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Article 3. Disbursements By Superintendent Of Public Instruction of California Education Code >> Division 3. >> Title 2. >> Part 24. >> Chapter 3. >> Article 3.

Commencing with the 2003-04 fiscal year, for the purposes of allocating the advance apportionment for the current fiscal year, the Superintendent of Public Instruction shall on or before July 20th of each year certify to the Controller the amounts estimated to be apportioned to each effective school district for the current fiscal year on the basis of the report of the districts for the second principal apportionment of the preceding fiscal year, the amounts estimated to be apportioned to each county school tuition fund and to each county school service fund for schools and classes to be maintained by the county superintendent of schools during the current fiscal year on the basis of reports provided by the county superintendent of schools, and the amounts estimated by the Superintendent of Public Instruction to be apportioned to the county school service fund during the current fiscal year under subdivisions (a) and (b) of Section 14054.
The Superintendent of Public Instruction shall, on or before February 20th of each year, apportion to each elementary school district, high school district, county school service fund, and county school tuition fund the total amounts allowed to them under Sections 14054, 14057, 14058, 41790, 41800, 41810, 41811, 41840, 41841, 41863, 41866, 41882, 41884, 41885, 41886, 41888, 41950, 41970, 41971, 42004, 42005, 42054, 42055, 42056, and 52205, whichever are in effect. This apportionment shall be called the first principal apportionment.
For purposes of determining the eligibility of a school for the "necessary small school" foundation program, if by November 10th of any current fiscal year, an additional teacher or teachers are hired in elementary schools or high schools such teachers shall be deemed to have been hired as of the beginning of the school year, and the districts shall, if otherwise eligible, be entitled to the appropriate small school foundation programs for purposes of computation of the principal apportionments.
(a) The Superintendent of Public Instruction shall on or before July 2 of each year apportion to each elementary school district, high school district, county school service fund, and county school tuition fund the total amounts allowed to each respective district or fund, as would have been apportioned on June 25 of the fiscal year of the apportionment pursuant to Section 41335 as it read on May 30, 2003, under Sections 14054, 14057, 14058, 41790, 41800, 41810, 41811, 41840, 41841, 41863, 41866, 41882, 41884, 41885, 41886, 41888, 41950, 41970, 41971, 42004, 42005, 42054, 42055, 42056, and 52205, whichever are in effect. This apportionment shall be called the second principal apportionment.
  (b) This section shall become operative on June 1, 2003.
The Superintendent of Public Instruction shall on or before June 25th of each year apportion to each school district or fund the total of the amounts allowed to the district or fund under Section 41972. This apportionment shall be called the final apportionment.
The Superintendent of Public Instruction shall apportion at such times as needed the amounts allowed pursuant to Section 14055.
(a) The Superintendent of Public Instruction shall certify each apportionment made by him or her under Sections 41332 to 41340, inclusive, whichever are in effect, to the Controller.
  (b) Ten working days prior to the dates prescribed in Sections 41330, 41332, and 41335, the superintendent shall notify the Joint Legislative Budget Committee and the Department of Finance of the average daily attendance numbers and the local property tax revenues to be utilized in the respective certification.
Notwithstanding subdivision (b) of Section 41339, 10 working days prior to the dates prescribed in Section 41330 and Section 41335, as Section 41335 reads on and after June 1, 2003, the Superintendent of Public Instruction shall notify the Joint Legislative Budget Committee and the Department of Finance of the average daily attendance numbers and the local property tax revenues to be utilized in the respective certification.
The Superintendent of Public Instruction shall furnish an abstract of each apportionment of the State School Fund to the State Controller, the Department of Finance and to the county and city and county auditors, county and city and county treasurers, and to the county superintendents of schools of the several counties of the state.
(a) (1) If, during any fiscal year, the amount apportioned to a school district or to any fund from Section A of the State School Fund differs either positively or negatively from the amount to which the school district or fund was entitled by an amount equal to the local control funding formula allocation pursuant to Section 42238.02, as implemented pursuant to Section 42238.03, for one unit of average daily attendance, the Superintendent, in accordance with regulations that he or she is hereby authorized to adopt, not later than the first succeeding fiscal year from the fiscal year in which the computational error was made, shall withhold from, or add to, the apportionment made during that fiscal year, the amount of the excess or deficiency, as the case may be. Notwithstanding any other provision of this code to the contrary, excesses withheld or deficiencies added by the Superintendent pursuant this subdivision shall be added to or allowed from any portion of the State School Fund.
  (2) Notwithstanding paragraph (1), excesses may be withheld or deficiencies added to apportionments on account of audit exceptions in any fiscal year in which they are certified by the Superintendent.
  (b) If, during any fiscal year, the amount apportioned to a community college district or to any fund from Section B of the State School Fund differs either positively or negatively from the amount to which the community college district or fund was entitled, by an amount equal to the funding of one full-time equivalent student, the Chancellor of the California Community Colleges, in accordance with regulations that he or she is hereby authorized to adopt, not later than the first succeeding fiscal year from the fiscal year in which the computational error was made, shall withhold from, or add to, the apportionment made during that fiscal year, the amount of the excess or deficiency, as the case may be. Notwithstanding any other provision of this code to the contrary, excesses withheld or deficiencies added by the Chancellor of the California Community Colleges under this subdivision shall be added to or allowed from any portion of the State School Fund.
When any judgment has been rendered which requires the apportionment from the State School Fund to any school district, to any other agency, or to any fund for any fiscal year of more than the amount actually apportioned thereto during that fiscal year, the difference shall be apportioned to the district, agency, or fund by the Superintendent of Public Instruction from the State School Fund during the fiscal year following that in which the judgment becomes final before any other apportionment from the State School Fund is made. Upon the becoming final of any judgment which requires the apportionment from the State School Fund to any school district, to any other agency, or to any fund for any fiscal year of less than the amount actually apportioned thereto during any fiscal year, the difference shall be deducted from the apportionment made to that district, agency, or fund by the Superintendent of Public Instruction from the State School Fund during the fiscal year following that in which the judgment becomes final.
Wherever the attendance of pupils is not included in the computation of the average daily attendance of a school district for any fiscal year because the certification document of the person employed by the district to instruct such pupils was not in force during the period of such attendance, the governing board of the district may, upon payment of the salary of such person pursuant to Section 45036, or similar provisions of law, report such attendance to the Superintendent of Public Instruction during the fiscal year in which such salary is paid. Such report shall be made in such form as shall be prescribed and furnished by the Superintendent of Public Instruction. Thereafter the Superintendent of Public Instruction shall add to the apportionment from the State School Fund to the district during the next succeeding fiscal year or years, as determined by him but not exceeding three, the additional amount to which the district would have been entitled in the fiscal year next succeeding that in which such attendance was not included in the computation of the average daily attendance of the district if such amount is at least one hundred dollars ($100) or more. Any such additional amount shall be apportioned from the State School Fund before any other apportionment from such fund is made and shall be allowed from any portion of such fund except that portion reserved as allowances for basic state aid.
(a) If, as the result of an audit or review, a local educational agency is required to repay an apportionment significant audit exception or to pay a penalty arising from an audit exception, the Superintendent and the Director of Finance, or their designees, jointly shall establish a plan for repayment of state school funds that the local educational agency received on the basis of average daily attendance, or other data, that did not comply with statutory or regulatory requirements that were conditions of the apportionments, or for payment of a penalty arising from an audit exception. A local educational agency shall request a plan within 90 days of receiving the final audit report or review, within 30 days of withdrawing or receiving a final determination regarding an appeal pursuant to subdivision (d), or, in the absence of an appeal pursuant to subdivision (d), within 30 days of withdrawing or receiving a determination of a summary review pursuant to subdivision (d) of Section 41344.1. At the time the local educational agency is notified, the Controller also shall be notified of the plan. The plan shall be established in accordance with the following:
  (1) The Controller shall withhold the disallowed or penalty amount at the next principal apportionment or pursuant to paragraph (2), unless subdivision (d) of this section or subdivision (d) of Section 41344.1 applies, in which case the disallowed or penalty amount shall be withheld, at the next principal apportionment or pursuant to paragraph (2) following the determination regarding the appeal or summary appeal. In calculating a disallowed amount, the Controller shall determine the total amount of overpayment received by the local educational agency on the basis of average daily attendance, or other data, reported by the local educational agency that did not comply with one or more statutory or regulatory requirements that are conditions of apportionment.
  (2) If the Superintendent and the Director of Finance concur that repayment of the full liability or payment of the penalty in the current fiscal year would constitute a severe financial hardship for the local educational agency, they may approve a plan of equal annual payments over a period of up to eight years. The plan shall include interest on each year's outstanding balance at the rate earned on the state's Pooled Money Investment Account during that year. The Superintendent and the Director of Finance jointly shall establish this plan. The Controller shall withhold amounts pursuant to the plan.
  (3) If the Superintendent and the Director of Finance do not jointly establish a plan, the Controller shall withhold the entire disallowed amount determined pursuant to paragraph (1), or the penalty amount, at the next principal apportionment.
  (b) (1) For purposes of computing average daily attendance pursuant to Section 42238.05, a local educational agency's prior fiscal year average daily attendance shall be reduced by an amount equal to any average daily attendance disallowed in the current year, by an audit or review, as defined in subdivision (e).
  (2) Commencing with the 1999-2000 fiscal year, this subdivision may not result in a local educational agency repaying more than the value of the average daily attendance disallowed in the audit exception plus interest and other penalties or reductions in apportionments as provided by existing law.
  (c) Notwithstanding any other law, this section may not be waived under any authority set forth in this code except as provided in this section or Section 41344.1.
  (d) Within 60 days of the date on which a local educational agency receives a final audit report resulting from an audit or review of all or any part of the operations of the local educational agency, or within 30 days of receiving a determination of a summary review pursuant to subdivision (d) of Section 41344.1, a local educational agency may appeal a finding contained in the final report, pursuant to Section 41344.1. Within 90 days of the date on which the appeal is received by the panel, a hearing shall be held at which the local educational agency may present evidence or arguments if the local educational agency believes that the final report contains any finding that was based on errors of fact or interpretation of law, or if the local educational agency believes in good faith that it was in substantial compliance with all legal requirements. A repayment schedule may not commence until the panel reaches a determination regarding the appeal. If the panel determines that the local educational agency is correct in its assertion, in whole or in part, the allowable portion of any apportionment payment that was withheld shall be paid at the next principal apportionment.
  (e) (1) As used in this section, "audit or review" means an audit conducted by the Controller's office, an annual audit conducted by a certified public accountant or a public accounting firm pursuant to Section 41020, and an audit or review conducted by a governmental agency that provided the local educational agency with an opportunity to provide a written response.
  (2) As used in this section, "local educational agency" includes a charter school.
(a) The Education Audit Appeals Panel is hereby established as a separate state agency. Its membership shall consist of the Superintendent, the Director of the Department of Finance, and the Chief Executive Officer of the Fiscal Crisis and Management Assistance Team established pursuant to Section 42127.8 or their designees. The panel shall have the authority to expend funds, hire staff, make contracts, sue and be sued, and issue regulations in furtherance of its duties.
  (b) The panel shall hear appeals filed pursuant to subdivision (d) of Section 41344. The Controller shall be a party to all appeals. The department and the Department of Finance may, at their election, timely intervene as a party in any appeal. The panel shall consider audit appeals pursuant to the administrative adjudication provisions of the Administrative Procedure Act (Chapter 4.5 (commencing with Section 11400) and Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code), except that it may adopt regulations specifying special pleadings that shall govern audit appeals. The panel may approve settlements and make findings of fact and interpretations of law.
  (c) Compliance with all legal requirements is a condition to the state's obligation to make apportionments. A condition may be deemed satisfied if the panel finds there has been compliance or substantial compliance with all legal requirements. "Substantial compliance" means nearly complete satisfaction of all material requirements of a funding program that provide an educational benefit substantially consistent with the program's purpose. A minor or inadvertent noncompliance may be grounds for a finding of substantial compliance provided that the local educational agency can demonstrate it acted in good faith to comply with the conditions established in law or regulation necessary for apportionment of funding. The panel may further define "substantial compliance" by issuing regulations or through adjudicative opinions, or both. If the panel finds there has been substantial compliance, the panel may waive or reduce the reimbursement or penalty amount and may also order other remedial measures sufficient to induce full compliance in the future. Other remedial measures may include restoration of a reduction or penalty amount if full compliance is not rendered in the future, ordering special audits, and requiring special training.
  (d) In addition to the normal appeal process specified above, there is hereby created a voluntary, informal, summary appeals process for noncompliant audit exceptions that clearly constitute substantial compliance as that term is defined in subdivision (c). Requests for summary review shall be made to the executive officer of the panel who may seek comment from the Department of Finance or Superintendent. Summary review shall be sought within 30 days of the date on which a local educational agency receives a final audit report resulting from an audit or review.
  (1) If the executive officer concludes the conditions for finding substantial compliance are not clearly met or involve substantial questions of fact, the executive officer may deny the request for summary review and the appellant may pursue its claim through the normal appeal process.
  (2) For appeals in which the total audit exceptions for full repayment or penalty constitute less than 150 units of average daily attendance or seven hundred fifty thousand dollars ($750,000), whichever is less, the executive officer may waive or reduce the reimbursement or penalty upon a finding of substantial compliance and that other remedial measures are sufficient to induce full compliance in the future.
  (3) For appeals in which the total audit exceptions for full repayment or penalty meet or exceed 150 units of average daily attendance or seven hundred fifty thousand dollars ($750,000), whichever is greater, the executive officer may waive or reduce the reimbursement or penalty upon a finding of substantial compliance and order other remedial measures that are sufficient to induce full compliance in the future, if he or she has the written approval of the Department of Finance and the Superintendent. The executive officer shall provide the details of the proposed settlement and the rationale in writing to the Department of Finance and Superintendent and allow at least 30 days for their review.
  (4) The right to appeal pursuant to subdivision (d) of Section 41344 is independent of this subdivision and an appellant may pursue his or her appeal under subdivision (b) regardless of the result under this subdivision. A local educational agency that has unresolved audit appeals pursuant to subdivision (d) of Section 41344 pending on January 1, 2003, may file a request for summary review under this subdivision for a period of 60 days after January 1, 2003.
Notwithstanding subdivision (c) of Section 41344 or any other provision of law, the State Board of Education may consider and act upon requests to retroactively waive any provision of this code or any regulation adopted by the State Board of Education that is the basis of an apportionment significant audit if the request was received in writing by the State Department of Education prior to July 7, 1999.
Notwithstanding subdivision (c) of Section 41344 or any other provision of law, the State Board of Education may, upon a finding that violations were minor or inadvertent and the intent of Section 60119 was substantially met, consider and act upon requests to waive Section 60119 to the extent that a failure to comply with that section would otherwise subject the school district to a repayment due to an apportionment significant audit. The board may act on requests to waive Section 60119 regardless of whether the request was received before or after the effective date of this section.
Notwithstanding any other provision of law, a local educational agency is not required to repay an apportionment based on a significant audit exception related to the requirements specified in paragraphs (1), (2), and (3) of subdivision (b) of Section 14501 if the county superintendent of schools certifies to the Superintendent of Public Instruction and the Controller that the audit exception was corrected by the local educational agency or that an acceptable plan of correction was submitted to the county superintendent of schools pursuant to subdivision (k) of Section 41020. With respect to textbooks and instructional materials, the plan shall be consistent with the requirements of subparagraph (A) of paragraph (2) of subdivision (a) of Section 60119.
(a) Notwithstanding Sections 17456, 17457, 17462, and 17463, or any other law, from June 1, 2004, to June 30, 2015, inclusive, the Vallejo City Unified School District may sell property owned by the district and use the proceeds from the sale to reduce or retire the emergency loan provided in Section 9 of Chapter 53 of the Statutes of 2004. The sale only of property pursuant to this subdivision is not subject to Section 17459 or 17464.
  (b) Notwithstanding any other provision of law, from June 1, 2004, to June 30, 2015, inclusive, the Vallejo City Unified School District is not eligible for hardship assistance pursuant to Article 8 (commencing with Section 17075.10) of Chapter 12.5 of Part 10 of Division 1 of Title 1.