SECTIONS 84030-84043 - California Statutes

EDUCATION CODE

SECTION 84030-84043

84030. The accounting system including the uniform fund structure
used to record the financial affairs of any community college
district shall be in accordance with the definitions, instructions,
and procedures published in the California Community Colleges Budget
and Accounting Manual as approved by the board of governors and
furnished by the board of governors. No accounting manual so approved
shall expressly or by implication affect the content of any
educational program or objective, except as otherwise specifically
provided for by this code. The Legislature hereby finds that the
content shall be best determined by those involved in the
administration of educational programs, including community college
district governing boards, local administrators, instructors, and
students.

84040. (a) It is the intent of the Legislature to encourage sound
fiscal management practices among community college districts for the
most efficient and effective use of public funds for the education
of community college students by strengthening fiscal accountability
at the district and state levels.
(b) The governing board of each community college district shall
provide for an annual audit of all funds, books, and accounts of the
district in accordance with regulations of the board of governors.
The audit shall be made by certified public accountants licensed by
the California Board of Accountancy. In the event the governing board
of a community college district fails to provide for an audit, the
board of governors shall provide for an audit, and if the board of
governors fails or is unable to make satisfactory arrangements for
such an audit, the Department of Finance shall make arrangements for
the audit. The cost of any audit described above shall be paid from
district funds.
(c) The board of governors shall adopt criteria and standards for
periodic assessment of the fiscal condition of community college
districts, and these regulations regarding the review and improvement
of district fiscal conditions as necessary to encourage sound fiscal
management practices. In so doing:
(1) The governing board of a community college district, as
required by regulations of the board of governors, shall periodically
report information to the board of governors regarding the fiscal
condition of the district.
(2) The board of governors, by regulation, shall develop standards
for district maintenance of sound fiscal conditions. The regulations
shall authorize a board comprehensive management review of any
community college district which, after assessing itself or being
assessed in accordance with board criteria and standards, is shown to
be experiencing fiscal difficulty. On the basis of the findings of
the management review, the board of governors may recommend
appropriate changes in a district's management practices.
(3) The board of governors, by regulation, shall develop
appropriate procedures and actions for districts that fail to achieve
fiscal stability or that fail to comply with the board of governors'
recommendations. The procedures and remedies may include the
appointment of a special trustee to manage the district. The board of
governors shall be authorized to reduce or withhold apportionment to
districts to pay for the cost of the special trustee, management
review, or other extraordinary costs resulting from the district's
fiscal difficulties and to ensure the stabilization of the district's
financial condition.
(4) The board of governors shall report to the chairs of the
educational policy and fiscal committees of both houses of the
Legislature, the Director of Finance, and the Governor any corrective
action taken by the district and any action taken against the
district pursuant to paragraph (3).

84040.3. Each organization that is described in Section 501(c)(3)
of the Internal Revenue Code of 1954, 26 U.S.C. 501(c)(3), and that
is recognized by the governing board of a community college district
as having a formal relationship with, and that is working on behalf
of, the district or a community college within the district, shall
file a copy of its audited financial report for the previous fiscal
year or its annual financial report for the previous fiscal year with
the governing board on or before April 1 of each year.

84040.5. (a) The board of governors, in cooperation with, and upon
approval by, the Department of Finance, shall prescribe the
statements and other information to be included in the audit reports
filed with the state and shall develop audit procedures for carrying
out the purposes of this section. The Department of Finance may make
audits, surveys, and reports which, in the judgment of the department
will serve the best interest of the state.
(b) A review of existing audit procedures, statements, and other
information required to be included in the audit reports shall be
conducted periodically by the board of governors, in cooperation with
the Department of Finance. Standards shall be updated periodically.
(c) For the audit of community colleges electing to take formal
action pursuant to Sections 22714, 22714.5, 87488, and 87488.1, the
audit standards shall require any information as is prescribed by the
chancellor, including, but not limited to, the following:
(1) The number and type of positions being vacated.
(2) The age and service credit of the retirees receiving the
additional service credit provided by Sections 22714 and 87488.
(3) A comparison of the salary and benefits of each retiree
receiving the additional service credit with the salary and benefits
of the replacement employee, if any.
(4) The resulting retirement costs, including interest, if any,
and postretirement healthcare benefits costs, incurred by the
employer.
(d) The chancellor shall annually prepare a cost analysis, based
upon the information included in the audit reports for the prior
fiscal year, to determine the net savings or costs resulting from
formal actions taken by community college districts pursuant to
Sections 22714, 22714.5, 87488, and 87488.1, and shall report the
results of the cost analysis to the Governor and the Legislature by
April 1 of each year.
(e) All costs incurred by the board of governors to implement
subdivision (c) shall be absorbed by the board of governors.
(f) At the request of the Department of Finance, each community
college district that elects to take formal action pursuant to
Sections 22714, 22714.5, 87488, and 87488.1 shall reimburse the
Department of Finance for any related administrative costs incurred
by the Department of Finance.

84040.6. On June 30, 1991, and each year thereafter, the Board of
Governors of the California Community Colleges shall report to the
Joint Legislative Audit Committee on (1) the number and nature of
audit exceptions and estimated amount of funds involved in the
exceptions, (2) a list of districts which failed to file their audits
pursuant to Section 84040, and (3) the actions taken by the
department to eliminate audit exceptions and comply with management
improvement recommendations.

84041. (a) The board of governors may request the County Office
Fiscal Crisis and Management Assistance Team (FCMAT) established
pursuant to Section 42127.8 to assist a community college district to
establish or maintain sound financial and budgetary conditions and
to comply with principles of sound fiscal management.
(b) The board of governors may recommend additional persons with
expertise in community college fiscal accountability to serve as part
of a FCMAT operation for the purposes of this section.
(c) The board of governors may request FCMAT to assist a community
college district as follows:
(1) Whenever regulations adopted by the board of governors
authorize contracting for a management review of the district and its
educational programs or an audit of the financial conditions of the
district.
(2) To provide management or fiscal crisis intervention, or both,
for a community college district where a crisis presents an imminent
threat to the fiscal integrity and security of that district. In
these cases, the FCMAT shall have the authority, subject to
regulations adopted by the board of governors, to stay or rescind any
action of the district's governing board that is inconsistent with
the district's fiscal integrity and security.
(d) The FCMAT shall submit a progress report to the affected
district, to the board of governors, and to the chancellor at least
every six months, or more frequently if that is required by the
chancellor.
(e) Each community college district that receives assistance at
the request of the board of governors under subdivision (a), (b),
(c), or (d) shall be required to pay the full cost incurred by the
unit for these purposes.
(f) If the board of governors requests the assistance of the FCMAT
pursuant to paragraph (2) of subdivision (c), the chancellor shall
provide the board of governors with a report that includes all of the
following:
(1) An assessment of which events or activities led to the crisis.
(2) An action plan for addressing the deficiencies of the
district.
(3) A process for assessing district progress in correcting
deficiencies.
(4) Benchmarks that indicate the presence of local capacity to
manage the fiscal responsibilities of the district.
(g) (1) Irrespective of whether the FCMAT has been requested by
the board of governors to assist a district under this section, a
district may request the FCMAT to do either or both of the following
at district expense, in accordance with paragraph (2):
(A) Provide fiscal management assistance.
(B) Facilitate training for members of the district governing
board and for any district employees whose responsibilities include
addressing fiscal issues. Training services shall emphasize efforts
to improve fiscal accountability and to expand the fiscal competency
of the trainees.
(2) Each community college district that receives assistance at
its request under this subdivision shall be required to pay the full
cost incurred by the unit for that purpose.
(h) The board of governors shall develop and adopt any regulations
that are necessary for the implementation of this section.

84042. Except as provided in this section, any election held for
the purpose of permitting a community college district to exceed the
expenditure of district funds fixed by the Constitution or by the
statutes of the state shall be called, held, and conducted as nearly
as possible as are elections for the issuance of district bonds.
The notice of election shall contain only the following:
(a) The time and place or places of holding the election.
(b) The names of the officers appointed to conduct the election.
(c) The hours during the day in which the polls will be open.
(d) The amount by which it is proposed to increase the
expenditures of the district during the school year.
(e) The total amount of proposed expenditures of the district,
including the proposed increase, for the school year.
The ballots used at the election shall contain the following
language: "Shall the total authorized expenditures of the district be
increased from ____ (naming the sum) to ____ (naming the sum) for
the school year ____ (naming the school year) "
The hours during which the polls at the election are open shall be
fixed in accordance with Section 14212 of the Elections Code.

84043. (a) (1) Notwithstanding any other provision of law, and
unless otherwise prohibited under federal law, for the 2009-10 to
2012-13 fiscal years, inclusive, community college districts may use
funding received, pursuant to subdivision (b), from any of the
programs listed in paragraph (2) that are contained in Item
6870-101-0001 of Section 2.00 of the annual Budget Act, for the
purposes of any of the programs contained in Schedule (2) and
Schedules (4) to (23), inclusive, of Item 6870-101-0001 of Section
2.00 of the Budget Act of 2009.
(2) (A) Apprenticeship.
(B) Matriculation.
(C) Academic Senate for the Community Colleges.
(D) Equal Employment Opportunity.
(E) Part-time Faculty Health Insurance.
(F) Part-time Faculty Compensation.
(G) Part-time Faculty Office Hours.
(H) Economic Development.
(I) Transfer Education and Articulation.
(J) Physical Plant and Instructional Support.
(K) Campus Childcare Tax Bailout.
(b) For the 2009-10 to 2012-13 fiscal years, inclusive, the
chancellor shall apportion from the amounts provided in the annual
Budget Act for the programs enumerated in paragraph (2) of
subdivision (a), an amount to a community college district, based on
the same relative proportion that the district received in the
2008-09 fiscal year for the programs enumerated in paragraph (2) of
subdivision (a). The amounts allocated shall be adjusted for any
greater or lesser amount appropriated for the items enumerated in
paragraph (2) of subdivision (a).
(c) (1) This section does not obligate the state to refund or
repay reductions made pursuant to this section. A decision by a
district to reduce funding pursuant to this section for a
state-mandated local program shall constitute a waiver of the
subvention of funds that the district is otherwise entitled to
pursuant to Section 6 of Article XIII B of the California
Constitution on the amount so reduced.
(2) If a community college district elects to use funding received
pursuant to subdivision (b) in the manner authorized pursuant to
subdivision (a), the governing board of the district shall, at a
regularly scheduled open public hearing, take testimony from the
public, discuss, and shall approve or disapprove the proposed use of
funding.
(3) (A) If a community college district elects to use funding
received pursuant to subdivision (b) in the manner authorized
pursuant to subdivision (a), the district shall continue to report
the expenditures pursuant to this section by using the appropriate
codes to indicate the activities for which these funds were expended
using the existing standard reporting process as determined by the
chancellor.
(B) The chancellor shall collect the information in subparagraph
(A) and shall provide that information to the Department of Finance
and to the appropriate policy and budget committees of the
Legislature on or before April 15, 2010, and annually thereafter by
April 15 of each year, through 2014.
(d) For the 2009-10 to 2012-13 fiscal years, inclusive, community
college districts that elect to use funding in the manner authorized
pursuant to subdivision (a) shall be deemed to be in compliance with
the program and funding requirements contained in statutory,
regulatory, and provisional language, associated with the programs
enumerated in subdivision (a).