Bill Text: MI SB0678 | 2017-2018 | 99th Legislature | Introduced
Bill Title: Education; public school academies; notification to public school academy if they are currently being operated by an educational maintenance organization that is experiencing financial distress; require. Amends secs. 1219 & 1220 of 1976 PA 451 (MCL 380.1219 & 380.1220).
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2017-11-30 - Referred To Committee On Education [SB0678 Detail]
Download: Michigan-2017-SB0678-Introduced.html
SENATE BILL No. 678
November 30, 2017, Introduced by Senator BIEDA and referred to the Committee on Education.
A bill to amend 1976 PA 451, entitled
"The revised school code,"
by amending sections 1219 and 1220 (MCL 380.1219 and 380.1220),
section 1219 as added by 2015 PA 109 and section 1220 as added by
2015 PA 111.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 1219. (1) Except as otherwise provided in subsection (2),
before July 7 of each school fiscal year, each school district and
public school academy shall transmit to CEPI the budgetary
assumptions used when adopting its annual budget pursuant to the
uniform budgeting and accounting act, 1968 PA 2, MCL 141.421 to
141.440a. However, a school district or public school academy that
had a positive general fund balance of at least 5% of total general
fund revenues for each of 2 most recently completed school fiscal
years is not required to transmit the budgetary assumptions under
this subsection. After receipt by CEPI, CEPI shall compile and
transmit the budgetary assumptions to the department of treasury.
The submission of the budgetary assumptions under this subsection
shall be in the form prescribed by CEPI and shall include at least
all of the following information:
(a) The projected foundation allowance for the school district
or public school academy used by its governing body when adopting
the budget for the school district or public school academy for the
current school fiscal year.
(b) The projected membership of the school district or public
school academy used when adopting the budget of the school district
or public school academy for the current school fiscal year.
(c) The estimated expenditures per pupil for the school
district or public school academy for the immediately preceding
school fiscal year, calculated by dividing total general fund
operating expenditures for the school district or public school
academy during that school fiscal year by the membership for the
school district or public school academy reported by the department
in the most recent state aid financial status report for the month
of May.
(d) The projected expenditures per pupil for the school
district or public school academy for the current school fiscal
year, calculated by dividing the total general fund operating
expenditures authorized by the governing body of the school
district or the public school academy when adopting the budget for
the current school fiscal year by the projected membership of the
school district or public school academy used when adopting the
budget of the school district or public school academy for the
current school fiscal year.
(2) If an authorizing body submits a budgetary assumption
report required under subsection (1) on behalf of each public
school academy authorized by that authorizing body that would
otherwise be required to submit budgetary assumptions under
subsection (1), then those public school academies are not required
to submit the budgetary assumption report required under subsection
(1).
(3) If, based on the factors enumerated in this subsection,
the state treasurer determines that the potential for fiscal stress
exists within a school district, intermediate school district, or
public school academy; that an operating deficit may arise within a
school district, intermediate school district, or public school
academy during the current school fiscal year or the following 2
school fiscal years; or that a school district, intermediate school
district, or public school academy may be unable to meet its
financial obligations while also satisfying the school district's,
intermediate school district's, or public school academy's
obligations or abilities to provide public educational services in
a manner that complies with this act, the state school aid act of
1979, and applicable rules, then the state treasurer may declare
that the potential for fiscal stress exists for the school
district, intermediate school district, or public school academy.
This determination shall be based on consideration of the following
factors:
(a) Financial data or other information submitted by the
school district, intermediate school district, or public school
academy to a state department or agency.
(b) Financial data or other information included within an
audited financial statement of the school district, intermediate
school district, or public school academy.
(c) Financial data or other information provided to a state
department, agency, or authority in connection with a request to
issue bonds, notes, or other debt obligations, including, but not
limited to, information relating to a request for a loan under the
emergency municipal loan act, 1980 PA 243, MCL 141.931 to 141.942.
(d) Financial data or other information included within a
recommended budget, budget, or general appropriations act of the
school district, intermediate school district, or public school
academy.
(e) Financial data or other information provided to a state
department, agency, or authority by an officer, employee,
contractor, or agent of the school district, intermediate school
district, or public school academy.
(f) For a school district, data relating to pupil enrollment,
including, but not limited to, residents of other school districts
enrolled in the school district and residents of the school
district enrolled in another school district or in a public school
not operated by the school district.
(g) For a school district, financial data or other information
provided to the department or department of treasury by the
intermediate school district in which the school district is
located.
(h) For a public school academy, financial data or other
information provided to the department or department of treasury by
the authorizing body of the public school academy.
(4) If the state treasurer declares under subsection (3) that
the potential for fiscal stress exists for a school district,
intermediate school district, or public school academy, then not
less than 14 days after the declaration the state treasurer shall
do all of the following:
(a) Notify the governing body of the school district,
intermediate school district, or public school academy and the
authorizing body of the public school academy that the state
treasurer has declared that the potential for fiscal stress exists
for the school district, intermediate school district, or public
school academy.
(b) For a school district or public school academy, notify the
governing body of the school district or public school academy that
it may establish a contract under subsection (5) with an
intermediate school district to perform an administrative review of
the financial status of the school district or public school
academy.
(5) Subject to subsection (16), if the state treasurer
declares under subsection (3) that the potential for fiscal stress
exists for a school district or public school academy, the
governing body of the school district or public school academy may
choose to establish a contract with an intermediate school district
to perform an administrative review of the financial status of the
school district or public school academy. An intermediate school
district that is working with a school district or public school
academy to establish a contract under this subsection shall consult
with the department of treasury on the development of the contract.
A school district or public school academy must enter into this
contract within 60 days after receiving notification of the
declaration from the state treasurer under subsection (4). A
contract under this subsection between an intermediate school
district and a school district or public school academy shall
provide for all of the following:
(a) Within 90 days after entering into the contract, the
intermediate school district shall complete an administrative
review and issue recommendations to the school district or public
school academy concerning those steps the school district or public
school academy should consider taking to avoid a deficit.
(b) After completion of the administrative review, the
intermediate school district shall present the recommendations
under subdivision (a) at the next scheduled public meeting of the
governing body of the school district or public school academy.
(c) The intermediate school district shall send a copy of the
recommendations to the department and the department of treasury.
(d) Subject to subsection (6), the intermediate school
district's administrative review under subdivision (a) shall
include, but is not limited to, all of the following:
(i) An examination of financial practices, including at least
an examination of the school district's or public school academy's
compliance with the uniform budgeting and accounting act, 1968 PA
2, MCL 141.421 to 141.440a, budget to actual expense report
monitoring, and budget amendment practices after budget adoption.
(ii) An examination of staffing and a comparison of staffing
to other school districts and public school academies, as
applicable.
(iii) An examination of wages and a comparison of wages to
other school districts and public school academies in the area, as
applicable.
(iv) An examination of benefit costs as a percentage of wages
and a comparison of benefit costs as a percentage of wages to other
school districts and public school academies in the area, as
applicable.
(v) A school building student capacity utilization review.
(vi) An examination of non-instructional costs by function and
a comparison of those costs to other school districts and public
school academies, as applicable.
(vii) A review of enrollment projection methods and history.
(viii) An examination of deferred maintenance and capital
investment needs. Capital investment needs include technology
equipment and technology infrastructure needs.
(ix) An examination of substitute costs, workers compensation
costs, unemployment compensation costs and forecasts, and a review
of other insurance programs.
(x) An examination of pupil transportation costs and routing.
(xi) An examination of the current and future costs of
existing bargaining agreements.
(e) The school district or public school academy shall give
the intermediate school district or its contracted agents access to
any and all financial data or information relating to the financial
condition of the school district or public school academy as
requested by the intermediate school district.
(f) The school district or public school academy shall allow
the intermediate school district or its contracted agents to
examine all financial records and books of account of the school
district or public school academy.
(g) The school district or public school academy shall
promptly and fully provide the assistance and information necessary
and properly requested by the intermediate school district or its
contracted agent in the effectuation of the intermediate school
district's duties under this subsection, including, but not limited
to, complying with a request that the school district or public
school academy provide a facility condition assessment or a
physical asset inventory if either of these has not been completed
in the immediately preceding 24 months.
(h) The school district or public school academy shall allow
the intermediate school district to work in a consortium with
another intermediate school district or multiple intermediate
school districts in the effectuation of the intermediate school
district's duties under this subsection.
(i) The school district or public school academy shall allow
the intermediate school district to use a contractor or contractors
to assist in the review on a cost recovery basis as determined by
the intermediate school district.
(j) Either the intermediate school district or the school
district or public school academy may rescind the contract, as
follows:
(i) The intermediate school district may rescind the contract
if the school district or public school academy is not complying
with 1 or more of the recommendations issued to the school district
or public school academy under subdivision (a).
(ii) The school district or public school academy may rescind
the contract for any reason.
(6) The parties to a contract under subsection (5) may request
the department of treasury to waive 1 or more of the requirements
for items to be included in the intermediate school district's
administrative review under subsection (5)(d). If the department of
treasury grants a waiver under this subsection, then the
intermediate school district's administrative review under
subsection (5)(d) is not required to include the waived item or
items.
(7) If a school district or public school academy establishes
a contract with an intermediate school district under subsection
(5), the intermediate school district shall submit quarterly
reports to the department of treasury on the status of the
implementation of the recommendations issued to the school district
or intermediate school district by the intermediate school district
under subsection (5)(a).
(8) Subject to subsection (9), the state treasurer may require
a school district, intermediate school district, or public school
academy to submit periodic financial status reports under this
section if all of the following occur:
(a) The state treasurer has declared under subsection (3) that
the potential for fiscal stress exists for the school district,
intermediate school district, or public school academy.
(b) More than 60 days have passed since the school district,
intermediate school district, or public school academy was notified
of the declaration as required under subsection (4)(a).
(c) For a school district or public school academy, that
school district or public school academy has not established a
contract with an intermediate school district in the time and
manner required under subsection (5), has rescinded a contract with
an intermediate school district under subsection (5)(j), or has had
its contract with an intermediate school district under subsection
(5) rescinded by the intermediate school district under subsection
(5)(j).
(d) The school district, intermediate school district, or
public school academy has not had a positive general fund balance
of at least 5% of total general fund revenues for each of the 2
most recently completed school fiscal years.
(e) The school district, intermediate school district, or
public school academy has had a declining general fund balance in 1
or both of the 2 most recently completed school fiscal years.
(f) The school district, intermediate school district, or
public school academy is not required to submit a deficit
elimination plan or an enhanced deficit elimination plan under
section 1220.
(9) If a school district or public school academy enters into
a contract with an intermediate school district as described under
subsection (5), the state treasurer shall not require the school
district or public school academy to submit periodic financial
status reports under this section until at least 730 days after the
governing body of the school district or public school academy was
notified of the declaration of the state treasurer under subsection
(4)(a). However, the state treasurer may require the school
district or public school academy to submit periodic financial
status reports under this section if the state treasurer determines
that the school district or public school academy has not
implemented any of the recommendations within 365 days after the
governing body of the school district or public school academy was
notified of the declaration of the state treasurer under subsection
(4)(a).
(10) If a school district, intermediate school district, or
public school academy is required to submit periodic financial
status reports under this section, the school district,
intermediate school district, or public school academy shall do all
of the following:
(a) Submit a periodic financial status report in the form and
manner and on the periodic basis prescribed by the department of
treasury, after approval by the governing body of the school
district or public school academy.
(b) Transmit a copy of each periodic financial status report
required under this section to the members of its governing body.
(c) Provide the department of treasury with other financial
data or information relating to the financial conditions of the
school district, intermediate school district, or public school
academy as requested by the department of treasury.
(d) Allow the department of treasury to examine financial
records and books of account of the school district, intermediate
school district, or public school academy.
(e) Promptly and fully provide the assistance and information
necessary and properly requested by the department of treasury in
the exercise of the department of treasury's duties under this
section.
(11) If a school district, intermediate school district, or
public school academy fails to submit a periodic financial status
report required under this section, or if the state treasurer
determines that information included on a periodic financial status
report indicates that fiscal stress exists within the school
district, intermediate school district, or public school academy,
or that a deficit has occurred or is projected to occur within the
school district, intermediate school district, or public school
academy within the current school fiscal year or the next school
fiscal year and that the school district, intermediate school
district, or public school academy lacks the capacity to address
the deficit without state assistance, then the state treasurer may
require the school district, intermediate school district, or
public school academy to submit an enhanced deficit elimination
plan under section 1220.
(12) If a school district is required to submit periodic
financial status reports under this section and a loan is issued to
the school district under the emergency municipal loan act, 1980 PA
243, MCL 141.931 to 141.942, the state treasurer shall require the
school district to submit periodic financial status reports under
this section for not more than 4 years after the date of issuance
of the loan.
(13) A school district, intermediate school district, or
public school academy is no longer required to submit periodic
financial status reports under this section if the state treasurer
determines that the periodic financial status reports submitted by
the school district, intermediate school district, or public school
academy indicate that potential fiscal stress does not exist within
the school district, intermediate school district, or public school
academy; that a deficit is not projected to arise within the school
district, intermediate school district, or public school academy
within the current school fiscal year or the next 2 school fiscal
years; and that the school district, intermediate school district,
or public school academy will be able to meet its financial
obligations while also satisfying the school district's,
intermediate school district's, or public school academy's
obligations or ability to provide public educational services in a
manner that complies with this act, the state school aid act, and
applicable rules.
(14) If the state treasurer makes a determination under
subsection (13) that the conditions under that subsection apply to
a school district, intermediate school district, or public school
academy, the state treasurer shall notify the school district,
intermediate school district, or public school academy within 14
days after making that determination.
(15) CEPI shall make available to the public on its website
all of the periodic financial status reports submitted to the state
treasurer under this section. The state treasurer shall transmit to
CEPI any documents needed by CEPI to comply with this subsection.
(16) If the state treasurer declares under subsection (3) that
the potential for fiscal stress exists for a public school academy,
then, in addition to the option under subsection (5) for the public
school academy to establish a contract with an intermediate school
district to perform an administrative review under subsection (5),
the governing body of the public school academy may establish a
contract with its authorizing body for the authorizing body to
perform an administrative review of the financial status of the
public school academy. If a public school academy and its
authorizing body establish a contract for the authorizing body to
perform an administrative review under this subsection, then all of
the following apply:
(a) The authorizing body shall perform all of the same
functions with respect to the public school academy as an
intermediate school district performs for an administrative review
under subsection (5).
(b) The contract and administrative review shall include all
of the same items as a contract and administrative review under
subsection (5).
(c) The authorizing body has all of the same powers and duties
with respect to the contract and the administrative review as an
intermediate school district has for a contract and administrative
review under subsection (5), including, but not limited to, the
duty to consult with the department of treasury when working to
establish the contract.
(d) The department of treasury shall perform the same role and
shall treat the contract and administrative review, and the public
school academy, in the same manner as if it were a contract and
administrative review under subsection (5).
(e) All of the provisions under this section that apply to a
contract and administrative review under subsection (5) also apply
to the contract and administrative review under this subsection.
(17) If an authorizing body receives a notification under
subsection (4)(a) for a public school academy that entered into a
management agreement with an educational management organization,
the authorizing body shall provide a copy of the notice to the
board of directors of each public school academy authorized by the
authorizing body that also entered into a management agreement with
the educational management organization.
(18) (17)
As used in this section:
(a) "Authorizing body" means an authorizing body for a public
school academy under this act.
(b) "CEPI" means the center for educational performance and
information created in section 94a of the state school aid act of
1979, MCL 388.1694a.
(c) "Deficit" means a condition prohibited under section 15(2)
of the uniform budgeting and accounting act, 1968 PA 2, MCL
141.435, or under section 102(1) of the state school aid act of
1979, MCL 388.1702. Deficit also includes 1 or both of the
following circumstances for a school district, intermediate school
district, or public school academy:
(i) The total general fund balance of the school district,
intermediate school district, or public school academy is negative
or is projected to be negative at the end of the current school
fiscal year.
(ii) One or more of the funds of the school district,
intermediate school district, or public school academy other than
the general fund have a negative balance or projected negative
balance that is greater than the total general fund balance.
(d) "Educational management organization" means that term as
defined in section 503c.
(e) (d)
"Financial emergency"
means that 1 or more of the
conditions described in section 5(3)(a) to (m) of the local
financial stability and choice act, 2012 PA 436, MCL 141.1545,
exist or are likely to occur within a school district, intermediate
school district, or public school academy in the current or next
school fiscal year and threaten the ability of the school district,
intermediate school district, or public school academy to provide
necessary governmental services essential to public health, safety,
and welfare.
(f) (e)
"Fiscal stress" means 1
or both of the following:
(i) That a school district, intermediate school district, or
public school academy is unable to meet its short-term or long-term
financial obligations as those obligations arise.
(ii) That 1 or more of the conditions described in section
4(1)(a) to (i), (k) to (q), or (s) of the local financial stability
and choice act, 2012 PA 436, MCL 141.1544, exist or are likely to
occur within a school district, intermediate school district, or
public school academy.
(g) (f)
"Governing body" means,
for a school district, the
school board of the school district and, for a public school
academy, the board of directors of the public school academy.
(h) "Management agreement" means that term as defined in
section 503c.
(i) (g)
"Membership" means that
term as defined in section 6
of the state school aid act of 1979, MCL 388.1606.
(j) (h)
"Pupil" means that term
as defined in section 6 of the
state school aid act of 1979, MCL 388.1606.
Sec. 1220. (1) A school district, intermediate school
district, or public school academy shall not adopt or operate under
a deficit budget, and a school district, intermediate school
district, or public school academy shall not incur an operating
deficit in a fund during a school fiscal year. If a school
district, intermediate school district, or public school academy
has an existing deficit fund balance, incurs a deficit fund balance
in the most recently completed school fiscal year, or adopts a
current year budget that projects a deficit fund balance, all of
the following apply:
(a) The school district, intermediate school district, or
public school academy shall notify the superintendent of public
instruction and the state treasurer immediately upon the occurrence
of the circumstance. A school district shall provide a copy of the
notice under this subdivision to the intermediate superintendent of
the intermediate school district in which the school district is
located. A public school academy shall provide a copy of the notice
under this subdivision to the authorizing body of the public school
academy.
(b) Within 30 days after making notification under subdivision
(a), the school district, intermediate school district, or public
school academy shall submit to the superintendent of public
instruction in the form and manner prescribed by the department an
amended budget for the current school fiscal year and a deficit
elimination plan approved by the board of the school district,
intermediate school district, or public school academy, with a copy
to the state treasurer. A school district shall transmit a copy of
the amended budget and the deficit elimination plan to the
intermediate superintendent of the intermediate school district in
which the school district is located. A public school academy shall
transmit a copy of the amended budget and the deficit elimination
plan to its authorizing body.
(c) The department may withhold and release some or all of the
money payable to the school district, intermediate school district,
or public school academy as provided under section 102(1) of the
state school aid act of 1979, MCL 388.1702.
(d) The superintendent of public instruction may require a
deficit elimination plan to include an academic plan for the school
district, intermediate school district, or public school academy.
(e) After the superintendent of public instruction approves a
school district's, intermediate school district's, or public school
academy's deficit elimination plan, the school district,
intermediate school district, or public school academy shall post
the deficit elimination plan on the school district's, intermediate
school district's, or public school academy's website.
(f) If an authorizing body receives a notification under
subdivision (a) for a public school academy that entered into a
management agreement with an educational management organization,
the authorizing body shall provide a copy of the notice to the
board of directors of each public school academy authorized by the
authorizing body that also entered into a management agreement with
the educational management organization.
(2) The following reporting requirements apply for the
purposes of this section and section 1219:
(a) Not later than March 1 of each year, the department shall
prepare a report of deficits incurred or projected by school
districts, intermediate school districts, and public school
academies in the immediately preceding fiscal year and the progress
made in reducing those deficits and submit the report to the
standing committees of the legislature responsible for K-12
education legislation, the appropriations subcommittees of the
legislature responsible for K-12 school aid appropriations, the
house and senate fiscal agencies, the state treasurer, and the
state budget director. The department also shall submit quarterly
interim reports concerning the progress made by school districts,
intermediate school districts, and public school academies in
reducing those deficits to the standing committees of the
legislature responsible for K-12 education legislation, the
appropriations subcommittees of the legislature responsible for K-
12 school aid appropriations, the house and senate fiscal agencies,
the state treasurer, and the state budget director. On a quarterly
basis, the superintendent of public instruction shall publicly
present those reports to the appropriations subcommittees of the
legislature responsible for K-12 school aid appropriations.
(b) Not later than March 1 of each year, the state treasurer
shall prepare a report of school districts, intermediate school
districts, and public school academies that were required under
section 1219 to submit periodic financial status reports in the
immediately preceding state fiscal year or required under this
section to submit an enhanced deficit elimination plan in the
immediately preceding state fiscal year, and the progress made in
adhering to that plan, and submit the report to the standing
committees of the legislature responsible for K-12 education
legislation, the appropriations subcommittees of the legislature
responsible for K-12 state school aid appropriations, the house and
senate fiscal agencies, the department, and the state budget
director. The state treasurer also shall submit quarterly interim
reports concerning school districts, intermediate school districts,
and public school academies that are subject to periodic financial
status reports or are under an enhanced deficit elimination plan to
the standing committees of the legislature responsible for K-12
education legislation, the appropriations subcommittees of the
legislature responsible for K-12 state school aid appropriations,
the house and senate fiscal agencies, the department, and the state
budget director. On a quarterly basis, the state treasurer shall
publicly present those quarterly interim reports to the
appropriations subcommittees of the legislature responsible for K-
12 state school aid appropriations.
(3) A school district, intermediate school district, or public
school academy required to submit a deficit elimination plan under
this section shall submit to the superintendent of public
instruction and the state treasurer a monthly monitoring report on
revenue and expenditures in a form and manner prescribed by the
department and shall post these reports on its website. A school
district shall transmit a copy of each report under this subsection
to the intermediate superintendent of the intermediate school
district in which the school district is located. A public school
academy shall transmit a copy of each report under this section to
the authorizing body of the public school academy. A school
district may contract with its intermediate school district or
another entity to provide the monthly monitoring report.
(4) If a school district, intermediate school district, or
public school academy is required to submit a deficit elimination
plan under this section, and the deficit elimination plan is
approved by the department, the superintendent of public
instruction may continue allotment and payment of funds as provided
under section 102 of the state school aid act of 1979, MCL
388.1702. When approving a deficit elimination plan, the
superintendent of public instruction shall establish the period of
time within which a school district, intermediate school district,
or public school academy must eliminate its deficit and may set
special conditions that the school district, intermediate school
district, or public school academy must meet while the deficit
elimination plan is in effect. After the department approves a
school district's, intermediate school district's, or public school
academy's deficit elimination plan under this subsection, the
school district, intermediate school district, or public school
academy shall post the deficit elimination plan on the school
district's, intermediate school district's, or public school
academy's website. The requirements of this section relating to a
deficit elimination plan do not apply to a school district,
intermediate school district, or public school academy if the
school district, intermediate school district, or public school
academy is required to submit an enhanced deficit elimination plan
under subsection (5).
(5) If, based upon information included in a periodic
financial status report required under section 1219, a deficit
elimination plan required under this section, or a request by the
superintendent of public instruction, the state treasurer
determines that a school district, intermediate school district, or
public school academy is subject to rapidly deteriorating financial
circumstances, persistently declining enrollment, or other
indicators of financial stress likely to result in recurring
operating deficits or recurring financial stress within the school
district, intermediate school district, or public school academy,
the state treasurer may require the school district, intermediate
school district, or public school academy to submit an enhanced
deficit elimination plan in the form and manner determined by the
department of treasury. If the deficit for a school district,
intermediate school district, or public school academy that is
subject to a deficit elimination plan has not been completely
eliminated within 5 years after it submitted its initial deficit
elimination plan, the state treasurer shall require the school
district, intermediate school district, or public school academy to
submit an enhanced deficit elimination plan under this subsection.
An enhanced deficit elimination plan shall provide for the
resolution of the deteriorating financial circumstances,
persistently declining enrollment, or other indicators of recurring
operating deficits or recurring financial stress and is subject to
approval by the state treasurer. As a condition of approving the
enhanced deficit elimination plan, the state treasurer may require
a school district, intermediate school district, or public school
academy required to submit an enhanced deficit elimination plan
under this section to enter into a financial recovery agreement
with the state treasurer. A financial recovery agreement may
provide for, but is not limited to, all of the following:
(a) Assistance and guidance from the department of treasury
and other state departments and agencies.
(b) A financial and operating plan for the school district,
intermediate school district, or public school academy.
(c) The appointment of a local auditor or inspector, or both.
(d) Remedial measures or other action under this act necessary
to address the financial circumstances of the school district,
intermediate school district, or public school academy.
(e) The required retention by the school district,
intermediate school district, or public school academy of a
consultant or 1 or more other experts for the purpose of assisting
the school district, intermediate school district, or public school
academy to achieve the goals and objectives of the financial
recovery agreement.
(6) Before a school district, intermediate school district, or
public school academy submits an enhanced deficit elimination plan
to the state treasurer under subsection (5), the board of the
school district or intermediate school district or board of
directors of the public school academy shall approve the plan. If a
school district, intermediate school district, or public school
academy is required to submit an enhanced deficit elimination plan
under subsection (5), some or all of the money payable to the
school district, intermediate school district, or public school
academy under the state school aid act of 1979 may be withheld by
the state treasurer and released as provided under section 102(3)
of the state school aid act of 1979, MCL 388.1702. When approving
an enhanced deficit elimination plan, the state treasurer may
establish the period of time within which a school district,
intermediate school district, or public school academy must
eliminate its deficit and may set special conditions that the
school district, intermediate school district, or public school
academy must meet while the enhanced deficit elimination plan is in
effect.
(7) To assure greater coordination and effective partnerships
in the development and implementation of an enhanced deficit
elimination plan under subsection (5), when administering
subsections (5), (6), and (9), the department of treasury shall
consult with all of the following:
(a) The department.
(b) The school district, intermediate school district, or
public school academy required to submit an enhanced deficit
elimination plan under subsection (5).
(c) For a school district required to submit an enhanced
deficit elimination plan under subsection (5), the intermediate
superintendent of the intermediate school district in which the
school district is located.
(d) For a public school academy required to submit an enhanced
deficit elimination plan under subsection (5), the authorizing body
of the public school academy.
(8) After the state treasurer approves an enhanced deficit
elimination plan for a school district, intermediate school
district, or public school academy, the school district,
intermediate school district, or public school academy shall post
the enhanced deficit elimination plan on the school district's,
intermediate school district's, or public school academy's website.
(9) If a school district, intermediate school district, or
public school academy is required to submit an enhanced deficit
elimination plan under subsection (5), the school district,
intermediate school district, or public school academy shall submit
to the superintendent of public instruction and the state treasurer
an enhanced monthly monitoring report on revenue, expenditures,
cash flow, debt, other liabilities, assets, budget amendments,
pupil membership, and other data relating to the finances of the
school district, intermediate school district, or public school
academy in a form and manner prescribed by the department of
treasury and shall post these reports on its website.
(10) As used in this section:
(a) "Authorizing body" means an authorizing body for a public
school academy under this act.
(b) "Deficit elimination plan" means a plan required under
this section for the elimination of a deficit that sets forth
actions to be taken to eliminate the deficit within the time period
prescribed by the department.
(c) "Deficit fund balance" means that term as defined in the
"Michigan Public School Accounting Manual" published by the
department.
(d) "Educational management organization" means that term as
defined in section 503c.
(e) (d)
"Enhanced deficit elimination
plan" means measures
required by the state treasurer under this section to address the
financial conditions within a school district, intermediate school
district, or public school academy and resolve any deficit within
the time period prescribed by the state treasurer.
(f) "Management agreement" means that term as defined in
section 503c.
Enacting section 1. This amendatory act takes effect 90 days
after the date it is enacted into law.
