HB 7031 Summary: Financial Emergencies

• Auditor General must notify all governing body members of local governmental entities, district school boards, charter schools, and charter technical career centers when deteriorating financial conditions exist or fund balance deficits occur.

• Entities in financial emergency must provide requested information to the Governor or Commissioner of Education within 45 days, or the Legislative Auditing Committee will be notified.

• Financial emergency boards may consult with other governmental entities regarding consolidation of administrative services including asset sales, economic development, building inspections, parks and recreation, facilities management, engineering, insurance, planning, information systems, fleet management, and purchasing.

• Governor or Commissioner of Education can require implementation of consolidation, sourcing, or discontinuance of administrative direction and support services in recovery plans.

• Failure of governing body members to resolve a state of financial emergency constitutes malfeasance, misfeasance, and neglect of duty under the State Constitution and can result in suspension or removal from office.

• Effective date: July 1, 2012.