EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
Underlining indicates amendments to bill.
Strike out indicates matter stricken from the bill by amendment or deleted from the law by
amendment.
*hb1115*
HOUSE BILL 1115
F1 4lr2390
CF SB 1026
By: Delegates Solomon and Palakovich Carr
Introduced and read first time: February 7, 2024
Assigned to: Appropriations
Committee Report: Favorable with amendments
House action: Adopted
Read second time: March 5, 2024
CHAPTER ______
AN ACT concerning 1
County Boards of Education – Budgets – Notice 2
(Transparency in Education Spending Act) 3
FOR the purpose of requiring the State Board of Education to adopt a process for the 4
uniform and timely reporting of certain county board of education budget 5
information to a county governing body; requiring a county board to post certain 6
information in a certain manner on the county board’s website; requiring a certain 7
transfer to be made only following the approval of the county commissioners or the 8
county council; providing for exemptions from certain requirements related to 9
certain transfers; requiring a certain audit to be sent to the county council or the 10
county commissioners; and generally relating to the budgets of county boards of 11
education. 12
BY repealing and reenacting, with amendments, 13
Article – Education 14
Section 5–101(a) and (b), 5–102(e), 5–105(b), 5–109, and 5–111 15
Annotated Code of Maryland 16
(2022 Replacement Volume and 2023 Supplement) 17
BY repealing and reenacting, without amendments, 18
Article – Education 19
Section 5–102(a) and (b) and 5–105(a) 20
Annotated Code of Maryland 21
(2022 Replacement Volume and 2023 Supplement) 22
2 HOUSE BILL 1115
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 1
That the Laws of Maryland read as follows: 2
Article – Education 3
5–101. 4
(a) (1) Subject to the rules and regulations of the State Board and with the 5
advice of the county superintendent, each county board shall prepare an annual budget 6
according to: 7
(i) The major categories listed in this section; and 8
(ii) Any other major category required by the State Board. 9
(2) In addition to the information required by this section, the county fiscal 10
authorities may require the county board to provide details to the service areas and 11
activities levels in the account structure within the “Financial Reporting Manual for 12
Maryland Public Schools”. 13
(3) With the annual budget, each county board shall provide: 14
(i) The number of full–time equivalent positions included within 15
each major category; and 16
(ii) A description of any fund balances or other money held by any 17
outside source, including an insurer, that are undesignated or unreserved and are under 18
the direction and control of the county board. 19
(4) THE STATE BOARD SHALL ADOPT A P ROCESS FOR THE UNIFO RM 20
REPORTING OF THE INF ORMATION IN SUBSECTI ON (B) OF THIS SECTION TO T IMELY 21
SHARE THE INFORMATIO N PROVIDED BY A COUNTY BOARD IN SUBSECTION (B) OF 22
THIS SECTION TO A CO UNTY GOVERNING BODY . 23
(b) The budget shall be prepared to include the following categories: 24
Part I 25
(1) Current expense fund, estimated receipts: 26
(i) Revenue from local sources; 27
(ii) Revenue from State sources; 28
(iii) Revenue from federal sources; 29
HOUSE BILL 1115 3
(iv) Unliquidated surplus, the actual from the previous fiscal year 1
and the estimated from the current fiscal year, whether accrued from revenues or 2
expenditures; and 3
(v) Revenue from all other sources with identification of the source. 4
(2) Current expense fund, requested appropriations: 5
(i) Administration, which means those activities associated with the 6
general regulations, direction, and control of the county board, including: 7
1. Executive administration; 8
2. Business support services; and 9
3. Centralized support services; 10
(ii) Mid–level administration, including: 11
1. The office of the school principal; and 12
2. Staff providing administration and supervision to the 13
school instructional programs; 14
(iii) Instructional salaries, which means those activities which deal 15
directly with teaching students, including: 16
1. Teachers; 17
2. Aides; 18
3. Psychological personnel; 19
4. Guidance counselors; and 20
5. Library personnel; 21
(iv) Textbooks and classroom instructional supplies; 22
(v) Other instructional costs; 23
(vi) Special education with subcategories and items budgeted in this 24
category to be determined by the State Board with the advice of the county board; 25
(vii) Student personnel services; 26
(viii) Health services; 27 4 HOUSE BILL 1115
(ix) Student transportation; 1
(x) Operation of plant and equipment; 2
(xi) Maintenance of plant; 3
(xii) Fixed charges; 4
(xiii) Food services; and 5
(xiv) Capital outlay. 6
(3) CURRENT FUNDS HELD IN RESERVE, INCLUDING: 7
(I) REVENUE TO AND EXPEND ITURES FROM FUNDS HE LD IN 8
RESERVE IN THE PRIOR FISCAL YEAR; AND 9
(II) APPROPRIATIONS PLANNE D IN THE UPCOMING FI SCAL 10
YEAR FROM FUNDS HELD IN RESERVE. 11
(4) THE AMOUNT OF ANY FED ERAL FUNDS RECEIVED IN THE LAST 12
FISCAL YEAR, INCLUDING: 13
(I) EXPENDITURES OF THE F EDERAL FUNDS IN THE PRIOR 14
FISCAL YEAR; 15
(II) A DESCRIPTION OF WHETH ER THE FEDERAL FUNDS ARE 16
COMMITTED FOR A PART ICULAR PURPOSE ; AND 17
(III) THE ANTICIPATED TIMIN G TO APPROPRIATE THE FEDERAL 18
FUNDS IN THE UPCOMIN G FISCAL YEAR. 19
(5) THE AMOUNT OF FUNDS H ELD IN TRUST OR OTHE RWISE 20
DEDICATED TOWARD LON G–TERM OBLIGATIONS FOR RETIREE HEALTH CARE COSTS 21
OR OTHER POSTEMPLOYM ENT BENEFITS, AND INFORMATION USED TO CALCULATE 22
THE COUNTY BOARD ’S OBLIGATION FOR THO SE COSTS. 23
Part II 24
[(3)] (6) School construction fund, estimated receipts: 25
(i) Revenue from local sources; 26
(ii) Sale of bonds; 27 HOUSE BILL 1115 5
(iii) State General Public School Construction Loan; 1
(iv) Revenue from State sources; 2
(v) Revenue from federal sources; 3
(vi) Unliquidated surplus, the actual from the previous fiscal year 4
and the estimated for the current fiscal year, whether accrued from revenues or 5
expenditures; and 6
(vii) Funds from all other sources, with identification of the source. 7
[(4)] (7) School Construction Fund, requested appropriations: 8
(i) Land for school sites; 9
(ii) Buildings and the equipment that will be an integral part of a 10
building by project; 11
(iii) School site improvement by project; 12
(iv) Remodeling by project; 13
(v) Additional equipment by project; 14
(vi) Debt service; and 15
(vii) An amount that is adequate to satisfy a final court judgment 16
that, after exhaustion of the rights of appeal, is rendered against the county board of 17
education or any of its officers or employees. 18
5–102. 19
(a) In this subtitle, “county council” means, in Baltimore City, the Mayor and City 20
Council of Baltimore. 21
(b) (1) Each county board shall submit an annual school budget in writing to 22
the county commissioners, county council, or county executive. 23
(2) The budget shall be submitted not less than 45 days before the date for 24
levying local taxes or on an earlier date on or after March 1 as may be requested by the 25
county fiscal authority. 26
(e) (1) Copies of the budget shall be made available to the public, on request, 27
at the time it is submitted by the county board. 28
6 HOUSE BILL 1115
(2) A copy of the budget as approved by the county commissioners or county 1
council shall be sent to the State Superintendent within 30 days after approval AND 2
POSTED ON THE COUNTY BOARD’S PUBLIC–FACING WEBSITE , IN AN EASILY 3
IDENTIFIABLE LOCATIO N. 4
(3) A COPY OF THE BUDGET S UBMITTED UNDER SUBSE CTION (B)(1) 5
OF THIS SECTION SHAL L BE PLACED ON THE COUNTY BOARD ’S PUBLIC–FACING 6
WEBSITE, IN AN EASILY IDENTIF IABLE LOCATION . 7
5–105. 8
(a) All revenues received by a county board shall be spent by the board in 9
accordance with the major categories of its annual budget as provided under § 5–101 of this 10
subtitle. 11
(b) (1) (i) A transfer may be made within the major categories without 12
recourse to the county commissioners or county council except that a report of the transfer 13
shall be submitted to the county commissioners or county council within 15 days after the 14
end of each month. 15
(ii) A report under subparagraph (i) of this paragraph shall include 16
a narrative summary that clearly indicates each transfer. 17
(2) (I) THIS PARAGRAPH APPLIE S ONLY TO A LOCAL SC HOOL 18
SYSTEM THAT RECEIVES AT LEAST 40% OF ITS FUNDING FROM THE LOCAL 19
GOVERNMENT . 20
(II) [A] EXCEPT AS PROVIDED IN SUBPARAGRAPH (II) (III) OF 21
THIS PARAGRAPH , A transfer between major categories OF MORE THAN 1% 10% OF THE 22
TOTAL FUNDING IN A M AJOR CATEGORY shall be made only [with] FOLLOWING the 23
approval of the county commissioners or county council. 24
(II) (III) 1. A COUNTY BOARD MAY MAK E A TRANSFER 25
BETWEEN MAJOR CATEGO RIES OF MORE THAN 1% 10% OF THE TOTAL FUNDING IN 26
A MAJOR CATEGORY WIT HOUT THE APPROVAL OF THE COUNTY COMMISSIO NERS OR 27
COUNTY COUNCIL IF THE TI MING IN ACHIEVING AP PROVAL OF THE COUNTY 28
COMMISSIONERS OR COU NTY COUNCIL WOULD RE SULT IN THE LOSS OF 29
OPPORTUNITY . 30
2. IF A TRANSFER IS MADE UNDER SUBSUBPARAGRAP H 31
1 OF THIS SUBPARAGRAPH , A COUNTY BOARD SHALL REPORT THE TRANSFER 32
BETWEEN MAJOR CATEGORIES OF MORE THAN 1% 10% OF THE TOTAL FUNDING IN 33
A MAJOR CATEGORY EXP EDITIOUSLY TO THE CO UNTY COMMISSIONERS O R COUNTY 34
COUNCIL WITH AN EXPL ANATION OF THE CIRCU MSTANCES NECESSITATI NG THE 35
EXPEDITED REALLOCATI ON. 36 HOUSE BILL 1115 7
(3) If the county commissioners or county council fail to take action on a 1
request for transfer between major categories within 30 days after the receipt of a written 2
request substantiating the transfer, the failure to take action constitutes approval. 3
(4) A county board shall submit to the county governing body a report 4
within 15 days after the end of each month if during that month the county board takes 5
any action that would commit the county board to spend more for the current fiscal year in 6
any major category than the amount approved in the annual budget for that category. 7
(5) A report under paragraph (4) of this subsection shall include a narrative 8
explanation of the action taken, indicating any request for transfer between categories that 9
may become necessary for the fiscal year as a result of the action. 10
5–109. 11
(a) (1) Each county board shall provide for an annual audit of its financial 12
transactions and accounts. 13
(2) At the request of the Department, a county board shall conduct an audit 14
under § 5–203 of this title. 15
(b) (1) The audit shall be made by a certified public accountant or a 16
partnership of certified public accountants who are: 17
(i) Licensed by the State Board of Public Accountancy; and 18
(ii) Approved by the State Superintendent. 19
(2) The audit shall be made in accordance with the standards and 20
regulations adopted by the State Board. 21
(c) (1) The results of the audit, including the letter of recommendation 22
submitted by the auditor, are a matter of public record. 23
(2) The results shall be reported within 3 months after the close of the fiscal 24
year for the county board on the form and in the manner required by the State Board to: 25
(i) The State Superintendent; 26
(ii) The county fiscal authority AND THE COUNTY COUNC IL OR 27
THE COUNTY COMMISSIO NERS; 28
(iii) The Joint Audit and Evaluation Committee of the General 29
Assembly; 30
(iv) The Senate Budget and Taxation Committee; 31 8 HOUSE BILL 1115
(v) The Senate Education, Health, and Environmental Affairs 1
Committee; 2
(vi) The House Appropriations Committee; and 3
(vii) The House Committee on Ways and Means. 4
(d) In addition to the audit required by this section, the county commissioners or 5
county council may conduct an audit using auditors employed by the county. 6
5–111. 7
(a) (1) Each county board shall make the reports required by the State Board 8
and by the State Superintendent. 9
(2) The reports shall be made at the time, include the items, and be on the 10
forms required by the State Board and by the State Superintendent. 11
(b) (1) Each county board shall prepare, publish, and make available to 12
interested parties an annual report on the condition, current accomplishments, and needs 13
for improvement of the schools as well as a statement of the business and financial 14
transactions of the county board. 15
(2) This report shall be published before the end of the calendar year. 16
(c) The public schools of each county shall use a uniform method, as required by 17
the county superintendent, for reporting the receipts, expenditures, and balances of the 18
operations and activities conducted by the public schools. 19
(d) (1) At the request of the county governing body made in writing at least 30 20
days before the reporting deadline, the county board or superintendent shall report to the 21
county governing body on or before November 1 and March 1 of each fiscal year on the 22
school system’s operations, including any adjustment made to the approved annual budget 23
AND POST THE REPORT ON THE COUNTY BOARD ’S PUBLIC–FACING WEBSITE , IN AN 24
EASILY IDENTIFIABLE LOCATION. 25
(2) A report under this subsection shall be made available to all interested 26
persons. 27
(e) (1) At the request of the county board made in writing at least 30 days 28
before the reporting deadline the county governing body shall report to the county board on 29
or before November 1 and March 1 of each fiscal year on the county’s fiscal status for the 30
immediate fiscal year and the subsequent fiscal year AND POST THE REPORT ON THE 31
COUNTY BOARD ’S PUBLIC–FACING WEBSITE , IN AN EASILY IDENTIF IABLE LOCATION . 32
HOUSE BILL 1115 9
(2) A report under this subsection shall be made available to all interested 1
persons. 2
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 3
1, 2024. 4
Approved:
________________________________________________________________________________
Governor.
________________________________________________________________________________
Speaker of the House of Delegates.
________________________________________________________________________________
President of the Senate.