S4617

An Act concerning State monitors in certain school districts and amending and supplementing P.L.2006, c.15.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. Section 2 of P.L.2006, c.15 (C.18A:7A-55) is amended to read as follows:

2. a. In addition to the powers provided pursuant to P.L.2005, c.235, P.L.1996, c.138 (C.18A:7F-1 et al.), and P.L.2007, c.260 (C.18A:7F-43 et al.) or any other law, the Commissioner of Education shall have the authority to appoint a State monitor [and additional staff, as necessary,] to provide direct oversight of a board of education's business operations and personnel matters if: the school district receives an adverse or a disclaimer of opinion by its independent auditor in the annual audit required pursuant to N.J.S.18A:23-1; or any two or more of the following circumstances apply to the school district:

(1) the school district ends the fiscal year with a deficit balance as calculated for budgetary purposes in the general fund, special revenue fund, or capital projects fund, with the exception of a capital projects fund deficit caused by the issuance of bond anticipation notes;

(2) the school district receives a qualified opinion by its independent auditor in the annual audit required pursuant to N.J.S.18A:23-1;

(3) the school district receives an adverse, disclaimer, or qualified opinion by its independent auditor under the single audit section for State or federal awards in the annual audit required pursuant to N.J.S.18A:23-1;

(4) the school district receives any audit findings by its independent auditor identified as material weaknesses in internal controls;

(5) the school district fails to develop and implement a plan acceptable to the commissioner or [his] the commissioner’s designee to address a potential or actual deficit balance in the general fund, special revenue fund, or capital projects fund, with the exception of a capital projects fund deficit caused by the issuance of bond anticipation notes;

(6) the school district fails to implement a plan from the prior year which causes any findings from the independent auditor to be repeated;

(7) the school district is required to return federal funds once it is determined that the school district's expenditures are not in compliance with the grant requirements; or

(8) the school district submits the annual audit after the submission date required pursuant to N.J.S.18A:23-1.

b. The State monitor shall:

(1) oversee the fiscal management and expenditures of school district funds, including, but not limited to, budget reallocations and reductions, approvals of purchase orders, budget transfers, and payment of bills and claims;

(2) oversee the operation and fiscal management of school district facilities, including the development and implementation of recommendations for redistricting and restructuring of schools;

(3) ensure development and implementation of an acceptable plan to address the circumstances set forth in subsection a. of this section which resulted in the appointment of the State monitor. The plan shall include measurable benchmarks and specific activities to address the deficiencies of the school district;

(4) oversee all district staffing, including the ability to hire, promote, and terminate employees;

(5) have authority to override a chief school administrator's action and, except as otherwise provided in paragraph (2) of subsection a. of section 2 of P.L. , c. (C. ) (pending before the Legislature as this bill), a vote by the board of education on any of the matters set forth in this subsection, except that all actions of the State monitor shall be subject to the education, labor, and employment laws and regulations, including the "New Jersey Employer-Employee Relations Act," P.L.1941, c.100 (C.34:13A-1 et seq.), and collective bargaining agreements entered into by the school district. The authority provided in this paragraph shall not be construed as permitting the State monitor to recommend against, or otherwise interfere with, the educational placement decisions provided in a student’s individualized education program, unless otherwise provided in law;

(6) attend all meetings of the board of education, including closed sessions; and

(7) meet with the board of education on at least a quarterly basis to discuss with the members of the board the past actions of the board which led to the appointment of the State monitor and to provide board members with education and training that address the deficiencies identified in board actions.

c. The Commissioner of Education shall notify the State Board of Education following the appointment of a State monitor pursuant to subsection a. of this section. The State monitor shall report directly to the commissioner or [his] the commissioner’s designee on a weekly basis. The State monitor, and any assistant State monitor appointed pursuant to section 2 of P.L. , c. (C. ) (pending before the Legislature as this bill), shall [also] report monthly to the board of education and members of the public at the regularly scheduled board of education meeting.

d. For purposes of the "New Jersey Tort Claims Act," N.J.S.59:1-1 et seq., the State monitor shall be considered a State officer, but for all other purposes the State monitor shall be considered an employee of the district.

e. The State monitor shall [provide oversight in the school district until the commissioner determines that] serve a term of 24 months and oversee the implementation of the plan required pursuant to paragraph (3) of subsection b. of this section. The school district shall then have 12 months to ensure that all remedial actions required under the plan have been implemented and the necessary local capacity and fiscal controls have been restored to [school] the district [operations] without direct oversight by an appointed State monitor. At the end of the 12-month period, the commissioner shall determine whether it is necessary to reappoint a State monitor pursuant to subsection a. of this section. If the commissioner determines it is necessary to reappoint a State monitor, the commissioner shall provide the district with a written determination, which shall include a statement of reasons that supports the commissioner’s determination. After providing the requisite written determination, the commissioner may reappoint a State monitor pursuant to this section.

f. The salary of the State monitor shall be fixed by the commissioner and adjusted from time to time as the commissioner deems appropriate. The school district shall assume the total cost of the State monitor [and necessary additional staff] appointed pursuant to subsection a. of this section. The State monitor shall have the authority to appoint legal counsel if legal action is taken against [him] the State monitor while acting in [his] the State monitor’s official duties [as a State monitor] or as needed upon approval of the commissioner.

(cf: P.L.2007, c.260, s.24)

2. (New section) a. The Commissioner of Education may appoint additional staff, including one or more assistant State monitors, to support the State monitor appointed pursuant to section 2 of P.L.2006, c.15 (C.18A:7A-55). If the commissioner determines it is necessary to appoint one or more assistant State monitors pursuant to this section, the commissioner shall:

(1) provide written notice to the board of education explaining the need for the appointment; and

(2) obtain approval from the board prior to appointing any additional assistant State monitor, which approval shall be signified by a recorded roll call majority vote of the board’s full membership.

b. The commissioner shall notify the State Board of Education following the appointment of an assistant State monitor pursuant to subsection a. of this section. The assistant State monitor shall report directly to the State monitor on a weekly basis. The assistant State monitor shall assist with the State monitor’s monthly report pursuant to subsection c. of section 2 of P.L.2006, c.15 (C.18A:7A-55).

c. For purposes of the "New Jersey Tort Claims Act," N.J.S.59:1-1 et seq., an assistant State monitor appointed pursuant to this section shall be considered a State officer, but for all other purposes the assistant State monitor shall be considered an employee of the district.

d. An assistant State monitor shall serve a term of 24 months and assist with the implementation of the plan required pursuant to paragraph (3) of subsection b. of section 2 of P.L.2006, c.15 (C.18A:7A-55). The school district shall then have 12 months to ensure that all remedial actions required under the plan have been implemented and the necessary local capacity and fiscal controls have been restored to the district without direct oversight by an appointed assistant State monitor. At the end of the 12-month period, the commissioner shall determine whether it is necessary to reappoint an assistant State monitor. If the commissioner determines it is necessary to reappoint an assistant State monitor, the commissioner shall provide the district with a written determination, which shall include a statement of reasons that supports the commissioner’s determination. After providing the requisite written determination, the commissioner may reappoint an assistant State monitor pursuant to this section.

e. The State shall assume the total cost of any assistant State monitor or any additional staff appointed pursuant to this section.

3. This act shall take effect immediately.

STATEMENT

This bill regulates the appointment of assistant State monitors in certain school districts, revises the duties of the State monitor, and establishes term limits for both assistant State monitors and State monitors.

Under the provisions of the “School District Fiscal Accountability Act,” the Commissioner of Education has the authority to appoint a State monitor and additional staff, as necessary, to provide direct oversight of a board of education’s business operations and personnel matters if certain requirements are met. Pursuant to the authority to appoint additional staff, the commissioner has appointed assistant State monitors in certain circumstances to support the appointed State monitor.

This bill clarifies that the commissioner may appoint any additional staff, including one or more assistant State monitors, to support the State monitor. If the commissioner determines it is necessary to appoint one or more assistant State monitors, the commissioner is required to: (1) provide written notice to the board of education explaining the need for the appointment; and (2) obtain the approval of a roll call majority vote of the board prior to appointing any assistant State monitor. The bill requires an assistant State monitor to report weekly to the State monitor and assist the State monitor with the State monitor’s monthly reporting requirement under current law.

Under current law, the State monitor has the authority to override a chief school administrator’s action and a vote by the board of education on any matter related to the State monitor being appointed. This bill clarifies that this authority is not to be construed to permit the State monitor to recommend against, or otherwise interfere with, the educational placement decisions provided in a student’s individualized education program.

Current law further provides that the State monitor is to provide oversight in the school district until the commissioner determines that all remedial actions required under the plan have been implemented and the necessary local capacity and fiscal controls have been restored to school district operations.

This bill amends current law to establish a term limit for both the State monitor and assistant State monitor. The bill imposes a 24-month term on each monitor. The bill provides that the school district will then have 12 months to ensure that all remedial actions required under the plan have been implemented and the necessary local capacity and fiscal controls have been restored to the district without direct oversight by the State monitor or an appointed State monitor. At the end of the 12-month period, the commissioner is required to determine whether it is necessary to reappoint a State monitor or assistant State monitor. If the commissioner determines it is necessary to reappoint a State monitor or an assistant State monitor, the commissioner is required to provide the district with a written determination that includes a statement of reasons that supports the commissioner’s determination. After providing the requisite written determination, the commissioner is authorized to reappoint a State monitor or an assistant State monitor if the conditions required under current law continue to persist.

Additionally, under current law, a school district is required to assume the salary and other costs associated with the State monitor and any additional staff appointed by the commissioner, including assistant State monitors. This bill amends current law to require the State to bear the salary and costs associated with any additional staff, including assistant State monitors. A district is still required under the bill to pay the salary and costs associated with the State monitor.