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ARIZONA HOUSE OF REPRESENTATIVESFifty-seventh Legislature First Regular Session |
House: ED DPA 12-0-0-0 |
HB 2610: school districts; board members; superintendent
Sponsor: Representative Gress, LD 4
Caucus & COW
Overview
Requires, if a school district is placed in receivership, the school district superintendent to be terminated for cause and the school district governing board (governing board) members to be removed.
History
The State Board of Education (SBE) has jurisdiction over all petitions requesting that a school district be placed in receivership or that a fiscal crisis team be appointed due to the school district's alleged insolvency or gross mismanagement. If, after a public meeting in which the school district has the opportunity to respond to the allegations, SBE finds that the school district is insolvent or has engaged in gross mismanagement, SBE may place the school district in receivership and appoint a receiver.
Once appointed, a receiver must begin an investigation of the school district's financial affairs. Within 120 days of appointment, the receiver is required to submit a detailed report that includes a financial improvement plan and budget that details how the school district will eliminate any continued gross mismanagement and achieve financial solvency. The financial improvement plan approved by SBE may authorize the receiver to: 1) override any decisions by the governing board or school district superintendent; 2) attend all governing board and administrative staff meetings; 3) supervise the day-to-day activities of school district staff; 4) place on extended leave, suspend or terminate for cause the school district superintendent or chief financial officer without providing a severance or buyout package; 5) authorize the transfer of pupils to other school districts; 6) appoint a chief educational officer, chief fiscal officer and independent public accountant; 7) reorganize the school district's financial accounts, management and budgetary systems; 8) establish school district fiscal guidelines and a system of internal controls; and 9) cancel or renegotiate most contracts.
After review and approval by SBE, the receiver must take all necessary steps to implement the financial improvement plan and budget. Statute details the requirements a school district must meet to be removed from receivership (A.R.S. § 15-103).
Provisions
School District Superintendent
1. Mandates the financial improvement plan for a school district placed in receivership to require the receiver to terminate for cause the school district superintendent. (Sec. 1)
2. Prohibits, if SBE places the school district in receivership, the receiver from providing a severance or buyout package to the school district superintendent. (Sec. 1)
3. Allows a school district superintendent who is terminated to file an appeal with SBE within 30 days after receiving notice of the termination. (Sec. 1)
Governing Board Members
4. Mandates, if SBE places a school district in receivership, the county school superintendent in which the school district is located to:
a) remove each of the school district's governing board members; and
b) fill the governing board vacancies. (Sec. 2)
5. Prohibits the county school superintendent from accepting names from the governing board for consideration when filling the governing board vacancies. (Sec. 2)
6. Makes a person ineligible for election to a governing board if the person has been removed from a governing board by the county school superintendent due to the school district being placed in receivership. (Sec. 1)
Miscellaneous
7. Makes technical and conforming changes. (Sec. 1)
Amendments
Committee on Education
1. Specifies that if the school district SBE places into receivership is located in two or more counties, each vacancy must be filled by the county school superintendent of the county in which the removed governing board member resided.
2. Declares a person is ineligible to hold an elective or appointive state, county, city, town or precinct office in Arizona and may not be issued a certificate of election or commission if the person:
a) is removed as a governing board member by the county school superintendent due to the school district being placed in receivership; or
b) resigned as a governing board member up to one month before the school district was placed in receivership.
3. Directs the county treasurer to register warrants in the total amount of $2,500,000 that are issued by a school district in receivership and approved by the receiver, regardless of whether there are sufficient monies in the school district's account.
4. States it is the Legislature's intent that warrants registered are funded by basic state aid payments to the school district.
5. Repeals the requirement for the county treasurer to register warrants as specified on January 1, 2027.
6. Prohibits the Arizona Department of Education (ADE) from considering the cash balance or budget carryforward of a school district that is placed in receivership in the third quarter of FY 2025 when calculating the school district's budget capacity until March 2025.
7. Repeals the prohibition for ADE on January 1, 2027.
8. Adds an emergency clause.
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12. HB 2610
13. Initials CH Page 0 Caucus & COW
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