EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
*sb1026*
SENATE BILL 1026
F1 4lr2549
CF HB 1115
By: Senator Brooks
Introduced and read first time: February 2, 2024
Assigned to: Education, Energy, and the Environment
A BILL ENTITLED
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
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 23
That the Laws of Maryland read as follows: 24
Article – Education 25
5–101. 26 2 SENATE BILL 1026
(a) (1) Subject to the rules and regulations of the State Board and with the 1
advice of the county superintendent, each county board shall prepare an annual budget 2
according to: 3
(i) The major categories listed in this section; and 4
(ii) Any other major category required by the State Board. 5
(2) In addition to the information required by this section, the county fiscal 6
authorities may require the county board to provide details to the service areas and 7
activities levels in the account structure within the “Financial Reporting Manual for 8
Maryland Public Schools”. 9
(3) With the annual budget, each county board shall provide: 10
(i) The number of full–time equivalent positions included within 11
each major category; and 12
(ii) A description of any fund balances or other money held by any 13
outside source, including an insurer, that are undesignated or unreserved and are under 14
the direction and control of the county board. 15
(4) THE STATE BOARD SHALL ADO PT A PROCESS FOR THE UNIFORM 16
REPORTING OF THE INF ORMATION IN SUBSECTI ON (B) OF THIS SECTION TO T IMELY 17
SHARE THE INFORMATIO N PROVIDED BY A COUN TY BOARD IN SUBSECTI ON (B) OF 18
THIS SECTION TO A CO UNTY GOVERNING BODY . 19
(b) The budget shall be prepared to include the following categories: 20
Part I 21
(1) Current expense fund, estimated receipts: 22
(i) Revenue from local sources; 23
(ii) Revenue from State sources; 24
(iii) Revenue from federal sources; 25
(iv) Unliquidated surplus, the actual from the previous fiscal year 26
and the estimated from the current fiscal year, whether accrued from revenues or 27
expenditures; and 28
(v) Revenue from all other sources with identification of the source. 29
(2) Current expense fund, requested appropriations: 30 SENATE BILL 1026 3
(i) Administration, which means those activities associated with the 1
general regulations, direction, and control of the county board, including: 2
1. Executive administration; 3
2. Business support services; and 4
3. Centralized support services; 5
(ii) Mid–level administration, including: 6
1. The office of the school principal; and 7
2. Staff providing administration and supervision to the 8
school instructional programs; 9
(iii) Instructional salaries, which means those activities which deal 10
directly with teaching students, including: 11
1. Teachers; 12
2. Aides; 13
3. Psychological personnel; 14
4. Guidance counselors; and 15
5. Library personnel; 16
(iv) Textbooks and classroom instructional supplies; 17
(v) Other instructional costs; 18
(vi) Special education with subcategories and items budgeted in this 19
category to be determined by the State Board with the advice of the county board; 20
(vii) Student personnel services; 21
(viii) Health services; 22
(ix) Student transportation; 23
(x) Operation of plant and equipment; 24
(xi) Maintenance of plant; 25
4 SENATE BILL 1026
(xii) Fixed charges; 1
(xiii) Food services; and 2
(xiv) Capital outlay. 3
(3) CURRENT FUNDS HELD IN RESERVE, INCLUDING: 4
(I) REVENUE TO AND EXPEND ITURES FROM FUNDS H ELD IN 5
RESERVE IN THE PRIOR FISCAL YEAR; AND 6
(II) APPROPRIATIONS PLANNE D IN THE UPCOMING FI SCAL 7
YEAR FROM FUNDS HELD IN RESERVE. 8
(4) THE AMOUNT OF ANY FED ERAL FUNDS RECEIVED IN THE LAST 9
FISCAL YEAR, INCLUDING: 10
(I) EXPENDITURES OF THE F EDERAL FUNDS IN THE PRIOR 11
FISCAL YEAR; 12
(II) A DESCRIPTION OF WHETH ER THE FEDERAL FUNDS ARE 13
COMMITTED FOR A PART ICULAR PURPOSE ; AND 14
(III) THE ANTICIPATED TIMIN G TO APPROPRIATE THE FEDERAL 15
FUNDS IN THE UPCOMIN G FISCAL YEAR. 16
(5) THE AMOUNT OF FUNDS H ELD IN TRUST OR OTHERWISE 17
DEDICATED TOWARD LON G–TERM OBLIGATIONS FOR RETIREE HEALTH CARE COSTS 18
OR OTHER POSTEMPLOYM ENT BENEFITS, AND INFORMATION USED TO CALCULATE 19
THE COUNTY BOARD ’S OBLIGATION FOR THO SE COSTS. 20
Part II 21
[(3)] (6) School construction fund, estimated receipts: 22
(i) Revenue from local sources; 23
(ii) Sale of bonds; 24
(iii) State General Public School Construction Loan; 25
(iv) Revenue from State sources; 26
(v) Revenue from federal sources; 27
SENATE BILL 1026 5
(vi) Unliquidated surplus, the actual from the previous fiscal year 1
and the estimated for the current fiscal year, whether accrued from revenues or 2
expenditures; and 3
(vii) Funds from all other sources, with identification of the source. 4
[(4)] (7) School Construction Fund, requested appropriations: 5
(i) Land for school sites; 6
(ii) Buildings and the equipment that will be an integral part of a 7
building by project; 8
(iii) School site improvement by project; 9
(iv) Remodeling by project; 10
(v) Additional equipment by project; 11
(vi) Debt service; and 12
(vii) An amount that is adequate to satisfy a final court judgment 13
that, after exhaustion of the rights of appeal, is rendered against the county board of 14
education or any of its officers or employees. 15
5–102. 16
(a) In this subtitle, “county council” means, in Baltimore City, the Mayor and City 17
Council of Baltimore. 18
(b) (1) Each county board shall submit an annual school budget in writing to 19
the county commissioners, county council, or county executive. 20
(2) The budget shall be submitted not less than 45 days before the date for 21
levying local taxes or on an earlier date on or after March 1 as may be requested by the 22
county fiscal authority. 23
(e) (1) Copies of the budget shall be made available to the public, on request, 24
at the time it is submitted by the county board. 25
(2) A copy of the budget as approved by the county commissioners or county 26
council shall be sent to the State Superintendent within 30 days after approval AND 27
POSTED ON THE COUNTY BOARD’S PUBLIC–FACING W EBSITE, IN AN EASILY 28
IDENTIFIABLE LOCATIO N. 29
6 SENATE BILL 1026
(3) A COPY OF THE BUDGET S UBMITTED UNDER SUBSE CTION (B)(1) 1
OF THIS SECTION SHAL L BE PLACED ON THE C OUNTY BOARD ’S PUBLIC–FACING 2
WEBSITE, IN AN EASILY IDENTIF IABLE LOCATION . 3
5–105. 4
(a) All revenues received by a county board shall be spent by the board in 5
accordance with the major categories of its annual budget as provided under § 5–101 of this 6
subtitle. 7
(b) (1) (i) A transfer may be made within the major categories without 8
recourse to the county commissioners or county council except that a report of the transfer 9
shall be submitted to the county commissioners or county council within 15 days after the 10
end of each month. 11
(ii) A report under subparagraph (i) of this paragraph shall include 12
a narrative summary that clearly indicates each transfer. 13
(2) (I) [A] EXCEPT AS PROVIDED IN SUBPARAGRAPH (II) OF THIS 14
PARAGRAPH , A transfer between major categories OF MORE THAN 1% OF THE TOTAL 15
FUNDING IN A MAJOR C ATEGORY shall be made only [with] FOLLOWING the approval of 16
the county commissioners or county council. 17
(II) 1. A COUNTY BOARD MAY MAK E A TRANSFER BETWEEN 18
MAJOR CATEGORIES OF MORE THAN 1% OF THE TOTAL FUNDING IN A MAJOR 19
CATEGORY WITHOUT THE APPROVAL OF THE COUN TY COMMISSIONERS OR COUNTY 20
COUNCIL IF THE TIM ING IN ACHIEVING APP ROVAL OF THE COUNTY COMMISSIONERS 21
OR COUNTY COUNCIL WO ULD RESULT IN THE LO SS OF OPPORTUNITY . 22
2. IF A TRANSFER IS MADE UNDER SUBSUBPARAGRAP H 23
1 OF THIS SUBPARAGRAPH , A COUNTY BOARD SHALL REPORT THE TRANSFER 24
BETWEEN MAJOR CATEGO RIES OF MORE THAN 1% OF THE TOTAL FUNDING IN A 25
MAJOR CATEGORY EXPED ITIOUSLY TO THE COUN TY COMMISSIONERS OR COUNTY 26
COUNCIL WITH AN EXPL ANATION OF THE CIRCU MSTANCES NECESSITATI NG THE 27
EXPEDITED REALLOCATI ON. 28
(3) If the county commissioners or county council fail to take action on a 29
request for transfer between major categories within 30 days after the receipt of a written 30
request substantiating the transfer, the failure to take action constitutes approval. 31
(4) A county board shall submit to the county governing body a report 32
within 15 days after the end of each month if during that month the county board takes 33
any action that would commit the county board to spend more for the current fiscal year in 34
any major category than the amount approved in the annual budget for that category. 35
SENATE BILL 1026 7
(5) A report under paragraph (4) of this subsection shall include a narrative 1
explanation of the action taken, indicating any request for transfer between categories that 2
may become necessary for the fiscal year as a result of the action. 3
5–109. 4
(a) (1) Each county board shall provide for an annual audit of its financial 5
transactions and accounts. 6
(2) At the request of the Department, a county board shall conduct an audit 7
under § 5–203 of this title. 8
(b) (1) The audit shall be made by a certified public accountant or a 9
partnership of certified public accountants who are: 10
(i) Licensed by the State Board of Public Accountancy; and 11
(ii) Approved by the State Superintendent. 12
(2) The audit shall be made in accordance with the standards and 13
regulations adopted by the State Board. 14
(c) (1) The results of the audit, including the letter of recommendation 15
submitted by the auditor, are a matter of public record. 16
(2) The results shall be reported within 3 months after the close of the fiscal 17
year for the county board on the form and in the manner required by the State Board to: 18
(i) The State Superintendent; 19
(ii) The county fiscal authority AND THE COUNTY COUNC IL OR 20
THE COUNTY COMMISSIO NERS; 21
(iii) The Joint Audit and Evaluation Committee of the General 22
Assembly; 23
(iv) The Senate Budget and Taxation Committee; 24
(v) The Senate Education, Health, and Environmental Affairs 25
Committee; 26
(vi) The House Appropriations Committee; and 27
(vii) The House Committee on Ways and Means. 28
(d) In addition to the audit required by this section, the county commissioners or 29
county council may conduct an audit using auditors employed by the county. 30 8 SENATE BILL 1026
5–111. 1
(a) (1) Each county board shall make the reports required by the State Board 2
and by the State Superintendent. 3
(2) The reports shall be made at the time, include the items, and be on the 4
forms required by the State Board and by the State Superintendent. 5
(b) (1) Each county board shall prepare, publish, and make available to 6
interested parties an annual report on the condition, current accomplishments, and needs 7
for improvement of the schools as well as a statement of the business and financial 8
transactions of the county board. 9
(2) This report shall be published before the end of the calendar year. 10
(c) The public schools of each county shall use a uniform method, as required by 11
the county superintendent, for reporting the receipts, expenditures, and balances of the 12
operations and activities conducted by the public schools. 13
(d) (1) At the request of the county governing body made in writing at least 30 14
days before the reporting deadline, the county board or superintendent shall report to the 15
county governing body on or before November 1 and March 1 of each fiscal year on the 16
school system’s operations, including any adjustment made to the approved annual budget 17
AND POST THE REPORT ON THE COUNTY BOARD ’S PUBLIC–FACING WEBSITE , IN AN 18
EASILY IDENTIFIABLE LOCATION. 19
(2) A report under this subsection shall be made available to all interested 20
persons. 21
(e) (1) At the request of the county board made in writing at least 30 days 22
before the reporting deadline the county governing body shall report to the county board on 23
or before November 1 and March 1 of each fiscal year on the county’s fiscal status for the 24
immediate fiscal year and the subsequent fiscal year AND POST THE REPORT ON THE 25
COUNTY BOARD ’S PUBLIC–FACING WEBSITE , IN AN EASILY IDENTIF IABLE LOCATION . 26
(2) A report under this subsection shall be made available to all interested 27
persons. 28
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 29
1, 2024. 30