BILL ANALYSIS �
SENATE GOVERNANCE & FINANCE COMMITTEE
Senator Lois Wolk, Chair
BILL NO: SB 288 HEARING: 4/6/11
AUTHOR: Negrete McLeod FISCAL: No
VERSION: 3/29/11 TAX LEVY: No
CONSULTANT: Lui
SPECIAL DISTRICTS' FUNDS
Expands independent special districts' authority to
establish revolving funds.
Background and Existing Law
California's 3,294 special districts are separate local
governments that provide specialized services like fire,
water, irrigation, cemetery, and mosquito abatement and
vector control, in geographically defined areas.
Two-thirds are independent special districts that operate
under governing boards that are either elected by the
districts' voters or are appointed for fixed terms. In
contrast, dependent special districts are governed by city
councils or county boards of supervisors ex officio.
Each independent special district varies in size and type
of service it provides. Some independent special districts'
governing boards designate their own treasurers. Other
districts use the county treasurer as the district's
treasurer. For special districts that use the county
treasurer, the process for paying bills can be lengthy and
expensive. Special districts get warrants, or checks, from
the county treasurer, but delayed warrants can result in
late payments to vendors. Further, some districts have to
pay the county treasurer for this service, sometimes almost
$5 for each county warrant.
In 1976, the Legislature authorized independent special
districts to establish a $1,000 petty cash fund to pay for
routine expenditures, like utility bills (AB 2997, Duffy,
1976). This authority applied only to districts that used
the county treasury as the holding place for the districts'
funds. In 1982, the Legislature authorized public cemetery
districts to establish revolving funds in an amount not to
exceed 110% of one-twelfth of the districts' adopted budget
SB 288 -- 3/29/11 -- Page 2
for the fiscal year (AB 2388, Kelley, 1982). In 1990, AB
3179 (N. Waters, 1990) granted the same authority to
mosquito abatement and vector control districts.
Proposed Law
Senate Bill 288 authorizes an independent special district
to establish, by resolution, a revolving fund in an amount
that does not exceed 110% of one-twelfth of the district's
adopted budget for the fiscal year. SB 288 requires the
resolution establishing the revolving fund to designate:
The purposes for which the fund may be expended.
The district officer who is responsible for keeping
receipts and making disbursements.
The necessity for the fund.
The maximum amount of the fund.
State Revenue Impact
No estimate.
Comment
Purpose of the bill . SB 288 creates consistency among the
enabling acts of independent special districts. The $1,000
revolving fund limit has not been increased since 1976, and
the authority for establishing larger funds exists only for
public cemetery and mosquito abatement and vector control
districts. Public cemetery districts and mosquito
abatement and vector control special districts have used
larger revolving funds for more than 20 years. Authorizing
all independent special districts to establish larger
revolving funds can help them pay their routine
expenditures more efficiently and expediently. The 110% of
the 1/12 district's adopted budget is just over one month's
worth of expenditures.
Support and Opposition (3/31/11)
Support : California Special Districts Association, CA
SB 288 -- 3/29/11 -- Page 3
Association of Public Cemeteries
Opposition : Unknown.