WITH PASSAGE OF AB 80, SCHOOL DISTRICTS HAVE ONE LESS BITE AT THE PROP 39 BOND APPLE

August 2011
Number 43

On July 29, 2011, Governor Brown signed into law Assembly Bill (AB) 80, which eliminates the stand-alone February presidential primary election and consolidates it with the statewide direct primary election in June.

Proposition 39 (Prop. 39), passed by the voters in 2000, reduces the electorate approval threshold for school district and community college district general obligation bond measures from two-thirds to 55%. However, among other restrictions, Prop. 39 limits the dates on which a general obligation bond election may be held. Prop. 39 general obligation bond elections may only be held in conjunction with a statewide regular or special election, or a regularly-scheduled local election in which all of the district’s voters are already entitled to vote. The stand-alone February presidential primary election would have qualified as a regular statewide election on which school districts and community college districts might have placed a Prop. 39 general obligation bond measure. AB 80 eliminates that opportunity.

Accordingly, the remaining regular statewide elections for 2012 on which school districts and community college districts may place a Prop. 39 general obligation bond measure are:

■ June 5, 2012

■ November 6, 2012

LOZANO SMITH provides bond and special financing counsel services and advice regarding various alternative mechanisms for financing capital projects. If you have any questions, please contact Jerry Behrens or Daniel Maruccia in ourSacramento Office, Jeff Kuhn or Dale Bacigalupi in ourFresnoOffice, or Trevin Sims in our Los Angeles Office, all of whom are municipal bond counsel listed in The Bond Buyer’s Municipal Marketplace (the “Red Book”). 

If you have any further questions, please contact one of our eight offices located statewide or consult our website.

Jeffrey Kuhn
Shareholder
Fresno Office
jkuhn@lozanosmith.com

Daniel Maruccia
Associate
Sacramento Office
dmaruccia@lozanosmith.com

© 2011 Lozano Smith

GOVERNOR SIGNS AB 23 REQUIRING GOVERNING BOARDS TO DISCLOSE ADDITIONAL COMPENSATION PAID TO BOARD MEMBERS FOR SERIAL OR SIMULTANEOUS MEETINGS

August 2011
Number 42

Assembly Bill (AB) 23, effective January 1, 2012, requires that each governing board of a local agency, prior to holding serial or simultaneous meetings, have the clerk or a member of the governing board verbally announce the additional compensation that members of that governing board will receive for attending the serial or simultaneous meetings. Examples of serial or simultaneous meetings would be when a city council meets as the city council, and then adjourns and immediately reconvenes as the governing board of the city’s redevelopment agency; or when a county board of education adjourns a board meeting and then immediately reconvenes as the county committee on school district organization. In these examples, no additional compensation is paid to the city council members for attending the redevelopment agency meeting, or to the county board members for attending the school district organization committee meeting, or, if the compensation paid for the redevelopment agency or county committee meeting is the same as that allowed by another statute, then no announcement is necessary.

The purpose of this new law is to address and curb practices that were widely reported to have occurred in the City ofBellwhen city council members met simultaneously or serially as several different legislative bodies, (e.g., the redevelopment agency, the housing authority, and the community development committee), and then received significant compensation for the various meetings. The part time councilmembers were able to pay themselves a combined annual salary exceeding $95,000 for meetings of various city boards, commissions and agencies that prosecutors say never happened.

If you have any questions regarding AB 23, or if you do not know if compensation paid to the members of a legislative body is different or more than allowed under state law, please do not hesitate to contact one of our eight offices located statewide or consult our website.

Written by:
David Wolfe
Shareholder
Fresno Office
dwolfe@lozanosmith.com

Judy Bailey
Paralegal
Fresno Office
jbailey@lozanosmith.com

© 2011 Lozano Smith

CHARTER AUTHORIZER’S COMPLIANCE WITH EDUCATION CODE REQUIREMENTS RELATED TO REVOCATION AFFORDS THE CHARTER SCHOOL WITH DUE PROCESS

August 2011
Number 41

In a win for school districts and county offices of education, the Second District Court of Appeal determined that a charter authorizer’s compliance with the revocation process prescribed in the Education Code provides a charter school with sufficient due process for the authorizer to revoke a charter. Today’s Fresh Start, Inc. v.Los AngelesCounty Office of Ed, (July 12, 2011, B212966, B214470) ___ Cal.App.4th ___ (“Fresh Start”), confirms the position long held by charter authorizers that a charter petition may be revoked after a hearing before the board of the authorizing entity and that a charter school is not entitled to any higher level of due process under the law.

In Fresh Start, the Los Angeles County Board of Education (“CountyBoard”) had authorized the charter petition of Today’s Fresh Start, Inc. (“CharterSchool”), which operated for several years. After concerns were raised about various aspects of the CharterSchool’s operation, including student attendance and standardized testing procedures, theCountyBoardinvestigated and provided theCharterSchoolwith a corrective action plan to address those issues. TheCountyBoardmet on several occasions to discuss the status of the corrective measures and whether to revoke the charter. During these meetings, the county superintendent presented information to the CountyBoardsupporting revocation of the charter, and theCharterSchoolpresented oral testimony and documentary support opposing revocation.

The County Board ultimately scheduled a public hearing on the matter consistent with Education Code section 47607(e). During the hearing, the Charter School presented evidence to support its position and expressed its view that the revocation proceedings violated theCharterSchool’s due process rights because theCountyBoard’s staff was both advocating for revocation and advising theCountyBoardregarding the revocation proceeding. The Charter School’s counsel urged theCountyBoardto have a neutral administrative law judge hear the matter. After hearing all evidence, the CountyBoardopted to revoke the charter.

The court of appeal confirmed that theCountyBoard’s actions were appropriate and that theCharterSchoolwas afforded due process because theCharterSchoolwas provided with all of the evidence against it and theCountyBoardonly relied upon such evidence during the revocation proceeding. Additionally, the court held that the CharterSchoolwas not entitled to an additional evidentiary hearing by a neutral third party because theCountyBoardcomplied with the revocation process prescribed by the Education Code and theCharterSchoolcould not show actual bias by the County Board. Moreover, the Education Code provided theCharterSchoolan additional safeguard of appeal to the State Board, which conducts an independent review of the entire record and assesses whether there is substantial evidence to support each ground for the revocation.

Fresh Start confirms the importance of compliance with the legal requirements of the Education Code and its implementing regulations on all matters related to authorizing, renewing or revoking a charter. If you have any questions regarding charter school matters, please contact one of our eight offices located statewide or consult our website.

Written by:
Megan Macy
Shareholder
SacramentoOffice
mmacy@lozanosmith.com

Aimee Perry
Associate
Sacramento Office
aperry@lozanosmith.com

© 2011 Lozano Smith

GOVERNOR VETOES BILL AFFECTING COMPOSITION OF CITY ANDCOUNTYPERSONNELAND MERIT COMMISSIONS

August 2011
Number 40

Under current law, city and county governments may establish a personnel or merit commission to administer personnel rules or a merit system. Assembly Bill (AB) 455, recently passed by Legislature, would have given employee unions a role in nominating appointees to these commissions. Under AB 455, a city or county’s governing board would have appointed half of the commission members and selected the other half of the commission members from a list of nominees provided by the recognized employee union.

Governor Brown vetoed AB 455 on July 25, 2011. According to his veto message, AB 455 would have imposed a “top down, one-size-fits-all” requirement on all merit and personnel commissions which would have been inconsistent with his administration’s efforts to increase local control.

If you have any questions about AB 455 or personnel or merit commissions in general, please do not hesitate to contact one of our eight offices located statewide or consult our website.

Written by:
Darren Kameya
Senior Counsel and Labor & Employment Practice Group Co-Chair
Los Angeles Office
dkameya@lozanosmith.com

Mary Gates
Paralegal
MontereyOffice
mgates@lozanosmith.com

© 2011 Lozano Smith

FURTHER DEVELOPMENTS FOR DIR’S LABOR COMPLIANCE UNIT

August 2011
Number 21

On August 1, 2011, the Office of Administrative Law approved the request by the Department of Industrial Relations (DIR) for another 90-day extension of its emergency regulations, which will again delay the implementation of the DIR’s Compliance Monitoring Unit (CMU) for Labor Compliance Programs (LCP) for school and community college construction projects. During this extension period, the DIR will be working on adopting new permanent regulations to implement the CMU in early 2012. (Please see Client News Brief No. 28, July 2010, Client Alert No. 16, November 2010, and Client Alert No. 8, May 2011 for more details regarding the recent developments of the LCP requirements.)

This extension continues the suspension of all CMU operations, along with the fee which was to be imposed for its labor compliance enforcement, through the end of October 2011. In the meantime, the DIR has scheduled a public hearing for August 15, 2011 on its proposed new regulations. The new regulations are intended to address concerns raised by the state’s bond counsel and others regarding the CMU fee and to delay the effective date of the CMU to January 1, 2012 or later. For now, school districts and community college districts should continue to administer their own LCP programs or obtain the services of third-party LCP providers for projects.

We will continue to monitor developments from the DIR and provide any updates on the CMU and the related fee. In the meantime, if you have questions regarding labor compliance requirements or construction matters in general, please contact one of our eight offices located statewide or consult our website.

Written By:
Ruth Mendyk
Shareholder and Facilities & Business Practice Group Co-Chair
Fresno Office
rmendyk@lozanosmith.com

Michael Dunne
Paralegal
Fresno Office
mdunne@lozanosmith.com

© 2011 Lozano Smith

LEGISLATURE CODIFIES INCREASES IN INFORMAL BID LIMITS UNDER THE UNIFORM PUBLIC CONSTRUCTION COST

August 2011
Number 20

Effective July 1, 2011, the State Controller increased the informal bid limits under the Uniform Public Construction Cost Accounting Act (Act) from $125,000 to $175,000. (Please see Client News Brief No. 17, May 2011.) Assembly Bill (AB) 943, signed by Governor Brown on July 25, 2011, confirms this increase in the Public Contract Code.

Currently, the Act provides that if all bids exceed the $125,000 informal limit, the bid may be awarded to the lowest bidder up to a maximum of $137,500. However, with the passage of AB 943, if all bids received exceed the new $175,000 informal bid limit, the bid may be awarded to the lowest bidder up to a maximum of $187,500. Note that AB 943 does not take effect until January 1, 2012. Therefore, if all bids exceed $175,000, the agency may not award the bid to the lowest bidder up to the $187,500 limit until January 1, 2012. AB 943 does not affect a local agency’s ability to award bids up to the new $175,000 informal bid limit between now and January 1, 2012.

The Act provides an alternative method for school districts, cities, and other public agencies to obtain bids for public works projects that can save agencies the time and expense required by the traditional bidding process. It does not apply to the purchases of equipment, materials, supplies, or services. As before, the limit for construction projects performed by force account or without bidding remains at $30,000 under the Act.

Lozano Smith attorneys have assisted many public agency clients with adopting the required procedures and maintaining compliance with the Act. If you have any questions about this recent development, or about becoming a uniform construction cost accounting agency, please contact one of our eight offices located statewide or consult our website.

Written By:
Daniel Maruccia
Associate
Sacramento Office
dmaruccia@lozanosmith.com

© 2011 Lozano Smith

WELCOME BACK TO SCHOOL WORKSHOPS

August 2011
Number 19

Summer will soon be coming to a close and districts are busy planning welcome back sessions for their employees. Lozano Smith attorneys are also getting ready for the new school year and preparing training presentations to be included in these welcome back sessions. These presentations include:

  • Sexual Harassment Prevention Training
    (Required for Supervisors)
  • Student Discipline Refresher
  • Student Fees and Fundraising
  • IEP Team Meetings
  • Cyber Communications for Employees and Students
  • Employee Evaluation and Discipline

These workshops are designed to provide up-to-date, practical advice and training for all district personnel.

If you would like to include a Lozano Smith training presentation with your district’s back to school session, please contact Kim Pollastrini at kpollastrini@lozanosmith.com or 1-800-445-9430, or contact any of our eight offices located statewide.

© 2011 Lozano Smith