HOUSE BILL No. 5386


     February 16, 2000, Introduced by Rep. Switalski and referred to the Committee on Education.


        A bill to amend 1976 PA 451, entitled

   "The revised school code,"

   by amending section 653 (MCL 380.653) and by adding sections 506a

   and 1220.

               THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

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           SEC. 506A.  IN ADDITION TO OTHER OVERSIGHT OF PUBLIC SCHOOL

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      ACADEMIES AS PROVIDED BY LAW, AN INTERMEDIATE SCHOOL DISTRICT

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      SHALL OVERSEE AND MONITOR THE OPERATIONS OF THE PUBLIC SCHOOL

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      ACADEMIES LOCATED WITHIN ITS BOUNDARIES TO THE SAME EXTENT AS THE

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      INTERMEDIATE SCHOOL DISTRICT OVERSEES AND MONITORS THE OPERATIONS

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      OF ITS CONSTITUENT SCHOOL DISTRICTS.  THIS OVERSIGHT SHALL

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      INCLUDE OVERSIGHT OF MANAGEMENT COMPANIES OR OTHER ENTITIES PRO-

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      VIDING SERVICES TO PUBLIC SCHOOL ACADEMIES UNDER AN AGREEMENT

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      DESCRIBED IN SECTION 504A(D).




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           Sec. 653.  The intermediate superintendent shall be the

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      executive officer of the intermediate school board and shall DO

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      ALL OF THE FOLLOWING:

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           (a) Put into practice IN ALL SCHOOL DISTRICTS AND PUBLIC

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      SCHOOL ACADEMIES LOCATED WITHIN THE INTERMEDIATE SCHOOL DISTRICT

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      the educational policies of the state and of the intermediate

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      school board.

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           (b) Recommend in writing all employees.

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           (c) Suspend an employee for cause until the intermediate

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      school board considers the suspension.

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           (d) Supervise and direct the work of assistants and other

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      employees of the intermediate school board.

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           (e) Examine and audit the books and records of a constituent

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      SCHOOL district  when  OR OF A PUBLIC SCHOOL ACADEMY LOCATED

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      WITHIN THE INTERMEDIATE SCHOOL DISTRICT, OR OF A MANAGEMENT COM-

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      PANY OR OTHER CONTRACTOR PROVIDING SERVICES TO SUCH A SCHOOL DIS-

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      TRICT OR PUBLIC SCHOOL ACADEMY, IF directed to do so by the state

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      board OR SUPERINTENDENT OF PUBLIC INSTRUCTION.

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           (f) Perform duties the state board and the intermediate

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      school board prescribe, make reports as may be required by the

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      state board, and at the close of his term of office deliver all

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      records, books, and papers belonging to the office to the inter-

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      mediate superintendent's successor.

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           (g) Examine in constituent SCHOOL districts not employing a

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      superintendent the statements of taxes to be raised by the con-

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      stituent  districts  SCHOOL DISTRICT required by law to be filed

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      with the township clerk and the county board of commissioners at



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      the October session of the board, and notify the secretary of the

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      board of a constituent SCHOOL district that fails to file tax

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      statements required by law, or has failed to qualify for state

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      school aid.

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           (h) Make written reports to the boards of constituent SCHOOL

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      districts AND GOVERNING BOARDS OF PUBLIC SCHOOL ACADEMIES LOCATED

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      WITHIN THE INTERMEDIATE SCHOOL DISTRICT in regard to all matters

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      pertaining to the educational interests of the SCHOOL districts

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      AND PUBLIC SCHOOL ACADEMIES.

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           SEC. 1220.  (1) FOR THE PURPOSE OF DETERMINING THE REASON-

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      ABLENESS OF EXPENDITURES AND WHETHER A VIOLATION OF STATE LAW HAS

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      OCCURRED, THE DEPARTMENT SHALL REQUIRE THAT THE GOVERNING BOARD

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      OF EACH SCHOOL DISTRICT, PUBLIC SCHOOL ACADEMY, AND INTERMEDIATE

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      SCHOOL DISTRICT HAVE AN AUDIT OF THE SCHOOL DISTRICT'S, PUBLIC

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      SCHOOL ACADEMY'S, OR INTERMEDIATE SCHOOL DISTRICT'S FINANCIAL AND

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      PUPIL ACCOUNTING RECORDS CONDUCTED AT LEAST ANNUALLY AT THE

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      EXPENSE OF THE SCHOOL DISTRICT, PUBLIC SCHOOL ACADEMY, OR INTER-

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      MEDIATE SCHOOL DISTRICT, AS APPLICABLE.  IF A SCHOOL DISTRICT OR

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      PUBLIC SCHOOL ACADEMY HAS CONTRACTED FOR MANAGEMENT SERVICES OR

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      OTHER OPERATIONAL SERVICES, THE AUDIT SHALL INCLUDE RECORDS OF

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      THE CONTRACTOR RELATING TO THE MANAGEMENT OR OPERATION OF THE

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      SCHOOL DISTRICT OR PUBLIC SCHOOL ACADEMY.  THE AUDIT SHALL BE

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      CONDUCTED BY A CERTIFIED PUBLIC ACCOUNTANT OR BY THE INTERMEDIATE

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      SUPERINTENDENT, AS MAY BE REQUIRED BY THE DEPARTMENT, OR IN THE

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      CASE OF A SCHOOL DISTRICT OF THE FIRST CLASS, BY A CERTIFIED

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      PUBLIC ACCOUNTANT, THE INTERMEDIATE SUPERINTENDENT, OR THE

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      AUDITOR GENERAL OF THE CITY.  AN INTERMEDIATE SCHOOL DISTRICT'S



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      ANNUAL FINANCIAL AUDIT SHALL BE ACCOMPANIED BY THE INTERMEDIATE

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      SCHOOL DISTRICT'S PUPIL ACCOUNTING PROCEDURES REPORT.  A SCHOOL

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      DISTRICT'S, PUBLIC SCHOOL ACADEMY'S, OR INTERMEDIATE SCHOOL

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      DISTRICT'S ANNUAL FINANCIAL AUDIT SHALL INCLUDE AN ANALYSIS OF

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      THE FINANCIAL AND PUPIL ACCOUNTING DATA USED AS THE BASIS FOR

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      DISTRIBUTION OF STATE SCHOOL AID.  THE PUPIL ACCOUNTING RECORDS

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      AND REPORTS, AUDITS, AND MANAGEMENT LETTERS ARE SUBJECT TO

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      REQUIREMENTS ESTABLISHED IN THE AUDITING AND ACCOUNTING MANUALS

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      APPROVED AND PUBLISHED BY THE DEPARTMENT.

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           (2) EXCEPT AS OTHERWISE PROVIDED IN THIS SUBSECTION, THE

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      BOARD OF A SCHOOL DISTRICT OR BOARD OR DIRECTORS OF A PUBLIC

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      SCHOOL ACADEMY SHALL FILE THE ANNUAL FINANCIAL AUDIT REPORTS WITH

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      THE INTERMEDIATE SCHOOL DISTRICT NOT LATER THAN 120 DAYS AFTER

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      THE END OF EACH SCHOOL FISCAL YEAR AND THE INTERMEDIATE SCHOOL

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      DISTRICT SHALL FORWARD THE ANNUAL FINANCIAL AUDIT REPORTS FOR

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      SCHOOL DISTRICTS OR PUBLIC SCHOOL ACADEMIES LOCATED WITHIN THE

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      INTERMEDIATE SCHOOL DISTRICT AND FOR THE INTERMEDIATE SCHOOL DIS-

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      TRICT, AND THE PUPIL ACCOUNTING PROCEDURES REPORT FOR THE PUPIL

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      MEMBERSHIP COUNT DAY AND SUPPLEMENTAL COUNT DAY, TO THE DEPART-

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      MENT NOT LATER THAN NOVEMBER 15 OF EACH YEAR.

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           (3) THE GOVERNING BOARD OF EACH SCHOOL DISTRICT, PUBLIC

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      SCHOOL ACADEMY, AND INTERMEDIATE SCHOOL DISTRICT SHALL FILE WITH

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      THE DEPARTMENT BY NOVEMBER 15 OF EACH YEAR AN ANNUAL COMPREHEN-

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      SIVE FINANCIAL REPORT, KNOWN AS "FORM B", ON A FORM AND IN THE

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      MANNER PRESCRIBED BY THE DEPARTMENT.  IF A SCHOOL DISTRICT OR

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      PUBLIC SCHOOL ACADEMY HAS CONTRACTED FOR MANAGEMENT SERVICES OR

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      OTHER OPERATIONAL SERVICES, THIS ANNUAL COMPREHENSIVE FINANCIAL



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      REPORT SHALL INCLUDE INFORMATION ON THE SERVICES PERFORMED BY THE

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      CONTRACTOR AND ON EXPENDITURES FOR THOSE SERVICES.

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           (4) THE ANNUAL FINANCIAL AUDIT REPORTS, PUPIL ACCOUNTING

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      PROCEDURES REPORTS, AND ANNUAL COMPREHENSIVE FINANCIAL REPORTS

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      REQUIRED UNDER THIS SECTION SHALL BE AVAILABLE TO THE PUBLIC IN

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      COMPLIANCE WITH THE FREEDOM OF INFORMATION ACT, 1976 PA 442,

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      MCL 15.231 TO 15.246.

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           (5) NOT LATER THAN DECEMBER 1 OF EACH YEAR, THE DEPARTMENT

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      SHALL NOTIFY THE STATE BUDGET DIRECTOR, THE STATE BOARD, THE LEG-

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      ISLATIVE APPROPRIATIONS SUBCOMMITTEES RESPONSIBLE FOR REVIEW OF

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      THE SCHOOL AID BUDGET, AND THE LEGISLATIVE STANDING COMMITTEES ON

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      EDUCATION OF SCHOOL DISTRICTS, PUBLIC SCHOOL ACADEMIES, AND

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      INTERMEDIATE SCHOOL DISTRICTS THAT HAVE NOT FILED AN ANNUAL

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      FINANCIAL AUDIT, PUPIL ACCOUNTING PROCEDURES REPORT, OR ANNUAL

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      COMPREHENSIVE FINANCIAL REPORT REQUIRED UNDER THIS SECTION FOR

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      THE SCHOOL YEAR ENDING IN THE IMMEDIATELY PRECEDING STATE FISCAL

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      YEAR.























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