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Chapter 14. School Finance. Subchapter 9. Criteria and Standards for County Office of Education Budgets and Interim Reports. Interim Report Review. Note: For fiscal responsibility of County Superintendents. Supplemental Information.   

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(a) County offices of education shall provide supplemental information in the following general areas:

(1) Provide the methodology and assumptions used to estimate ADA, enrollment, revenues, expenditures, reserves and fund balance, and multiyear commitments (including cost-of-living adjustments).

(2) Provide information on additional indicators as requested.

(b) County offices of education shall provide supplemental information in the following specific areas:

(1) Contingent Liabilities. Identify any known or contingent liabilities from financial or program audits, state compliance reviews, litigation, etc., that have occurred since budget adoption that may impact the budget.

(2) Use of One-Time Revenues for Ongoing Expenditures. Identify the ongoing county school service fund (CSSF) expenditures funded by one time revenues that have changed by more than five percent since budget adoption. (For this purpose, the first interim reports will be compared to adopted budgets; the second interim reports will be compared to first interim projections.)

(3) Contingent Revenues. Identify projected revenues for the current fiscal year and two subsequent fiscal years that are contingent on reauthorization by the local government, special legislation, or other definitive act (e.g., parcel taxes). If any of these revenues are dedicated for ongoing expenses, explain how the revenues will be replaced or the expenditures reduced.

(4) Contributions. Provide information regarding contributions as follows:

(A) Identify projected contributions from unrestricted resources in the CSSF to restricted resources in the CSSF for the current year and two subsequent fiscal years. Provide an explanation if contributions have changed by more than $20,000 and more than five percent since budget adoption. (For this purpose, the first interim reports will be compared to adopted budgets; the second interim reports will be compared to first interim projections.)

(B) Identify projected transfers to or from the CSSF to cover operating deficits in either the CSSF or any other fund for the current year and two subsequent fiscal years. Provide an explanation if transfers have changed by more than $20,000 and more than five percent since budget adoption. (For this purpose, the first interim reports will be compared to adopted budgets; the second interim reports will be compared to first interim projections.)

(C) Identify capital project cost overruns that have occurred since budget adoption that may impact the CSSF budget. (For this purpose, first interim reports will be compared to adopted budgets; second interim reports will be compared to first interim projections.)

(5) Long-Term Commitments. Provide information regarding long-term commitments as follows:

(A) Identify all existing and new multiyear commitments (include multiyear commitments, multiyear debt agreements, and new programs or contracts that result in long-term obligations) and their annual required payment, for the current fiscal year and two subsequent fiscal years.

(B) Explain how any increase in annual payments will be funded. Also explain how any decrease to funding sources used to pay long-term commitments will be replaced.

(6) Unfunded Liabilities. Identify any changes in estimates for unfunded liabilities since budget adoption, and indicate whether the changes are the result of a new actuarial valuation. (For this purpose, first interim reports will be compared to adopted budgets; second interim reports will be compared to first interim projections.)

(7) Temporary Interfund Borrowings. Identify projected temporary borrowings between funds (refer to Education Code section 42603).

(8) Status of Labor Agreements. Analyze the status of employee labor agreements, including the following:

(A) Identify new labor agreements that have been ratified since budget adoption, as well as new commitments provided as part of previously ratified multiyear agreements; and include all contracts, including all administrator contracts (and including all compensation). For new agreements, indicate the date of the required board meeting.

(B) Compare the increase in new commitments to the projected increase in ongoing revenues, and explain how these commitments will be funded in future fiscal years.

(C) If salary and benefit negotiations are not finalized, upon settlement with certificated or classified staff:

1. The county office of education must determine the cost of the settlement, including salaries, benefits, and any other agreements that change costs, and provide the CDE with an analysis of the cost of the settlement and its impact on the operating budget.

2. The CDE shall review the analysis relative to the criteria and standards, and may provide written comments to the president of the governing board and county superintendent of schools.

(9) Status of Other Funds. Analyze the status of other funds that may have negative fund balances at the end of the current fiscal year. If any other fund has a projected negative fund balance, prepare an interim report and multiyear projection for that fund. Explain plans for how and when the negative fund balance will be addressed.

Authority cited:

Education Code 1240(l)

Education Code 33127

Education Code 33129

Reference:

Education Code 33128

Education Code 42603

Government Code 3540.2

Government Code 3547.5

(Amended by Register 2013, No. 49.)