20250AB__005196AMD INTRODUCED 2024-12-02 AMENDED_ASSEMBLY 2025-02-19 AMENDED_ASSEMBLY 2025-04-09 AMENDED_ASSEMBLY 2025-05-05 2025 AB AMD Introduced by Assembly Member McKinnor (Principal coauthor: Assembly Member Bonta) (Principal coauthors: Senators Arreguín and Richardson) (Coauthors: Assembly Members Addis, Ahrens, Bryan, Connolly, Elhawary, Gipson, Haney, Jackson, Kalra, Lee, Lowenthal, and Schultz) LEAD_AUTHOR ASSEMBLY McKinnor PRINCIPAL_COAUTHOR ASSEMBLY Bonta PRINCIPAL_COAUTHOR SENATE Arreguín PRINCIPAL_COAUTHOR SENATE Richardson COAUTHOR ASSEMBLY Addis COAUTHOR ASSEMBLY Ahrens COAUTHOR ASSEMBLY Bryan COAUTHOR ASSEMBLY Connolly COAUTHOR ASSEMBLY Elhawary COAUTHOR ASSEMBLY Gipson COAUTHOR ASSEMBLY Haney COAUTHOR ASSEMBLY Jackson COAUTHOR ASSEMBLY Kalra COAUTHOR ASSEMBLY Lee COAUTHOR ASSEMBLY Lowenthal COAUTHOR ASSEMBLY Schultz

An act to add

Chapter 3.15 (commencing with

Section 41475) to Part of Division of Title of the Education Code, relating to education finance. education finance Education finance: General Fund cashflow loans: Inglewood Unified School District: interest waivers. Existing law authorizes the governing board of a school district that determines during a fiscal year that its revenues are less than the amount necessary to meet its current year expenditure obligations to request an emergency apportionment through the Superintendent of Public Instruction, subject to specified requirements.

Existing law authorizes emergency apportionments to be provided through an interim loan from the General Fund and lease financing made available by the California Infrastructure and Economic Development Bank, which is authorized to issue bonds for purposes of the emergency apportionments and related costs, or as an alternative to lease financing, as an emergency apportionment from the General Fund. Existing law prescribes the financing conditions on emergency apportionments, including the calculation of the interest rate.

This bill would require, commencing January 1, 2026, the interest rate to be 0% for the outstanding emergency apportionment to Inglewood Unified School District.</xhtml:p>"?> Existing law, notwithstanding any other law, authorizes the Inglewood Unified School District, through the State Department of Education, to request cashflow loans from the General Fund for a total of up to $55,000,000 for emergency operational purposes, as provided. Existing law requires the interest on these loans to be charged at the annual rate of return of the Pooled Money Investment Account, plus an additional 2%.

This bill, notwithstanding any other law, and once the Inglewood Unified School District has successfully repaid at least years of a General Fund cashflow loan made pursuant to those provisions, would authorize the school district to seek, and would require the Department of Finance to grant, a waiver of interest on that loan for the next succeeding fiscal year if specified conditions are met, including, among other conditions, that the Los Angeles County Superintendent of Schools, in consultation with the County Office Fiscal Crisis and Management Assistance Team, determines that the school district is making substantial progress towards fiscal solvency and that a waiver of interest would help the school district to exit receivership, as provided.

In each subsequent fiscal year, the bill would authorize the school district to seek, and would require the Department of Finance to grant, a subsequent waiver of interest for the applicable fiscal year if the school district again meets those same requirements. To the extent the bill would impose additional duties on the Los Angeles County Superintendent of Schools, the bill would impose a state-mandated local program. This bill would make legislative findings and declarations as to the necessity of a special statute for the Inglewood Unified School District.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that, if the Commission on State Mandates determines that the bill contains costs mandated by the state, reimbursement for those costs shall be made pursuant to the statutory provisions noted above. MAJORITY NO YES YES NO NO NO NO NO NO NO The people of the State of California do enact as follows:

SECTION 1.

Chapter 3.15 (commencing with

Section 41475) is added to Part of Division of Title of the Education Code , to read: 3.15. General Fund Cashflow Loan Repayment for Inglewood Unified School District 41475. (

a) Notwithstanding any other law, once the Inglewood Unified School District has successfully repaid at least years of a General Fund cashflow loan made pursuant to

Section of

Chapter of the Statutes of 2013, as amended by

Section of

Chapter of the Statutes of 2013, the school district may seek, and the Department of Finance shall grant, a waiver of interest on that loan for the next succeeding fiscal year if both of the following conditions are met:

(1) In conjunction with the filing of the school district’s second interim financial report pursuant to

Section 42130, the Inglewood Unified School District notifies the Los Angeles County Superintendent of Schools and the County Office Fiscal Crisis and Management Assistance Team of their intent to seek a waiver of interest for the next succeeding fiscal year. A copy of the notification shall also be sent, consistent with

Section of the Government Code, to the Assembly Committee on Education, the Senate Committee on Education, the Assembly Committee on Budget, the Senate Committee on Budget and Fiscal Review, and the Department of Finance.

(2) The Los Angeles County Superintendent of Schools, in consultation with the County Office Fiscal Crisis and Management Assistance Team, determines that the school district is making substantial progress towards fiscal solvency and a waiver of interest would help the school district to exit receivership, based on the successful completion of all of the following: (

A) Meeting the requirements for qualified or positive certification for the school district’s second interim report pursuant to

Article 3 (commencing with

Section 42130) of

Chapter 6. (

B) Completing comprehensive operational reviews that compare the needs of the school district with similar school districts and provide data and recommendations regarding changes the school district can make to achieve fiscal sustainability. (

C) Undergoing an annual independent audit pursuant to

Section and submitting a fiscal recovery plan to the Los Angeles County Superintendent of Schools detailing the steps taken to address any material weaknesses or internal control deficiencies. (

b) For each subsequent fiscal year after the initial waiver of interest, the Inglewood Unified School District may seek, and the Department of Finance shall grant, a subsequent waiver of interest for the applicable fiscal year if the school district again meets the requirements of paragraphs (1) and (2) of subdivision (

a) for each waiver.

SEC. 2. The Legislature finds and declares that a special statute is necessary and that a general statute cannot be made applicable within the meaning of

Section of

Article IV of the California Constitution because of the unique circumstances relating to the fiscal emergency in the Inglewood Unified School District.

SEC. 3. If the Commission on State Mandates determines that this act contains costs mandated by the state, reimbursement to local agencies and school districts for those costs shall be made pursuant to

Part 7 (commencing with

Section 17500) of Division of Title of the Government Code. <caml:Num>SECTION 1.</caml:Num><caml:ActionLine action="IS_AMENDED" xlink:href="urn:caml:statutes2013:CHP201300048:caml#xpointer(%2Fcaml%3AMeasureDoc%2Fcaml%3ABill%2Fcaml%3ABillSection%5Bcaml%3ANum%3D'SEC.%2083.'%5D)" xlink:label="fractionType: BILL_SECTION||qualifyingLanguage: amended by

Section of

Chapter of the Statutes of 2013" xlink:type="locator">Section of

Chapter of the Statutes of 2013, as amended by

Section of

Chapter of the Statutes of 2013, is amended to read:</caml:ActionLine><caml:Fragment><caml:BillSection id="id_51CF5F3B-E7EE-4923-9F86-5E83ABB61FEF"><caml:Num>Sec. 83.</caml:Num><caml:Content><xhtml:p>(a)<xhtml:span class="EnSpace"/>Notwithstanding any other law, the Inglewood Unified School District, through the State Department of Education, may request cashflow loans from the General Fund for a total of up to fifty-five million dollars ($55,000,000) for emergency operational purposes.</xhtml:p><xhtml:p>(b)<xhtml:span class="EnSpace"/>Unless otherwise specified in this section, the terms and conditions of any General Fund cashflow loan provided pursuant to this

section shall be subject to approval by the Director of Finance and shall be consistent with the terms and conditions of the General Fund emergency apportionment issued pursuant to

Chapter of the Statutes of 2012. The terms and conditions of the General Fund cashflow loan shall include authorization for the payment of costs incurred before June 15, 2013, by the California Infrastructure and Economic Development Bank to implement

Section of

Chapter of the Statutes of 2012. Notwithstanding the interest rates specified in the terms and conditions of the General Fund loan issued pursuant to

Chapter of the Statutes of 2012, the interest on these loans shall be charged at the annual rate of return of the Pooled Money Investment Account, plus an additional percent until December 31, 2025, and commencing January 1, 2026, the interest rate shall be percent.</xhtml:p><xhtml:p>(c)<xhtml:span class="EnSpace"/>Once a General Fund cashflow loan is approved pursuant to this section, and upon the order of the Director of Finance, the Controller shall draw warrants against General Fund cash to the Inglewood Unified School District to provide a cashflow loan.</xhtml:p><xhtml:p>(d)<xhtml:span class="EnSpace"/>Upon approval of a General Fund cashflow loan pursuant to this section, a repayment

schedule shall be determined by the Department of Finance. If a required payment is not made within days after a scheduled date, upon order of the Department of Finance, the Controller shall pay the defaulted General Fund cashflow loan repayment by withholding that amount from the next available payment that would otherwise be made to the county treasurer on behalf of the school district pursuant to

Section of the Education Code.</xhtml:p><xhtml:p>(e)<xhtml:span class="EnSpace"/>The Department of Finance shall notify the Legislature within days of authorizing a General Fund cashflow loan pursuant to this section.</xhtml:p><xhtml:p>(f)<xhtml:span class="EnSpace"/>A cashflow loan from the General Fund authorized by this

section does not constitute budgetary expenditures. A cashflow loan, and the repayment of a cashflow loan, made under this

section shall not affect the General Fund reserve.</xhtml:p><xhtml:p>(g)<xhtml:span class="EnSpace"/>Issuance of a General Fund cashflow loan authorized pursuant to this

section shall require the Inglewood Unified School District to abide by all provisions associated with the issuance of the emergency loan specified in

Chapter of the Statutes of 2012, including those cited in

Article 2 (commencing with

Section 41320) and

Article 2.5 (commencing with

Section 41325) of

Chapter of Part of Division of Title of the Education Code.</xhtml:p><xhtml:p>(h)<xhtml:span class="EnSpace"/>As a condition of requesting a General Fund cashflow loan pursuant to this section, the Inglewood Unified School District shall repay the twenty-nine million dollar ($29,000,000) General Fund loan issued pursuant to

Chapter of the Statutes of from the proceeds of the school district’s initial request for a General Fund cashflow loan.</xhtml:p></caml:Content></caml:BillSection></caml:Fragment></caml:BillSection>"?>