ARIZONA STATE SENATE
Phoenix, Arizona
schools;
USFR; compliance
Removes the requirement that the State Superintendent of Public Instruction withhold distribution of state funds and allows the State Board of Education (SBE) to direct the State Superintendent to withhold any portion of state funds from a school district where a school district is not in compliance with the Uniform System of Financial Records (USFR) or has failed to correct a deficiency after a specified notification period.
The Auditor General is required to report to the SBE regarding a school district’s compliance with the USFR. The Auditor General notifies a school district if the district is found to be in noncompliance. If a school district is not in compliance with the USFR or has failed to correct the deficiency within 90 days after being notified, the State Superintendent is required to withhold further distribution of state funds until the Auditor General confirms the school district is back in compliance with the USFR. Current law allows a school district to request a hearing where the SBE evaluates the Auditor General’s findings and reviews a school district’s compliance with the USFR. Also, the State Superintendent shall not withhold state funds from a school district until a final determination regarding USFR compliance is made by the SBE. The timeline for this process may take from eight months to a year, according to the SBE.
S.B. 1233 removes the requirement that the State Superintendent withhold distribution of state funds and allows the SBE to direct the State Superintendent to withhold any portion of state funds from a school district if a school district is not in compliance with the USFR or has failed to correct a deficiency within 90 days after receiving notification.
There is no discernable fiscal impact to the state general fund associated with this bill.
1. Allows the SBE to direct the state Superintendent to withhold any portion of state funds from a school district if the SBE determines that the school district is not in compliance with USFR or has failed to correct a deficiency within 90 days after receiving notification from the Auditor General.
2. Removes the requirement that the State Superintendent withhold further distribution of State funds from a school district that the SBE determines is not in compliance with USFR 90 days after the school district receives notice of noncompliance from the Auditor General.
3. Removes the Auditor General’s and the Department of Education’s allowance to grant a time extension if more than 90 days is needed to bring a school district back into compliance with the USFR.
4. Removes the allowance for a school district found to be in noncompliance with USFR to request a hearing before the SBE. Also removes the prohibition of the State Superintendent to withhold distribution of state funds until the SBE finds the school district to be out of USFR compliance following the hearing.
5. Removes the stipulation that the final decision of the SBE is subject to judicial review. Removes the requirement that school district monies are not withheld until a judicial decision is rendered upon the SBE ruling.
6. Provides for a general effective date.
Prepared by Senate Staff
February 5, 2002