Senate Bill (H)

DIGEST

Gary schools and the distressed unit appeal board. Designates the Gary Community School Corporation as a distressed political subdivision. Provides that until the Gary Community School Corporation's designation as a distressed political subdivision is terminated: (1) the emergency manager appointed for the school corporation has the powers and duties under the distressed political subdivision law; and (2) the emergency manager, rather than the governing body of the school corporation, shall exercise all powers related to financial matters of the school corporation. Authorizes the distressed unit appeal board (DUAB) to do the following: (1) Delay or suspend any payments of principal Gary schools and the distressed unit appeal board. Designates the Gary Community School Corporation as a distressed political subdivision. Provides that until the Gary Community School Corporation's designation as a distressed political subdivision is terminated: (1) the emergency manager appointed for the school corporation has the powers and duties under the distressed political subdivision law; and (2) the emergency manager, rather than the governing body of the school corporation, shall exercise all powers related to financial matters of the school corporation. Authorizes the distressed unit appeal board (DUAB) to do the following: (1) Delay or suspend any payments of principal or interest, or both, that would otherwise be due from the Gary Community School Corporation on loans or advances from the common school fund. (2) Recommend to the state board of finance that the state board of finance make an interest free loan to the Gary Community School Corporation from the common school fund. (3) Provide grants or loans to the school corporation to assist the school corporation in overcoming short term financial problems. Establishes the fiscal management board for the Gary Community School Corporation, consisting of one member appointed by the governing body of the school corporation, one member appointed by the mayor of the city of Gary, and one member appointed by the superintendent of public instruction. Provides that the fiscal management board shall make recommendations to the emergency manager and shall advise the emergency manager as requested by the emergency manager. Requires the governing body of the school corporation to employ a chief financial officer for the school corporation. Specifies that the chief financial officer shall report to the emergency manager and shall assist the emergency manager appointed for the school corporation in carrying out the day to day financial operations of the school corporation. Provides that the annual budget adopted by the emergency manager for the school corporation must dedicate a significant part of the school corporation's budget to eliminating the school corporation's debt obligations. Requires the emergency manager to do the following: (1) Attempt to negotiate with the creditors of the school corporation to establish a plan specifying the schedule for paying each creditor. (2) Submit the plan to the DUAB for approval. Provides that the emergency manager must consult with the governing body of the school corporation, the fiscal management board, and the mayor of the city of Gary in developing the school corporation's annual budget, and that the DUAB must review and approve the school corporation's annual budget that is adopted by the emergency manager. Provides that the governing body of the school corporation is responsible for the academic matters of the school corporation, subject to the emergency manager's powers, and requires the governing body to develop an education plan to achieve academic progress. Requires the emergency manager to do the following: (1) Conduct a financial and compliance audit of the operations of the school corporation. (2) Develop a written financial plan in consultation with the fiscal management board, the governing body, and the mayor of the city of Gary. Requires the emergency manager to report quarterly to the DUAB. Requires the emergency manager to provide copies of the report to the governing body, the fiscal management board, and the mayor of the city of Gary. Requires the school corporation to: (1) publish a copy of each report on the school corporation's Internet web site; (2) make copies of the report available free of charge to the public upon request at each school building; and (3) provide copies of the report to the city of Gary to be made available free of charge to the public. Requires the governing body and the emergency manager to report annually concerning the school corporation's academic and financial progress and condition at a public meeting of the city council. Specifies that the designation of the Gary Community School Corporation as a distressed political subdivision is terminated on the earlier of the following: (1) July 1, 2022. (2) The date specified in a resolution adopted by the DUAB in which the DUAB terminates the school corporation's designation as a distressed political subdivision, after finding that significant improvements have been made to the financial condition of the school corporation (including the implementation of a financial plan that provides for the payment of all of the school corporation's debts and that will allow the school corporation to operate under a balanced budget and be financially solvent and stable) and that it is in the best interest of students, the school corporation, citizens, and the state to terminate the school corporation's designation as a distressed political subdivision. Specifies that if an emergency manager or a member of the fiscal management board is made a party to a civil suit, the attorney general shall defend the emergency manager or fiscal management board member throughout the action. Specifies that an emergency manager for a distressed political subdivision may impose only those taxes or fees that the political subdivision is authorized by law to impose. Provides that: (1) subject to existing labor agreements, an emergency manager shall assume and exercise the authority and responsibilities of both the executive and the fiscal body of the political subdivision in setting the salaries and other compensation of the political subdivision's employees; and (2) an emergency manager shall approve (rather than review, under current law) payrolls and other claims against the political subdivision before payment. ... View more