| Old | New | Differences | |
|---|---|---|---|
| 1 | 1 | ||
| 2 | 2 | ||
| 3 | - | LCO 1 of | |
| 3 | + | LCO No. 665 1 of 12 | |
| 4 | 4 | ||
| 5 | - | General Assembly | |
| 5 | + | General Assembly Raised Bill No. 5472 | |
| 6 | 6 | February Session, 2024 | |
| 7 | + | LCO No. 665 | |
| 7 | 8 | ||
| 9 | + | ||
| 10 | + | Referred to Committee on PLANNING AND DEVELOPMENT | |
| 11 | + | ||
| 12 | + | ||
| 13 | + | Introduced by: | |
| 14 | + | (PD) | |
| 8 | 15 | ||
| 9 | 16 | ||
| 10 | 17 | ||
| 11 | 18 | ||
| 12 | 19 | AN ACT CONCERNING MUNICIPAL FINANCE AND AUDITS. | |
| 13 | 20 | Be it enacted by the Senate and House of Representatives in General | |
| 14 | 21 | Assembly convened: | |
| 15 | 22 | ||
| 16 | 23 | Section 1. Section 7-576a of the general statutes is repealed and the 1 | |
| 17 | 24 | following is substituted in lieu thereof (Effective July 1, 2024): 2 | |
| 18 | 25 | [(a) Any] The Municipal Finance Advisory Commission may 3 | |
| 19 | 26 | designate any municipality referred to said commission pursuant to 4 | |
| 20 | 27 | subsection (d) of section 7-395 [to the Municipal Finance Advisory 5 | |
| 21 | 28 | Commission shall be designated] as a tier I municipality. The chief 6 | |
| 22 | 29 | elected official of any municipality that does not meet the conditions 7 | |
| 23 | 30 | identified under subsection (d) of section 7-395 may apply to the 8 | |
| 24 | 31 | Municipal Finance Advisory Commission for designation as a tier I 9 | |
| 25 | 32 | municipality, provided such official (1) expects that such municipality 10 | |
| 26 | 33 | will meet one or more such conditions in the following twenty-four 11 | |
| 27 | 34 | month period, and (2) submits a report to the Municipal Finance 12 | |
| 28 | 35 | Advisory Commission, in a form and manner prescribed by the 13 | |
| 29 | 36 | commission, that confirms that such condition or conditions will be met 14 | |
| 30 | 37 | in such period. Each decision to designate a municipality as a tier I 15 | |
| 31 | - | municipality pursuant to this section shall be based on an evaluation of 16 | |
| 38 | + | municipality pursuant to this section shall be based on an evaluation of 16 Raised Bill No. 5472 | |
| 39 | + | ||
| 40 | + | ||
| 41 | + | ||
| 42 | + | LCO No. 665 2 of 12 | |
| 43 | + | ||
| 32 | 44 | such municipality's financial condition and financial practices. In 17 | |
| 33 | 45 | addition to the requirements of section 7-394b, each municipality 18 | |
| 34 | - | designated as a tier I municipality shall prepare and present a five-year 19 Substitute Bill No. 5472 | |
| 35 | - | ||
| 36 | - | ||
| 37 | - | LCO 2 of 8 | |
| 38 | - | ||
| 46 | + | designated as a tier I municipality shall prepare and present a five-year 19 | |
| 39 | 47 | financial plan to the Municipal Finance Advisory Commission for its 20 | |
| 40 | 48 | review and approval. 21 | |
| 41 | 49 | [(b) The secretary shall refer any municipality designated as a tier I 22 | |
| 42 | 50 | municipality to the Municipal Finance Advisory Commission, pursuant 23 | |
| 43 | 51 | to the provisions of section 7-395. In addition to the requirements of 24 | |
| 44 | 52 | section 7-394b, such municipality shall prepare and present a five-year 25 | |
| 45 | 53 | financial plan to the Municipal Finance Advisory Commission for its 26 | |
| 46 | 54 | review and approval.] 27 | |
| 47 | 55 | Sec. 2. Section 7-576f of the general statutes is repealed and the 28 | |
| 48 | 56 | following is substituted in lieu thereof (Effective July 1, 2024): 29 | |
| 49 | 57 | (a) (1) A municipality designated as a tier I municipality in 30 | |
| 50 | 58 | accordance with section 7-576a, as amended by this act, shall retain such 31 | |
| 51 | 59 | designation, notwithstanding any positive changes in the factors 32 | |
| 52 | 60 | leading to its current designation, until the Municipal Finance Advisory 33 | |
| 53 | 61 | Commission, by unanimous vote, terminates such designation based on 34 | |
| 54 | 62 | an evaluation of such municipality's financial condition and financial 35 | |
| 55 | 63 | practices. 36 | |
| 56 | - | [(a)] (2) A municipality designated as a [tier I municipality in 37 | |
| 57 | - | accordance with section 7-576a,] tier II municipality in accordance with 38 | |
| 58 | - | section 7-576b, tier III municipality in accordance with section 7-576c, or 39 | |
| 59 | - | tier IV municipality in accordance with section 7-576e, as amended by 40 | |
| 60 | - | this act, shall retain such designation, notwithstanding any positive 41 | |
| 61 | - | changes in the factors leading to its current designation, until, in the 42 | |
| 62 | - | fiscal years following such designation, [(1)] the Municipal 43 | |
| 63 | - | Accountability Review Board determines that (A) there have been no 44 | |
| 64 | - | audited operating deficits in the general fund of the municipality for 45 | |
| 65 | - | two consecutive fiscal years, [(2)] (B) the [municipality's] municipality 46 | |
| 66 | - | has a long-term bond rating from one or more bond rating agencies that 47 | |
| 67 | - | is investment grade or higher and such bond rating has either improved 48 | |
| 68 | - | or remained unchanged since its most current designation, [(3)] (C) the 49 | |
| 69 | - | municipality has presented and the [commission or] board has 50 | |
| 70 | - | approved a financial plan that projects a positive fund balance for the 51 Substitute Bill No. 5472 | |
| 64 | + | (2) A municipality designated as a [tier I municipality in accordance 37 | |
| 65 | + | with section 7-576a,] tier II municipality in accordance with section 7-38 | |
| 66 | + | 576b, tier III municipality in accordance with section 7-576c, or tier IV 39 | |
| 67 | + | municipality in accordance with section 7-576e, as amended by this act, 40 | |
| 68 | + | shall retain such designation, notwithstanding any positive changes in 41 | |
| 69 | + | the factors leading to its current designation, until, in the fiscal years 42 | |
| 70 | + | following such designation, [(1)] the Municipal Accountability Review 43 | |
| 71 | + | Board determines that (A) there have been no audited operating deficits 44 | |
| 72 | + | in the general fund of the municipality for two consecutive fiscal years, 45 | |
| 73 | + | [(2)] (B) the [municipality's] municipality has a long-term bond rating 46 | |
| 74 | + | from one or more bond rating agencies that is investment grade or 47 | |
| 75 | + | higher and such bond rating has either improved or remained 48 Raised Bill No. 5472 | |
| 71 | 76 | ||
| 72 | 77 | ||
| 73 | - | LCO 3 of 8 | |
| 74 | 78 | ||
| 75 | - | three succeeding consecutive fiscal years covered by such financial plan, 52 | |
| 76 | - | [where] provided (i) each fiscal year of such plan is based upon 53 | |
| 77 | - | recurring revenue and expenses, (ii) a positive fund balance of at least 54 | |
| 78 | - | five per cent is projected in the third such fiscal year, [and (4)] and (iii) 55 | |
| 79 | - | such plan does not include funding received pursuant to section 7-576i, 56 | |
| 80 | - | as amended by this act, or 7-576j, (D) the municipality's audits for such 57 | |
| 81 | - | consecutive fiscal years have been completed and [contain no general 58 | |
| 82 | - | fund deficit] the general fund reports an audited fund balance of at least 59 | |
| 83 | - | five per cent, and (E) there is no evidence that the municipality has 60 | |
| 84 | - | engaged in unsound or irregular financial practices in relation to 61 | |
| 85 | - | commonly accepted standards in municipal finance. The board may 62 | |
| 86 | - | undertake the determination described in this subdivision at its 63 | |
| 87 | - | discretion or upon the request of a municipality. 64 | |
| 79 | + | LCO No. 665 3 of 12 | |
| 80 | + | ||
| 81 | + | unchanged since its most current designation, [(3)] (C) the municipality 49 | |
| 82 | + | has presented and the [commission or] board has approved a financial 50 | |
| 83 | + | plan that projects a positive fund balance for the three succeeding 51 | |
| 84 | + | consecutive fiscal years covered by such financial plan, [where] 52 | |
| 85 | + | provided (i) each fiscal year of such plan is based upon recurring 53 | |
| 86 | + | revenue and expenses, (ii) a positive fund balance of at least five per cent 54 | |
| 87 | + | is projected in the third such fiscal year, [(4)] and (iii) such plan does not 55 | |
| 88 | + | include funding received pursuant to sections 7-576i, as amended by 56 | |
| 89 | + | this act, or 5-576j, (D) the municipality's audits for such consecutive 57 | |
| 90 | + | fiscal years have been completed and [contain no general fund deficit] 58 | |
| 91 | + | the general fund reports an audited fund balance of at least five per cent, 59 | |
| 92 | + | and (E) there is no evidence that the municipality has engaged in 60 | |
| 93 | + | unsound or irregular financial practices in relation to commonly 61 | |
| 94 | + | accepted standards in municipal finance. The board may undertake the 62 | |
| 95 | + | determination described in this subdivision at its discretion or upon the 63 | |
| 96 | + | request of a municipality. 64 | |
| 88 | 97 | (b) [Notwithstanding subsection (a) of this section, the Municipal 65 | |
| 89 | 98 | Finance Advisory Commission may, by unanimous vote, end the 66 | |
| 90 | 99 | designation of a municipality designated as a tier I municipality, based 67 | |
| 91 | 100 | on an evaluation of such municipality's financial condition.] (1) If the 68 | |
| 92 | 101 | Municipal Accountability Review Board determines that a municipality 69 | |
| 93 | 102 | has satisfied the criteria listed in subdivision (2) of subsection (a) of this 70 | |
| 94 | 103 | section, the secretary shall, at the secretary's discretion and in 71 | |
| 95 | 104 | consideration of the fiscal condition of the municipality and best 72 | |
| 96 | 105 | interests of the state, terminate such municipality's tier designation or 73 | |
| 97 | 106 | redesignate such municipality to a lower tier, provided no such 74 | |
| 98 | 107 | municipality shall be redesignated as a tier I municipality. Not later than 75 | |
| 99 | 108 | sixty days after the board makes such determination, the secretary shall 76 | |
| 100 | 109 | notify the municipality of the secretary's decision to terminate such 77 | |
| 101 | 110 | municipality's tier designation or redesignate such municipality to a 78 | |
| 102 | 111 | lower tier. A municipality shall retain its existing tier designation until 79 | |
| 103 | 112 | such notice is received. If the secretary fails to provide such notice prior 80 | |
| 104 | 113 | to the expiration of said sixty-day period, the municipality's tier 81 | |
| 105 | - | designation shall be deemed terminated on the sixty-first day following 82 | |
| 114 | + | designation shall be deemed terminated on the sixty-first day following 82 Raised Bill No. 5472 | |
| 115 | + | ||
| 116 | + | ||
| 117 | + | ||
| 118 | + | LCO No. 665 4 of 12 | |
| 119 | + | ||
| 106 | 120 | such determination. 83 | |
| 107 | 121 | (2) A municipality redesignated to a lower tier pursuant to 84 | |
| 108 | - | subdivision (1) of this subsection shall (A) meet the requirements of this 85 Substitute Bill No. 5472 | |
| 109 | - | ||
| 110 | - | ||
| 111 | - | LCO 4 of 8 | |
| 112 | - | ||
| 122 | + | subdivision (1) of this subsection shall (A) meet the requirements of this 85 | |
| 113 | 123 | chapter pertaining to such lower tier, and (B) not request a 86 | |
| 114 | 124 | determination from the Municipal Accountability Review Board 87 | |
| 115 | 125 | pursuant to subdivision (2) of subsection (a) of this section during the 88 | |
| 116 | 126 | one-year period following such redesignation. 89 | |
| 117 | 127 | Sec. 3. Section 7-576i of the general statutes is repealed and the 90 | |
| 118 | 128 | following is substituted in lieu thereof (Effective July 1, 2024): 91 | |
| 119 | 129 | (a) Any designated tier II, III, or IV municipality shall be eligible to 92 | |
| 120 | 130 | receive funding from the Municipal Restructuring Fund, which fund 93 | |
| 121 | 131 | shall be nonlapsing. A designated tier II, III or IV municipality seeking 94 | |
| 122 | 132 | such funds shall submit, for approval by the Secretary of the Office of 95 | |
| 123 | 133 | Policy and Management, a plan detailing its overall restructuring plan, 96 | |
| 124 | 134 | including local actions to be taken and its proposed use of such funds. 97 | |
| 125 | 135 | Notwithstanding section 10-262j, a municipality may, as part of such 98 | |
| 126 | 136 | plan and in consultation with its local board of education, submit a 99 | |
| 127 | 137 | proposed reduction in the minimum budget requirement related to its 100 | |
| 128 | 138 | education budget. The secretary shall consult with the Commissioner of 101 | |
| 129 | 139 | Education in approving or rejecting such proposed reduction. The 102 | |
| 130 | 140 | secretary shall consult with the [municipal accountability review board] 103 | |
| 131 | 141 | Municipal Accountability Review Board in making distribution 104 | |
| 132 | 142 | decisions and attaching appropriate conditions thereto, including the 105 | |
| 133 | 143 | timing of any such distributions and whether such funds shall be 106 | |
| 134 | 144 | distributed in the form of a municipal restructuring fund loan subject to 107 | |
| 135 | 145 | repayment by the municipality. The distribution of such assistance 108 | |
| 136 | 146 | funds shall be based on the relative fiscal needs of the requesting 109 | |
| 137 | 147 | municipalities. The secretary may approve all, none or a portion of the 110 | |
| 138 | 148 | funds requested by a municipality. In attaching conditions to such 111 | |
| 139 | 149 | funding, the secretary shall consider the impact of such conditions on 112 | |
| 140 | 150 | the ability of a municipality to meet legal and other obligations. The 113 | |
| 141 | 151 | board shall monitor and report to the secretary on the use of such funds 114 | |
| 142 | - | and adherence to the conditions attached thereto. The secretary shall 115 | |
| 152 | + | and adherence to the conditions attached thereto. The secretary shall 115 Raised Bill No. 5472 | |
| 153 | + | ||
| 154 | + | ||
| 155 | + | ||
| 156 | + | LCO No. 665 5 of 12 | |
| 157 | + | ||
| 143 | 158 | develop and issue guidance on the (1) administration of the [municipal 116 | |
| 144 | 159 | restructuring fund] Municipal Restructuring Fund, (2) criteria for 117 | |
| 145 | 160 | participation by municipalities and requirements for plan submission, 118 | |
| 146 | - | and (3) prioritization for the awarding of assistance funds pursuant to 119 Substitute Bill No. 5472 | |
| 147 | - | ||
| 148 | - | ||
| 149 | - | LCO 5 of 8 | |
| 150 | - | ||
| 161 | + | and (3) prioritization for the awarding of assistance funds pursuant to 119 | |
| 151 | 162 | this section. Any municipality that receives funding from the [municipal 120 | |
| 152 | 163 | restructuring fund] Municipal Restructuring Fund, in addition to the 121 | |
| 153 | 164 | other responsibilities and authority given to the board with respect to 122 | |
| 154 | 165 | designated tiers II, III and IV municipalities, shall be required to receive 123 | |
| 155 | 166 | board approval of its annual budgets. 124 | |
| 156 | 167 | (b) The secretary may distribute funds from the Municipal 125 | |
| 157 | 168 | Restructuring Fund to a third party on behalf of a designated tier II, tier 126 | |
| 158 | 169 | III or tier IV municipality. Funds received by a municipality pursuant to 127 | |
| 159 | - | this section may be used | |
| 160 | - | ||
| 170 | + | this section may be used to pay an arbitrator selected pursuant to 128 | |
| 171 | + | subclause (v) of subdivision (3) of subsection (a) of section 7-576e, as 129 | |
| 161 | 172 | amended by this act. 130 | |
| 162 | 173 | [(b)] (c) Notwithstanding the provisions of subsection (a) of this 131 | |
| 163 | 174 | section, in making distributions from the Municipal Restructuring 132 | |
| 164 | 175 | Fund, the board shall give immediate consideration to any municipality 133 | |
| 165 | 176 | that shall default on debt obligations by January 1, 2018, without an 134 | |
| 166 | 177 | immediate distribution of such funds. 135 | |
| 167 | 178 | Sec. 4. Subdivision (2) of subsection (a) of section 7-576e of the general 136 | |
| 168 | 179 | statutes is repealed and the following is substituted in lieu thereof 137 | |
| 169 | 180 | (Effective July 1, 2024): 138 | |
| 170 | 181 | (2) The Municipal Accountability Review Board may designate a tier 139 | |
| 171 | 182 | III municipality as a tier IV municipality based on a finding by the board 140 | |
| 172 | 183 | that the fiscal condition of such municipality warrants such a 141 | |
| 173 | 184 | designation based upon an evaluation of the following criteria: (A) The 142 | |
| 174 | 185 | balance in the municipal reserve fund; (B) the short and long-term 143 | |
| 175 | 186 | liabilities of the municipality, including, but not limited to, the 144 | |
| 176 | 187 | municipality's ability to meet minimum funding levels required by law, 145 | |
| 177 | 188 | contract or court order; (C) the initial budgeted revenue for the 146 | |
| 178 | - | municipality for the past five fiscal years as compared to the actual 147 | |
| 189 | + | municipality for the past five fiscal years as compared to the actual 147 Raised Bill No. 5472 | |
| 190 | + | ||
| 191 | + | ||
| 192 | + | ||
| 193 | + | LCO No. 665 6 of 12 | |
| 194 | + | ||
| 179 | 195 | revenue received by the municipality for such fiscal years; (D) budget 148 | |
| 180 | 196 | projections for the following five fiscal years; (E) the economic outlook 149 | |
| 181 | 197 | for the municipality; [and] (F) the municipality's access to capital 150 | |
| 182 | - | markets; and (G) evidence of unsound or irregular financial practices in 151 Substitute Bill No. 5472 | |
| 183 | - | ||
| 184 | - | ||
| 185 | - | LCO 6 of 8 | |
| 186 | - | ||
| 198 | + | markets; and (G) evidence of unsound or irregular financial practices in 151 | |
| 187 | 199 | relation to commonly accepted standards in municipal finance that the 152 | |
| 188 | 200 | board believes may materially affect the municipality's financial 153 | |
| 189 | 201 | condition. For the purpose of determining whether to make a finding 154 | |
| 190 | 202 | pursuant to this subdivision, the membership of the board shall 155 | |
| 191 | 203 | additionally include the chief elected official of such municipality, the 156 | |
| 192 | 204 | treasurer of such municipality and a member of the legislative body of 157 | |
| 193 | 205 | such municipality, as selected by such body. In conducting a vote on 158 | |
| 194 | 206 | any such determination, the treasurer of such municipality shall be a 159 | |
| 195 | 207 | non-voting member of the board. The board shall submit such finding 160 | |
| 196 | 208 | and recommended designation to the secretary, who shall provide for a 161 | |
| 197 | 209 | thirty-day notice and public comment period related to such finding 162 | |
| 198 | 210 | and recommendation. Following the public notice and comment period, 163 | |
| 199 | 211 | the secretary shall forward the board's finding and recommended 164 | |
| 200 | 212 | designation and a report regarding the comments received in this regard 165 | |
| 201 | 213 | to the Governor. Following the receipt of such documentation from the 166 | |
| 202 | 214 | secretary, the Governor may approve or disapprove the board's 167 | |
| 203 | 215 | recommended designation. 168 | |
| 204 | - | Sec. 5. Section 7-393 of the general statutes is repealed and the 169 | |
| 205 | - | following is substituted in lieu thereof (Effective July 1, 2024): 170 | |
| 206 | - | Upon the completion of an audit, the independent auditor shall file 171 | |
| 207 | - | certified copies of the audit report with (1) the appointing authority, (2) 172 | |
| 208 | - | in the case of a town, city or borough, with the clerk of such town, city 173 | |
| 209 | - | or borough, (3) in the case of a regional school district, with the clerks of 174 | |
| 210 | - | the towns, cities or boroughs in which such regional school district is 175 | |
| 211 | - | located and with the board of education, (4) in the case of an audited 176 | |
| 212 | - | agency, with the clerks of the towns, cities or boroughs in which such 177 | |
| 213 | - | audited agency is located, and (5) in each case, with the Secretary of the 178 | |
| 214 | - | Office of Policy and Management. Such copies shall be filed within six 179 | |
| 215 | - | months from the end of the fiscal year of the municipality, regional 180 | |
| 216 | - | school district or audited agency, but the secretary may grant an 181 | |
| 217 | - | extension of not more than thirty days, provided the auditor making the 182 | |
| 218 | - | audit and the chief executive officer of the municipality, regional school 183 | |
| 219 | - | district or audited agency shall jointly submit a request in writing to the 184 | |
| 220 | - | secretary stating the reasons for such extension at least thirty days prior 185 Substitute Bill No. 5472 | |
| 216 | + | Sec. 5. Subdivision (3) of subsection (a) of section 7-576e of the general 169 | |
| 217 | + | statutes is repealed and the following is substituted in lieu thereof 170 | |
| 218 | + | (Effective July 1, 2024): 171 | |
| 219 | + | (3) If any municipality is designated as a tier IV municipality, the 172 | |
| 220 | + | following individuals shall serve as ex-officio, nonvoting members of 173 | |
| 221 | + | the Municipal Accountability Review Board, provided such additional 174 | |
| 222 | + | members shall only serve for purposes of the tier IV municipality that 175 | |
| 223 | + | they represent: (A) The chief elected official of such municipality, or the 176 | |
| 224 | + | chief elected official's designee, (B) an elected member of the local 177 | |
| 225 | + | legislative body of such municipality, or such member's designee, as 178 | |
| 226 | + | selected by a majority vote of the local legislative body of such 179 | |
| 227 | + | municipality, (C) in the case where the municipality has an elected 180 | |
| 228 | + | treasurer, the municipal treasurer or other municipal official responsible 181 Raised Bill No. 5472 | |
| 221 | 229 | ||
| 222 | 230 | ||
| 223 | - | LCO 7 of 8 | |
| 224 | 231 | ||
| 225 | - | to the end of such six-month period. If the reason for the extension 186 | |
| 226 | - | relates to deficiencies in the accounting system of the municipality, 187 | |
| 227 | - | regional school district or audited agency the request must be 188 | |
| 228 | - | accompanied by a corrective action plan. The secretary may, after a 189 | |
| 229 | - | hearing with the auditor and officials of the municipality, regional 190 | |
| 230 | - | school district or audited agency, grant an additional extension if 191 | |
| 231 | - | conditions warrant, provided such extension shall not exceed six 192 | |
| 232 | - | months from the date the auditor was required to file such copies. Said 193 | |
| 233 | - | auditor shall preserve all of his or her working papers employed in the 194 | |
| 234 | - | preparation of any such audit until the expiration of [three] five years 195 | |
| 235 | - | from the date of filing a certified copy of the audit with the secretary 196 | |
| 236 | - | and such working papers shall be available, upon written request and 197 | |
| 237 | - | upon reasonable notice from the secretary, during such time for 198 | |
| 238 | - | inspection by the secretary or his authorized representative, at the office 199 | |
| 239 | - | or place of business of the auditor, during usual business hours. Any 200 | |
| 240 | - | municipality, regional school district, audited agency or auditor who 201 | |
| 241 | - | fails to have the audit report filed on its behalf within six months from 202 | |
| 242 | - | the end of the fiscal year or within the time granted by the secretary shall 203 | |
| 243 | - | be referred by the secretary to the Municipal Finance Advisory 204 | |
| 244 | - | Commission established pursuant to section 7-394b, assessed a civil 205 | |
| 245 | - | penalty of not less than one thousand dollars but not more than [ten] 206 | |
| 246 | - | fifty thousand dollars or both, except that the secretary may waive such 207 | |
| 247 | - | penalties if, in the secretary's opinion, there appears to be reasonable 208 | |
| 248 | - | cause for not having completed or provided the required audit report, 209 | |
| 249 | - | provided an official of the municipality, regional school district or 210 | |
| 250 | - | audited agency or the auditor submits a written request for such waiver. 211 | |
| 251 | - | The secretary may impose any civil penalty assessed pursuant to this 212 | |
| 252 | - | section against a municipality, regional school district or audited agency 213 | |
| 253 | - | in the form of a reduction in the amount of one or more grants awarded 214 | |
| 254 | - | by the secretary, including, but not limited to, any grant payable 215 | |
| 255 | - | pursuant to section 12-18b. 216 | |
| 232 | + | LCO No. 665 7 of 12 | |
| 233 | + | ||
| 234 | + | for the issuance of bonds, and (D) a member of the minority party of the 182 | |
| 235 | + | municipality's legislative body as elected by such minority party 183 | |
| 236 | + | members. Notwithstanding the provisions of sections 7-568 to 7-575, 184 | |
| 237 | + | inclusive, and sections 7-576a, as amended by this act, and 7-576b, a 185 | |
| 238 | + | municipality designated as a tier IV municipality pursuant to this 186 | |
| 239 | + | section shall retain such designation following the issuance of a deficit 187 | |
| 240 | + | obligation subsequent to such municipality's designation as a tier IV 188 | |
| 241 | + | municipality. With respect to a designated tier IV municipality, the 189 | |
| 242 | + | Municipal Accountability Review Board shall have the same powers 190 | |
| 243 | + | and responsibilities as it has with respect to designated tier III 191 | |
| 244 | + | municipalities in addition to which it shall have the following additional 192 | |
| 245 | + | or superseding authority and responsibilities: 193 | |
| 246 | + | (i) To review and approve or disapprove the municipality's annual 194 | |
| 247 | + | budget, including, but not limited to, the general fund, other 195 | |
| 248 | + | governmental funds, enterprise funds and internal service funds. No 196 | |
| 249 | + | annual budget, annual tax levy or user fee for the municipality shall 197 | |
| 250 | + | become operative until it has been approved by the board. If the board 198 | |
| 251 | + | disapproves any annual budget, not later than the May twenty-first 199 | |
| 252 | + | prior to the beginning of the new fiscal year, the board shall specify the 200 | |
| 253 | + | reasons for such disapproval and shall provide the legislative body until 201 | |
| 254 | + | the June fifteenth prior to the beginning of the new fiscal year to 202 | |
| 255 | + | resubmit the annual budget in accordance with this section. If the 203 | |
| 256 | + | legislative body has not adopted a budget by such June fifteenth date or 204 | |
| 257 | + | its resubmitted annual budget is not approved by the board, the board 205 | |
| 258 | + | shall adopt an interim budget and establish a tax rate and user fees. Such 206 | |
| 259 | + | interim budget shall take effect at the commencement of the fiscal year 207 | |
| 260 | + | and shall remain in effect until the municipality submits and the board 208 | |
| 261 | + | approves a modified budget. Notwithstanding any provision of the 209 | |
| 262 | + | general statutes, or any public or special act, local law, charter or 210 | |
| 263 | + | ordinance or resolution, a municipality may approve a modified budget 211 | |
| 264 | + | pursuant to this section after any applicable deadline for such adoption 212 | |
| 265 | + | has passed. 213 | |
| 266 | + | (ii) To review and approve all bond ordinances and bond resolutions 214 | |
| 267 | + | of the municipality. 215 Raised Bill No. 5472 | |
| 268 | + | ||
| 269 | + | ||
| 270 | + | ||
| 271 | + | LCO No. 665 8 of 12 | |
| 272 | + | ||
| 273 | + | (iii) To monitor compliance with the municipality's five-year financial 216 | |
| 274 | + | plan and annual budget and require that the municipality make such 217 | |
| 275 | + | changes as are necessary to ensure budgetary balance in such plan and 218 | |
| 276 | + | budget. 219 | |
| 277 | + | (iv) To approve or reject all collective bargaining agreements for a 220 | |
| 278 | + | new term, other than modifications, amendments or reopening of an 221 | |
| 279 | + | agreement, to be entered into by the municipality or any of its agencies 222 | |
| 280 | + | or administrative units, including the board of education. If it rejects an 223 | |
| 281 | + | agreement, the board shall indicate the specific provisions of the 224 | |
| 282 | + | proposed agreement present or missing which caused the rejection, as 225 | |
| 283 | + | well as its rationale for the rejection. The board may indicate the total 226 | |
| 284 | + | cost impact or savings that are acceptable in a new agreement. At any 227 | |
| 285 | + | time during negotiations and prior to reaching any agreement, or a 228 | |
| 286 | + | modified agreement, the parties, by mutual agreement, may request 229 | |
| 287 | + | guidance from the board as to the level and areas of savings that may be 230 | |
| 288 | + | acceptable to the board in a new agreement. Following any rejection of 231 | |
| 289 | + | a proposed collective bargaining agreement, the parties to the 232 | |
| 290 | + | agreement shall have ten days from the date of the board's rejection to 233 | |
| 291 | + | consider the board's concerns and propose a modified agreement. After 234 | |
| 292 | + | the expiration of such ten-day period, the board shall approve or reject 235 | |
| 293 | + | any such modified agreement. If the parties have been unable to reach a 236 | |
| 294 | + | modified agreement or the board rejects such modified agreement, the 237 | |
| 295 | + | board shall impose binding arbitration on the parties, in accordance 238 | |
| 296 | + | with clause (v) of this subdivision, to arbitrate issues identified by the 239 | |
| 297 | + | board as the cause for such inability or rejection. In establishing the 240 | |
| 298 | + | issues to be arbitrated, as well as in making a determination to reject a 241 | |
| 299 | + | proposed agreement, the board shall not be limited to matters raised or 242 | |
| 300 | + | negotiated by the parties. Also, to approve or reject all modifications, 243 | |
| 301 | + | amendments or reopeners to collective bargaining agreements entered 244 | |
| 302 | + | into by the municipality or any of its agencies or administrative units, 245 | |
| 303 | + | including the board of education. If it rejects a modification, amendment 246 | |
| 304 | + | or reopener to an agreement, the board shall indicate the specific 247 | |
| 305 | + | provisions of the proposed modification, amendment or reopener which 248 | |
| 306 | + | caused the rejection, as well as its rationale for the rejection. The board 249 Raised Bill No. 5472 | |
| 307 | + | ||
| 308 | + | ||
| 309 | + | ||
| 310 | + | LCO No. 665 9 of 12 | |
| 311 | + | ||
| 312 | + | may indicate the total cost impact or savings acceptable in a new 250 | |
| 313 | + | modification, amendment or reopener. If the board rejects a proposed 251 | |
| 314 | + | amendment or reopener to a collective bargaining agreement, the 252 | |
| 315 | + | parties to the agreement shall have ten days from the date of the board's 253 | |
| 316 | + | rejection to consider the board's concerns and put forth a revised 254 | |
| 317 | + | modification, amendment or reopener. After the expiration of such ten-255 | |
| 318 | + | day period, the board shall approve or reject any revised modification, 256 | |
| 319 | + | amendment or reopener amendment. If the parties are unable to reach 257 | |
| 320 | + | a revised modification, amendment or reopener or the board rejects 258 | |
| 321 | + | such revised modification, amendment or reopener, the board shall 259 | |
| 322 | + | impose binding arbitration upon the parties in accordance with clause 260 | |
| 323 | + | (v) of this subdivision. The issues to be arbitrated shall be those 261 | |
| 324 | + | identified by the board as causing such inability or rejection. Prior to the 262 | |
| 325 | + | board taking action on any such modification, amendment or reopener, 263 | |
| 326 | + | the parties shall have an opportunity to make a presentation to the 264 | |
| 327 | + | board. 265 | |
| 328 | + | (v) Except as otherwise provided in this subdivision, with respect to 266 | |
| 329 | + | collective bargaining agreements of the municipality or any of its 267 | |
| 330 | + | agencies or administrative units, including, but not limited to, the board 268 | |
| 331 | + | of education, that are in or are subject to binding arbitration, the board 269 | |
| 332 | + | shall have the power to impose binding arbitration upon the parties any 270 | |
| 333 | + | time after the seventy-fifth day following the commencement of 271 | |
| 334 | + | negotiations or to reject any arbitration award pending municipal or 272 | |
| 335 | + | board of education action pursuant to section 7-473c or 10-153f on the 273 | |
| 336 | + | date the board is established. If, upon the date of a municipality's 274 | |
| 337 | + | designation as a tier IV municipality, the parties are in binding 275 | |
| 338 | + | arbitration, or if the board rejects a pending arbitration award, the board 276 | |
| 339 | + | shall immediately replace any established binding arbitration panel 277 | |
| 340 | + | with an arbitrator selected in accordance with this section. If the board 278 | |
| 341 | + | imposes binding arbitration or replaces an existing binding arbitration 279 | |
| 342 | + | panel, it shall do so with an arbitrator selected by the Governor from a 280 | |
| 343 | + | list of three potential arbitrators approved by and submitted to the 281 | |
| 344 | + | Governor by the board. Such list of potential arbitrators shall include 282 | |
| 345 | + | former judges of the state or federal judicial systems or other persons 283 Raised Bill No. 5472 | |
| 346 | + | ||
| 347 | + | ||
| 348 | + | ||
| 349 | + | LCO No. 665 10 of 12 | |
| 350 | + | ||
| 351 | + | who have experience with arbitration or similar proceedings. Prior to 284 | |
| 352 | + | the Governor's selection of an arbitrator, the parties may provide 285 | |
| 353 | + | recommendations for such selection to the board. The board shall not be 286 | |
| 354 | + | limited to selecting arbitrators from those recommended by the parties. 287 | |
| 355 | + | The board may reduce the time limits in the applicable provisions of the 288 | |
| 356 | + | general statutes or any public or special acts governing binding 289 | |
| 357 | + | arbitration by one-half. In imposing such arbitration or in replacing an 290 | |
| 358 | + | arbitration panel, the board shall not be limited to consideration and 291 | |
| 359 | + | inclusion in the collective bargaining agreement of the last best offers or 292 | |
| 360 | + | the matters raised by or negotiated by the parties provided the board 293 | |
| 361 | + | shall indicate reasons for raising any matters not negotiated by the 294 | |
| 362 | + | parties. The board shall be given the opportunity to make a presentation 295 | |
| 363 | + | before the arbitrator. In addition to any statutory factors that shall be 296 | |
| 364 | + | considered by the arbitrator with respect to proposed municipal or 297 | |
| 365 | + | board of education collective bargaining agreements, the arbitrator shall 298 | |
| 366 | + | give highest priority to the short and long-term fiscal exigencies that 299 | |
| 367 | + | resulted in the municipality's designation as a tier IV municipality. Not 300 | |
| 368 | + | later than ten days after the issuance of any of the arbitrator's decisions 301 | |
| 369 | + | on the matters subject to such binding arbitration, the board may 302 | |
| 370 | + | request reconsideration of one or more of such decisions and state its 303 | |
| 371 | + | position as to the impact of such decisions on the short and long-term 304 | |
| 372 | + | fiscal sustainability of the municipality. Not later than five days after the 305 | |
| 373 | + | board's request for such reconsideration, the parties may submit 306 | |
| 374 | + | comments to the arbitrator in response to the board's stated position. 307 | |
| 375 | + | Not later than thirty days following the board's request for such 308 | |
| 376 | + | reconsideration, the arbitrator, based on the record of the arbitration, 309 | |
| 377 | + | may either modify or maintain the original arbitration decisions. The 310 | |
| 378 | + | arbitrator's decisions shall be binding upon the parties. With respect to 311 | |
| 379 | + | collective bargaining agreements negotiated pursuant to section 10-312 | |
| 380 | + | 153d and arbitration awards issued pursuant to section 10-153f, the 313 | |
| 381 | + | provisions of this subdivision shall not apply until the board has 314 | |
| 382 | + | rejected such agreement or award pursuant to subdivision (7) of 315 | |
| 383 | + | subsection (b) of section 7-576d on two occasions. No collective 316 | |
| 384 | + | bargaining agreement that requires the approval of the board shall be 317 | |
| 385 | + | deemed approved solely due to the board's failure to act within a 318 Raised Bill No. 5472 | |
| 386 | + | ||
| 387 | + | ||
| 388 | + | ||
| 389 | + | LCO No. 665 11 of 12 | |
| 390 | + | ||
| 391 | + | specified period of time. 319 | |
| 392 | + | Sec. 6. Section 7-393 of the general statutes is repealed and the 320 | |
| 393 | + | following is substituted in lieu thereof (Effective July 1, 2024): 321 | |
| 394 | + | Upon the completion of an audit, the independent auditor shall file 322 | |
| 395 | + | certified copies of the audit report with (1) the appointing authority, (2) 323 | |
| 396 | + | in the case of a town, city or borough, with the clerk of such town, city 324 | |
| 397 | + | or borough, (3) in the case of a regional school district, with the clerks of 325 | |
| 398 | + | the towns, cities or boroughs in which such regional school district is 326 | |
| 399 | + | located and with the board of education, (4) in the case of an audited 327 | |
| 400 | + | agency, with the clerks of the towns, cities or boroughs in which such 328 | |
| 401 | + | audited agency is located, and (5) in each case, with the Secretary of the 329 | |
| 402 | + | Office of Policy and Management. Such copies shall be filed within six 330 | |
| 403 | + | months from the end of the fiscal year of the municipality, regional 331 | |
| 404 | + | school district or audited agency, but the secretary may grant an 332 | |
| 405 | + | extension of not more than thirty days, provided the auditor making the 333 | |
| 406 | + | audit and the chief executive officer of the municipality, regional school 334 | |
| 407 | + | district or audited agency shall jointly submit a request in writing to the 335 | |
| 408 | + | secretary stating the reasons for such extension at least thirty days prior 336 | |
| 409 | + | to the end of such six-month period. If the reason for the extension 337 | |
| 410 | + | relates to deficiencies in the accounting system of the municipality, 338 | |
| 411 | + | regional school district or audited agency the request must be 339 | |
| 412 | + | accompanied by a corrective action plan. The secretary may, after a 340 | |
| 413 | + | hearing with the auditor and officials of the municipality, regional 341 | |
| 414 | + | school district or audited agency, grant an additional extension if 342 | |
| 415 | + | conditions warrant, provided such extension shall not exceed six 343 | |
| 416 | + | months from the date the auditor was required to file such copies. Said 344 | |
| 417 | + | auditor shall preserve all of his or her working papers employed in the 345 | |
| 418 | + | preparation of any such audit until the expiration of [three] five years 346 | |
| 419 | + | from the date of filing a certified copy of the audit with the secretary 347 | |
| 420 | + | and such working papers shall be available, upon written request and 348 | |
| 421 | + | upon reasonable notice from the secretary, during such time for 349 | |
| 422 | + | inspection by the secretary or his authorized representative, at the office 350 | |
| 423 | + | or place of business of the auditor, during usual business hours. Any 351 | |
| 424 | + | municipality, regional school district, audited agency or auditor who 352 Raised Bill No. 5472 | |
| 425 | + | ||
| 426 | + | ||
| 427 | + | ||
| 428 | + | LCO No. 665 12 of 12 | |
| 429 | + | ||
| 430 | + | fails to have the audit report filed on its behalf within six months from 353 | |
| 431 | + | the end of the fiscal year or within the time granted by the secretary shall 354 | |
| 432 | + | be referred by the secretary to the Municipal Finance Advisory 355 | |
| 433 | + | Commission established pursuant to section 7-394b, assessed a civil 356 | |
| 434 | + | penalty of not less than one thousand dollars but not more than [ten] 357 | |
| 435 | + | fifty thousand dollars or both, except that the secretary may waive such 358 | |
| 436 | + | penalties if, in the secretary's opinion, there appears to be reasonable 359 | |
| 437 | + | cause for not having completed or provided the required audit report, 360 | |
| 438 | + | provided an official of the municipality, regional school district or 361 | |
| 439 | + | audited agency or the auditor submits a written request for such waiver. 362 | |
| 440 | + | The secretary may impose any civil penalty assessed pursuant to this 363 | |
| 441 | + | section against a municipality, regional school district or audited agency 364 | |
| 442 | + | in the form of a reduction in the amount of one or more grants awarded 365 | |
| 443 | + | by the secretary, including, but not limited to, any grant payable 366 | |
| 444 | + | pursuant to section 12-18b. 367 | |
| 256 | 445 | This act shall take effect as follows and shall amend the following | |
| 257 | 446 | sections: | |
| 258 | 447 | ||
| 259 | - | Section 1 July 1, 2024 7-576a Substitute Bill No. 5472 | |
| 260 | - | ||
| 261 | - | ||
| 262 | - | LCO 8 of 8 | |
| 263 | - | ||
| 448 | + | Section 1 July 1, 2024 7-576a | |
| 264 | 449 | Sec. 2 July 1, 2024 7-576f | |
| 265 | 450 | Sec. 3 July 1, 2024 7-576i | |
| 266 | 451 | Sec. 4 July 1, 2024 7-576e(a)(2) | |
| 267 | - | Sec. 5 July 1, 2024 7-393 | |
| 452 | + | Sec. 5 July 1, 2024 7-576e(a)(3) | |
| 453 | + | Sec. 6 July 1, 2024 7-393 | |
| 268 | 454 | ||
| 269 | - | Statement of Legislative Commissioners: | |
| 270 | - | In Section 2(C)(iii), "5-576j" was changed to "7-576j" for accuracy. | |
| 271 | - | ||
| 272 | - | PD Joint Favorable Subst. | |
| 455 | + | Statement of Purpose: | |
| 456 | + | To amend certain conditions and procedures for changing the tier | |
| 457 | + | designation of municipalities referred to the Municipal Finance | |
| 458 | + | Advisory Commission and Municipal Accountability Review Board, | |
| 459 | + | specify that the Municipal Accountability Review Board's failure to | |
| 460 | + | approve certain collective bargaining agreements will not cause such | |
| 461 | + | agreements to be deemed approved, and authorize the Secretary of the | |
| 462 | + | Office of Policy and Management to impose certain penalties as | |
| 463 | + | reductions to grant awards. | |
| 464 | + | [Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except | |
| 465 | + | that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not | |
| 466 | + | underlined.] | |
| 273 | 467 |