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.
Italics indicate opposite chamber/conference committee amendments.
*sb1026*
SENATE BILL 1026
F1 (4lr2549)
ENROLLED BILL
— Education, Energy, and the Environment/Appropriations —
Introduced by Senator Brooks
Read and Examined by Proofreaders:
_______________________________________________
Proofreader.
_______________________________________________
Proofreader.
Sealed with the Great Seal and presented to the Governor, for his approval this
_______ day of _______________ at __ ______________________ o’clock, ________M.
______________________________________________
President.
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 2 SENATE BILL 1026
Section 5–101(a) and (b), 5–102(e), 5–105(b), 5–109, and 5–111 1
Annotated Code of Maryland 2
(2022 Replacement Volume and 2023 Supplement) 3
BY repealing and reenacting, without amendments, 4
Article – Education 5
Section 5–102(a) and (b) and 5–105(a) 6
Annotated Code of Maryland 7
(2022 Replacement Volume and 2023 Supplement) 8
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 9
That the Laws of Maryland read as follows: 10
Article – Education 11
5–101. 12
(a) (1) Subject to the rules and regulations of the State Board and with the 13
advice of the county superintendent, each county board shall prepare an annual budget 14
according to: 15
(i) The major categories listed in this section; and 16
(ii) Any other major category required by the State Board. 17
(2) In addition to the information required by this section, the county fiscal 18
authorities may require the county board to provide details to the service areas and 19
activities levels in the account structure within the “Financial Reporting Manual for 20
Maryland Public Schools”. 21
(3) With the annual budget, each county board shall provide: 22
(i) The number of full–time equivalent positions included within 23
each major category; and 24
(ii) A description of any fund balances or other money held by any 25
outside source, including an insurer, that are undesignated or unreserved and are under 26
the direction and control of the county board. 27
(4) THE STATE BOARD SHALL ADOPT A P ROCESS FOR THE UNIFO RM 28
REPORTING OF THE INF ORMATION IN SUBSECTI ON (B) OF THIS SECTION TO T IMELY 29
SHARE THE INFORMATIO N PROVIDED BY A COUNTY BOARD IN SUBSECTION (B) OF 30
THIS SECTION TO A CO UNTY GOVERNING BODY . 31
(b) The budget shall be prepared to include the following categories: 32
SENATE BILL 1026 3
Part I 1
(1) Current expense fund, estimated receipts: 2
(i) Revenue from local sources; 3
(ii) Revenue from State sources; 4
(iii) Revenue from federal sources; 5
(iv) Unliquidated surplus, the actual from the previous fiscal year 6
and the estimated from the current fiscal year, whether accrued from revenues or 7
expenditures; and 8
(v) Revenue from all other sources with identification of the source. 9
(2) Current expense fund, requested appropriations: 10
(i) Administration, which means those activities associated with the 11
general regulations, direction, and control of the county board, including: 12
1. Executive administration; 13
2. Business support services; and 14
3. Centralized support services; 15
(ii) Mid–level administration, including: 16
1. The office of the school principal; and 17
2. Staff providing administration and supervision to the 18
school instructional programs; 19
(iii) Instructional salaries, which means those activities which deal 20
directly with teaching students, including: 21
1. Teachers; 22
2. Aides; 23
3. Psychological personnel; 24
4. Guidance counselors; and 25
5. Library personnel; 26
4 SENATE BILL 1026
(iv) Textbooks and classroom instructional supplies; 1
(v) Other instructional costs; 2
(vi) Special education with subcategories and items budgeted in this 3
category to be determined by the State Board with the advice of the county board; 4
(vii) Student personnel services; 5
(viii) Health services; 6
(ix) Student transportation; 7
(x) Operation of plant and equipment; 8
(xi) Maintenance of plant; 9
(xii) Fixed charges; 10
(xiii) Food services; and 11
(xiv) Capital outlay. 12
(3) CURRENT FUNDS HELD IN RESERVE, INCLUDING: 13
(I) REVENUE TO AND EXPEND ITURES FROM FUNDS HE LD IN 14
RESERVE IN THE PRIOR FISCAL YEAR; AND 15
(II) APPROPRIATIONS PLANNE D IN THE UPCOMING FI SCAL 16
YEAR FROM FUNDS HELD IN RESERVE. 17
(4) THE AMOUNT OF ANY FED ERAL FUNDS RECEIVED IN THE LAST 18
FISCAL YEAR, INCLUDING: 19
(I) EXPENDITURES OF THE F EDERAL FUNDS IN THE PRIOR 20
FISCAL YEAR; 21
(II) A DESCRIPTION OF WHETH ER THE FEDERAL FUNDS ARE 22
COMMITTED FOR A PART ICULAR PURPOSE ; AND 23
(III) THE ANTICIPATED TIMIN G TO APPROPRIATE THE FEDERAL 24
FUNDS IN THE UPCOMIN G FISCAL YEAR. 25
(5) THE AMOUNT OF FUNDS H ELD IN TRUST OR OTHE RWISE 26
DEDICATED TOWARD LON G–TERM OBLIGATIONS FOR RETIREE HEALTH CARE COSTS 27 SENATE BILL 1026 5
OR OTHER POSTEMPLOYM ENT BENEFITS, AND INFORMAT ION USED TO CALCULAT E 1
THE COUNTY BOARD ’S OBLIGATION FOR THO SE COSTS. 2
Part II 3
[(3)] (6) School construction fund, estimated receipts: 4
(i) Revenue from local sources; 5
(ii) Sale of bonds; 6
(iii) State General Public School Construction Loan; 7
(iv) Revenue from State sources; 8
(v) Revenue from federal sources; 9
(vi) Unliquidated surplus, the actual from the previous fiscal year 10
and the estimated for the current fiscal year, whether accrued from revenues or 11
expenditures; and 12
(vii) Funds from all other sources, with identification of the source. 13
[(4)] (7) School Construction Fund, requested appropriations: 14
(i) Land for school sites; 15
(ii) Buildings and the equipment that will be an integral part of a 16
building by project; 17
(iii) School site improvement by project; 18
(iv) Remodeling by project; 19
(v) Additional equipment by project; 20
(vi) Debt service; and 21
(vii) An amount that is adequate to satisfy a final court judgment 22
that, after exhaustion of the rights of appeal, is rendered against the county board of 23
education or any of its officers or employees. 24
5–102. 25
(a) In this subtitle, “county council” means, in Baltimore City, the Mayor and City 26
Council of Baltimore. 27 6 SENATE BILL 1026
(b) (1) Each county board shall submit an annual school budget in writing to 1
the county commissioners, county council, or county executive. 2
(2) The budget shall be submitted not less than 45 days before the date for 3
levying local taxes or on an earlier date on or after March 1 as may be requested by the 4
county fiscal authority. 5
(e) (1) Copies of the budget shall be made available to the public, on request, 6
at the time it is submitted by the county board. 7
(2) A copy of the budget as approved by the county commissioners or county 8
council shall be sent to the State Superintendent within 30 days after approval AND 9
POSTED ON THE COUNTY BOARD’S PUBLIC–FACING WEBSITE , IN AN EASILY 10
IDENTIFIABLE LOCATIO N. 11
(3) A COPY OF THE BUDGET S UBMITTED UNDER SUBSE CTION (B)(1) 12
OF THIS SECTION SHAL L BE PLACED ON THE COUNTY BOARD ’S PUBLIC–FACING 13
WEBSITE, IN AN EASILY IDENTIF IABLE LOCATION . 14
5–105. 15
(a) All revenues received by a county board shall be spent by the board in 16
accordance with the major categories of its annual budget as provided under § 5–101 of this 17
subtitle. 18
(b) (1) (i) A transfer may be made within the major categories without 19
recourse to the county commissioners or county council except that a report of the transfer 20
shall be submitted to the county commissioners or county council within 15 days after the 21
end of each month. 22
(ii) A report under subparagraph (i) of this paragraph shall include 23
a narrative summary that clearly indicates each transfer. 24
(2) (I) [A] EXCEPT AS PROVIDED IN SUBPARAGRAPH (II) OF THIS 25
PARAGRAPH , A transfer between major categories OF MORE THAN 1% 10% OF THE 26
TOTAL FUNDING IN A M AJOR CATEGORY shall be made only [with] FOLLOWING the 27
approval of the county commissioners or county council. 28
(II) 1. A COUNTY BOARD MAY MAK E A TRANSFER BETWEEN 29
MAJOR CATEGORIES OF MORE THAN 1% 10% OF THE TOTAL FUNDING IN A MAJOR 30
CATEGORY WITHOUT THE APPROVAL OF THE COUN TY COMMISSIONERS OR COUNTY 31
COUNCIL IF THE TIMIN G IN ACHIEVING APPRO VAL OF THE COUNTY CO MMISSIONERS 32
OR COUNTY COUNCIL WO ULD RESULT IN THE LO SS OF OPPORTUNITY . 33
SENATE BILL 1026 7
2. IF A TRANSFER IS MADE UNDER SUBSUBPARAGRAP H 1
1 OF THIS SUBPARAGRAPH , A COUNTY BOARD SHALL REPORT THE TRANSFER 2
BETWEEN MAJOR CATEGO RIES OF MORE THAN 1% 10% OF THE TOTAL FUNDING IN 3
A MAJOR CATEGORY EXP EDITIOUSLY TO THE CO UNTY COMMISSIONER S OR COUNTY 4
COUNCIL WITH AN EXPL ANATION OF THE CIRCU MSTANCES NECESSITATI NG THE 5
EXPEDITED REALLOCATI ON. 6
(3) If the county commissioners or county council fail to take action on a 7
request for transfer between major categories within 30 days after the receipt of a written 8
request substantiating the transfer, the failure to take action constitutes approval. 9
(4) A county board shall submit to the county governing body a report 10
within 15 days after the end of each month if during that month the county board takes 11
any action that would commit the county board to spend more for the current fiscal year in 12
any major category than the amount approved in the annual budget for that category. 13
(5) A report under paragraph (4) of this subsection shall include a narrative 14
explanation of the action taken, indicating any request for transfer between categories that 15
may become necessary for the fiscal year as a result of the action. 16
5–109. 17
(a) (1) Each county board shall provide for an annual audit of its financial 18
transactions and accounts. 19
(2) At the request of the Department, a county board shall conduct an audit 20
under § 5–203 of this title. 21
(b) (1) The audit shall be made by a certified public accountant or a 22
partnership of certified public accountants who are: 23
(i) Licensed by the State Board of Public Accountancy; and 24
(ii) Approved by the State Superintendent. 25
(2) The audit shall be made in accordance with the standards and 26
regulations adopted by the State Board. 27
(c) (1) The results of the audit, including the letter of recommendation 28
submitted by the auditor, are a matter of public record. 29
(2) The results shall be reported within 3 months after the close of the fiscal 30
year for the county board on the form and in the manner required by the State Board to: 31
(i) The State Superintendent; 32
8 SENATE BILL 1026
(ii) The county fiscal authority AND THE COUNTY COUNC IL OR 1
THE COUNTY COMMISSIO NERS; 2
(iii) The Joint Audit and Evaluation Committee of the General 3
Assembly; 4
(iv) The Senate Budget and Taxation Committee; 5
(v) The Senate Education, Health, and Environmental Affairs 6
Committee; 7
(vi) The House Appropriations Committee; and 8
(vii) The House Committee on Ways and Means. 9
(d) In addition to the audit required by this section, the county commissioners or 10
county council may conduct an audit using auditors employed by the county. 11
5–111. 12
(a) (1) Each county board shall make the reports required by the State Board 13
and by the State Superintendent. 14
(2) The reports shall be made at the time, include the items, and be on the 15
forms required by the State Board and by the State Superintendent. 16
(b) (1) Each county board shall prepare, publish, and make available to 17
interested parties an annual report on the condition, current accomplishments, and needs 18
for improvement of the schools as well as a statement of the business and financial 19
transactions of the county board. 20
(2) This report shall be published before the end of the calendar year. 21
(c) The public schools of each county shall use a uniform method, as required by 22
the county superintendent, for reporting the receipts, expenditures, and balances of the 23
operations and activities conducted by the public schools. 24
(d) (1) At the request of the county governing body made in writing at least 30 25
days before the reporting deadline, the county board or superintendent shall report to the 26
county governing body on or before November 1 and March 1 of each fiscal year on the 27
school system’s operations, including any adjustment made to the approved annual budget 28
AND POST THE REPORT ON THE COUNTY BOARD ’S PUBLIC–FACING WEBSITE , IN AN 29
EASILY IDENTIFIABLE LOCATION. 30
(2) A report under this subsection shall be made available to all interested 31
persons. 32 SENATE BILL 1026 9
(e) (1) At the request of the county board made in writing at least 30 days 1
before the reporting deadline the county governing body shall report to the county board on 2
or before November 1 and March 1 of each fiscal year on the county’s fiscal status for the 3
immediate fiscal year and the subsequent fiscal year AND POST THE REPORT ON THE 4
COUNTY BOARD ’S PUBLIC–FACING WEBSITE , IN AN EASILY IDENTIF IABLE LOCATION . 5
(2) A report under this subsection shall be made available to all interested 6
persons. 7
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 8
1, 2024. 9
Approved:
________________________________________________________________________________
Governor.
________________________________________________________________________________
President of the Senate.
________________________________________________________________________________
Speaker of the House of Delegates.