Bill Text: MI HB6576 | 2009-2010 | 95th Legislature | Introduced
Bill Title: Education; school districts; renaissance school districts; allow certain school districts to become, require certain measures, and provide certain funding for. Amends sec. 1225 of 1976 PA 451 (MCL 380.1225) & adds pt. 5B. TIE BAR WITH: HB 6577'10, HB 6578'10, HB 6579'10
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2010-11-30 - Printed Bill Filed 11/18/2010 [HB6576 Detail]
Download: Michigan-2009-HB6576-Introduced.html
HOUSE BILL No. 6576
November 17, 2010, Introduced by Rep. Durhal and referred to the Committee on Education.
A bill to amend 1976 PA 451, entitled
"The revised school code,"
by amending section 1225 (MCL 380.1225), as amended by 2006 PA 285,
and by adding part 5B.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
PART 5B
RENAISSANCE SCHOOL DISTRICTS
Sec. 381. As used in this part:
(a) "Board" means the board of the school district or, if the
school district is operating under the oversight of an emergency
financial manager under the local government fiscal responsibility
act, 1990 PA 72, MCL 141.1201 to 141.1291, the emergency financial
manager.
(b) "Deficit district" means a school district with a general
fund deficit as of June 30, 2010.
(c) "Resolution" means a resolution adopted by the board of a
school district or an order executed by an emergency financial
manager in place in a school district under the local government
fiscal responsibility act, 1990 PA 72, MCL 141.1201 to 141.1291.
(d) "CEO" means a chief executive officer appointed by the
board of a school district under section 382 and confirmed by the
superintendent of public instruction or the superintendent of the
school district.
(e) "Renaissance plan" means a renaissance plan that is
adopted under and meets the requirements of section 382.
(f) "Renaissance school district" means a school district that
has adopted a renaissance plan approved by the superintendent of
public instruction under section 382.
(g) "Underperforming district" means a school district in
which 10% or more of its pupils are enrolled in a school that is on
the list of lowest achieving 5% of public schools in this state
under section 1280c.
Sec. 382. (1) Not later than December 15, 2010, the
superintendent for public instruction shall identify and publish a
list of deficit districts.
(2) A deficit district may become a renaissance school
district by adopting a resolution that adopts a renaissance plan
meeting the requirements of this section, submitting the proposed
renaissance plan to the superintendent of public instruction for
approval, and having the renaissance plan approved by the
superintendent of public instruction under subsection (3).
(3) The superintendent of public instruction shall approve,
disapprove, or request modifications to a proposed renaissance plan
within 30 days after receiving it. The superintendent of public
instruction shall approve a renaissance plan that he or she
determines meets the requirements of this section. The
superintendent of public instruction shall explain any reasons for
disapproval or requested modifications in writing, and the deficit
district may revise and resubmit its proposed renaissance plan
within 30 days after receiving the written explanation from the
superintendent of public instruction. If the deficit district
revises and resubmits its proposed renaissance plan within this 30-
day time period, the superintendent of public instruction shall
issue a final determination either approving or disapproving the
renaissance plan within 30 days after receiving the resubmitted
renaissance plan. Upon a final determination by the superintendent
of public instruction approving a deficit district's renaissance
plan, the superintendent of public instruction shall transmit the
renaissance plan and approval to the state board of education, and
the deficit district is then a renaissance school district eligible
for funding pursuant to section 10(f) of the Michigan trust fund
act, 2000 PA 489, MCL 12.260, and is subject to this part.
(4) A renaissance plan shall include all of the following:
(a) The name of the school district.
(b) The administrative management team for the school
district, which may include a CEO, a chief financial officer, and a
chief academic officer, including the qualifications and rationale
for appointment of each member of the administrative management
team.
(c) The school district's deficit elimination plan, budget
status, 12-month cash flow, and plan for resolving and addressing
audit findings, including a plan and timeline for addressing any
material findings.
(d) The school district's academic status and plan for
improving the school district's academic performance, including at
least all of the following:
(i) The level of autonomy to be granted to each school in the
renaissance school district.
(ii) If the deficit district is an underperforming district, a
description of initiatives to improve student achievement and
performance in the school district and the methods by which these
initiatives will be implemented, including initiatives for meeting
the needs of pupils at risk of falling seriously behind other
pupils of the same age level, of not advancing in grade level, or
of dropping out or being expelled from school.
(e) If required by the superintendent of public instruction,
the retention of either an auditor general or an inspector general
as provided in section 384, or both.
(f) A plan for the expenditure, together with other funds
available to the school district, of funds to be received pursuant
to section 10(f) of the Michigan trust fund act, 2000 PA 489, MCL
12.260. This plan for expenditure of funds must include the
elimination of the school district's general fund deficit and the
adoption of balanced budgets during the term of the renaissance
plan.
(g) The timelines for the implementation and evaluation of
each of the principles and goals described in the renaissance plan.
(5) A renaissance plan may include any of the following:
(a) Goals or plans for reducing the school district's costs
for current employee benefits, noninstructional support services,
and transportation, if applicable.
(b) Goals for reducing school building overcapacity, if any.
(c) Goals for enhancing information technology capabilities
and data quality through internal restructuring, shared services,
or outsourcing.
(d) A plan to grant individual schools a degree of autonomy,
subject to specified operating and performance parameters.
(e) Compensation schedules for employee groups, including
incentive compensation for teachers working in an underperforming
district.
(f) A plan to partner with 1 or more education service
providers to manage individual schools within the school district.
(g) A plan for paying the costs associated with specific
elements of the renaissance plan, including incentive compensation,
if any, for teachers working in an underperforming district.
(6) The appointments of the members of the administrative
management team identified in the renaissance plan are subject to
approval by the superintendent of public instruction. An
appointment shall be considered to be confirmed by the
superintendent of public instruction, unless specifically
disapproved by the superintendent of public instruction on the
basis of review of the qualifications of an individual member or
members of the administrative management team.
(7) Upon approval of a renaissance school district's
renaissance plan pursuant to this section, the administrative
management team shall impose an addendum to each collective
bargaining agreement in effect in the renaissance school district.
The addendum shall include all of the following:
(a) That any contractual or other seniority system that would
otherwise be applicable shall not apply in the renaissance school
district. This subdivision does not allow unilateral changes in pay
scales or benefits.
(b) That any contractual or other work rules that are
impediments to implementing financial and academic reforms in
accordance with this part shall not apply in the renaissance school
district. This subdivision does not allow unilateral changes in pay
scales or benefits.
(c) That the CEO shall implement a data-driven evaluation
policy for all instructional personnel and administrators. This
policy shall promote quality instruction, professional development,
and corrective action, and shall determine the minimum level of
administrators' classroom observations for tenured instructional
personnel.
(d) That the CEO shall implement a data-driven determination
of optimum class sizes for each grade level and academic subject
area to promote quality instruction and adequate yearly progress.
(e) That the CEO shall implement work schedules that promote
quality instruction and adequate yearly progress, including
schedules for the length of the school day and the length of the
school year.
(f) That the CEO shall implement an attendance policy for all
instructional and noninstructional personnel. The attendance policy
shall promote continuity of instruction and efficiency and
effectiveness of expenditures of funds.
(g) That the CEO may implement a data-driven, merit-based
compensation policy for instructional and administrative personnel.
The compensation policy shall provide incentives for quality
instruction and professional development.
(8) A renaissance school district shall implement its
renaissance plan in accordance with the terms and timelines
established in the renaissance plan.
(9) For each school year in which oversight by the
superintendent of public instruction remains in place in the
renaissance school district pursuant to section 383, not later than
June 30 after conclusion of that school year, the board and CEO of
the renaissance school district shall submit an annual update and
report to the superintendent of public instruction on the school
district's progress in implementing each element of its renaissance
plan, including the deficit elimination plan, and a summary of the
initiatives described in the renaissance plan that have been
implemented to improve school quality in the school district,
indications of success or lack of success in implementation, and
proposed revisions to the renaissance plan to address elements of
the plan that have not met the plan's goals.
Sec. 383. (1) The superintendent of public instruction shall
perform the responsibilities listed under subsection (2) for a
renaissance school district until the renaissance school district
has met all of the following:
(a) Has submitted audits for 2 consecutive fiscal years
without material weaknesses demonstrating that the district has
positive fund balances in its general fund and no more than de
minimis operating deficits in its other funds.
(b) Demonstrates that it has achieved the financial and
academic objectives in its renaissance plan in all material
respects.
(2) Subject to subsections (1) and (3), the superintendent of
public instruction shall review all of the following for a
renaissance school district at least once every 3 months:
(a) The renaissance school district's budget status, cash
flow, and progress in resolving and addressing audit findings.
(b) The renaissance school district's progress in implementing
the other financial and academic objectives contained in its
renaissance plan and the report submitted annually by the CEO
pursuant to section 382(9).
(c) The inspector general and auditor general reports
described in section 384, if applicable.
(3) The superintendent of public instruction may adjust his or
her level of oversight for a renaissance school district and the
level of funding for a renaissance school district under section
10(f) of the Michigan trust fund act, 2000 PA 489, MCL 12.260, and
a renaissance school district's renaissance plan may be adjusted
annually by the school district with the approval of the
superintendent of public instruction, based on the progress or lack
of progress the superintendent of public instruction determines the
school district is making in meeting the objectives of the
renaissance plan within the timelines contained in the plan. The
superintendent of public instruction may ask the state treasurer to
phase funding to the renaissance school district under section
10(f) of the Michigan trust fund act, 2000 PA 489, MCL 12.260, if
the renaissance school district has not demonstrated progress in
the 18 months before approval of the renaissance plan or in each
year after the renaissance plan is approved toward achieving the
objectives of the renaissance plan. The superintendent of public
instruction may ask the state treasurer to accelerate funding to
the renaissance school district under section 10(f) of the Michigan
trust fund act, 2000 PA 489, MCL 12.260, if progress exceeds
targeted benchmarks. The superintendent of public instruction may
phase out oversight under this section as goals identified in the
renaissance plan are met and sustained. The superintendent of
public instruction may increase oversight under this section if
goals are not met within the timelines identified in the
renaissance plan for meeting each goal.
(4) The responsibilities of the superintendent of public
instruction under this section with respect to a renaissance school
district shall be suspended if the school district demonstrates the
results described in subsection (1), but the superintendent of
public instruction shall resume those responsibilities
automatically upon the occurrence of at least 1 of the following:
(a) The school district has a negative general fund balance
based on the annual audit report or the board of the school
district adopts a budget that projects a negative fund balance in
excess of 1% of the school district's revenues for the immediately
preceding fiscal year.
(b) Failure by the school district to provide an annual
financial report or audit that conforms with the minimum procedures
and standards required under section 303 of the revised municipal
finance act, 2001 PA 34, MCL 141.2303, or the uniform budget and
accounting act, 1968 PA 2, MCL 141.421 to 141.440a.
(5) The superintendent of public instruction shall report his
or her findings in writing at least annually to the governor, the
legislature, and the state board of education, with a copy to the
board of the school district.
(6) The superintendent of public instruction may consult with
the state treasurer and the director of the state department of
technology, management, and budget as to nonacademic elements of a
particular renaissance plan.
Sec. 384. (1) As part of the approval of a renaissance plan,
the superintendent of public instruction may require a deficit
district to retain 1 or more individuals or firms to perform the
duties of an inspector general or an auditor general as described
in this section. An individual or firm retained by a school
district under this section may be selected from a list maintained
by the superintendent of public instruction or may be another
individual or firm employed or retained by the school district with
the approval of the superintendent of public instruction.
(2) An inspector general retained under this section shall
ensure integrity, economy, efficiency, and effectiveness in the
operations of the school district by conducting meaningful and
accurate investigations, forensic audits, and program reviews, and
shall take steps to detect and deter waste, fraud, and abuse. At
least annually, the inspector general shall submit a report to the
CEO, the superintendent of public instruction, and the state board
of education. The annual report shall detail the inspector
general's activities and findings.
(3) An auditor general retained under this section shall take
measures as necessary to provide assurance that internal controls
over school district operations are designed and operating
effectively to mitigate risks that hamper the achievement of
departmental goals; to ensure that school district operations are
effective and efficient; to ensure financial information is
accurate, reliable, and timely; to comply with policies,
regulations, and applicable laws; and to ensure assets are properly
safeguarded. At least annually, the auditor general shall submit a
report to the CEO, the superintendent of public instruction, and
the state board of education. The annual report shall detail the
auditor general's activities and findings.
Sec. 385. Upon approval of its renaissance plan by the
superintendent of public instruction, a renaissance school district
is entitled to receive funds under section 10(f) of the Michigan
trust fund act, 2000 PA 489, MCL 12.260, in the amount specified in
its renaissance plan. The renaissance school district shall apply
these funds in accordance with the terms of the renaissance plan.
The state treasurer shall deposit funds granted to a renaissance
school district under section 10(f) of the Michigan trust fund act,
2000 PA 489, MCL 12.260, directly in a separate depository account
held by a trustee designated by the state treasurer. The
renaissance school district may request funds from the trust
account from time to time. Funds may be disbursed from the trust
account only with the prior written approval of the superintendent
of public instruction, and the school district shall apply those
funds only for the purposes specified in the school district's
renaissance plan. The superintendent of public instruction may
direct that payment from the trust account be made directly to a
third party.
Sec. 386. The validity of the adoption of a renaissance plan
by a school district under this part and the applicability of this
part to a renaissance school district shall be conclusive unless
contested in the court of appeals within 60 days after a final
determination of approval of the school district's renaissance plan
by the superintendent of public instruction.
Sec. 1225. (1) Subject to restrictions of this section, the
board of a local or intermediate school district may borrow money
and issue its notes for the borrowed money to secure funds for
school operations or to pay previous loans obtained for school
operations under this or any other statute. The school board or
intermediate school board shall pledge money to be received by it
from state school aid for the payment of notes issued under this
section.
The notes A pledge of state school aid by a local or
intermediate school district for the payment of notes or other
obligations issued pursuant to this section is valid and binding
from the time when the pledge is made. A pledge made pursuant to
this section for the benefit of the holders of notes or other
obligations or others is perfected without delivery, recording, or
notice. Notes and obligations issued pursuant to this section are
full faith and credit obligations of the school district or
intermediate school district and are payable from tax levies or
from unencumbered funds of the school district or intermediate
school district in event of the unavailability or insufficiency of
state school aid for any reason.
(2) A local or intermediate school district that has an
existing operating deficit or an operating deficit projected for
the end of the current fiscal year or for which an emergency
financial manager has been appointed pursuant to the local
government fiscal responsibility act, 1990 PA 72, MCL 141.1201 to
141.1291, may enter into an agreement with the Michigan finance
authority or with a trustee in accordance with section 17a of the
state school aid act, 1979 PA 94, MCL 388.1617a, providing for the
direct payment to the Michigan finance authority or to the trustee
of state school aid pledged and to be used for the sole purpose of
paying the principal of and interest on the notes or obligations
issued pursuant to this section and secured by state school aid.
(3) (2)
Notes issued under this section
shall become due not
later than 372 days after the date on which they are issued, except
as otherwise provided in this section. Notes issued within a fiscal
year shall not exceed 70% of the difference between the total state
aid funds apportioned to the school district or intermediate school
district for that fiscal year and the portion already received or
pledged, except secondary pledges made under section 1356.
(4) (3)
A school district or intermediate
school district that
is not able to redeem its notes within 372 days after the date on
which the notes were issued may enter into a multi-year agreement
with a lending institution to repay its obligation. A repayment
agreement shall not be executed without the prior approval of an
authorized representative of the state board or, for notes sold to
the
Michigan municipal bond finance
authority only, without the
approval of an authorized representative of the department of
treasury.
(5) (4)
During the last 4 months of a
fiscal year, notes may
be issued pledging state school aid for the next succeeding fiscal
year. Except as otherwise provided in this subsection, the notes
shall not exceed 50% of the state school aid apportioned to the
school district or intermediate school district for the next
succeeding fiscal year or, if the apportionment has not been made,
50% of the apportionment for the then current fiscal year. The
notes shall mature not later than 372 days after the date of
issuance.
(6) (5)
Notes issued under this section are
subject to the
revised municipal finance act, 2001 PA 34, MCL 141.2101 to
141.2821. Failure of a school district or intermediate school
district to receive state school aid does not affect the validity
or enforceability of a note issued under this section.
(7) (6)
A school board or intermediate
school board may make
more than 1 borrowing under this section during a school year.
(8) For the purposes of this section, a local or intermediate
school district is considered to have an operating deficit if its
general fund balance before restricted reserves is negative, or if
its other funds have negative balances that in total exceed the
general fund balance.
(9)
(7) In addition to other powers under this section, with
the approval of the state treasurer, the board of a local or
intermediate school district may obtain a line of credit to secure
funds for school operations or to pay previous loans obtained for
school operations under this or any other statute. The school board
or intermediate school board shall pledge not more than 30% of the
state school aid apportioned to the school district or intermediate
school district for that fiscal year for repayment of funds
received pursuant to a line of credit obtained under this
subsection. However, the school board or intermediate school board
shall not borrow against the line of credit an amount greater than
the difference, as of the date of the borrowing, between the total
state school aid funds apportioned to the school district or
intermediate school district for that fiscal year and the portion
already received or pledged, except secondary pledges made under
section 1356. To obtain approval for obtaining a line of credit
under this subsection, a school board or intermediate school board
shall apply to the state treasurer in the form and manner
prescribed by the state treasurer, and shall provide information as
requested by the state treasurer for evaluating the application.
The state treasurer shall approve or disapprove an application and
notify the school board or intermediate school board within 20
business days after receiving a proper application. If the state
treasurer disapproves an application, the state treasurer shall
include the reasons for disapproval in the notification to the
school board or intermediate school board.
Enacting section 1. This amendatory act does not take effect
unless all of the following bills of the 95th Legislature are
enacted into law:
(a) Senate Bill No.____ or House Bill No. 6578(request no.
07747'10).
(b) Senate Bill No.____ or House Bill No. 6577(request no.
07748'10).
(c) Senate Bill No.____ or House Bill No. 6579(request no.
07749'10).
