Frequently Asked Questions

Proposition 39, officially titled the “Smaller Classes, Safer Schools and Financial Accountability Act,” was approved by California voters in November 2000. It was difficult for most tax increase measures to receive the required two-thirds approval needed to issue general obligation bonds for school construction.

The effect of the proposition was to reduce the voter approval rate required for school districts to issue general obligation bonds from 66 2/3% to 55%. Proposition 39 limits the use of bond proceeds to school facilities projects listed or described in the language of the ballot measure approved by the voters.

Because of the lower voter approval requirement, Education Code Sections 15264-15282 contains provisions ensuring public oversight and accountability concerning the expenditure of facilities bond revenues. The district board is required to appoint a citizens’ oversight committee within 60 days the school Governing Board records the results of the election in its minutes. (Education Code Section 15278 (a).)

The legislation that implemented Proposition 39 (Education Code Section 15264) had the following legislative intent (emphasis added):

• Vigorous efforts are undertaken to ensure that the expenditure of bond measures, including those authorized pursuant to paragraph (3) of subdivision (b) of Section 1 of Article XIII A of the California Constitution, are in strict conformity with the law
• Taxpayers directly participate in the oversight of bond revenues
• The members of the oversight committees promptly alert the public to any waste or improper expenditure of school construction bond money
• Unauthorized expenditures of school bond revenues are vigorously investigated, and the courts are to act swiftly to restrain any improper expenditures

Bond oversight is supposed to be an active probing process.

The purpose of this committee is to inform the public concerning the expenditure of bond revenues. To fulfill this responsibility, the oversight committee is expressly required “to actively review and report on the proper expenditure of taxpayers’ money for school construction” and to “verify that the funds are being spent only for authorized purposes.” The oversight committee must promptly alert the public to any waste or improper expenditure of bond revenue. (Education Code Section 15278 b)

These requirements are as follows:

1. Determine whether a district is spending the bond monies for construction, reconstruction, rehabilitation, or replacement of school facilities, including the furnishing, and equipping of school facilities, or the acquisition or lease of real property for school facilities.

2. Advise the public as to whether a district is spending the bond monies for the purposes specified above and not for any other purpose, including teacher and administrator salaries and other school operating expenses

3. Determine whether a district is spending the bond monies for the specific school facilities projects listed in the bond measure information given to the public prior to the vote.

4. Receive and review copies of an annual, independent performance audit to ensure that the funds have been expended only on the specific projects listed.

5. Receive and review copies of an annual, independent financial audit of the proceeds from the sale of the bonds until all those proceeds have been expended for the school facilities projects (listed in the bond measure)

In short, the Education Code requires the CBOC to review and report out to public whether the projects identified to be funded by the bond money is being spent as promised and efficiently and not for efforts which were not approved by the voters or for operating expenses.

The primary requirements are as follows:

1. Prepare and publish an Annual Report

2. Hold meetings at least once a year.

3. While the open meeting requirement does not explicitly reference the Ralph M. Brown (Open Meeting) Act, most school districts
   and CBOCs have interpreted the need to establish that CBOC public meetings should be noticed and held by Brown Act provisions.         
   CABOC agrees with this position. 

4. Consist of a minimum of seven members with five requirements as follows:

• One member active in a business organization representing the business community located within the district.
• One member active in a senior citizens’ organization.
• One member active in a bona fide taxpayer’s organization.
• One member who is the parent or guardian of a child enrolled in the district: and
  (For Community College:  student currently enrolled and active in a community college group.)
• One member who is both a parent or guardian of a child enrolled in the district and active in a parent-teacher organization.
  (For Community College:  member active in the support and organization of a community college or community colleges of the district.)

• The remaining two members are “at large” community positions.

  5. Receive and review Annual Performance and Financial Audits.
  
  6. Provide an Annual Compliance Opinion.

Q5 12.22.20/revised 2.4.22

The committee is the eyes and ears of the community to hold the school district accountable for the spending of bond funds authorized by the voters. It is an independent committee that sets its own agenda within the rules and regulations provided in its by-laws.

It reviews reports and information provided by the district. For the committee to be most effective, it must ask questions and receive complete and transparent responses from the school district. The committee reports to the public its findings including both positive observations about the efficiency and effectiveness of the district as well as areas for improvement.

The committee member should be prepared to read a moderate amount of written material, attend all meetings (subject to the normal exceptions such as illness or unavoidable conflicts), be attentive at the meetings, and not be shy in asking questions or inquiry about specific data and reports. While it is preferable for several members expertise in construction, municipal finance, public agency budgeting, project management or related field, it is not an absolute requirement for every member. Different perspectives such as senior representatives and taxpayer groups are on the committee. Common sense, an inquisitive mind, and commitment to ask questions are basic qualities of a good oversight member.

There will be good deal of reports from staff on the progress of projects and information related to master planning, design, and construction. Issues of community concerns about school projects could also be discussed, so meetings are an opportunity to have the community directly participate in school governance.

This is not absolute requirement for every member. A variety of views and any concerns need to be heard. Critical thinking and question asking are particularly important factors to make your volunteer experience valuable to the District and enjoyable as a volunteer.

California Constitution, Article XIIIA, Section 1 (b) (3), states the funding must be for “the construction, reconstruction, rehabilitation, or replacement of school facilities, including the furnishing and equipping of school facilities, or the acquisition or lease of real property for school facilities.” Bond Funds cannot be used for operating expenses such as teacher or general administrative salaries but can be used for the administration of the school construction process, including planning, design, engineering, and project management and control.

The Constitution requires that the bond measure contain a “specific list of projects to be funded”. The arguable intent of this language is the voter has a specific idea of how the money is be spent and not be expended on undefined or “pet projects” of elected officials.

The dilemma facing those who oversee bond measures is that a ballot measure will often contain a list of projects (sometimes more than what can be funded with the amount of bonds) as well as a generic paragraph(s) that contain statements such as “repair, renovation upgrading, lighting and electrical systems, HVAC systems……repair, renovation, modernization, and construction of new classrooms” without specific guidance on the location or dollar amount of expenditures.

These generic descriptions are often used to justify most any expenditure. For instance, the ballot language could state a school was to construct a “multipurpose room” and yet the actual project ended up being a “Performing Arts Center”. The problem is the law does not provide much teeth or force to prohibit such expenditures other than filing an injunction/restraining order pursuant to the Waste Fraud and Prevention Action. (Education Code Section 15284)

Under the Waste Fraud and Prevention Act an injunction can be filed by any taxpayer who pays taxes with the school bond area. There are three main reasons for such an action:

• Expenditures that are not authorized by the Constitution such as payment of teacher or administrative salaries
• Expenditure on projects that were not authorized in the bond language presented to the voters
• Willfully failing to appoint a bond oversight committee that meets all the statutory requirements, such as not having a business, senior citizen, student, parent, or taxpayer representative.

The action seeks a restraining order to prevent expenditure of funds.

Bylaws are rules adopted for the regulation of a Citizens’ Bond Oversight Committee’s own actions.

There is nothing in current law to prohibit a School District from attempting to dictate how an Oversight Committee can operate. There is no known case law that has challenged the enactment of onerous and restrictive bylaws that run counter to the legislative intent of bond oversight.

However, the District must operate within the context of Education Code Sections 15264 to 15288.

There are five (5) basic requirements – The citizens’ oversight committee shall advise the public as to whether a school district or community college district follows the requirements of the Education Code. This in simple terms is as follows:

1. Did the District spend on authorized purposes i.e., capital expenditures and not on teacher and administrator salaries and other operating expenses
2. Were expenditures made on projects specifically authorized by the voters?
3. Was there an Annual Financial Audit?
4. Was there an Annual Performance Audit?
5. Annual Report Required and Regular Reports Encouraged. “The citizens’ oversight committee shall issue regular reports on the results of its activities. A report shall be issued at least once a year.”

In addition to these requirements of the Bond Oversight Committee, there are the following requirements of the School District:

Provide technical Assistance. “The governing board of the district shall, without expending bond funds, provide the citizens’ oversight committee with any necessary technical assistance and shall provide administrative assistance in furtherance of its purpose and sufficient resources to publicize the conclusions of the citizens’ oversight committee.”

Access to Audits. “The governing board of the district shall provide the citizens’ oversight committee with responses to all findings, recommendations, and concerns addressed in the annual, independent financial and performance audits
required by subparagraphs (C) and (D) of paragraph (3) of subdivision (b) of Section 1 of Article XIII A of the California Constitution within three months of receiving the audits.”

Maintenance of Public Records and Public Access. “All citizens’ oversight committee proceedings shall be open to the public and notice to the public shall be provided in the same manner as the proceedings of the governing board of the district.”

District Reporting Requirements. Minutes of the proceedings of the citizens’ oversight committee and all documents received and reports issued shall be a matter of public record and be made available on an Internet Website maintained by the governing board of the district.

Answer: CABOC believes that CBOCs may review expenditures at all steps of the process from immediately following the passage of the school construction bond ballot measure and the establishment of the CBOC until after the last payment.

The specific responsibilities of the CBOC are found in the California Education Code §15278:

(b) The purpose of the citizens’ oversight committee shall be to inform the public concerning the expenditure of bond revenues. The citizens’ oversight committee shall actively review and report on the proper payment of taxpayers’ money for school construction.

Note that the statutory provision discussed what the CBOC should do but not when it should do it.

In significant construction programs and projects, it is exceeding essential to start right, keep going straight, and identify and correct any problems as soon as possible. It is far superior to solve problems when they are small early in the process rather than wait until later – when they are much bigger problems that will be far more difficult, expensive, and take more time to correct.

For example, consider a district that decided to expend Prop. 39 school construction bond funds for a purpose that was not allowed by the applicable statutes, such as for teacher compensation, or chose to spend funds for a school construction purpose that was not identified, as required, in the detail of the ballot measure presented to the electorate.

If the CBOC was not informed and not allowed to research such expenditures until after the spending was underway, such improper conduct could produce high costs before detection. Suppose the original plan of spending and any revisions to the program of projects were to be presented to the CBOC before the Board adopted them. The potential violation could be identified and questioned, while the unallowable spending was relatively minor.

Some districts will present the program of projects for a proposed new ballot issue to their existing CBOC for comments and recommendations before the Board adopts it.

Another important consideration is the ability of a district to plan appropriately, design, construct, and place into service its construction program and individual projects. It is generally accepted that, before such major programs get underway, the district should have in place:

1. A well-experienced team of qualified program and project managers.
2. Proper systems to ensure that the program and projects are adequately managed, reported on, and overseen.

“Proper expenditure of taxpayers’ money” must be understood to include not just that all statutes and other requirements are not violated, but that the funds be spent wisely and with minimum waste. Therefore, reviewing the staffing and systems early in the process and, as needed, on an on-going basis, is a very justifiable function for CBOCs.

The short answer is “no.”

The Proposition 39 school bond amendments to the California Constitution specifically provide that bonded indebtedness incurred may be used for specific school facilities projects approved in the bond measure for “construction, reconstruction, rehabilitation, or replacement of school facilities, including the furnishing and equipping of school facilities, or the acquisition or lease of real property for school facilities … on or after the effective date of the bond measure… .”

On November 9, 2004, the California Attorney General issued Opinion No. 04-110 that answered this question:

“May a school district use Proposition 39 school bond proceeds to pay the salaries of district employees who perform administrative oversight work on construction projects authorized by voter approved bond measure?”

The answer: “A school district may use Proposition 39 school bond proceeds to pay the salaries of district employees to the extent they perform administrative oversight work on construction projects authorized by a voter approved bond measure.”

While it is permissible for bond funds to pay for some overhead costs of the school construction bond program, such as employer pension contributions and office space and costs for the construction staff, the CBOC should monitor such costs to be sure that the construction program is not overcharged.

Proposition 39 requires “… an annual independent performance audit to ensure that the funds have been expended only on the specific projects listed.”  (California Constitution Article XIIIA, Section 1(b)(3)(C).)

Appendix A to the California guide for annual audits (Guide for Annual Audits of K-12 Local Education Agencies and State Compliance Reporting, published by the  Education Audit Appeals Panel) prescribes the specific scope for this audit:

1. “Select a representative sample of expenditures charged to the facilities project(s) and review supporting documentation to ensure that such funds were properly expended on specific projects listed in the text of the applicable ballot measure.

2. “Verify that the funds were generally expended for the construction, renovation, furnishing, and equipping of school facilities constituting authorized bond projects.

3. “Verify that the funds used to pay the salaries of district employees were allowable per Opinion 04-110 issued on November 9, 2004 by the State of California Attorney General.

4. “If the school district did not properly account for the expenditures, if such expenditures were made for  unauthorized bond projects, of if salary transactions were used for general administration or operations, include a finding in the audit report.”

The audit required by the Guide is known as a “compliance” audit, performed to help the report recipients decide if the organization has met the applicable requirements.  In addition, to the annual required compliance audit, the best practice is to do an annual ‘Effectiveness and Results’ performance audit.  This audit could determine, for example if bond projects were delivered on-time, within budget and tax dollars spent effectively.

A review of efficiency and effectiveness could include factors and issues such as:

• The development of project scopes and cost estimates.
• Adequacy, completeness of justification of change orders in projects.
• Procedures for avoiding claims in projects.
• Whether project costs are in line with industry standards.
• Procurement processes for project consultants such as architects and engineers.
• Processes and procedures for utilizing best value procurement (e.g., design build)
• Master planning and cost estimations
• Procurement management and controls
• Contract Administration and controls
• Auditing post project completion construction contracts
• Warranty compliance and ongoing maintenance of assets
• District and Professional Services staffing plan
• Design and construction schedules cash flow analysis
• Cost schedule, budgetary management, and reporting controls
• Review of material specifications for competitiveness and completeness
• Contractor billing compliance controls
• Project close out controls

In short, the expanded performance audit is a vehicle for the oversight committee to “report on the proper expenditure of taxpayer dollars” and is also a process improvement document for a district’s bond program.

The Little Hoover Commission is an independent California oversight agency that recommended all school Proposition 39 bond programs have annual ‘Effectiveness and Results’ performance audits be performed in accordance with Government Auditing Standards published United States Government Accountability Office.

The key elements of a school district facility master plan are as follows:

Strategic Priorities.  This is a description from a policy perspective of the priorities for spending on capital projects.  Factors such as health life safety needs, improvement  in classroom environments, future capital cost avoidance or long-range operational cost savings are among the type of policy considerations.  These priorities guide the timing of spending given a limited availability of funds with higher priority projects receiving more immediate funding.

Educational Plan/Specifications. This includes an examination of the delivery standards for education such as the size of classrooms, support space needs, and the infrastructure requirements such as lighting. These specifications are often included as design standards. The master plan process requires an examination of how the education service is best delivered by a particular physical environment.

Facility Needs/Condition Assessment.  This involves a review of the physical condition of buildings and infrastructure and determination of such factors as remaining useful life; improvements need to extend and improve their physical life and which assets should be replaced.  The Assessment includes an estimate of costs.

Enrollment Projections.  This phase involves the forecasting of student population by service areas and the overall need for educational spaces.

Site Development Plans/Master Plans. For each educational facility, the overall space, and functional needs, be identified and dovetail with the facility conditions assessment to identify which facilities should be maintained and improved along with new construction or refurbishment requirements. Cost estimates would be for each site as well as the inclusion of overall systemwide infrastructure needs.

Implementation Plan.  This final phase of the master plan takes estimated funding availability, project costs and district priorities and then identifies the phased development of school facilities.

The overarching goal of bond oversight is for the members of a Committee to report to the public on whether the expenditures from bond funds were “proper” and consistent with what was promised to the voters

Here are some sample questions:

1. 1. Why were outside consultant services used for Project Management when they have an hourly rate of X when in house half-staff has an hourly rate of Y?

       

   2. .Why was sole source or no solicitation of proposals approach used for selection of an architect for this project?

       

   3. How did your district expenditure plan for this fiscal year relate to district priorities for capital projects?

       

   4. What processes does your district have to reduce the amount of change orders in projects?

       

   5. What was the districts process for evaluating the environmental and site-specific conditions of a project that now has problems with soil contamination and settling that has resulted in substantial increase in costs?

       

   6. How was the district policy on Consulting selection followed for this project’s architect?

While knowledge of construction and related services is helpful in providing bond oversight, it is not an absolute requirement.  Common sense and intuition given the circumstances of the bond program are just as important factors in determining questions.

Proposition 39

“On November 7, 2000, California voters reduced the voter approval threshold for school and community college district general obligation bonds from two-thirds (2/3) voter approval to 55% voter approval.  Proposition 39 amends Article XVI, Section 18 of the California Constitution…to pay debt service on bonds issues for school construction with the approval of 55% of the votes cast.” 1  The California Legislature, as part of the Proposition 39 implementation legislation, enacted Education Code Section 15278 which establishes Citizens’ Oversight Committees.

Education Code Section 15278 Citizens’ Oversight Committee

Education Code Section 15278, Article 2 Citizens’ Oversight Committee, provides that if a bond measure authorized pursuant to Proposition 39 is approved, “… the governing board of the school district or community college district shall establish and appoint members to an independent citizens’ oversight committee, pursuant to Section 15282 2, within 60 days of the date that the governing board enters the election results on its minutes pursuant to Section 15274.” 3  (emphasis added)

Definition of “Independent”

Dictionary.com is helpful in the context of Education Code Section 15278 an “independent citizens’ oversight committee”.  In this context Dictionary.com defines “independent” as follows:

• “not influenced or controlled by others in matters of opinion, conduct, etc.; thinking or acting for oneself.”

• “not subject to another’s authority or jurisdiction; autonomous; free”

• “not influenced by the thought or action of others.”

• “capable of acting for oneself or on one’s own.”

Is Your CBOC Independent?

An independent CBOC needs to answer each of these twelve (12) questions with a “yes.“

1. Can you prepare your own agenda?

2. Can you meet whenever you want?

3. Can you approve your own bylaws?

4. Can you establish subcommittees?

5. Do you have your own budget?

6. Do you have ability to post documents to the CBOC website?

7. Does the District provide you with all documents requested?

8. Do you have independent legal counsel who works for the CBOC?

9. Do you receive and accept the annual financial and performance audit reports?

10. Does the CBOC prepare and issue its annual report including compliance opinion?

11. Can CBOC members talk with contractors, architects, consultants, and auditors without restriction?

12. Can CBOC members visit construction sites?

A new CBOC member needs some basic information during the first three months of service to be an effective member.  This is the basic information a new CBOC member should get during the first three months of service (not listed in any priority order):

1. Requirement for an independent CBOC and review to ensure no conflicts of interest
   
2. Ballot language including project list
   
3. Facilities master plan including projects, costs, schedules, and objectives
   
4. Dates of community meetings for the next year so they can be added to your calendar
   
5. Bylaws
   
6. The CBOC and CABOC website links
   
7. The last CBOC Annual Report
   
8. The last financial audit report
9. The last performance audit report
10. Names, bio’s, emails, and telephone numbers of CBOC members and key district staff and policy on non-sharing of such information
11. How to place an item on a future CBOC agenda
12. Monthly check registers of bond measure expenditures, e.g., check #, date of check, vendor, amount, payroll in total, and purpose from which sample invoices could be selected for review at each committee meeting
13. Monthly budget v. actual expenditures and commitments
14. District policies for prioritization of projects
15. Brown Act (open meeting act) and compliance requirements, most specifically, what not to do
16. Who to contact for questions
17. Subcommittee assignment
18. California Association of Bond Oversight Committee Help Desk at website www.bondoversight.org

First, we recommend that every CBOC have its own legal counsel that is responsible to the CBOC and that the district’s legal counsel, internal or external, cannot be the CBOC’s legal counsel because that would be a conflict of interest.  Also, for the same reason, the CBOC’s legal counsel cannot do any work for the district.

There will be occasions when it is totally appropriate for the district’s legal counsel to provide information about legal matters to the CBOC.  For example, if the CBOC has legal questions about the district’s human resources or procurement processes, it will likely be far more efficient for the district’s legal counsel that works in these areas to provide the explanation to the CBOC.  In such cases, it may be appropriate for the CBOC’s legal counsel to review the district’s legal counsel statements.

Occasionally, a CBOC may need technical advice.  The district is required to provide technical advice to the CBOC when requested ”without expending bond funds.”   See Education Code Section 15280 (a).  Legal advice is one type of technical advice.  Typically, the district employs a lawyer to give the district advice about issues related to the bond programs. 

The district’s lawyer has an “attorney/client” relationship with the district in which the lawyer has a duty to give advice that is in the best interest of the district.  The district’s lawyer has no duty to the CBOC, even if the legal advice is good advice.  The district’s legal counsel also has a legal privilege responsibility to the district.  This means that it is prohibited from sharing certain information, such as those for a claim or legal action, individual personnel action, and information regarding procurements that have not been completed, with any outside parties including the CBOC.  Similarly, the CBOC’s legal counsel has the same responsibilities to the CBOC.  It is possible that the CBOC’s legal counsel may be able to give general information about a situation that is in process that the district’s legal counsel is prohibited from discussing with the CBOC.

The potential problem with the CBOC receiving legal advice from the district is that the advice is “in the best interest of the district.”  The CBOC should have advice that is in the best interest of the CBOC as the representative of the taxpayers, residents, and other stakeholders. 

For example, the bylaws of a CBOC may include a provision “only the district may amend these bylaws.”  An independent CBOC’s lawyer might explain that the board’s bylaws encroach on the independence of the CBOC. 

An independent CBOC must draft its own bylaws.

Best practice is for the CBOC to have an independent legal counsel, paid by the District, and for CBOC legal counsel to be experienced in the types of matters that are likely to come before the CBOC.  Fortunately, there are law firms that have attorneys that specialize in governmental and even K-12 and Community College organizations that can be well-qualified and experienced in the legal issues of such entities.

No.

In 2000, the proponents for Proposition 39 presented the initiative to the voters with the Title ”SMALLER CLASSES, SAFER SCHOOLS AND FINANCIAL ACCOUNTABILITY ACT.” “The people of the State of California find and declare as follows: We need to build new classrooms to facilitate class size reduction, so our children can learn basic skills like reading and mathematics in an environment that ensures that California’s commitment to class size reduction does not become an empty promise.” [Proposition 39 Section Two (c)]

This proposition provided for the following accountability requirements:

“A list of the specific school facilities projects to be funded and certification that the school district board, community college board, or county office of education has evaluated safety, class size reduction, and information technology needs in developing that list.” [Proposition 39, Section Four, Section 1 of Article XIII of the California Constitution adds Sec. 1, (b)(3)(B)]

This is the single “class size reduction” requirement in the California Constitution and only provides that a school board provide a certification that ‘this matter was evaluated when making the list of school facilities projects’.

Education Code Section 15282 (a)(3) provides that the CBOC shall have at least seven members and at least one of the  seven members  “… shall be active in a bona fide taxpayers’ organization.”

What does “bona fide taxpayers’ organization” mean?

Bona fide means genuine, real, done honestly.  In law it means sincerely, without intention to deceive.  It is Latin for “in good faith.”

In the context of CBOC membership it mean that the CBOC taxpayers’ organization member shall be an active member of a real and genuine taxpayers’ organization.

In CABOC opinion, the attached list of California Taxpayers’ Organizations would qualify as “bona fide” taxpayers’ organizations.

Taxpayers’ organizations are not limited to a local taxpayers’ organization.  It can be regional, statewide, or national organization.

_____________________________________________________________________

Alameda County Taxpayers Association     mcprose@att.net    Alameda

Calaveras County Taxpayers Association     alsegalla1@gmail.com     Calaveras

Taxpayers Association of El Dorado County    toddwhite2006@hotmail.com    El DoradoValley

Taxpayer’s Coalition    Mathys@OroFinancial.net    Fresno

Kern County Taxpayers Association    kerntax@kerntaxpayer.org    Kern

Long Beach Taxpayers Association    zerotaxeslb@gmail.com    Los Angeles

Marin – Coalition of Sensible Taxpayers    coalitiontaxpayers@gmail.com    Marin

Marin United Taxpayers Association    info@marintaxpayers.org    Marin

San Juan Ridge Taxpayers Association    info@sjrtaxpayers.org    Nevada

Orange County Taxpayers Association    Info@OCTax.org    Orange

Central Valley Taxpayers Association    brice@dacom.us    Placer

Inland Empire Taxpayers Association    info@ietaxpayers.com    Riverside

Sacramento County Taxpayers Association    info@sacramentotaxpayers.com    Sacramento    

San Diego County Taxpayers Association    info@sdcta.org    San Diego

The Coalition of Labor, Agriculture & Business – San Luis Obispo    colabslo@gmail.com    San Luis Obispo

Central Coast Taxpayers Association    president@ccta.news    San Luis Obispo

The Coalition of Labor, Agriculture & Business – Santa Barbara    andy@colabsbc.org

Santa BarbaraSanta Barbara County Taxpayers Association    https://www.sbctaxpayers.org    Santa Barbara

Silicon Valley Taxpayers Association    info@svtaxpayers.org    Santa Clara

Central Solano Citizen/Taxpayer Group    no.more.taxes.2016@gmail.com    Solano

Solano County Taxpayers Association    solanotaxpayers@sbcglobal.net    Solano

Sonoma County Taxpayers’ Association    taxpayer@sonic.net    Sonoma

Sutter County Taxpayers’ Association    information@suttertaxpayers.com    Sutter

Gold Country Taxpayers Association    https://goldcountrytax.org/contact    Tehama

Ventura County Taxpayers Association    vcta@att.net    Ventura

Yolo County Taxpayers Association    yolocountytaxpayers@gmail.com    Yolo

California Taxpayers Association    caltax@caltax.org    z – ALL

Howard Jarvis Taxpayers Association    info@hjta.org    z _ ALL

Overview

The Citizens’ Bond Oversight Committee (CBOC) is required by Education Code to issue regular reports on the results of its activities. A report is required at least once a year. In addition, the Education Code requires the CBOC to advise the public as to whether the district followed the California Constitution Proposition 39 accountability requirements. Best practice is to include this annual compliance opinion in the CBOC’s annual report. The purpose of this FAQ is to provide a format for the Annual Compliance Opinion.

Legal Requirements

California Constitution Article XIIIA, Section 1(b):

“(3) Bonded indebtedness incurred by a school district, community college district, or county office of education for the construction, reconstruction, rehabilitation, or replacement of school facilities, including the furnishing and equipping of school facilities, or the acquisition or lease of real property for school facilities, approved by 55 percent of the voters of the district or county, as appropriate, voting on the proposition on or after the effective date of the measure adding this paragraph. This paragraph shall apply only if the proposition approved by the voters and resulting in the bonded indebtedness includes all the following accountability requirements:

(A) A requirement that the proceeds from the sale of the bonds be used only for the purposes specified in Article XIII A, Section 1(b)(3), and not for any other purpose, including teacher and administrator salaries and other school operating expenses.

(B) A list of the specific school facilities projects to be funded and certification that the school district board, community college board, or county office of education has evaluated safety, class size reduction, and information technology needs in developing that list.

(C) A requirement that the school district board, community college board, or county office of education conduct an annual, independent performance audit to ensure that the funds have been expended only on the specific projects listed.

(D) A requirement that the school district board, community college board, or county office of education conduct an annual, independent financial audit of the proceeds from the sale of the bonds until all of those proceeds have been expended for the school facilities projects.”

Education Code Section 15278 (b):

“The citizens’ oversight committee shall advise the public as to whether a school district or community college district is in compliance with the requirements of paragraph (3) of subdivision (b) of Section 1 of Article XIIIA of the California Constitution.”

Education Code 15280 (b):

“The citizens’ oversight committee shall issue regular reports on the results of its activities. A report shall be issued at least once a year.”

Annual Compliance Opinion

Best practice is to include the Annual Compliance Opinion in the CBOC’s annual report in the following format:

Annual Compliance Opinion Bond Measure XX, June 30, 202X

Approved by the XYZ District Citizens’ Bond Oversight Committee on xxxx yy,
__________________________________________________________________________________________

If one or more CBOC Member(s) takes exception to any of the findings of compliance or non-compliance that have been accepted by the majority of the CBOC Members for presentation in the Annual Compliance Opinion, that/those

Member(s) may, at their option, prepare a Minority Report which shall be appended to that Opinion. Such exceptions can include compliance items that Minority Member(s) believe should have been included or excluded. The Minority Report shall identify the specific compliance requirement(s), the differing opinion(s) of the dissenting Member(s), and, as they may choose, the explanation and/or justification for their dissent.

Note:  In regard bond expenditures only for the specific school facilities projects listed in the bond measure (item B above) the CBOC could report, “cannot be determined.” The language of the ballot measure project may be written in such general terms that the specific projects cannot be identified. The CBOC should explain why their opinion may be different than the opinion of the performance auditor.

The Member has a large variety of options, including, but certainly not limited to:

1. 1. At the CBOC Meeting, the Member can express their displeasure and, as the Member may desire, introduce a motion to adopt the Member’s desires.

       

   2. The Member may vote against a motion that they disagree with or abstain.
      
      
   3. The Member(s) may provide a Minority Report to be included in the report and/or the minutes of the meeting, as applicable.

       

   4. The Member(s) may prepare a written communication to the district Board and/or district management on the topic.  In all such communications, the Member(s) should, in the introduction, identify themselves as CBOC Members and clearly announce that the communication is their own opinion and is not an adopted action of the CBOC.

       

   5. CBOC Members retain their non-CBOC status as citizens, residents, taxpayers, parents, etc. and all the rights thereof.  Therefore, they may use their right of public address to the district Board at a public meeting thereof to express their opinions.  As detailed in 4 above, they should disclose their CBOC Member status and that their opinions are their own.

       

   6. In similar manners, CBOC Members may engage in social media, letters to the editor, blogs, editorials, op-eds, articles, papers, conferences, etc. and express their opinions, including opposition to actions that have been taken by and/or been presented to the CBOC – again being sure to make the disclosures outlined above.

Members that engage in a dialog on such matters, such as commenting on a blog posting, should be aware of the Brown Act prohibitions, including serial meeting issues.

Yes, a CBOC should recommend a Program Effectiveness and Results Audit wherever and whenever it believes that one could be useful – which, based on the experience of CABOT members, will be frequent and usual.  (See FAQ 15 for examples of Program Effectiveness and Results performance audit scopes.)

The California Education Code (EC) §15278 requires the District to provide an annual Performance Audit to the CBOC:

(c) In furtherance of its purpose, the citizens’ oversight committee may engage in any of the following activities:

(1) Receiving and reviewing copies (emphasis added) of the annual independent performance audit (emphasis added) required by subparagraph (c) of paragraph (3) of Section 1 of Article XIII A of the California Constitution.

The Constitutional provision referenced above states:

(C) A requirement that the school district board, community college board, or county office of education conduct an annual, independent performance audit to ensure that the funds have been expended only on the specific projects listed.

EC §15280 states:

(b) … The citizens’ oversight committee shall actively review and report on the proper expenditure of taxpayers’ money for school construction. …

Under Government Auditing Standards, there are four types of Performance Audits; for K-12 and Community College Districts and their CBOCs, the two most common are “Compliance Audits” and “Program Effectiveness and Results Audits.”  The Performance Audit required by the above-quoted Constitutional provision is a “Compliance Audit,” which is useful for testing for legal/regulatory/contractual/procedural compliance, but “Program Effectiveness and Results Audits” can go much further and consider the economy, efficiency, and effectiveness of the District’s construction bond program in achieving the results stated in the bond ballot measure when it was presented to the voters.

Under Proposition 39, the CBOC is charged with the responsibility of reporting to the public as to compliance with “proper expenditure of taxpayers’ money for school construction” and “Program Effectiveness and Results Audits” are one of the best means for assisting the CBOC in performing its duties in this regard.

CBOCs should indicate to their District Boards and administrations the specific scope(s) of performance audit(s) that they need to satisfy their requirements for reporting to the public. 

There is no statutory requirement, but there can be significant advantages to all parties from having a single CBOC for all Prop. 39 school construction bond ballot measures.

First, CABOC – and many other knowledgeable entities – recommend that each district have a single, unified plan for its entire construction program, not a separate program for each bond ballot measure.  Also, it is generally best to have a single program management system under a unified manager and staff.  Having multiple CBOCs each reviewing these would be wasteful, both for the CBOCs and the district staff.

Second, it is not at all uncommon for individual projects to be funded from multiple sources, including more than one construction bond ballot measure.  Having, potentially, multiple CBOCs responsible for individual projects would also be wasteful – as would different CBOCs taking different approaches to how they operate.

Third, there are administrative and cost considerations for CBOCs including, but not limited to, putting together the meeting agenda packages, running the meetings and taking the minutes, maintaining the CBOC web site, and meetings and coordination with district Board members and district management.  Having two or three separate CBOCs would likely not double or triple this work, but it would undoubtedly increase it significantly over having just one CBOC for all.

Fourth, the purpose of CBOCs is to “inform the public” (Ed Code §15278.(b)).  If there were to be multiple CBOCs with multiple web sites and multiple annual reports to the public, members of the public and other interested parties would either have to review multiple sources of information or could wind up missing what they were looking for because they didn’t look in, or even know of, all the places that had information that they were looking for.

Fifth, if there is a single CBOC for all current – and future – construction bond ballot issues, the district and the district Board and top management would be more inclined to involve the CBOC as the new bond ballot measure is being formulated.

There are good reasons why CBOCs should have responsibility for at least some non-school construction bond expenditures and plans.

First, many projects have multiple sources of funding, such as the State of California providing funds for construction of new schools.  In most (but not all) cases, once the money from the different funds goes into the pot, it becomes fungible.  It is not that school construction bond expenditures pay for the construction of the first floor of the new school, State funds pay for the second floor, and developer fees pay for the third floor – rather, it is 45% of the total is from funding source A, 35% from funding source B, and 20% from funding source C.  It is simply not very practical to oversee 45% of the expenditures on a project in such cases – and it is not really very much additional work, if any at all, to oversee the entire project.

On the other hand, there are funding sources that are dedicated to specific uses and only specific uses, such as Federal e-rate funds for educational technology upgrades.  If, as is commonly the case, there are multiple individual projects at a school being performed at the same time, funded from difference sources, then it is important that there be procedures in place to ensure that each type of cost is allocated to the proper funding source, no more and no less, and that there is a pre-established methodology for splitting joint costs (such as the demolition work necessary for the e-rate work, plumbing, HVAC, and natural gas for new science classrooms or culinary facilities), and that overruns on one part of the work are not funded out of the other in violation of the allowed purposes.

If there is construction project that is totally separate from bond-funded projects, physically, technically, and financially, there would be less reason to have the CBOC have cognizance, but, if the district does have the recommended single consolidated capital projects plan, a case could be made for the CBOC to perform oversight for the entire program.

There is no residency requirement in the State Constitution or Statute or Regulation, but each District is free to establish its own, if it desires.

While Proposition 39 and its implementing Education Code and other laws and regulations do comprehend certain aspects of CBOC member qualifications, there is no discussion of residency.  The CBOC is aware of several CBOCs around the State of California that have, or have had, members that did not reside within the boundaries of the K-12 or Community College District that the CBOC covers.

While it appears logical that CBOC members that live in, pay taxes, attended, and send their children to would have obvious advantages, there are certainly conditions where it may be necessary to go outside the District boundaries, such as if there is no person active in a bona fide taxpayer organization that is willing to serve.

Conversely, the same laws that do not require that CBOC members be residents also do not prohibit a District from imposing its own geographic membership requirements.

The CBOC recommends that all CBOCs have Memorandums of Understanding and adopt their own Bylaws.  Such documents would be appropriate for residency requirements if residency requirements are considered appropriate for individual Districts and CBOCs that wish them.

The general rule is that agendas for almost all organizations are set by the Chair (or other title, such as President, of the entity; “Chair” will be used in this FAQ) of each organization, but each organization has some ability to establish its own procedures.

CABOC is aware of some K-12 and Community College Districts where the CBOC is essentially managed and operated by the District, rather than the CBOC, including where District administrators set the agenda with little or no input from the CBOC and its members.  CABOC recommends against such practices in the strongest possible terms.

CABOC recommends that the process for setting the agenda for each meeting be determined and approved by the CBOC members and memorialized in the CBOC Bylaws.  CABOC recommends that the following be considered:

1. The final agenda will be ultimately determined by the Chair.
2. The CBOC promulgates its preliminary meeting schedule for the year at least a month prior to the beginning of the new year.
3. The CBOC develops a timetable for establishing agendas with specific responsibilities assigned and deadlines expressed in terms of days prior to the meeting.
4. A specific staff person should be assigned responsibility for the administrative aspects of the agenda, including ensuring that inputs are received on a timely basis, the approval process is followed, and the agenda is properly posted in accordance with the applicable laws and regulations, and the Agenda Package is properly prepared and distributed. A back-up person should be named if the primary is unavailable.
5. Generally, most items to be agendized will be originated from the District. A District employee (with a back-up) should be named to coordinate and assemble all District agenda topics and agenda materials and providing same to the CBOC coordinator.
6. The CBOC may wish to have a procedure where a CBOC member, or more than one CBOC member, could place an item on the agenda.
7. The CBOC may wish to have a procedure where a Member of the public may request that an item be placed on the CBOC agenda subject to the approval of the CBOC Chair.

The CBOC Chair may consult with other CBOC members, and non-CBOC personnel as the Chair believes appropriate, as to the items to be placed on the agenda, extent of what will be discussed, timing, etc.  In such consultations, the Chair and other CBOC members must take care to comply with the provisions of the Brown Act, including keeping the number of members consulted less than a quorum and not establishing what could be considered a Standing Committee, such as an “Agenda Committee,” under the Brown Act.  Making sure that the agenda process is properly performed, and all legal and other requirements satisfied should be a main duty of the independent CBOC legal counsel.

Only CBOC members may vote on matters brought before the CBOC, and all CBOC members are appointed by the District Board.  However, the CBOC may, if it wishes, bring in other personnel to particulate in CBOC actions, subcommittees, and task forces as the CBOC may see fit.

For example, CABOC is aware of a CBOC that established a task force to study the requirements for audio communication in classrooms and potential methods for improving same.  These ranged from quieting heating, ventilation, and air conditioning; sound insulation in walls and ceilings to reduce the impacts of exterior noise; for walls, floor, and ceiling insulation to reduce the impact of noise inside the classroom; and the use of classroom microphones and speakers.  The task force invited acoustic specialists and academics who specialized in audio-challenged students to regularly meet with the CBOC members of the task force to help them understand the options, their implications, and costs and timing.

CABOC is unaware of any CBOC that regularly had non-CBOC members sitting as CBOC members during CBOC meetings.  If the CBOC so desired, this does not appear to be prohibited, but such personnel would not be able to vote on matters that come before the CBOC.

If a CBOC desires to utilize this option, CABOC recommends that it be memorialized in the CBOC Bylaws.

No – but the distinction between what can and what cannot be funded through such funding often requires detailed knowledge and a careful reading of the applicable legal requirements.

Proposition 39 has been codified in Article XIII A (“Tax Limitations”) of the California Constitution:

SECTION 1.

(b) The limitation provided for in subdivision (a) shall not apply to ad valorem taxes or special assessments to pay the interest and redemption charges on any of the following:

(3) Bonded indebtedness incurred by a school district, community college district, or county office of education for the construction, reconstruction, rehabilitation, or replacement of school facilities, including the furnishing and equipping of school facilities (emphasis added), or the acquisition or lease of real property for school facilities, approved by 55 percent of the voters of the district or county, as appropriate, voting on the proposition on or after the effective date of the measure adding this paragraph.

The allowable categories shown in bold above are, for accounting purposes, referred to as “capital costs,” as opposed to “operating costs,” which include maintenance, servicing, and non-capital repairs.  For determination of which side of what can be a fine line in some cases a specific cost item might fall, the primary applicable control documents are Government Generally Accepted Accounting Principles, promulgated by the Government Accounting Standards Board, and the California School Accounting Manual (“SAM”).  This manual is updated periodically; as of this writing, the 2019 Edition is applicable.  CABOC recommends that CBOC members rely upon the expertise of experts in accounting and law for opinions on what is and is not SCB-funding eligible rather than attempting to develop their own expertise in these fields.

In order to be eligible to be funded by SCB funds, an expenditure must meet all of the following criteria:

1. It satisfies the general requirements, such as being for a purpose or project specifically referenced in the list of projects presented to the electorate when the SCB was enacted.
2. It creates an asset, or contributes to the creation of an asset (such as planning and administrative costs of the capital program) that has a useful life of greater than one year.
3. It has a cost greater than the capitalization threshold established by the district, such as $2,500 (as each district has great freedom to set its own, this will vary).  SAM provides for “group” assets for similar items, such as tables, chairs, laptops and tablets, that have individual item costs less than the threshold, but the group totals exceed it.

For fixes, repairs, and replacements, a key consideration is extension of the useful life.  A cost that allows the asset to reach its useful life, such as the normal servicing and maintenance of a heating/ventilation/air conditioning system such as changing filters, or a repair that does not extend the useful life, is not a capital expenditure and, therefore, cannot be charged to SCB.

There are many expenditures that require a detailed understanding of these requirements.  For example, if a roof, with a 20-year useful life, develops a leak in its 15^th year of service, and a patch is applied that will allow the roof to last another five years, that is a repair and cannot be capitalized or charged as a SCB expenditure.  However, if, at the 15^th year of service, the entire roof was determined to have failed, and was replaced with a new roof with a 20-year life from date of installation, this will likely be a proper capital expenditure and can be chargeable to a SCB assuming the other requirements are met.

For all expenditures that are proposed for charging to SCB, and particularly for those where there may be some question as to propriety, CABOC recommends that the applicable district facilities, financial, and legal executives certify that such expenditures are eligible.  Some districts have SCB bond counsel to? certify; after this is done for the original proposed expenditures, these prior opinions will generally cover most future proposed expenditures, reducing the requirements for later individual opinions. 

Of course – but CBOC members must understand the Brown Act and its requirements and prohibitions; all members should be well aware of the “open meeting” requirements of the Brown Act and should take care to be always in compliance, as is discussed elsewhere on this website.

Besides communications at announced meetings, it is perfectly proper and allowable for CBOC members to meet in person, make phone calls, e-mails, facsimiles, snail mails, use social media, etc., as long as such meetings, including “serial meetings” (member A talks to member B about a topic, then talks to member C about the same topic, etc.), do not amount to a quorum of the voting members.

Some amount of inter-member communication is normal and expected, such as the chair speaking with a new member or a committee chair, two members working on a motion that they plan to introduce for consideration at a future meeting, or am asking the chair for a staff report on a specific project or school.

Each CBOC is free to establish its practices through its Bylaws.  See FAQ 12.  (Some districts, governing boards, and superintendents improperly resist their CBOCs from setting their own bylaws.)

This answer will discuss general requirements (Brown Act Open Meeting) and common topics.   Every CBOC will develop its way of planning and conducting its meetings.

While the open meeting requirement does not explicitly reference the Ralph M. Brown (Open Meeting) Act most school districts and CBOCs have interpreted the requirement to establish that CBOC public meetings should be noticed and held in accordance with Brown Act provisions.  CABOC agrees with this position.

Common Topics

• Mission statement
• Roll call
• Approval of agenda
• Approval of prior meeting minutes
• Review vendor expenditures prior period (school/project, vendor, check number., check date, account code, invoice number, invoice date, amount, description) *
• Review salary and fringe benefit expenditures prior period (name, title, amount) *
• Review financial report prior period (object code by school/project, original budget, current budget, expenditures, commitments, budget balance) *
• Review construction schedule (school/project, plan start date, actual start date, plan end date, the actual end date for each phase:  planning, design, procurement, construction)
• Review CBOC members information request log
• Agenda items for next meeting
• Meeting schedule this year
• Accept and review the annual financial audit report
• Accept and review the annual performance audit report
• Approve CBOC annual report
• Cost-savings measureDeferred maintenance plan
• Inspection of school facilities and grounds
• Website review
• Status of CBOC recommendations to School Board
• Review of change orders
• CBOC member attendance chart

*Level of detail to be determined by CBOC.

Education Code Section 15280(b) provides, “All citizens’ oversight committee proceedings shall be open to the public and notice to the public shall be provided in the same manner as the proceedings of the governing board of the district.” 

Government Code Section 54954.2 provides that K-12 school districts shall at least 72 hours before a regular meeting post an agenda with a brief general description of the business to be transacted or discussed.

Education Code Section 72121(b) prescribes the exact requirements for community college districts.

While the open meeting requirement does not explicitly reference the Ralph M. Brown (Open Meeting) Act, most school districts and CBOCs have interpreted the requirement to establish that CBOC public meetings should be noticed and held in accordance with Brown Act provisions.  CABOC agrees with this position

CABOC has provided answers to various Brown Act FAQs below because the Brown Act applies to Proposition 39 school CBOC.

34.2 What are the main provisions of the Brown Act?

All CBOC meetings, including standing committees, must be open to the public.

A meeting is any congregation of a quorum of the CBOC members simultaneously and in place, including Zoom or other electronic meetings.

Meetings can also include phone calls and an e-mail thread that consists of a quorum of the CBOC.

A quorum of CBOC members is a majority of the active membership.  For example, if there are nine CBOC seats and all nine are filled, a quorum is five – but if two of the seats are unfilled, a quorum is four.

34.3 What is a Brown Act “serial meeting?”

A serial meeting occurs when two or more individual meetings involving CBOC members on the same topic combine to affect a quorum of CBOC members.

For example, if there is a five-member board with a quorum being three members, Member A can meet privately with Member B and discuss a matter. Still, if Member B then meets with Member C to discuss the same topics, the unallowable serial meeting may be deemed to have occurred.

A serial meeting can also occur if a non-member is a common link if the positions or concerns of CBOC members are relayed to other CBOC members.

34.4 Are meetings, phone calls, and e-mails to or between CBOC members subject to the Brown Act?

A CBOC member can e-mail one or more other members on a topic if the number of CBOC members involved is kept under a quorum.

E-mails that are sent out by staff to inform CBOC members, such as transmitting a meeting agenda package, are not subject to the Brown Act.  However, e-mails should be used with caution because if any of the members “respond to all,” it can become subject to the Brown Act requirements.  Therefore, it may be a good idea to send such e-mails with most addresses as “bcc’s” to avoid the potential problems of members being able to respond to all.  CBOC members should not send out e-mails to what could become a quorum of members discussing such matters.

34.5 What are the Brown Act advance notice requirements for meetings?

A regular meeting must be noticed 72 hours in advance on the CBOC or district website.  If the CBOC does not have a website, the meeting notice must be posted at a stipulated place accessible to public members.  Weekend hours may be counted as part of the 72 hours.  The notice shall include the time and place, alternative access (Zoom, call-in, etc.), and the agenda with the items to consider at the meeting.

All meetings must have an agenda, and the agenda must include a description of each item on the agenda.

Special meetings – generally, a non-regularly scheduled meeting on a single topic require 24 hours’ notice.

34.6 How broad can a Brown Act “meeting” be construed?

A “meeting,” as that term is defined under the Brown Act, can occur whenever a majority of the members are in one location, including electronically and even at a social event where the members did not know that other members would be in attendance.  At such occurrences, members must be careful not to discuss CBOC business.

34.7 Does the Brown Act require that the agenda package be accessible by public members?

Upon written request by the media, or any member of the public, the agenda and all documents shall be sent by the district to the person requesting when the agenda is posted.

Many government boards, including CBOCs, post their entire agenda packages on their websites, in a downloadable format, as part of their meeting notice process.

34.8 Under the Brown Act, what rights does the public have to address the CBOC at meetings?

For regular meetings, the public must be provided an opportunity to address any item on the agenda and any item within the subject matter of the CBOC. 

Generally, on items on the agenda, members of the public are allowed to comment after the presentation of the item is made to the CBOC by staff and before the CBOC members begin their discussion.

Members of the public may comment on any CBOC relevant topic they wish during a general public comment period.  Some CBOCs have their available public comment period near the top of the list of agenda items, others at the end.

For special meetings, the public must be provided an opportunity to address any item on the agenda.

34.9 Does the Brown Act allow items that the CBOC can discuss in closed sessions?

Certain items, such as personnel matters and possible and active legal actions, may be considered in executive sessions where the public is not allowed.

However, such items must be placed on the agenda, the items to be considered in the closed session announced in an open meeting before the commencement of the closed session, and the results of any actions taken in the executive session announced.  The public has the same right to comment on any other items before the commencement of the closed session.

34.10 What Are the Brown Act requirements for meeting minutes?

Minutes of meetings must be kept.

Members of the public are entitled to know how each member of the CBOC voted on action items.

Many CBOCs post their meeting minutes on their website to be available to the public and other perpetually interested parties.

34.11 Are CBOC subcommittees and task force meetings subject to the Brown Act requirements?

Standing subcommittees – those intended to remain in existence without a predetermined end date or achievement of a specific objective – are also subject to the Brown Act rules shown above, even if a quorum is not present.

Task forces established for limited specific purposes and terms are not subject to the Brown Act if a quorum of CBOC members is not in attendance.

34.12 Does the Brown Act require members of the public to identify themselves?

Members of the public cannot be required to give names or sign a register as a condition of attendance or speaking. They may be required to go through security procedures such as metal detectors.

34.13 Does the Brown Act allow CBOC meetings to be recorded?

The CBOC, the press/media, and the public may record and broadcast meetings if they do not interfere with the conduct of the meeting and comply with all applicable regulations, such as not blocking fire escape access isles.

If the CBOC records its meetings, it must make such records available to the public or press/media upon request.  Some CBOCs make such recordings available for download on their website.

The Education Code 15280 (b) requires the CBOC documents to be posted on a website that the district maintains. 

Education Code Section 15280.  

“(b) … Minutes of the proceedings of the citizens’ oversight committee and all documents received and reports issued shall be a matter of public record and be made available on an Internet Web site maintained by the district districts governing board.”

The CBOC should control what documents are uploaded to the CBOC website.

The basic features of a good CBOC Website are:

1. The CBOC website should be easy for the public to find.
2. A CBOC membership application should be easy to find.
3. CBOC information should not be commingled with other district information.
4. The CBOC website title should be ‘Bonds’ or ‘Bond Oversight’ or a similar topic.
5. The CBOC website should have a drop-down menu of relevant topics, such as:
• An explanation about the CBOC.
• Application form to join the CBOC.
• Explanation ‘Why you should join.’
• Prop 39 (2000) explanation & text
• Each measure’s voter information statement
• Bylaws
• Agendas and minutes
• Financial audits (link to district website)
• Performance audits (link to district website)
• CBOC Annual Reports to the public.
• Facilities Projects construction schedule (link to district website)
• All documents received by the CBOC
• All reports issued by the CBOC
• Official statements for each bond sale (link to district website)
• Memorandum of Understanding, if it exists
• List CBOC members, their appointing authority, their term of service, and brief biographical information
• How the public can contact the CBOC
• Meeting schedule
• Rules for CBOC meetings

   

  Financial reports (link to district website)

Answer:  Yes.

First, there is no statutory requirement that a CBOC have Bylaws; however, virtually all entities do have them.

Bylaws are the collection of the rules by which an organization operates and includes the purpose of the organization, membership, officers, process for and frequency of selection, frequency of meetings and how they are called, meeting quorums, and a number of votes or percentage to pass diverse types of actions.

Bylaws should be collected in a single document on the CBOC website and furnished to all members.  Various websites can assist with the initial formation of Bylaws.  CABOC is currently preparing a Best Practice Bylaws template.

Although there are no specific statutory requirements for CBOC Bylaws, CABOC strongly recommends that the Bylaws be established by each CBOC and not enacted by the district Board or district administrative employees  – this is a vital part of the CBOC being able to perform its statutory responsibilities to the voters, taxpayers, students, residents, parents and guardians, and other stakeholders. 

For example, if the Bylaws state that only the district can schedule a meeting, decide what items will be placed on meeting agendas, appoint the CBOC officers, or provide that a district employee will conduct the CBOC meetings, the ability of the CBOC to develop an understanding of what is going on with the construction bond program, make recommendations, and report to the public will be severely hampered.

California Education Code Section 15280(b) states, “The citizens’ oversight committee shall issue regular reports on the results of its activities.  A report shall be issued at least once a year.”  Among the primary documents that a CBOC uses as a basis of the Annual Report are the required two annual audits: the financial audit and the performance audit.  Even when these two audits conclude that the bond expenditures substantially comply with the ballot measure, the Annual Report should also report on other requirements.  For example:

• Did the district submit the Audits to the CBOC on time?
• Did the district fill vacant CBOC seats?
• Did the district appoint each CBOC member a term “not less than two years?”

The Annual Report should, at the discretion of the CBOC, should also include information about the CBOC itself and the progress of the School Construction Bond and related programs, potentially including:

• The purpose of the CBOC, CBOC members, meetings, actions, and terms of service (which may link to detail contained on the CBOC website).
• Does the District have a facilities master plan?  Are the program and the procedures and practices for its development proper and adequate?
• How are the facilities program and projects proceeding according to plan?  Are projects proceeding according to schedule and within budget?  Are projects completed according to applicable building codes and practices and commitments made to the taxpayers, voters, residents, and parents, such as types and sizes of schools and school features and attributes, such as computer-assisted learning, air conditioning, or class sizes?
• Identification of the CBOC Web Site and other information that may be found there.

How members of the public can contact the CBOC.

The Annual Report can include news-related stories, such as

• A relevant Grand Jury report.
• Whistleblower reports.
• Comments on divergence from the facilities master plan.
• Troublesome construction change orders.
• Previous audit recommendations and district actions to come into compliance (or not).
• Best practices recommendations.

The Recommendations section at the end of the Annual Report should list the actions by the district that will help the CBOC function better and district actions are taken in response.  The CBOC annual report should be focused on accountability. 

Too often, the CBOC annual report consists of pictures of construction projects; the CBOC annual report should not be a report only on construction progress.

CABOC strongly recommends against such interfund borrowings.

Some districts have done this, but it has been ruled improper by the California Fiscal Crisis & Management Assistance Team (FCMAT)*.

“The Fiscal Crisis and Management Assistance Team’s (FCMAT’s) primary mission is to help California’s local K-14 educational agencies identify, prevent and resolve financial, operational, and data management challenges by providing management assistance and professional learning opportunities.

“FCMAT’s services help avert a fiscal crisis, promote sound financial practices, support chief business officials’ training and development, and help create efficient organizational operations.

“FCMAT’s data management services are used to help local educational agencies (LEAs) meet state reporting responsibilities, improve data quality, and inform instructional program decisions“•

In a Fiscal Alert*, FCMAT states:

“The use of bond proceeds outside of their intended capital may violate state law. School districts may issue general obligation bonds under Proposition 39, which requires that an issuer specify the purposes of general obligation bond proceeds and may not spend the proceeds “for any other purpose, including teacher and administrator salaries and other school operating expenses.” Districts issuing bonds under Proposition 46 must use the proceeds for “real property and improvements.” In both cases, using the funds as working capital, even temporarily, fails to fulfill these obligations. Education Code Section 15100 establishes permitted purposes for proceeds, including construction, repair, restoration, furniture, and equipment. Section 15146 prohibits proceeds for purposes other than those specified at the bond’s issuance. Therefore, interfund borrowing involving a transfer of general obligation bond proceeds to funds with expenditures outside of the designated capital project for which the bonds were issued may violate these sections of the Education Code.”

The FCMAT Fiscal Alert gives several additional reasons why such interfund borrowings should not be allowed. CABOC strongly concurs with FCMAT’s reasoning and conclusion and recommends that CBOCs oppose any attempt at their district to do such interfund borrowings. 

* See About FCMAT.

** FCMAT, “Interfund Borrowing,” https://www.fcmat.org/PublicationsReports/FCMAT_Fiscal_Alert-Interfund_Borrowing_Using_Bond_Procees-10-1-19.pdf

Salaries for the personnel who administer the teaching and direct educational administration and support activities of a K-12 or community college district may not be charged to SCB funds, but the salaries for administering the actual SCB program may.

This requirement is found in the California Constitution, Article XIII A, Section 1. (b)(3)(A). For Proposition 39 bond measures to qualify to be approved by a 55% majority, the use of bond funds must include:

A requirement that the proceeds from the sale of the bonds be used only for the purposes specified in Article XIII A, Section 1(b)(3), and not for any other purpose, including teacher and administrator salaries and other school operating expenses (emphasis added).

Unfortunately, these terms were not defined in Proposition 39, but the California Attorney General has issued an opinion on this subject (page 1):

A school district may use Proposition 39 school bond proceeds to pay the salaries of district employees to the extent they perform administrative oversight work on construction projects authorized by a voter-approved bond measure.

Further (pp. 5-6):

We believe that “the construction, reconstruction, rehabilitation, or replacement of school facilities” embraces project administrative costs, such as monitoring contracts and project funding, overseeing construction progress, and performing overall project management and accounting that facilitates timely completion of the construction project. A construction project generates not only the costs of materials and equipment, architectural and engineering design work, and construction worker salaries, but also costs of project administration — work that the school district would not be required to undertake or to fund but for the existence of the construction project. This administrative work is performed, whether by private consultants under contract with the school district or by school district employees with expertise in project management, to ensure that all aspects of the construction project are properly coordinated; that each step satisfies the specifications; that invoices are reviewed, revised where appropriate, and paid promptly; that costs do not exceed the project’s budget; and that the project is completed on schedule. (See 78 Ops.Cal.Atty.Gen. 48 (1995).) …

Therefore, Proposition 39 school bond proceeds may fund such project management costs unless the expenditures are expressly prohibited under the phrase “teacher and administrator salaries and other school operating expenses.” The “teacher and administrator salaries” in question are limited to those that qualify as “school operating expenses” because of the word “other” contained in the phrase.5 We believe that “school operating expenses” are those regular, ongoing, day-to-day costs associated with maintaining and operating a school. Among such expenses would be (1) the cost of managing the educational services provided, including the salaries of school administrators, and (2) the cost of providing instruction to students, including teachers’ salaries. (See 22 Ops.Cal.Atty.Gen. 105, 108 (1953) [school district’s routine operating expenses include the purchase of supplies and payment of salaries of school administrators, teachers, and janitors].)

In the absence of a specific statutory provision, such as in the California State Constitution or state statute, case law from a court decision, or state regulations implementing the same, generally, the best legal authority will be from an opinion of a qualified attorney.  In general, an opinion of the California Attorney General is regarded as superior in power to that of any other attorney but junior to that of statute or case law.

We note that this opinion should not be regarded as authorizing all facilities-related costs of a district to be charged to SCB funds.  For example, while the costs of the facilities department related to school construction activities are likely allowable, those related to maintenance and non-capital repairs are likely not.  So, for example, if the district facilities manager spends 60% of their time on SCB capital projects and 40% on maintenance, service, cleaning, etc., then 60% of the costs of the facilities manager would generally be chargeable SCB funds.

(Best practice would be for the district to have a cost allocation study prepared at the beginning of the SCB program, periodically updated after that, and reviewed and approved by district finance, legal, and bond counsel, and that the district implements a proper cost accounting methodology, including, in particular, detail time reporting for those district employees and contractor personnel who split their time between allowable SCB and non-SCB activities.)

The short answer is that communications costs directly supporting school construction bond (SCB) activities are allowable.  Examples of allowable expenses include the costs of doing a public hearing as part of an Environmental Impact Report (EIR) for a new school as required by the California Environmental Quality Act (CEQA), press releases for the opening of a new school, or the costs of a public information office that does SCB work.  The costs of hiring external professionals, such as public relations or community communications firms, may also be allowable, depending upon the work performed.

As always, with charges to Prop. 39 SCB funds, it is best to have cost charging and cost allocation plans established in advance, including an agreement with agency fiscal and legal offices and bond counsel as appropriate.

Non-allowable communication costs include support of general school administration activities, such as a press release announcing the hiring a new school superintendent, public information on registering students for pre-kindergarten, or announcing a public hearing on the entity’s annual budget.

It is common for some offices in a district to split their work and time between SCB and general activities; in such cases, it is possible to separate the costs between SCB funds and non-SCB funds if proper records are kept.  The best practice is for the employees in such offices to do daily time sheets, allocating their work between bond-funded and other activities by an approved cost allocation plan.

By definition and statute (California Education Code §§15278-88), the entire function of a Prop. 39 School Construction Bond Citizens’ Oversight Committee is to perform oversight – and, if something unusual or improper is noted, take action on its findings.

By statute, the CBOC must report its findings to the district’s public that it has been established to oversee.  These can be done through the CBOC’s annual (or more frequent) reports or individual actions, such as reports and recommendations to the governing board, the agency’s administrative departments, stakeholders, and the general public.  The CBOC leadership may meet individually with governing board members, the superintendent, or other senior administrators.

Depending on the specific circumstances of the objectionable actions, the CBOC (and individual member(s) thereof) has many possibilities for further actions, including:

• Include a discussion of the issue in the annual (or more frequent) report of the CBOC to the public.
• Consider a resolution, or special report, to the governing board discussing the issues.
• Consider a resolution of no confidence against the district, the board, the superintendent, or other officers or departments.
• Consider initiating an action to recall members of the governing board.
• Contact the local district attorney (for actions that could rise to criminal activity.)
• Contact the civil grand jury (for improprieties that could include poor procedures and potential instances of fraud, waste, or misuse of funds that may or may not rise to criminal action.)
• For matters involving the potential misuse of Federal funds, contact the Federal grantor agency, the Office of the Inspector General of the Federal grantor, or the U.S. Attorney. Most Federal funding for K-12 and community college districts comes through the U.S. Department of Education and is used primarily for operations, but other Federal departments fund K-12 and community college capital projects, including e-rate funding through the Federal Communications Commission that is used for information technology capital projects that may be co-funded with bond monies.
• Contact the County Superintendent of Education, County School Board, and other county-level oversight agencies as appropriate for the jurisdiction.
• Contact the California Board of Education, the State Superintendent of Schools, and the California Department of Education (these three are closely connected.)
• Contact the California State Controller.
• Contact the California Joint Committee on Legislative Audit and the California State Auditor. Other than the specific functions of the State Auditor established by statute, the Auditor undertakes audit work at the instruction of the Joint Committee. If a particular audit is desired, the party advocating such work is generally best served by contacting its State Senator or Assemblyperson, who can submit a request to the Joint Committee.
• If appropriate, contact the U.S. Internal Revenue Service (IRS) and Security and Exchange Commission (SEC). Under certain situations, misuse of bond funds could potentially endanger the tax-exempt status of the bonds, which could attract the interest of one or both agencies.
• Contact bond rating agencies.
• Contact CABOC for assistance.
• Consider a legal action under California Education Code §15284 (“… an action to obtain an order restraining and preventing any expenditure of funds received by a school district or community college district through the sale of bonds authorized by …” Proposition 39.)
• Consider a CBOC resolution and prepare a ballot argument against a subsequent ballot measure due to perceived, serious uncorrected problems with prior bond measures, management and control deficiencies, and other issues.
• Consider other legal actions.
• Hold a press conference to announce the CBOC’s findings, recommendations, and actions, such as referring the matter to the agencies above.

Before taking any of the above actions, the CBOC and individual members should consider the potential impacts of such actions on the future relationship between the CBOC and the entity it oversees.

First, CABOC recommends that any CBOC that so desires should be able to have its own independent legal counsel (ILC), working for and answerable only to the CBOC, not performing any other work for the district that the CBOC oversees, and that the CBOC select its own ILC.  Further, the cost of the CBOC’s ILC should be paid by the district that is being overseen out of non-Prop. 39 bond funds.

To be clear, this recommendation should not be interpreted to mean that the procurement and contracting process for the CBOC’s ILC should be performed solely by the CBOC, nor that the standard statutory, regulatory, and local processes and procedures should not be followed.  Rather, CABOC recommends that the CBOC work with the appropriate offices of the district that it oversees, specifically including the procurement department, to conduct a procurement that is fully compliant with all such requirements – but where the CBOC makes the key decisions.

The first steps are to; (a) consider if the CBOC’s work would be enhanced by having its own ILC, (b) determine the desired legal expertise and qualifications of the ILC, and (c) prepare a preliminary scope of services and estimate the annual hours of work that is expected to be required.  The next step is to meet with the district’s top administrator and/or board members to produce a joint plan to execute the procurement, fine-tuning the CBOC’s initial estimates.

Each CBOC should determine its own needs based on its local conditions, but CABOC suggests considering the following:

1. To be considered, candidates cannot currently be performing any work for the district that the CBOC is overseeing, have not done any work for the prior three years for the district, and may not do any work for the district while engaged in serving the CBOC.
2. In many of the larger and medium-sized metropolitan areas in California, there are law firms that have the specialty of serving as contract legal counsel for small and mediumsized local governmental units, which equips them with knowledge and experience in the Brown Act, government procurement, human resources, and other common general governmental legal and administrative matters.
3. Experience with a governmental entity with major construction projects and programs.
4. Experience with Prop. 39 school construction bonds

In determining what services will be desirable, the following should be considered:

1. Does the CBOC expect ILC to review meeting agendas and materials before meetings?
2. Does the CBOC expect ILC to attend all CBOC meetings? Subcommittee and task force meetings?  Meetings with the district administrators and governing board members?  Meetings with legal counsel to the district being overseen and bond counsel?
3. Will ILC be reviewing CBOC reports, such as the required public reports?
4. Are there any expected special problems, or special projects, that may require the involvement of ILC?
5. Many attorneys and firms with large local governmental practices have significant general government experience and can be useful business and legal advisors to a CBOC – is this desired? If so, how much, and how often?
6. What will be the line of communications between the CBOC members and the ILC, and other parties?
   1. Will ILC communicate only with the CBOC Chair? CBOC officers only?  Any CBOC members that have legal questions?
   2. Will district staff be able to contact the ILC? Members of the public?
7. Will ILC be performing any other services, such as the administrative work to prepare meeting agendas, agenda packages, and minutes of meetings, or managing the CBOC website?
8. Consideration of a contingency for unanticipated work may be wise.

All governments have procurement functions that have established their more-or-less standard types of language for requests for proposals (RFP) for professional services and contracts that include most of the necessary “boilerplate” requirements.  The Chair or other designated CBOC member(s) should meet with the procurement personnel to understand how the procurement will work, which will include the items discussed above and what variances are required for the CBOC ILC procurement and contract.  The RFP should include the following:

1. The necessary qualifications
2. Scope of services
3. Term of service (generally, no more than five years)
4. Type of contract (generally, time and materials, with hourly rates and specified out-of-pocket expenses, such as travel to CBOC meetings)
5. Selection criteria and weight for each factor:
   1. Firm experience, particularly with California local governments and Prop. 39 programs.
   2. Qualifications of the personnel to be assigned to the CBOC (it is generally best to have one primary contact who will handle most of the ILC work for the CBOC, but also a backup if the primary is unavailable for any reason)
   3. Work program, demonstrating the ’firm’s and personnel’s ability to be assigned to do the work desired
   4. References
   5. Cost proposal
6. Procurement schedule
7. Administrative requirements, such as the necessary forms and certifications required of all government contractors.

Once this is completed, we recommend that all firms’ proposals be reviewed by a committee of CBOC members and procurement department staff.  Before the proposals are received, there should be a meeting of all involved personnel, CBOC and procurement, so that everyone understands their roles, what to do, and what not to do, such as keeping all information regarding the procurement, proposers, scoring, etc. confidential until the procurement is completed and the contract is awarded.  The procurement department personnel should be responsible for the technical aspects of the proposal (all required forms included, proposals submitted on time, firms not violating no-contact during procurement limitations, etc.), and the CBOC members should then score each proposal on the evaluation factors (in some entities, the cost proposals are submitted separately and are not considered until after the technical scoring is performed).

A common practice is for each person scoring the technical proposals to read and score each technical proposal independently on separate scoring sheets for each proposal.  When all the scoring sheets are completed, they are consolidated on a single page, and the scorers meet to discuss the firms and attempt to achieve or at least approach a consensus score – and to identify what could be “fatal flaws” or major concerns.

Generally, if more than a few firms submit, the top-ranked firms are “short-listed” and invited in for oral interviews.  The interview panel should include all the CBOC members on the selection team, procurement, and perhaps other district personnel.  CBOC members should be carefully briefed on how the oral presentation will be done and what they may and should not do.  Most commonly, each proposing firm will be given a show-up time and an outline of what they are expected to cover in their presentation with a time limit for their presentation.  A good practice is to require that the attorney that will be the primary contact with the CBOC will be the speaker for the significant portion of the presentation.

Another common practice is to prepare a list of questions that each firm will be asked in an identical matter (if not covered in the presentation) in the oral presentation.

A common practice is for each selection committee member to score each presenting firm as they speak, make adjustments to their scores after the last presentation as they see fit, and only then share the scores.  At this time, the selection committee will discuss the strengths and weaknesses of each firm, and the members will attempt to work towards consensus on their selection.  Procurement personnel should be present to ensure that no rules are violated, the process is performed correctly, and to advise if there are any perceived issues, such as a potential conflict of interest.

There are various methods to factor costs into the evaluation and selection.  The CBOC should work with procurement to establish a process with which all parties can work.

(See also FAQ 20, “Should a CBOC take legal advice from the school district’s lawyer?”)

The CBOC must be able to select its own independent legal counsel and other advisors.  The role of the district’s staff should be to assist the CBOC in conducting the procurement, but not to have any role in the selection of the independent legal counsel or other advisor.

The entire point of the CBOC having its own independent legal counsel is to have an attorney with the sole responsibility of working for the CBOC.  By its legal, ethical requirements, the district’s bond counsel is required to be responsible solely to its client(s) – which, depending on the specific legal details, would be the district, the bondholders, and/or other parties, but will never be the CBOC.  Therefore, it is totally unacceptable for the district staff to attempt to deny the CBOC its right to have its own independent legal counsel and try to force it to use bond counsel or another attorney that, under legal ethics, must be responsible only to the district and/or other parties other than the CBOC.

There are many situations where it will be useful to have the district’s bond counsel, and/or other district legal counsel meet with the CBOC or the CBOC’s independent legal counsel.  This is a normal and common situation; there is no need to have the CBOC’s independent legal counsel do independent research, which could take considerable time and cost if the CBOC’s counsel can obtain the desired information from the district’s counsel and then verify the information and analysis provided to its satisfaction.

(See also FAQs 18., “Is Your CBOC Independent,” and 46., “CBOC Legal Counsel Selection.”)

Since Proposition 39 and Ed Code §15278 et seq. not only allow, but requires CBOCs to conduct independent bond oversight, we assume that the question refers to some local legal, regulatory, or other provision.  Since any local action must be consistent with these higher legal authorities, the general rule is that the higher legal authority rules – and, therefore, any “… laws that prohibit the (CBOC) and/or member to conduct independent bond oversight” would appear to be improper, invalid, and unenforceable.

Therefore, it is questionable that there is any law that would “… prohibit the committee and/or member to conduct independent bond oversight” – although it is certainly not unknown that some districts and/or district staff would make such statements.

If you find yourself in this situation, CABOC is here for you to provide advice and assistance.

(See also FAQs 2, “What is the Legislative Intent of School Bond Oversight,” 3,, “What Is the Purpose of a Bond Oversight Committee,” and 18., “Is Your CBOC Independent?”)

It must be understood that the following is not a complete list of such red flags.

1. The district does not allow the CBOC to operate as an independent entity that conducts its own business and oversight activities.
2. The district prohibits, or works to prevent, the CBOC from scheduling its own meetings or setting its own meeting agendas and/or otherwise attempts to control what the CBOC does.
3. The district prepares the CBOC bylaws or other rules of procedure and conduct or insists on approving or disallowing the bylaws or bylaw provisions enacted by the CBOC.
4. The district does not fill all the required CBOC seats, does not fill the seats with members with the stipulated qualifications, does not fill vacant seats as quickly as reasonably possible, and/or appoints only allies to the CBOC who are inclined to see things as the district governing board sees things, rather than reaching out to the communities for members inclined to exercise independent judgment.
5. The district refuses to provide the CBOC its own independent legal counsel or other resources that the CBOC requires to properly conduct its oversight responsibilities.
6. The district does not provide the CBOC access to auditors and their reports, information, or individuals.
7. The district does not provide, or significantly limits, the CBOC’s access to district personnel and contractors.
8. The district does not provide information on a timely basis and/or provides only partial or incorrect information.
9. The district does not provide the CBOC with its own website, controlled by the CBOC.The CBOC should have sole control over what is on the CBOC website, what is added, and what is deleted.
10. The district’s own website does not provide more than very summary information on construction bond finances and projects. Other facilities information could include the size and composition of facilities staff, table of organization, contact information, and maintenance and repairs policies and budget.
11. There are serious and apparently viable complaints from the district’s construction bond employees, contractor’s employees, project neighbors, educational personnel, student parent/ guardians, etc., that the district does not appear to be addressing, particularly if the same issues tend to repeat. Sources of such matters can include, but are not limited to, appearances at district board and CBOC meetings; letters, e-mails, and phone calls; and press/media/social media.
12. The district does not have an experienced and capable facilities team, particularly on the capital improvement side, nor a detailed facilities improvement plan, nor detailed and strong facilities processes and procedures, including working and accessible information technology systems that are readily accessible by members of the public (for summary level information).
13. The district does not have an internal auditor
14. The district does not enforce the audit rotation requirements for annual audits per Education Code § 41020(f)(2).
15. The district does not extend “hold harmless” liability coverage to CBOC members.

In this situation, the essential work of the CBOC should remain mostly unchanged, but the parties that the CBOC will be working with need to be adjusted.

The CBOC should attempt to meet with the state-appointed administrator to initiate a line of communications and working relationship as soon as possible after such a transition.  (The CBOC should continue its pre-existing relationship with the district governing board and remaining top management, even though they may not have as much, if any, power during the state takeover period – this is still important during the state control period and many of these individuals are likely to return to their previous positions eventually.)

As such, state takeovers are usually implemented due to problems on the operations side, most commonly fiscal shortfalls that show the district becoming unable to continue operating its schools. There may be significant impacts on the construction bond program.  Fiscal cutbacks on the operations side often negatively impact facilities maintenance, repairs, and cleaning.  The CBOC would likely want to see what impacts there could be on facilities operations, particularly as to how problems with operations could negatively impact the construction bond program, such as failures to make timely repairs leading to far more significant costs for capital projects to replace a failed facility that could have been used for many years if the needed repairs had been performed when first identified.  The CBOC should be updated on changes in facilities management personnel and the working relationship between the facilities staff and the state administrator.

Ed Code §15282(a) lays out the membership requirements for CBOCs:

The citizens’ oversight committee shall consist of at least seven members who shall serve a minimum term of two years without compensation and for no more than three consecutive terms. While consisting of a minimum of at least seven members, the citizens’ oversight committee shall be comprised as follows:

(1) One member shall be active in a business organization representing the business community located within the school district or community college district.

(2) One member shall be active in a senior citizens’ organization.

(3) One member shall participate in a bona fide taxpayers’ organization.

(4) For a school district, one member shall be the parent or guardian of a child enrolled in the school district. For a community college district, one member shall be a student currently enrolled in the community college district and active in a community college group, such as student government. The community college student member may, at the discretion of the governing board of the community college district, serve up to six months after graduation.

(5) For a school district, one member shall be both a parent or guardian of a child enrolled in the school district and active in a parent-teacher organization, such as the Parent Teacher Association or school site council. For a community college district, one member shall be active in the support and organization of a community college or the community colleges of the district, such as a member of an advisory council or foundation.

These requirements appear very clear; it is reasonable to question whether a CBOC member can continue to serve if their required qualification lapses.

If this occurs, the CBOC chairperson (or another member) could communicate with the member at issue and ask if the member wishes to resign.  If not, it is the duty of the district governing board to ensure that the CBOC has the proper membership. If the CBOC believes there may be an issue, the best practice would be to advise the appropriate district official.

CABOC has many current training materials on its website and works hard to add educational opportunities for CBOCs and other stakeholders.

We also recommend the training available from:

1. The California Debt and Investment Advisory Commission:

Sign in | CDIAC (ca.gov)

1. The California Grand Jurors Association:

https://cgja.org/cgja-training

(See also FAQ 19., “What information should a new CBOC member get during the first three months of service?”)

Handbook for Muni-Bond Issuers’ by Joe Mysak

Win Win An Insider’s Guide to School Bonds” by Dale Scott

As Ed Code §15282(a) reproduced in FAQ 53 above is quite specific, this does not appear to be allowable.

Each district and each CBOC should maintain a schedule of when each member’s term will end.  As the term end is approaching, steps should be taken to have the existing or a new member appointed without a gap in service.  Members considering resigning should be asked to give as much advance notice as possible for the same reason.

However, even for those CBOCs that take the above steps, there are always times when there is an open seat.  The district should generally fill these openings as quickly as possible.  Some districts have an open CBOC member application page on their website.  Anyone interested in serving on the CBOC could look at the website to understand the requirements (including required qualifications and conflict of interest) and submit an application.  This produces a list of candidates that allows open positions to be filled more quickly.

All districts and all CBOCs should be aware that, while short, transient unfilled seats on a CBOC are unlikely to be significant issues if there is a process to fill them as soon as practical, long-term vacancies, particularly of the statutory stipulated qualification for some CBOC seats, could potentially expose the district to legal issues.

Changing a CBOC at-large member to a taxpayer representative is not consistent with the Education Code requirements.  A taxpayer representative is one of the five mandatory membership categories.  If the governing board has not filled the taxpayer representative within a reasonable time, the CBOC should consider if they want to continue meeting. 

School Bond Waste Prevention Action (Education Code §15284) provides that any taxpayer may file an action to obtain an order restraining and preventing any expenditures of funds when the governing board has willfully failed to appoint the citizens’ oversight committee in violation of the requirements of Section 15278.

(See also FAQ 22., “What is a “bona fide taxpayers’ organization” for the purpose of CBOC membership?”)

This is primarily a matter for each CBOC to determine.  As a general rule, it is probably best to err on the side of including essential documents in the agenda package for each meeting, which would mean that such matters would be sent out to all CBOC members in advance, as well as being available on the CBOC website for members of the general public to review if they wish.

One common situation in CBOC meetings is staff bringing in a large report, or a PowerPoint™ presentation, that was not part of the agenda package, and no CBOC member (or member of the public) had seen before it was presented – with the common excuse that there wasn’t time to get it finished before the meeting.  We suggest that CBOC leadership and members may wish to make it clear to staff that the date of the meeting was known long in advance and that the CBOC wants to receive all materials well in advance of the meeting date so that members – and the public – have time to review them and prepare.

If members consistently have attendance issues, the basic choices are to keep working on them to attend by every practical means or, if there are still problems, ask if they will resign.

The CBOC Chairperson can consult with members who have missed two meetings and inquire if the member intends to be active in the CBOC.  If the member does not agree to do so, the Chair may, as the Chair determines, request the member to resign.

There is little in the State statutes on the responsibility for recruiting CBOC members other than the requirement that all CBOC members must be appointed by the district governing board.  CABOC recommends that the CBOC and the district work together to develop a methodology to find, qualify, and appoint good candidates quickly when needed, using whatever appears worth doing for each district, including asking civic, business, senior citizen, taxpayer association, and PTA/Site Councils to nominate candidates.  Having a CBOC application on the District website is a best practice.

(See also FAQ 8., “What Can You Expect at CBOC Meetings?”)

Exactly the opposite – CABOC recommends that each CBOC prepare its own agendas for its meetings – scheduled as the CBOC shall determine – and have responsibility for its meeting minutes.

Of course, each CBOC should work with its district and particularly facilities staff in determining what should be on the agenda for each meeting and ensuring that district staff will be able to meet the CBOC’s desires.

Also, many CBOCs have district staff take the minutes and prepare the first draft of the minutes, with the designated CBOC secretary reviewing and, as required, modifying the proposed minutes before the draft minutes are distributed in the agenda package for the next meeting.

(See also FAQ 12., “Can a School District dictate the Bylaws of a Bond Oversight Committee?”)

CABOC recommends that each district have this detail on its website, organized to allow first-time users to find the information at the level of detail that they are interested in.  This should include high-level summaries but also detail down to individual schools, with a list of all projects at that school, including a description of the project, cost, start and finish dates, and progress to date.

The original list, by statute, must have been included in the bond ballot measure presented to the electorate.

(See also FAQ 16., “What are the basic key elements that should be included in a school district facility master plan?”)

There are significant ongoing debates on this.  It is certainly possible to read Prop. 39 and conclude that the project lists should be pretty specific – but many districts and construction program managers will reply that it is simply not practical to do that level of detailed planning, scheduling, and cost estimation on a large number of projects at different sites over a multi-year period – and there are far too many factors that can change. The district must be able to respond to unexpected changes, such as considerable increases in the costs of materials or a significant fire at a school.

Another common contention is that detailed planning for all proposed projects would require many personnel resources, take a long time, and be expensive.

This question could refer to two different lists.  The first is the list presented to the electorate in the bond ballot measure; the second is the list of individual projects developed as the school construction bond program proceeds to implementation.

As to the first, the list on the ballot issue, there is no consensus as to how detailed and specific this should be; some are very specific down to individual projects at individual schools; others very general, such as how money for new school construction and how much for five or ten particular programs.  It is not uncommon for districts to essentially put out a list that is a huge matrix, with one axis of the matrix a list of every existing school in the district and the other axis everything that could be done to a current school, from boiler replacement to upgrading the electrical system – plus a separate list for new schools, which may or may not be very specific as to site, grades, number of classrooms or student capacity, and features (competition football/soccer field, culinary arts emphasis, etc.)

CABOC prefers to have more detailed lists of what is presented to the voters.  However, they are expensive to prepare with any degree of accuracy, and, as a result, many districts prefer to provide the minimum possible level of detail.

The controlling factor is what bond counsel will determine is required by the law.

As to the second type of list, often referred to as the “Facilities Master Plan” (FMP), the actual action list of individual projects, by its nature, must be very detailed. The FMP should include an extensive picture project list, prioritization, and planning budgets and details of each project.  As individual projects move from planning to design to ready for contracting, “educational specifications,” such as the details of the design (this school will have a Science-Technology-Engineering-Mathematics [STEM] design; this one will emphasize performing and visual arts, this one will have a competition football stadium, this one won’t, etc.) and material criteria to be used should be added.  The District should also have a detailed general specifications document, such as classroom size, lighting, heating/ventilation/air conditioning, fire and emergency alarms, etc.  However, it is generally considered wise not to show the preliminary budget for specific projects going out to bid to ensure contractors will do their cost estimates and be more motivated to “sharpen their pencils” to submit competitive bids and proposals.

There are ways to consolidate projects for this form of the list – for example, have one contractor for heating/ventilation/air conditioning work at multiple schools – but, even if this is done, to have a degree of control over expenditures and contractors, there must be a detailed breakdown by site somewhere in the program/project control system.

The best practice is for there to be one consolidated system that allows authorized users to access data at many levels, from detail project managers who are responsible for the electrical system in a new school to the overall program totals, with different people given different degrees of access (and access is the ability to see information, not the ability to change or add data).  Any public member should be able to go down two or three levels. Still, only authorized insiders can access more detail –very few people will have total access to everything, and only specified personnel will have the authority to add, delete, or change data.

(See also FAQ 16., “What are the basic key elements that should be included in a school district facility master plan?”)

Construction bond funds can only be utilized for capital projects; therefore, they could not be used, for example, to cover the costs of teachers during a period when local tax revenues fell due to COVID-19.  That said, COVID has certainly impacted construction costs, such as material shortages during production work and supply line issues causing significant increases in construction materials – if you can find them anywhere.

This question is an argument for making the project lists presented to the voters as flexible – as in non-specific – as bond counsel will allow.  Again, this is still a discussion with two sides that has not been fully resolved and may never be.

(See also FAQ 16., “What are the basic key elements that should be included in a school district facility master plan?”)

It has become common for some project lists presented in the bond ballot measures to include far more projects at far greater total costs than could be completed with the value of the bonds authorized.

This is understandable as it is another way of providing flexibility for districts and facilities leadership to respond to changes in conditions.

With such an approach, a priority list appears desirable, reasonable, and valid.

Perhaps the main reason that the priority list approach is not made more often is that to get a new tax to pass (and Prop. 39 bond ballot issues are measures to allow property tax increases to cover the bond debt service), you need to get as many “yes” votes as possible.  One proven way to get more “yes” votes is to promise as many things as possible to as many potential voters as possible – and likely “yes” voters who see “their” projects at “their” school far down the priority list could be regarded as less likely to vote in favor of the tax increase if they are less likely to get something out of it.

(See also FAQs16., “What are the basic key elements that should be included in a school district facility master plan?” and 17., “What are some examples of questions that should be asked by bond oversight members?”)

In this context, a Memorandum of Understanding (MOU) is a legally enforceable contract between a district (and its governing board) and a CBOC that spells out the rights, duties, and responsibilities of both parties; for example:

1. How CBOC members are selected (or nominated) and appointed
2. Independence of the CBOC from the district
3. The CBOC is self-governing and prepares its own bylaws.
4. The CBOC sets its own meeting schedule and agendas.
5. The CBOC has access to district records and personnel.
6. The CBOC can access and report to the governing board when it wishes.
7. The district will contract and pay for independent legal counsel for the CBOC and other CBOC advisors and staff.
8. The district will budget for CBOC expenses.
9. The district will provide dedicated CBOC staff.
10. The CBOC will have specified access to construction bond program auditors.

CABOC has prepared MOU templates for interested CBOCs to use as a baseline for their MOUs on the CABOC website.

No, auditors are accountable to the district.

California Education Code §15278(c) states, in part:

(c) In furtherance of its purpose, the citizens’ oversight committee may engage in any of the following activities:

(1) Receiving and reviewing copies of the annual, independent performance audit required by subparagraph (C) of paragraph (3) of subdivision (b) of Section 1 of Article XIII A of the California Constitution.

(2) Receiving and reviewing copies of the annual, independent financial audit required by subparagraph (C) of paragraph (3) of subdivision (b) of Section 1 of Article XIII A of the California Constitution.

It should be understood that both financial and performance auditors report to the district’s governing board.  The CBOC receives and reviews the financial and performance audits related to the construction bond program.

Considering the above Education Code provision, CABOC recommends that the auditors present their reports directly to the CBOC at a public CBOC meeting.

“Can the CBOC utilize the auditors as a resource?”

CABOC recommends that the CBOC be involved, working with the district, in preparing the request for proposal scope of work, selection of the auditors, development of the specific scope of each audit, progress reports, and receipt and review of draft reports.  The CBOC should be able to ask the auditor questions at every stage of the process (except procurement and contract negotiation).

CABOC recommends that working with the district, CBOCs can make specific requests for audit work, including, for example, specific audit scope details to test program and project management, financial, and internal control procedures.

The CBOC should develop an ongoing plan to research, write and publish an annual report to the public.  Planning will ease the completion of the only work product required of the CBOC.

The CBOC should not rely on the district to routinely write the CBOC’s Annual Report.  The best practice is for a CBOC Annual Report Subcommittee to be responsible for setting the schedule, soliciting volunteers to draft individual sections, reviewing drafts, and publishing the final document.

Each district has a statutory responsibility to provide technical assistance to the CBOC in this effort, so planning for this district assistance is necessary.  A template that includes specific annual report sections will make researching, writing, and publishing the report move more quickly and can be re-used each year. 

Additional “Reports to the Public” may be written and published periodically, should the CBOC feel it’s necessary.  Reporting to the public is the primary purpose of oversight committees.

Reference:

EdCode Part 10, Chapter 1.5 §15280

Ed Code Part 10, Article 3 §15286

Yes, certainly.  The CABOC’s position on MOUs is that all CBOCs should have the legal right and the ability to enter into an MOU with their district, and this is part of the CABOC legislative agenda.

If a CBOC does not believe it needs an MOU with its district, that is its decision. 

There is a sample MOU on the CABOC website.

No.  CBOC member’s terms of office are determined by state statute – which sets a minimum term of two years and a maximum number of consecutive terms of three, and by each district board, which can elect longer terms and lesser number of consecutive terms.  As a CBOC has no statutory or other authority over the terms of its members, this is not a matter that should be included in the CBOC Bylaws.

It is appropriate for inclusion in a Memorandum of Understanding between the district and the CBOC.

CABOC recommends that matters that are established by the California State Constitution, state statute, or other external laws, regulations, or contracts should not be duplicated in the bylaws; as these requirements already exist, there is no need to duplicate them in the bylaws and if the provisions in the overriding statute, regulation, etc., are subsequently changed, the bylaws would have to be changed to comply, and failure to make such changes could cause problems.  Such statutory provisions can be included as an appendix to the bylaws – with a statement that, as these may change, the contents of the appendix automatically change.

While Ed Code §15282(a) states, “The citizens’ oversight committee shall consist of at least seven members who shall serve for a minimum term of two years without compensation and for no more than three consecutive terms,” in practice, CBOC members can serve longer than what is generally regarded as the six years maximum from the above.

First, note that term of office above is for “… a minimum term of two years.”  If a district wants longer terms, such as three years, that appears to be consistent with this statutory provision.

Also, there is a process for the district governing board to apply to the California Board of Education (CBOE) for an extension for specific CBOC members for specific periods of time.  It is recommended that such requests be discussed with CBOE staff and presented at least three months before the expiration of the final term for the CBOC members being considered.  The history of such matters that have come before the CBOE in recent years is that every such request has been approved.

Any reference to the three-two-year-term, six-year limit in the CBOC bylaws should be removed as, even with CBOE approval of CBOC members serving for more extended periods, the bylaw provisions could be interpreted as disallowing such extensions.

(See also FAQ 4, “What are the major Constitutional Requirements of a Bond Oversight Committee?)

In the opinion of CABOC, CBOC subcommittees can be useful, but this is a matter for each CBOC to determine.  CABOC has prepared a Best Practice Bylaws template, available on the CABOC website, including a provision for establishing subcommittees – if the CBOC wishes to include such a provision.

On this, there is no argument.

Depending on the specifics of each district, each CBOC, and their relationship, it could be a “heavy lift” to get the district to agree that its CBOC should have independent legal counsel and for the district to pay these costs.  However, some California districts have agreed to their CBOC having independent legal counsel, so there is precedent.

CABOC is prepared to support CBOCs interested in pursuing this course of action.  It is also a critical point in the CABOC legislative agenda.

The financial audit of the district’s Annual Report (or Annual Comprehensive Financial Report) includes the external presentation of the entire district’s financial position, required to be presented under Generally Accepted Accounting Principles (“GAAP”) and Generally Accepted Government Accounting Practices (“GAGAP”) and audited under Generally Accepted Auditing Standards (“GAAS”) and Government Audit Standards (U.S. Government Accountability Office “Yellow Book”).

As to the financial audit requirements for the construction bond program(s), these are limited to those expenditures for that specific purpose from that particular funding source and related funding sources, as required by California statute.  The same general accounting and auditing standards apply.

Proposition 39 (2000), which established the School Construction Bond program, and its enabling legislation in the Education Code, also set specific requirements for annual performance audits, specifically what is known as a compliance audit, chiefly to test if bond fund expenditures are for properly authorized projects.  The board, preferably working with the CBOC, may extend the performance audit requirements beyond the statutory minimum requirements.

Most commonly, both audits are performed by the same auditor simultaneously.  Some audit work can be used to satisfy the requirements for both, but the audits of the bond program require additional unique work to be performed.  It is also possible for these two audit requirements to be performed separately by different firms. However, this is not commonly done for the minimum required performance audits because the costs would be higher and require more resources from the entity being audited to work with two sets of auditors.  For more extensive performance audits, such as those looking at detailed construction program management procedures and practices and program results performance audits, more specialized audit experience may be desirable.

For California districts, it is typical for other required financial reports, such as those for federal grants, to be performed by the same “single auditor.”

1. This extended form of the annual report was formerly known as the Comprehensive Annual Financial Report, commonly shortened to “CAFR.”  However, when spoken, the latter sounds similar to an offensive slur in Afrikaner, so the Government Financial Officers Association has decided to no longer use the older term.

2. California Guide for Annual Audits of K-12 Local Education Agencies and State Compliance Reporting, Appendix A, Local School Construction Bond Audits, published by Education Audit Appeals Panel.

74 – What is the difference between the general financial audit for the entire district and the required financial and performance audits of the bond program(s)? 05.07.23-TR

In the context of the construction bond program, there are two audit risk assessments.  Both involve identifying and quantifying risks, evaluating the responses to these risks, monitoring and reporting risks, and reporting risks.

Each district should perform its fraud risk assessment internally to look for weaknesses and where improvements are required and results reported.  This should be an ongoing, never-ending process.

Auditors perform their own fraud risk assessments separate from the entity’s internal fraud risk assessment.  Auditors may, where appropriate, incorporate the entity’s internal fraud risk assessment while conducting their own, but are required to perform sufficient work of their own to ensure that the entity’s work can be relied upon.  While part of the work of the auditor is to identify such risks and bring them to the attention of the entity being audited so that these weaknesses can be addressed, the auditors also use their audit risk assessment to indicate which specific areas of the audit require additional attention, such as increasing the number of transactions tested to gain a sufficient level of confidence that the reported outcomes are reasonable.

CBOCs should consider if they want to have an audit risk assessment, together with a review of the school construction program and project control systems and internal control reviews, performed and reported to the CBOC to provide a foundation for the CBOC, and other stakeholders, to be able to rely upon reports rendered to the CBOC by the district and its facilities department.

Oversight should begin with the CBOC asking if the district has the proper personnel and systems to plan, design, finance, construct, and transfer programs and projects to operation.

The CBOC should determine what level of detail it wishes to see; for example, the district should present every project for an entirely new school and every project over $10 million at an existing school in detail and give a list of smaller projects – which individual CBOC members may wish to ask about.

Another option is “exception reporting” for projects.  Once there is an approved plan, if everything is proceeding according to plan, that’s all the CBOC needs to know. 

However, if a project is more than $50,000 or 10% (whichever is less) over budget, the district should report it to the CBOC, along with the reasons why and what is being done to prevent future cost increases on this and similar projects.  If a project has a schedule delay of more than two months, the district should provide an explanation and improvement action.  If the features of a school are changed, such as removing classrooms or adding a swimming pool, the district should report it.  “Exception reporting” effectiveness depends on having excellent and trusted control systems.

Project “exception reporting” aims to discover problems as early as possible when there is still a maximum opportunity to fix or change something.

No, it is allowable for one party to pay for the costs of legal counsel that works for another party.  This is specifically provided for in California legal cannons of ethics and is common.

Ed Code §15286 states, “Consistent with the provisions contained in subparagraphs (C) and (D) of paragraph (3) of subdivision (b) of Section 1 of Article XIII A of the California Constitution, the required annual, independent financial and performance audits for the preceding fiscal year shall be submitted to the citizens’ oversight committee established under Section 15278 at the same time they are submitted to the school district or community college district, no later than March 31 of each year. These audits shall be conducted by the Government Auditing Standards issued by the Comptroller General of the United States for financial and performance audits.”

This provision requires that performance audits be conducted.  If a district is not complying with the requirement, the CBOC should draw the district’s and the public’s attention to this violation.

CABOC recommends that all CBOCs work with their districts to develop the specific scope for performance audits to be conducted and participate in selecting the auditors and reviewing the audit results.

(See also FAQs 2., 4., 15., and 25., “What is the legislative intent of School Bond Oversight?,” “What are the major Constitutional Requirements of a Bond Oversight Committee?,” What is a Proposition 39 performance audit?,” and “Should the CBOC recommend a “Program Effectiveness and Results Audit?” respectively.)

Proposition 39 of 2000 added the following language to the California Constitution, Article XIIIA, Section 1.(b)(3)(A), which states, “A requirement that the proceeds from the sale of the bonds be used only for the purposes specified in Article XIII A, Section 1(b)(3), and not for any other purpose, including teacher and administrator salaries (emphasis added) and other school operating expenses.”

While “teacher … salaries” is relatively easy to understand, “administrator salaries” is more challenging to define, and there is no guidance in Proposition 39, its implementing State statutory provisions or other elements of Proposition 39.

This lack of definition caused confusion to school construction bond personnel until then-California Attorney General Bill Lockyer issued his Opinion No. 04-110¹ on November 9, 2004, which concludes, “A school district may use Proposition 39 school bond proceeds to pay the salaries of district employees to the extent they perform administrative oversight work on construction projects authorized by a voter-approved bond measure.”  In the absence of statutory or case law, an Attorney General opinion is generally regarded as the best available legal authority.  This opinion essentially disallows charging the general administrative salaries of a district, such as those of the Superintendent, to school construction bond funds, but allows the charging of such costs for administrative oversight work on construction projects authorized by bond measures approved by the voters.

The question of what administrative salaries and other administrative expenses can be charged to Prop. 39 school construction bond funds can be very complex, and such issues are frequently referred to district bond counsel.  If a CBOC has questions about whether questionable costs are being charged, it should ask the district for its legal and accounting justification.  It is possible that a district would refuse to provide a bond counsel opinion on the grounds of legal privilege; many districts will provide such information, and related information such as accounting department procedures and memos, references to Generally Accepted Accounting Procedures (GAAP), and Government GAAP, and indirect cost allocation plans.

We note that the Attorney General’s opinion should not be regarded as authorizing all facilities-related costs of a district to be charged to SCHOOL CONSTRUCTION BONDS funds.  For example, an Assistant Superintendent for Business or Facilities Manager may spend a portion of their time on non-SCHOOL CONSTRUCTION BONDS projects (construction projects not funded with Proposition 39 bond funds, maintenance, and repair projects).  The salary and benefits allocation of a position jointly funded with Proposition 39 bond funds and other funds (i.e., general fund) should be based on the actual hours worked for each fund.  The allocation should not be based on an arbitrary percentage (i.e., 50% bond construction fund and 50% general fund).  Arbitrary percentage allocations of a joint fund position could result in the bond funds subsidizing the general fund.

(See also FAQs 10. and 11., “What can be funded with bond proceeds and what is not permitted?”  and “What can a Bond Oversight Committee member do when the District spends money on projects not authorized or are questionable in nature?” respectively.)  Also, FAQ 39, “What is the meaning of ‘administrative salaries’ for determining allowable changes to Proposition 39 School Construction Bond (SCHOOL CONSTRUCTION BONDS) funds?”

It is difficult to respond to this very specific question without more information.  There is a requirement in Proposition 39 and its implementing statutes for a project list to be presented to the voters as a key, required part of the bond ballot measure.   The complete absence of any project list would appear quite questionable – and attempting to produce a project list after the bond ballot measure passes does not appear to be acceptable.

The requirement for a project list as part of the ballot measure package is not well-defined.  While it is possible that this dispute is different from one of, is there or is there not a project list, but rather, is the project list presented sufficient?  (The decision in Foothill-De Anza states, “The court also concluded that, although Measure C (the bond ballot measure before the court) did not set forth Proposition 39’s accountability provisions verbatim, the information it did supply was sufficient,” which can be read that there was a project list that was sufficient for the court (excerpts from the project list in Measure C are included in the decision), thereby rejecting the plaintiff’s contention that there was none, or that it was insufficient.

We cannot provide a definitive response without more data – and CABOC does not intend to be in the business of rendering opinions on whether such documents are sufficient or not.

This type of question should be directed to competent legal counsel.

(See also FAQs 16. and 20, “What are the basic key elements that should be included in a school district facility master plan?” and “Should a CBOC take legal advice from the school district’s lawyer?” respectively.)

If the prospect of such a matter comes to the attention of the CBOC, it should ask the district for information and clarification.  It should consult with legal counsel, starting with the CBOC independent legal counsel (if there is one) and, if possible, district bond counsel.

Unfortunately for the CBOC, district legal counsel, whether a district employee or an external contractor, owes first allegiance to the district and, therefore, may be unable to respond to any inquiries.

If more information is required, the CBOC should consider other actions, such as requesting that financial and/or performance audit work be conducted.

The CBOC should proceed with great caution if an illegal act is possible.  Again, referral to the appropriate law enforcement agency should be considered after consultation with legal counsel.  CBOCs should proceed very carefully in attempting to investigate potential law violations and should totally refrain from attempting investigations of alleged criminal acts. 

(See also FAQs 2., 3., 4., 10., 14., and 20., “What is the legislative intent of School Bond Oversight?,” “What is the purpose of a Bond Oversight Committee?,” “What are the major Constitutional Requirements of a Bond Oversight Committee?,” “What can be funded with bond proceeds and what is not permitted?,” “Can any operating costs be funded with bond proceeds?,” “Should a CBOC take legal advice from the school district’s lawyer?”)

It must be understood that the following is not a complete list of such problems – and the number of variations on each question below is massive.

1. There is spending for capital projects not included in the bond project list approved by the voters.
2. There is spending for non-capital purposes.
3. Proper procurement and project control procedures were not followed, or were not properly documented.
4. The district does not have (employee and/or contractors) personnel with the skills necessary to manage major capital programs and projects and/or has a deficient organizational makeup and delegation of duties and responsibilities.
5. The district does not have the systems and procedures necessary to manage major capital programs and projects.
6. The district has attempted to begin construction too quickly for political purposes, resulting in poor project selection, design, and/or management.
7. The district has failed to comply with all statutory, regulatory, and contractual requirements, including not performing annual financial and performance audits.
8. The district has failed to have sufficient outreach to the various communities it serves.
9. The district has not properly interacted with the California Division of the State Architect.
10. The district has not properly interacted with the appropriate local fire marshal prior to the school facility opening
11. The district has not done outreach to construction contractors and construction trades to help ensure that there will be competition for construction projects and sufficient workers to get the work done.
12. The district does not have proper claims and change order procedures or does not follow them.
13. There are bonds issued, or proposed to be issued, for terms longer than 30 years (generally speaking, bonds should be issued for the shortest possible period), and/or the district has issued capital appreciation bonds (also referred to as “zero-coupon” bonds).

(See also FAQs 10. and 14., “What can be funded with bond proceeds and what is not permitted?,” and Can any operating costs be funded with bond proceeds?”)

In order to assist in ensuring that there will be sufficient members for quorums at CBOC meetings, the governing boards of several districts with Prop. 39 outstanding bonds have made provisions for alternate members to stand in for the primary CBOC members when the primaries miss meetings.

The use or not of alternate members is a matter for each district to determine.  There is no mention of alternate CBOC members in the California Constitution or Education Code, which several districts have interpreted to mean that alternate members are not prohibited and, therefore, allowable, provided that all other statutory and other requirements are met.

CABOC recommends that alternate members not be appointed by the governing board.

If a district does utilize alternates, the procedural structure must be carefully and correctly defined, which means:

1. Only the district board can decide if there will be CBOC alternates – preferably with the concurrence of the CBOC
2. Some districts that have established alternates have done so on a one-for-one basis; e.g., there is a senior citizen alternate for the senior citizen primary.  While we believe that this is allowable, a different option, one that we suggest deserves consideration, is appointing an alternate who could potentially substitute for more than one primary, e.g., if a student parent is a member of PTA, AARP, and a business organization, and then joins the local taxpayer association, that alternate could substitute for all seven statutory positions if so designated in the board appointment action. 

After the alternates are appointed, the action decisions shift to the CBOC – and need to be memorialized in the CBOC bylaws:

1. The CBOC Chair (or acting Chair) determines when an alternate member stands in for a primary member and reads the replacement into the meeting minutes.
2. Some districts and CBOCs are using the alternates as the “junior varsity” for the CBOC, requiring or encouraging the alternates to attend all CBOC meetings, even if they are not required to stand in for a primary.  Then, when there is an opening for a CBOC position, the alternatives are given high priority to be named as primary members – and, in the meantime, until the board acts, the alternates serve as voting members of the CBOC.
3. Where alternates are standing in for missing primary members, they are counted as members to determine if the quorum requirement is satisfied and vote in the same manner as the primary member if the primary member was present at the meeting.
4. In other districts, the alternates are purely on standby; they are not required to attend meetings, but are sent the CBOC meeting agendas and asked to familiarize themselves with the CBOC activities.  Primary members are asked to inform a central attendance person if they will or will not be attending specific meetings, and, if there will be an unfilled position at a meeting, an alternate will be asked to attend and function as the voting member.  Which option, or other variation, is the decision of the individual district.
5. Alternates only vote if the primary member is not in attendance.
6. Some CBOCs allow alternate members to participate in discussions of CBOC agenda matters even if they are not voting; others do not.
7. Generally, where alternates are utilized, they do not serve as officers.  For example, if the student parent/PTA member is the CBOC Chair, is not in attendance at a meeting, and an alternate serves as the student parent/PTA member for that meeting, the alternate does not serve as Chair for that meeting – the Vice Chair does as per the CBOC bylaws (presumably).

The proper use of alternate CBOC members can assist in ensuring sufficient members are in attendance to form a quorum and conduct CBOC business – but the procedures and practices must be worked out and properly memorialized in advance.