Bill Text: MS SB2131 | 2014 | Regular Session | Introduced


Bill Title: School district expenditures; require school boards to adopt an annual balanced budget.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Failed) 2014-02-04 - Died In Committee [SB2131 Detail]

Download: Mississippi-2014-SB2131-Introduced.html

MISSISSIPPI LEGISLATURE

2014 Regular Session

To: Education

By: Senator(s) Smith

Senate Bill 2131

AN ACT TO AMEND SECTIONS 37-61-9 AND 37-61-19, MISSISSIPPI CODE OF 1972, TO REQUIRE SCHOOL DISTRICTS TO ADOPT AN ANNUAL BALANCED BUDGET TO BE SUBMITTED TO THE LEVYING AUTHORITY AND TO THE STATE BOARD OF EDUCATION AND TO CLARIFY THAT SCHOOL DISTRICT BUDGETS SHALL LIMIT FUND EXPENDITURES TO THE REVENUE RESOURCES AVAILABLE TO THAT FUND WHICH SHALL NOT INCLUDE TRANSFERS FROM OTHER FUND BALANCES; TO AMEND SECTION 37-61-21, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT NO SCHOOL DISTRICT FUND SHALL HAVE A NEGATIVE BALANCE AT THE END OF THE SCHOOL FISCAL YEAR; AND FOR RELATED PURPOSES.

     BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

     SECTION 1.  Section 37-61-9, Mississippi Code of 1972, is amended as follows:

     37-61-9.  (1)  On or before the fifteenth day of August of each year, the local school board of each school district, with the assistance of the superintendent of schools, shall prepare and file with the levying authority for the school district, as defined in Section 37-57-1, at least two (2) copies of a balanced budget of estimated expenditures for the support, maintenance and operation of the public schools of the school district for the fiscal year commencing on July 1 of such year.  Such budget shall be prepared on forms prescribed and provided by the State Auditor and shall contain such information as the State Auditor may require.  In the preparation of the annual school district budget, the local school board shall be required to limit the expenditure of each school fund during the fiscal year to the resources available to that particular fund which shall not include transfers from other fund balances.

     (2)  In addition, on or before the fifteenth day of August of each year, the local school board of each school district, with the assistance of the superintendent of schools, shall prepare and file with the State Department of Education such budgetary information as the State Board of Education may require.  The State Board of Education shall prescribe and provide forms to each school district for this purpose.

     (3)  Prior to the adoption of a budget pursuant to this section, the school board of each school district shall hold at least one (1) public hearing to provide the general public with an opportunity to comment on the taxing and spending plan incorporated in the proposed budget.  The public hearing shall be held at least one (1) week prior to the adoption of the budget with advance notice.  After final adoption of the budget, a synopsis of such budget in a form prescribed by the State Department of Audit shall be published in a newspaper having general circulation in the school district on a date different from the date on which the county or any municipality therein may publish its budget.

     (4)  There shall be imposed limitations on budgeted expenditures for certain administration costs, as defined hereinafter, in an amount not greater than One Hundred Fifty Thousand Dollars ($150,000.00) plus four percent (4%) of the expenditures of all school districts each year.  For purposes of this subsection, "administration costs" shall be defined as expenditures for salaries and fringe benefits paid for central administration costs from all sources of revenue in the following expenditure functions as defined in the MISSISSIPPI PUBLIC SCHOOL DISTRICT FINANCIAL ACCOUNTING MANUAL:

          2300 =    Support Services - General Administration

          2310 =    Board of Education Services

          2320 =    Executive Administration Services

          2330 =    Special Area Administration Services

          2500 =    Business Services

          2510 =    Fiscal Services

          2520 =    Purchasing Services

          2530 =    Warehousing and Distributing Services

          2540 =    Printing, Publishing and Duplicating Services

          2590 =    Other Support Services - Business

     Any costs classified as "administration costs" for purposes of this subsection which can be demonstrated by the local school district to be an expenditure that results in a net cost savings to the district that may otherwise require budget expenditures for functions not covered under the definition of administration costs herein may be excluded from the limitations imposed herein.  The local school board shall make a specific finding of such costs and spread such finding upon its minutes, which shall be subject to the approval of the Office of Educational Accountability of the State Department of Education.  Any school district required to make expenditure cuts, as a result of application of this subsection, shall not be required to reduce such expenditures more than twenty-five percent (25%) in any year in order to comply with this mandate.

     The State Auditor shall ensure that functions in all expenditure categories to which this administrative limitation applies shall be properly classified.

     This section shall not apply to central administration with five (5) or less full-time employees, or to those school districts which can substantiate that comparable reductions have occurred in administrative costs for the five-year period immediately prior to school year 1993-1994.  In the event the application of this section may jeopardize the fiscal integrity or operations of the school district, have an adverse impact on the ability of the district to deliver educational services, or otherwise restrict the district from achieving or maintaining a quality education program, the State Board of Education shall be authorized to exempt the application of this section to such school district pursuant to rules and regulations of the State Board of Education consistent with the intent of this section.

     SECTION 2.  Section 37-61-19, Mississippi Code of 1972, is amended as follows:

     37-61-19.  It shall be the duty of the superintendents of schools and the school boards of all school districts to limit the expenditure of school funds during the fiscal year to the resources available.  "Resources available" shall not include the transfer of fund balances from other school funds.  It shall be unlawful for any school district to budget expenditures from a fund in excess of the resources available within that fund.  Furthermore, it shall be unlawful for any contract to be entered into or any obligation incurred or expenditure made in excess of the resources available for such fiscal year.  Any member of the school board, superintendent of schools, or other school official, who shall knowingly enter into any contract, incur any obligation, or make any expenditure in excess of the amount available for the fiscal year shall be personally liable for the amount of such excess.  However, no school board member, superintendent or other school official shall be personally liable (a) in the event of any reduction in adequate education program payments by action of the Governor acting through the Department of Finance and Administration, or (b) for claims, damages, awards or judgments, on account of any wrongful or tortious act or omission or breach of implied term or condition of any warranty or contract; provided, however, that the foregoing immunity provisions shall not be a defense in cases of fraud, criminal action or an intentional breach of fiduciary obligations imposed by statute.

     SECTION 3.  Section 37-61-21, Mississippi Code of 1972, is amended as follows:

     37-61-21.  (1)  If it should appear to the superintendent of schools or the school board of any school district that the amounts to be received from state appropriations, taxation or any other source will be more than the amount estimated in the budget filed and approved, or if it should appear that such amounts shall be less than the amount estimated, the school board of the school district, with assistance from the superintendent, may revise the budget at any time during the fiscal year by increasing or decreasing the fund budget, in proportion to the increase or decrease in the estimated amounts.  If it should appear to the superintendent of schools or the school board of a school district that some function of the budget as filed is in excess of the requirement of that function and that the entire amount budgeted for such function will not be needed for expenditures therefor during the fiscal year, the school board of the school district, with assistance from the superintendent, may transfer resources to and from functions and funds within the budget when and where needed; however, no such transfer shall be made from fund to fund or from function to function which will result in the expenditure of any money for any purpose different from that for which the money was appropriated, allotted, collected or otherwise made available or for a purpose which is not authorized by law.  No revision of any budget under the provisions hereof shall be made which will permit a fund expenditure in excess of the resources available for such purpose.  The revised portions of the budgets shall be incorporated in the minutes of the school board by spreading them on the minutes or by attaching them as an addendum.  Final budget revisions, pertinent to a fiscal year, shall be approved on or before the date set by the State Board of Education for the school district to submit its financial information for that fiscal year, and no school district fund shall have a negative balance at the end of the fiscal year.

     (2)  On or before the fifteenth day of October of each year, the local school board of each school district, with the assistance of the school district superintendent, shall prepare and file with the State Department of Education year-end financial statements and any other budgetary information that the State Board of Education may require.  The State Board of Education shall prescribe and provide forms to each school district for this purpose.  No additional changes may be made to the financial statements after October 15 of each year.

     SECTION 4.  This act shall take effect and be in force from and after July 1, 2014.


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