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| Public Act 096-0668 |
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AN ACT concerning education.
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Be it enacted by the People of the State of Illinois,
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represented in the General Assembly:
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Section 5. The School Code is amended by changing Section | ||||
1A-8 as follows:
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(105 ILCS 5/1A-8) (from Ch. 122, par. 1A-8)
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Sec. 1A-8. Powers of the Board in Assisting Districts | ||||
Deemed in Financial
Difficulties. To promote the financial | ||||
integrity of school districts, the
State Board of Education | ||||
shall be provided the necessary powers to promote
sound | ||||
financial management and continue operation of the public | ||||
schools.
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The State Superintendent of Education may require a school | ||||
district, including any district subject to Article 34A of this | ||||
Code, to share financial information relevant to a proper | ||||
investigation of the district's financial condition and the | ||||
delivery of appropriate State financial, technical, and | ||||
consulting services to the district if the district (i) has | ||||
been designated, through the State Board of Education's School | ||||
District Financial Profile System, as on financial warning or | ||||
financial watch status, (ii) has failed to file an annual | ||||
financial report, annual budget, deficit reduction plan, or | ||||
other financial information as required by law, or (iii) has | ||||
been identified, through the district's annual audit or other | ||
financial and management information, as in serious financial | ||
difficulty in the current or next school year. In addition to | ||
financial, technical, and consulting services provided by the | ||
State Board of Education, at the request of a school district, | ||
the State Superintendent may provide for an independent | ||
financial consultant to assist the district review its | ||
financial condition and options.
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The State Board of Education, after proper investigation of | ||
a district's
financial condition, may certify that a district, | ||
including any district
subject to Article 34A, is in financial | ||
difficulty
when any of the following conditions occur:
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(1) The district has issued school or teacher orders | ||
for wages as permitted in Sections
8-16, 32-7.2 and 34-76 | ||
of this Code;
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(2) The district has issued tax anticipation warrants | ||
or tax
anticipation notes in anticipation of a second | ||
year's taxes when warrants or
notes in anticipation of | ||
current year taxes are still outstanding, as
authorized by | ||
Sections 17-16, 34-23, 34-59 and 34-63 of this Code, or has | ||
issued short-term debt against 2 future revenue sources, | ||
such as, but not limited to, tax anticipation warrants and | ||
general State Aid certificates or tax anticipation | ||
warrants and revenue anticipation notes;
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(3) The district has for 2 consecutive years shown an | ||
excess
of expenditures and other financing uses over | ||
revenues and other financing
sources and beginning fund | ||
balances on its annual financial report for the
aggregate | ||
totals of the Educational, Operations and Maintenance,
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Transportation, and Working Cash Funds;
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(4) The district refuses to provide financial | ||
information or cooperate with the State Superintendent in | ||
an investigation of the district's financial condition.
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No school district shall be certified by the State Board of | ||
Education to be in financial difficulty solely by
reason of any | ||
of the above circumstances arising as a result of (i) the | ||
failure
of the county to make any distribution of property tax | ||
money due the district
at the time such distribution is due or | ||
(ii) the failure of this State to make timely payments of | ||
general State aid or any of the mandated categoricals; or if | ||
the district clearly demonstrates
to the satisfaction of the | ||
State Board of Education at the time of its
determination that | ||
such condition no longer exists. If the State Board of
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Education certifies that a district in a city with 500,000 | ||
inhabitants or
more is in financial difficulty, the State Board | ||
shall so notify the
Governor and the Mayor of the city in which | ||
the district is located. The
State Board of Education may | ||
require school districts certified in
financial difficulty, | ||
except those districts subject to Article 34A, to
develop, | ||
adopt and submit a financial plan within 45 days after
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certification of financial difficulty. The financial plan | ||
shall be
developed according to guidelines presented to the | ||
district by the State
Board of Education within 14 days of | ||
certification. Such guidelines shall
address the specific | ||
nature of each district's financial difficulties. Any
proposed | ||
budget of the district shall be consistent with the financial | ||
plan
submitted to and
approved by the State Board of Education.
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A district certified to be in financial difficulty, other | ||
than a district
subject to Article 34A, shall report to the | ||
State Board of Education at
such times and in such manner as | ||
the State Board may direct, concerning the
district's | ||
compliance with each financial plan. The State Board may review
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the district's operations, obtain budgetary data and financial | ||
statements,
require the district to produce reports, and have | ||
access to any other
information in the possession of the | ||
district that it deems relevant. The
State Board may issue | ||
recommendations or directives within its powers to
the district | ||
to assist in compliance with the financial plan. The district
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shall produce such budgetary data, financial statements, | ||
reports and other
information and comply with such directives. | ||
If the State Board of Education
determines that a district has | ||
failed to comply with its financial plan, the
State Board of | ||
Education may rescind approval of the plan and appoint a
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Financial Oversight Panel for the district as provided in | ||
Section 1B-4. This
action shall be taken only after the | ||
district has been given notice and an
opportunity to appear | ||
before the State Board of Education to discuss its
failure to | ||
comply with its financial plan.
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No bonds, notes, teachers orders, tax anticipation | ||
warrants or other
evidences of indebtedness shall be issued or | ||
sold by a school district or
be legally binding upon or | ||
enforceable against a local board of education
of a district | ||
certified to be in financial difficulty unless and until the
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financial plan required under this Section has been approved by | ||
the State
Board of Education.
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Any financial profile compiled and watch list distributed | ||
by the State Board of Education in Fiscal Year 2009 or any | ||
fiscal year thereafter
pursuant to this Section shall | ||
incorporate such adjustments as may be needed in the profile | ||
scores to reflect the financial effects of the designate those | ||
school districts on the
watch list that would not otherwise be | ||
on the watch list were it not for the
inability or refusal of | ||
the State of Illinois to make timely
disbursements of any | ||
general State aid or mandated categorical aid payments due | ||
school districts or to fully reimburse
school districts for | ||
mandated categorical programs pursuant to
reimbursement | ||
formulas provided in this School Code.
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(Source: P.A. 94-234, eff. 7-1-06.)
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Section 99. Effective date. This Act takes effect July 1, | ||
2009.
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