California Association of Bond Oversight Committees

For Effective Oversight

Frequently Asked Questions

Welcome to the CABOC Help Desk. This resource is designed to provide guidance related to Citizens’ Bond Oversight Committees formed for Proposition 39 school construction bonds.

Responses are intended to share CABOC opinions and expertise and are not intended as legal advice. If your matter calls for legal advice, you should consult legal counsel before acting on the resulting guidance.

The following section includes a list of frequently asked questions. Each question can be clicked on to view the corresponding answer.

What was the Origin of Citizen’s Bond Oversight in California?

Proposition 39, officially titled the “Smaller Classes, Safer Schools and Financial Accountability Act,”was approved by California voters in 2000. At the time, California was experiencing unprecedented economic and population growth.

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, Proposition 39 contains a safeguard by ensuring public oversight and accountability concerning the expenditure of facilities bond revenues. Within 60 days following voter approval of a bond, the district board is required to appoint “an independent citizens’ oversight committee.”

What can be funded with bond proceeds and what is not permitted?

The type of 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 can not be used for operating expenses such as teachers salaries.

What is the purpose of a Bond Oversight Committee?

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.

What are the major Constitutional Requirements of Bond Oversight?

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 to be funded and certify that the district has evaluated safety, class size reduction, and information technology needs in developing that list.

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 of those proceeds have been expended for the school facilities projects (listed in the bond measure)

In short, the Constitution 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.

What are the major rules and requirements for a Bond Oversight Committee?

The major requirements are as follow:

1. Prepare and publish an Annual Report

2. Hold meetings at least Quarterly

3. Follow the Brown Act (e.g. Open and noticed meetings, published Agendas)

4. Consist of at 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
• One member who is both a parent or guardian of a child enrolled in the district and active in a parent-teacher organization.
• The remaining two members are “at large” community positions.

5. Receive and review Annual Performance and Financial Audits

What does a Citizen’s Bond Oversight Committee do?

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 obseNations about the efficiency and effectiveness of the District as well as areas for improvement.

What is expected of a Committee member?

The Committee member should be prepared to read a moderate amount of written materia,l be attentive at the meetings, and not be shy in asking questions or inquiry about specific data and reports. While the by laws state a majority of the member should have 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.

What can you expect at Bond Oversight Meetings?

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 particular school projects could also be discussed, so meetings are an opportunity to have the Community directly participate in school governance.

What if I don’t have a background in construction, municipal finance, public agency budgeting, project management or related field?

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 very important factors to make your volunteer experience valuable to the District and enjoyable as a volunteer.