Bill Text: AZ SB1348 | 2014 | Fifty-first Legislature 2nd Regular | Engrossed
Bill Title: Special districts; audits; budgets; boards
Spectrum: Partisan Bill (Republican 2-0)
Status: (Engrossed - Dead) 2014-04-02 - House majority caucus: Do pass [SB1348 Detail]
Download: Arizona-2014-SB1348-Engrossed.html
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Senate Engrossed |
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State of Arizona Senate Fifty-first Legislature Second Regular Session 2014
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SENATE BILL 1348 |
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AN ACT
amending sections 48-251, 48-253, 48-805 and 48-805.02, Arizona Revised Statutes; relating to special taxing districts.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1. Section 48-251, Arizona Revised Statutes, is amended to read:
48-251. Annual report
A. Each district organized under this title and not exempted under subsection C of this section shall submit an annual report as prescribed by this section that contains the following information:
1. A schedule of the beginning and ending fund balances and all revenues and expenditures for the preceding fiscal year on a form prescribed by the auditor general or the same information contained in a financial statement for the preceding fiscal year that has been attested to by an independent certified public accountant. The schedule or statement shall include all monies, gifts or donations that are received from all sources and that have a value exceeding one hundred dollars.
2. Legal descriptions of any boundary changes occurring during the preceding fiscal year.
3. The names, occupations and business telephone numbers of all members of the governing board and officers of the district on the last day of the preceding fiscal year.
4. The schedule and location of regular meetings of the district governing board.
5. The location or locations where public notices of meetings are posted pursuant to section 38‑431.02.
6. The name and title of the person or persons completing the reporting requirements pursuant to this subsection.
7. Except for a district organized pursuant to chapter 5, article 3 of this title, a copy of any financial audit or financial review required to be prepared pursuant to section 48-253.
B. The secretary or other officer of the district governing board shall submit the report within two hundred forty days of the close of the district's fiscal year to the clerk of the board of supervisors of each county in which the district is located.
C. Districts organized under chapters 4, 6, 17, 22, 27 and 28 of this title are exempt from the requirements of this section. Districts that do not provide services or otherwise operate during the entire period covered by the report and that notify the clerk of the board of supervisors in writing of such these circumstances within the time for filing the report are exempt from the requirements of subsection A of this section.
D. If a district fails to submit a report as required by this section, any taxpayer residing in the district may petition the superior court in a county in which the district is organized to order the district to show cause why the report has not been submitted. On a failure to show cause the court shall order the district to file all reports as required by this section. A failure to obey the order of the court is punishable as contempt of court.
E. If the court finds that a district has violated this section, it shall award the taxpayer attorney fees and costs associated with bringing the action.
F. The board of supervisors of each county shall submit annually by March 31 a report on compliance with the requirements of this section to the president of the senate, the speaker of the house of representatives and the governor. The annual report shall include a listing of all those districts required to comply with the requirements of this section, the districts in compliance and not in compliance with the requirements and an analysis of the sufficiency of each district report.
G. The board of supervisors shall notify each district not in compliance with the reporting requirements of this section to comply within thirty days after receipt by certified mail of such the noncompliance and that the district is subject to a civil penalty if it fails to comply. The board of supervisors shall assess, and the county treasurer shall collect from the monies of a district remaining in noncompliance thirty days after receipt of certified mail a penalty assessment of one hundred dollars per day for each day that such the district is not in compliance with the reporting requirements of this section from thirty days after receipt by certified mail of the noncompliance notice until such time as the board of supervisors receives a copy of the district's annual report, to the extent that district monies are available and unencumbered. Penalty monies collected shall be deposited in the county general fund.
Sec. 2. Section 48-253, Arizona Revised Statutes, is amended to read:
48-253. District audits and financial reviews
A. Each district that is organized under this title, that is not exempt under subsection subsections G and H of this section and that is required to make an annual report under this article shall have its reports audited in accordance with generally accepted government auditing standards and the following:
1. Audits required by this section shall be performed annually for districts whose budgets are one million dollars or more. Districts whose budgets are one hundred thousand dollars or more but less than one million dollars shall have a financial review performed annually. Districts whose budgets are more than fifty thousand dollars and less than one hundred thousand dollars shall have a financial review performed at least biennially. Districts whose budgets are fifty thousand dollars or less shall have a financial review performed at the request of the county board of supervisors or on receipt of a request for a financial review that is signed by at least ten residents of that district. A district shall not be required to perform a financial review more than once per fiscal year.
2. A district may select an outside auditor who is a certified public accountant or a representative who is selected by the board of supervisors and who is trained as an auditor.
3. A district may advertise and use competitive bidding practices to select an agent to perform the audits or financial reviews required by this section.
B. Each district that submits a financial statement for the preceding fiscal year that has been attested to by an independent certified public accountant pursuant to section 48‑251 is deemed to have complied with this section by submitting a copy of the financial statement to the county treasurer.
C. Each district shall submit a copy of the completed audit or financial review to the county treasurer and the board of supervisors within two hundred forty days after the close of the district's fiscal year or within one hundred eighty days after a request for a financial review is received by the district pursuant to subsection A, paragraph 1 of this section.
D. If a district fails to submit an audit or financial review as required by this section, any taxpayer residing in the district, the board of supervisors or the county treasurer may petition the superior court in a county where the district is organized to show cause why the audit or financial review has not been submitted. On a failure to show cause the court shall order the district to submit the audit or financial review within ten days after the judgment is entered. Except for a district organized pursuant to chapter 5, article 3 of this title, on complaint made to the county attorney, the county attorney may investigate any claimed failure to comply with this section, report publicly on the investigation's findings and take any enforcement action deemed appropriate by the county attorney.
E. If the court enters a judgment against the district under this section, the court may award the taxpayer, board of supervisors or county treasurer reasonable attorney fees and costs associated with bringing the action.
F. For districts organized under chapter 19 of this title, a district with an annual budget of at least five million dollars shall have an audit performed annually and a district with an annual budget of at least one million dollars but less than five million dollars shall have an audit performed every five years and a financial review performed each year an audit is not performed. A district with an annual budget of at least one hundred thousand dollars but less than one million dollars shall have an audit performed every ten years and a financial review performed each year an audit is not performed.
G. For districts organized under chapter 5 of this title and except for districts organized under chapter 5, article 3 of this title, a district that receives five hundred thousand dollars or more in total revenues shall perform an annual audit. For the purposes of this section, revenues include monies generated by tax levies, monies received through appropriations, grants and other federal and state sources and monies received from services or other private sources, including ambulance and similar services. If a district's total budgeted revenues in a fiscal year are less than five hundred thousand dollars and the district receives total actual revenues in a fiscal year of five hundred thousand dollars or more, the district shall have an audit performed for that preceding fiscal year as if the audit had originally been required by this section. Districts whose total annual revenues are one hundred thousand dollars or more but less than five hundred thousand dollars shall have a financial review performed annually. Districts whose total annual revenues are more than fifty thousand dollars and less than one hundred thousand dollars shall have a financial review performed at least biennially. Districts whose total annual revenues are fifty thousand dollars or less shall have a financial review performed at the request of the county board of supervisors or on receipt of a request for a financial review that is signed by at least ten residents of that district. A district shall not be required to perform a financial review more than once per fiscal year. All financial reviews prescribed by this section must be conducted according to generally accepted government auditing standards.
G. H. Districts organized under chapters 4, 6, 17, 22, 27 and 28 of this title are exempt from the requirements of this section.
Sec. 3. Section 48-805, Arizona Revised Statutes, is amended to read:
48-805. Fire district; powers and duties
A. A fire district, through its board, shall:
1. Hold public meetings at least once each calendar month unless a board consists of three members and the fire district levies less than five hundred thousand dollars annually then the board shall meet in July and at least every two months thereafter. A board for a district organized pursuant to article 3 of this chapter shall hold public meetings at least once each calendar month.
2. Determine the compensation payable to district personnel.
3. Require probationary employees in a paid sworn firefighter position, a reserve firefighter position or a volunteer firefighter position to submit a full set of fingerprints to the fire district. The fire district shall submit the fingerprints to the department of public safety for the purpose of obtaining a state and federal criminal records check pursuant to section 41‑1750 and Public Law 92‑544. The department of public safety may exchange this fingerprint data with the federal bureau of investigation.
B. A fire district, through its board, may:
1. Employ any personnel and provide services deemed necessary for fire protection, for preservation of life and for carrying out its other powers and duties, including providing ambulance transportation services when authorized to do so pursuant to title 36, chapter 21.1, article 2, but a member of a district board shall not be an employee of the district. The merger of two or more fire districts pursuant to section 48‑820 or the consolidation with one or more fire districts pursuant to section 48‑822 shall not expand the boundaries of an existing certificate of necessity unless authorized pursuant to title 36, chapter 21.1, article 2.
2. Construct, purchase, lease, lease‑purchase or otherwise acquire the following or any interest therein and, in connection with the construction or other acquisition, purchase, lease, lease‑purchase or grant a lien on any or all of its present or future property, including:
(a) Apparatus, water and rescue equipment, including ambulances and equipment related to any of the foregoing.
(b) Land, buildings, equipment and furnishings to house equipment and personnel necessary or appropriate to carry out its purposes.
3. Finance the acquisition of property as provided in this section and costs incurred in connection with the issuance of bonds as provided in section 48‑806. Bonds shall not be issued without the consent of a majority of the electors of the district voting at an election held for that purpose. For the purposes of an election held under this paragraph, all persons who are eligible to vote in fire district elections under section 48‑802 are eligible to vote.
4. Enforce the fire code adopted by the district, if any, and assist the state fire marshal in the enforcement of fire protection standards of this state within the fire district including enforcement of a nationally recognized fire code if expressly authorized by the state fire marshal.
5. After the approval of the qualified electors of the fire district voting at a regular district election or at a special election called for such that purpose by the district board, as appropriate, or at any election held in the county that encompasses the fire district, adopt the __________ fire code, which is a nationally recognized fire code approved by the state fire marshal. The words appearing on the ballots shall be "should ______________ fire district adopt the ______________ fire code, which is a nationally recognized fire code approved by the state fire marshal‑‑yes", "should ________________ fire district adopt the ______________ fire code, which is a nationally recognized fire code approved by the state fire marshal‑‑no". The code shall be enforced by the county attorney in the same manner as any other law or ordinance of the county. Any inspection or enforcement costs are the responsibility of the fire district involved. The district shall keep the code on file which shall be open to public inspection for a period of thirty days before any election for the purpose of adopting a fire code. Copies of the order of election shall be posted in three public places in the district at least twenty days before the date of the election, and if a newspaper is published in the county having a general circulation in the district, the order shall be published in the newspaper at least once a week during each of the three calendar weeks preceding the calendar week of the election.
6. Amend or revise the adopted fire code, including replacement of the adopted fire code with an alternative nationally recognized fire code, with the approval of the state fire marshal and after a hearing held pursuant to posted and published notice as prescribed by section 48‑805.02, subsection A. The district shall keep three copies of the adopted code, amendments and revisions on file for public inspection.
7. Enter into an agreement procuring the services of an organized private fire protection company or a fire department of a neighboring city, town, district or settlement without impairing the fire district's powers.
8. Contract with a city or town for fire protection services for all or part of the city or town area until the city or town elects to provide regular fire department services to the area.
9. Retain a certified public accountant to perform an annual audit of district books.
10. Retain private legal counsel.
11. Accept gifts, contributions, bequests and grants and comply with any requirements of those gifts, contributions, bequests and grants that are not inconsistent with this article.
12. Appropriate and expend annually monies as are necessary for the purpose of fire districts belonging to and paying dues in the Arizona fire district association and other professional affiliations or entities.
13. Adopt resolutions establishing fee schedules both within and outside of the jurisdictional boundaries of the district for providing fire protection services and services for the preservation of life, including emergency fire and emergency medical services, plan reviews, standby charges, fire cause determination, users' fees or facilities benefit assessments or any other fee schedule that may be required.
14. With the approval of two of the three members of a three-member board, four of the five members of a five-member board or five of the seven members of a seven-member board, change the district's name and on so doing shall give written notice to the board of supervisors of the change. The governing board of a fire district may place a question on the general election ballot as to whether the fire district shall change its name.
15. Require all employees to submit a full set of fingerprints as prescribed by subsection A, paragraph 3 of this section.
16. Enter into intergovernmental agreements or contracts as follows:
(a) Enter into an intergovernmental agreement with another political subdivision for technical or administrative services or to provide fire services to the property owned by the political subdivision, including property that is outside the district boundary.
(b) Enter into a contract with individuals to provide technical or administrative services.
(c) Enter into a contract with individuals to provide fire protection services or emergency medical services, or both, to the extent not regulated by title 36, chapter 21.1 to property owned by the individual located outside the district boundaries if the individual's property is not located in a county island as defined in section 11‑251.12 and at least one of the following apply:
(i) The existing fire service provider where the individual's property is located has issued a notice to the individual that the provider plans to discontinue service.
(ii) Fire service is not available to the individual's property.
(iii) Fire service is offered pursuant to a contract or subscription and the individual has not obtained service for a period of twenty-four months before the date of the contract with the district.
(d) Enter into a contract with individuals to provide fire services to property owned by the individual located outside the district boundaries, where the individual's property is located in a county island as defined in section 11‑251.12, if both of the following apply:
(i) The existing fire service provider where the individual's property is located has issued a notice to the residents of the county island and the individual that the provider plans to discontinue or substantially reduce service.
(ii) The district offers contracts to all residents and property owners of the county island who will be affected by the discontinuance or substantial reduction in service by the current fire service provider.
(e) For the purposes of subdivision (a), (b), (c) or (d) of this paragraph, a district may contract with any public or private fire service provider to provide some or all of the contractual services the district is contracting to deliver.
(f) Any contract entered into pursuant to subdivisions (b), (c) and (d) of this paragraph shall include a provision setting forth the cost of service and performance criteria.
C. A fire district may not administratively add or annex additional property or delete property or otherwise modify its boundaries except in a merger or consolidation pursuant to this chapter or in a boundary change made pursuant to section 48-262. This subsection does not apply to a district organized pursuant to article 3 of this chapter.
C. D. The chairman and clerk of the district board or their respective designees, as applicable, shall draw warrants on the county treasurer for money required to operate the district in accordance with the budget and, as so drawn, the warrants shall be sufficient to authorize the county treasurer to pay from the fire district fund.
D. E. For any fire district that designates one or more board members to have access to the financial books and records of the district, those board members are authorized by law to have full access to those financial books and records.
E. F. The district board may assess and levy a secondary property tax pursuant to this article to pay for the costs of fire protection services or emergency medical services except for services regulated pursuant to title 36, chapter 21.1.
F. G. The county attorney may advise and represent the district if in the county attorney's judgment the advice and representation are appropriate and not in conflict with the county attorney's duties under section 11‑532. If the county attorney is unable to advise and represent the district due to a conflict of interest, the district may retain private legal counsel or may request the attorney general to represent it, or both.
Sec. 4. Section 48-805.02, Arizona Revised Statutes, is amended to read:
48-805.02. Fire district annual budget; levy; requirements
A. A fire district shall prepare an annual budget that contains detailed estimated expenditures for each fiscal year and that clearly shows salaries payable to employees of the district. The budget summary shall be posted in three public places and a complete copy of the budget shall be published on the district's official website for twenty days before a public hearing at a meeting called by the board to adopt the budget. Copies of the budget shall also be available to members of the public on written request to the district. Following the public hearing, the district board shall adopt a budget. A complete copy of the adopted budget shall be posted in a prominent location on the district's official website within seven business days after final adoption and shall be retained on the website for at least sixty months. For any fire district that does not maintain an official website, the fire district may comply with this subsection by posting on a website of an association of fire districts in this state.
B. Not more than ten days after the organization of a fire district and not later than August 1 of each year thereafter, the chairman of the district board shall submit to the county board of supervisors a budget estimate that contains certifications by item and that specifies the amount of money required for the maintenance and operation of the district for the ensuing year.
C. Based on the budget submitted by the district, the board of supervisors shall levy the tax as prescribed in section 48‑807, subsection E.
D. Every budget adopted by a fire district shall include the following:
1. A certification by the chairman and clerk of the district board as to both of the following:
(a) That the district has not incurred any debt or liability in excess of taxes levied and to be collected and the money actually available and unencumbered at that time in the district general fund, except for those liabilities as prescribed in section 48‑805, subsection B, paragraph 2 and sections 48‑806 and 48‑807.
(b) That the district complies with subsection E F of this section.
2. For each of the items listed in the budget summary approved pursuant to subsection A of this section, the district shall estimate the revenue or expense for the next two fiscal years. Estimates shall be based on the average increase or decrease of the item for the previous two fiscal years unless more certain information is available to the district. Estimates shall include any applicable levy or rate limitations.
3. If a district's total estimate of expenses exceeds its total estimate of revenues for any fiscal year, the district shall undertake a study of merger, consolidation or joint operating alternatives. The study required by this subsection paragraph shall be presented to the fire district board in a special public meeting called for the sole purpose of evaluating the study. The study shall include an identification of districts available for merger, consolidation or joint operations, an analysis of the level of service and cost of service that may be provided to the residents of a merged, consolidated or jointly operated district as compared to the level and cost of service to the residents of the districts without any merger, consolidation or joint operations.
E. For any district that amends its budget after its initial adoption, the district board shall hold at least two hearings on the revision of the budget and the revised budget must be considered and adopted in a special meeting that is called for the adoption of the revised budget. The special meeting must be held one week after the consideration of the revision of the budget at a regularly scheduled meeting of the board of directors of the district. This subsection does not apply to a district organized pursuant to article 3 of this chapter.
E. F. When a fire district has adopted a budget and the board of supervisors has levied a fire district tax as provided in subsection C of this section and the district has insufficient monies in its general fund with the county treasurer to operate the district, the chairman of the fire district board of directors, on or after August 1 of each year, may draw warrants for the purposes prescribed in section 48‑805 on the county treasurer, payable on November 1 of that year or on April 1 of the succeeding year. The aggregate amounts of the warrants may not exceed ninety per cent of the taxes levied by the county for the district's current fiscal year. If the treasurer cannot pay a warrant for lack of monies in the fire district general fund, the warrant shall be endorsed, be registered, bear interest and be redeemed as provided by law for county warrants, except that the warrants are payable only from the fire district general fund.
F. G. Any audit or report of a fire district made pursuant to section 48‑253 shall be presented in person to the district board by the auditor and the district board shall accept the audit or report. The audit or report shall include a certification by the auditor of the district as to both of the following:
1. That the district has not incurred any debt or liability in excess of taxes levied and to be collected and the monies actually available and unencumbered at that time in the district general fund except for those liabilities as prescribed in section 48‑805, subsection B, paragraph 2 and sections 48‑806 and 48‑807.
2. That the district complies with subsection E F of this section.
Sec. 5. Emergency
This act is an emergency measure that is necessary to preserve the public peace, health or safety and is operative immediately as provided by law.
