Copyright© 2004 by School Services of California, Inc.
Volume 17 For Publication Date: December 17, 2004 No. 24
Legislation Proposed to
Clarify When the Chancellor’s Office
May Take Over the Fiscal Affairs of a District
Assembly Member Mervyn Dymally
(D-Compton) is considering reintroducing legislation that clarifies the
authority of the Community College Board of Governors (BOG) to authorize the
Chancellor of the California Community Colleges to suspend the authority of the
board of trustees of a local community college district and to appoint a special
trustee to administer and oversee a district’s fiscal operations.
Specifically, Assembly Member Dymally is proposing legislation that would
outline the process to be followed prior to, the implementation of, such action.
During the final days of the
2004 legislative session, Assembly Member Dymally amended AB 1507 to
accomplish the following:
1.
Require the Chancellor to review any plan prepared and adopted by a
district regarding its financial condition and to determine whether these plans
are adequate to achieve fiscal stability.
2.
Authorize the Chancellor to take specific action in the event of a
finding that the specified plans are inadequate.
3. Require that a hearing be held to provide the district an opportunity to respond to a BOG determination that its plans are inadequate.
4.
Provide that the BOG, upon a finding that a district has failed to
maintain fiscal integrity and remains unable to manage its own recovery, may
authorize the Chancellor to suspend, for up to one year, the authority of the
members of the district’s governing board to exercise any powers,
responsibilities, or official actions with respect to the management of the
district and appoint a special trustee, at district expense, to serve at the
pleasure of the Chancellor to manage the district.
5.
Authorize the Chancellor’s Office, with the prior approval of the BOG,
to renew the suspension as often as necessary.
6.
Require the Chancellor, in addressing a district’s financial problems,
to prepare and oversee an assessment of what led to the district’s fiscal
crisis and an action plan for addressing deficiencies in the district’s
services and procedures.
7.
Clarify that the provisions of such legislation may not be construed to
prohibit any otherwise qualified member of any community college district
governing board, or otherwise qualified individual, from candidacy for a
governing board elective office during the period of suspension.
8.
Establish the effective date of these provisions as of January 1, 2008.
AB 1507 was heard in by the
Senate Education Committee in August 2004, shortly before the Legislature
adjourned for the year. The bill was held in committee due to a lack of support.
However, it is the intent of Assembly Member Dymally to introduce a new bill
(with the same provisions) when the Legislature reconvenes for its 2005
legislative session.
As you may recall, the
Legislature enacted, and the Governor signed on July 13, 2004, legislation (AB
61/Chapter 139/2004) to respond to concerns regarding the Compton Community
College District’s fiscal condition. This legislation provided specific
authority to the Chancellor to appoint a special trustee to administer and
oversee the Compton Community College District’s operations. The District
filed a lawsuit against the BOG and Chancellor that challenged their authority
to take over the operations of the District. That lawsuit was found to be in
favor of the actions taken by the Chancellor, thus rejecting
Since then, the Chancellor’s
Office recognized that existing Title V regulations were insufficient to address
the type of problem that developed at the Compton Community College District.
Revised regulations regarding the Chancellor’s authority to address severe
fiscal problems have been developed and adopted by the BOG. Thus, concerns
raised by the Governor in signing AB 61 have been addressed in the new
regulations and essentially parallel the provisions being proposed in AB 1507
that will end up in a new bill, if pursued by Assembly Member Dymally.
Therefore, in light of the existing regulatory provisions, legislation is not needed.
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