorize the administrator appointed pursuant to subdivision (a)
to enter into a lease with the City of Emeryville pursuant to
Article 4 (commencing with Section 17456) of Chapter 4 of part 10.5
of the Education Code, for the use of the school district's
facilities during nonschool hours and events for recreational and
community programs, so that the school district may utilize the
proceeds from the lease to pay off the loan made pursuant to Section
3 of the act adding this section.
SEC. 2. Section 35029.1 is added to the Education Code, to read:
35029.1. Notwithstanding Section 35029, a local governing board
shall not hire an individual for the position of chief administrative
officer of the school district under its jurisdiction whose
credential has been revoked by the Commission on Teacher
Credentialing pursuant to Sections 44421 to 44427, inclusive.
SEC. 3. (a) The sum of two million three hundred thousand dollars
($2,300,000) is hereby appropriated from the General Fund to Section
A of the State School Fund for apportionment by the Superintendent of
Public Instruction to the Emery Unified School District for the
purpose of an emergency loan. In order to qualify for the loan, the
district shall comply with Article 2.5 (commencing with Section
41325) of Chapter 3 of Part 24 of the Education Code and the
conditions stipulated in this act.
(1) Of the amount appropriated by this subdivision, one million
three hundred thousand dollars ($1,300,000) shall be available
immediately to the district for expenditure in the 2001-02 fiscal
year for cash flow needs, based on a schedule submitted to the
Controller from the State Department of Education.
(2) Of the amount appropriated by this subdivision, one million
dollars ($1,000,000) shall be available for expenditure, as needed,
in the 2001-02, 2002-03, and 2003-04 fiscal years for the district's
cash flow needs as determined by the Department of Finance, in a
schedule submitted to the Controller.
(b) With the exception of funds that may be needed by the district
to meet its cash obligations, as described in subdivision (c), funds
may not be disbursed from the proceeds of the loan until the
conditions set forth in Section 41327 of the Education Code have been
met.
(c) Based on the needs of the district to meet its cash
obligations, the Superintendent of Public Instruction may direct the
Controller to disburse, on a monthly basis, specific amounts of the
emergency loan prior to the approval of all of the conditions
established by this act. The Emery Unified School District shall
repay the emergency loan to the state, pursuant to a repayment
schedule established by the Superintendent of Public Instruction
consistent with subparagraph (A) of paragraph (2) of subdivision (a)
of Section 41327 of the Education Code, together with interest at a
rate based on the most current investment rate of the Pooled Money
Investment Account as of the date of the disbursement of funds to the
district.
(d) For the fiscal year in which the apportionments are disbursed
and each fiscal year thereafter, the Controller, or his or her
designee, shall cause an audit to be conducted of the books and
accounts of the district, instead of the audit required by Section
41020 of the Education Code. At the Controller's discretion, the
audit may be conducted by the Controller, his or her designee, or an
auditor selected by the district and approved by the Controller. The
costs of these audits shall be borne by the district. These audits
shall be required until the Superintendent of Public Instruction
determines that the district is financially solvent, but not earlier
than one year following the implementation of the plan nor later than
the time the apportionment, including interest, made is repaid. In
addition, the Controller shall conduct quality control reviews
pursuant to subdivision (c) of Section 14504.2 of the Education Code.
(e) For the fiscal year in which the apportionments are disbursed
and each fiscal year thereafter, the Superintendent of Public
Instruction shall appoint the Fiscal Crisis and Management Assistance
Team to be the fiscal adviser to the district as defined in
paragraph (5) of subdivision (e) of Section 42127.6 of the Education
Code. The costs of the adviser shall be paid by the district to the
extent that the advisor's costs exceed the amount appropriated for
the Fiscal Crisis and Management Team pursuant to schedule (9) of
Item 6110-485 of Section 2.00 of the Budget Act of 2001. The adviser
shall be retained until the Superintendent of Public Instruction
determines that the district is financially solvent, but the adviser
shall not be released earlier than one year following the
implementation of the plan nor later than the time the apportionment
made, including interest, is repaid.
SEC. 4. (a) Notwithstanding subparagraph (A) of paragraph (2) of
subdivision (a) of Section 41327 of the Education Code, the debt
shall be repaid as a straight-line loan amortized over a 20-year
term. This amount shall be repaid by the school district, plus
interest calculated at a rate equal to the rate earned by the Pooled
Money Investment Account on the date the act that adds this section
is chaptered, for a period not to exceed 20 years.
(b) If payment is not made within 60 days after the scheduled
date, the Controller shall pay the defaulted loan payment of
principal and interest by withholding that amount from the next
available payment that would otherwise be made to the county
treasurer on behalf of the district pursuant to Section 14041 of the
Education Code. However, subject to the approval of the Department
of Finance, the amount withheld may be in monthly amounts as
determined by an agreement between the Emery Unified School District
and the Controller during the period beginning with the next
available apportionment through the month preceding the next
scheduled payment.
(c) The Director of Finance may amend the payment schedule set
forth in subdivision (a) if the director concludes that the amendment
is warranted and is in the best interests of both the state and the
Emery Unified School District education program. Upon that
determination, the director shall notify the Joint Legislative Budget
Committee that the payment scheduled will be changed on the date
that is 90 days from the date of notification if the Legislature is
in session, unless the Joint Legislative Budget Committee takes
appropriate action to preclude that change. If the 90-day period
ends during a recess of the Legislature or while the Legislature is
not in session, the 90-day period shall be extended until the
Legislature reconvenes. Amendments to the payment schedule shall
defer the unpaid portion of a repayment of the earliest fiscal year
in which no other repayment is scheduled. Interest shall accrue on
the unpaid portion of a repayment from the scheduled due date until
the time the payment is actually made. The interest charge shall be
the same rate as specified in Section 41471 of the Education Code.
(d) The school district may repay its loan obligation without
incurring any prepayment penalties.
(e) Any allegation of fraud or criminal misuse of district funds
on the part of a current or former employee of the district shall be
thoroughly investigated by the appropriate law enforcement agency or
by the district.
(f) Notwithstanding the repayment schedules provided in
subdivisions (a) and (c), any district funds or other assets
recovered pursuant to subdivision (e) shall be immediately directed
toward repayment of the loan made pursuant to Section 3 of the act
adding this section.
SEC. 5. The Legislature finds and declares that due to unique
circumstances relating to the fiscal emergency in the Emery Unified
School District, a general statute cannot be made applicable within
the meaning of Section 16 of Article IV of the California
Constitution.
SEC. 6. No reimbursement is required by this act pursuant to
Section 6 of Article XIIIB of the California Constitution because the
only costs that may be incurred by a local agency or school district
are the result of a program for which legislative authority was
requested by that local agency or school district, within the meaning
of Section 17556 of the Government Code and Section 6 of Article
XIIIB of the California Constitution.
SEC. 7. This act is an urgency statute necessary for the immediate
preservation of the public peace, health, or safety within the
meaning of Article IV of the Constitution and shall go into immediate
effect. The facts constituting the necessity are:
In order to make certain revisions in a timely manner to the
accounting of a designated appropriation of General Fund moneys, it
is necessary that this act take effect immediately.