2013 -- H 5762 SUBSTITUTE A

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LC01533/SUB A

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STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2013

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A N A C T

RELATING TO STATE AFFAIRS AND GOVERNMENT - DEPARTMENT OF

ADMINISTRATION

     Introduced By: Representatives Casey, Guthrie, Kazarian, and Phillips

     Date Introduced: February 28, 2013

     Referred To: House Health, Education & Welfare

It is enacted by the General Assembly as follows:

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     SECTION 1. Section 16-2-9.4 of the General Laws in Chapter 16-2 entitled “School

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Committees and Superintendents” is hereby amended to read as follows”

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     16-2-9.4. School district accounting compliance. -- (a) The office of auditor general

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and the department of elementary and secondary education shall promulgate a uniform system of

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accounting, including a chart of accounts based on the recommendations of the advisory council

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on school finance, and require all accounts of the school districts, regional school districts, state

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schools and charter schools to be kept in accordance therewith; provided, that in any case in

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which the uniform system of accounting is not practicable, the office of auditor general in

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conjunction with the department of elementary and secondary education shall determine the

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manner in which the accounts shall be kept. The uniform system of accounting shall also include

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a standardized budget process to ensure districts can annually assess investment priorities and

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incorporate long range planning.

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     (b) For the purpose of securing a uniform system of accounting and a chart of accounts

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the advisory council on school finances, as defined in § 16-2-9.2 may make such surveys of the

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operation of any school districts, regional school district, state school or charter school as they

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shall deem necessary.

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     (c) Upon completion of the implementation of the uniform chart of accounts, all the

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school districts, regional school districts, state schools, and/or charter schools, shall implement a

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regents-approved budget model, and use best practices established by the department of education

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for long range planning, budget development, and budget administration and reporting.

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     (d) If any school district, regional school district, state school or charter school fails to

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install and maintain the uniform system of accounting, including a chart of accounts and

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approved budget model, or fails to keep its accounts and interdepartmental records, or refuses or

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neglects to make the reports and to furnish the information in accordance with the method

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prescribed by the office of auditor general and the department of education or hinders or prevents

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the examination of accounts and financial records, the auditor general and the commissioner of

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education and/or their respective designee(s) shall make a report to the superintendent of schools

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of the local education agency, the school committee chairperson, the mayor or town manager, and

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the president of the town council, and/or for a charter school, to the board of trustees or directors,

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as applicable, in writing, specifying the nature and extent of the failure, refusal, neglect,

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hindrance, or prevention, and the commissioner is hereby authorized and directed to review the

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matter so reported. If the commissioner shall find that failure, refusal, neglect, hindrance, or

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prevention exists and that the school district, regional school district, state school or charter

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school should properly comply in the matter so reported, the commissioner shall direct the school

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district, regional school district, state school or charter school, in writing, to so comply. If the

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failure, refusal, neglect, hindrance, or prevention shall continue for a period of ten (10) days

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following the written direction, the commissioner may request the board of education for

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approval to withhold distribution of state aid to said school district, regional school district, state

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school or charter school. The board shall hold a hearing and provide the subject school and/or

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district notice and an opportunity to be heard at said hearing. After hearing thereon, the board

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may authorize the commissioner to withhold the distribution of state aid to said school district,

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regional school district, state school, or charter school, if the board determines such sanction is

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appropriate.

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     (e) The department of elementary and secondary education in consultation with the

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division of municipal finance shall conduct periodic reviews and analysis of school revenues and

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expenses. The department shall also review and monitor compliance with the approved budget

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model and best practices. The department shall identify those local education agencies considered

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to be at risk of a year-end deficit or a structural deficit that could impact future years. Such

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potential deficits shall be identified based on the periodic reviews, which may also include on-site

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visits and reporting in accordance with the provisions of § 45-12-22.2. Potential deficits shall be

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reported to the office of municipal finance, office of auditor general, superintendent, chairman of

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the school committee, mayor or town manager, and the president of the town council, of the

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applicable school district, regional school district, or state school, and/or for a charter school, to

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the board of trustees or directors, as applicable.

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     SECTION 2. This act shall take effect upon passage.

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LC01533/SUB A

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N A C T

RELATING TO STATE AFFAIRS AND GOVERNMENT - DEPARTMENT OF

ADMINISTRATION

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     This act would require the board of education, at the request of the commissioner, to hold

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a hearing on whether to withhold aid to a school district for failure to meet school district

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accounting compliance.

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     This act would take effect upon passage.

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LC01533/SUB A

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