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Engrossed House Bill (H)

Authored by

DIGEST

School corporation financial management. Allows the distressed unit appeal board (DUAB) to delegate board authority, duties, and responsibilities to the executive director by resolution of the board. Allows the DUAB to adopt rules. Requires the attorney general to represent a member of the fiscal management board, an emergency manager, a chief financial officer, or a chief academic officer if the individual requests the representation. Specifies restrictions on school corporations that are designated distressed. Specifies that waivers regarding the allocation of protected taxes apply only to distressed school corporations and not other distressed units. Provides that, for a period of two School corporation financial management. Allows the distressed unit appeal board (DUAB) to delegate board authority, duties, and responsibilities to the executive director by resolution of the board. Allows the DUAB to adopt rules. Requires the attorney general to represent a member of the fiscal management board, an emergency manager, a chief financial officer, or a chief academic officer if the individual requests the representation. Specifies restrictions on school corporations that are designated distressed. Specifies that waivers regarding the allocation of protected taxes apply only to distressed school corporations and not other distressed units. Provides that, for a period of two years following the termination of a political subdivision's distressed status, the political subdivision may not do any of the following without the prior approval of the DUAB: (1) Adopt a budget, tax levy, or tax rate. (2) Issue bonds. (3) Enter into a lease. Requires a political subdivision to submit certain reports to the DUAB for a period of four years following the termination of the political subdivision's distressed status. Authorizes the emergency manager of a distressed school corporation to cancel any employee's contract or terminate an employee's employment as part of a reduction in force. Provides that notification for a reduction in force of: (1) certificated employees may be delivered after September 30 and before November 1 of the contract year; and (2) noncertificated employees may be delivered at any time. Specifies that the maximum reduction in force of certificated employees under this provision may not exceed 5% of the full-time equivalency for all certificated employees in the certificated employee bargaining unit for the school corporation. Requires the emergency manager to provide any employee whose contract is being canceled with notice at least 90 days before the effective date of the cancellation. Provides that the governing body of a distressed school corporation (or the advisory board, in the case of Gary schools) may file a petition with the DUAB for termination of distressed status only if the school corporation's ongoing revenues exceed the school corporation's ongoing expenses. Specifies that the governing body or advisory board may file such a petition with the DUAB not more than one time in a 12 month period. Makes changes concerning the Gary Community school corporation and its operation. Converts the Gary Community school corporation's governing board to an advisory board. Provides that the advisory board may not hold a public meeting more often than once every three months. Provides that the advisory board may hold additional meetings that are authorized as executive sessions under the open door law. Specifies that the advisory board may vote to fill vacancies and select officers of the advisory board. Deletes from current law the requirements: (1) that the emergency manager for the Gary Community school corporation must consult with the fiscal management board and the governing body; and (2) that the emergency manager for the Gary Community school corporation must consult with the mayor, the fiscal management board, and the governing body when developing the school corporation's annual budget and developing a financial plan, and provides that the emergency manager shall consider any recommendations from these entities. Requires the chief financial officer and chief academic officer to submit a quarterly report the advisory board. Removes the laws concerning the Muncie Community school corporation being a fiscally impaired school corporation. Permits the Ball State University board of trustees to adopt a resolution to govern the Muncie Community school corporation using a newly appointed seven member governing board. Requires certain members of the governing body to reside in the Muncie Community school corporation district. Provides that in making the appointments to the governing body of the Muncie Community school corporation, the Ball State University board of trustees and the President of Ball State University shall strive to ensure that the members appointed to the governing body reflect the geographical and socioeconomic composition of the school district. Provides that the terms of office of the two members appointed by the President of Ball State University expire on June 30, 2022, and beginning July 1, 2022, two members of the board shall be individuals elected at-large. Requires the first elected members to be elected at the 2022 primary election. Specifies that the governing body serving on June 30, 2018, shall become on July 1, 2018, an advisory board to the governing body appointed by the President and board of trustees of Ball State University. Requires the governing body to engage academically innovative strategies. Specifies that only certain laws in IC 20 will apply to the Muncie Community school corporation. Specifies other conditions. Provides that during the period beginning July 1, 2018, and ending June 30, 2022, the DUAB shall provide financial support to the Muncie Community school corporation in an amount that does not exceed the amount of compensation that would have been provided to an emergency manager of the school corporation if the school corporation had retained the designation of a distressed political subdivision. Permits the DUAB to recommend to the state board of finance that the state board of finance make an interest free loan to the Muncie Community school corporation. Establishes a fiscal and qualitative indicators committee (committee) to make determinations about the fiscal and qualitative factors to be used in analyzing the financial condition of school corporations. Specifies certain factors that may be used. Requires the committee to make determinations about the presentation of the factors and the financial condition of school corporations to the public and the frequency of updates. Requires the DUAB to present school financial condition information on its Internet web site or the management performance hub Internet web site. Sets minimum standards for presenting the information. Requires the DUAB to determine the financial condition of each school corporation and whether a school corporation should be placed on a watch list. Requires the executive director of the DUAB to do the following: (1) Report to the state budget committee the process and procedures that will be used before a school corporation is placed on the watch list. (2) Prepare a report identifying each school corporation whose financial condition indicates the potential to be placed on the watch list. Provides that the DUAB may enter into an agreement with a school corporation to develop a corrective action plan. Requires the DUAB to meet in executive session for discussions and determinations related to placing a school corporation on the watch list. Specifies that the DUAB may make a determination to place a school corporation on the watch list only if the DUAB has, at least six months before making the determination, provided notice to the school corporation stating that the DUAB is considering making such a determination. Provides that before a school corporation is placed on a watch list, the school corporation shall be given an opportunity to meet with the DUAB and the DUAB executive director in executive session. Specifies that after the DUAB makes a determination to place the school corporation on the watch list, the school corporation may file an appeal with the DUAB and request removal from the watch list. Provides that until the DUAB has ruled on the appeal, the school corporation may not be placed on the watch list. Specifies that all correspondence and other records related to discussions and determinations concerning whether a school corporation should be placed on the watch list are confidential and not subject to public disclosure unless and until the school corporation is subsequently placed on the watch list. Specifies that if the DUAB finds that: (1) a determination has been provided by the state board of accounts specifying that a corrective action plan is appropriate for a school corporation; or (2) the fiscal and qualitative indicators indicate that a corrective action plan is appropriate for a school corporation; the DUAB shall initiate contact with the chairperson of the governing body and the superintendent of the school corporation and offer to provide technical assistance to the school corporation. Provides that the DUAB may form a technical assistance team. Provides that the governing body of the Indianapolis Public Schools may sell a closed, unused, or unoccupied school building without making the vacant school building available to a charter school if certain conditions are satisfied. Amends the definition of "deficit financing" for a budget year to mean, in the case of any distressed school corporation, the Gary Community school corporation, or the Muncie Community school corporation: (1) actual expenditures; plus (2) additional payments against any outstanding debt obligations; exceeding the employer's current year actual education fund revenue. Provides that until June 30, 2018, the governing body of Gary schools, rather than the emergency manager, shall exercise the power to fill a vacancy on the governing body. Resolves conflicts. Makes technical corrections. ... View more