The governing board is required to establish and appoint an independent citizen's oversight committee (the "Committee") within 60 days of the date that the governing board enters on its minutes the election results, pursuant to Section 15274. [Education Code Section 15278(a)]

Role of Committee

Composition of the Committee

The Committee shall consist of at least seven (7) members to serve for a term of two (2) years without compensation and for no more than two (2) consecutive terms.

The Committee must include:

• One member who is active in a business organization representing the business community located within the school district;
• One member active in a senior citizens' organization;
• One member who is the parent or guardian of a child enrolled in the school district;
• One member who is both a parent or guardian of a child enrolled in the school district and active in a parent-teacher organization; and
• One member who is active in a bona fide taxpayers' organization. [Education Code Section 15282(a)]

The Committee may not include any employee or official of the school district or any vendor, contractor or consultant of the school district. [Education Code Section 15282(b)]

Purpose and Activities of the Committee

The purpose of the Committee shall be to inform the public concerning the expenditure of the bond proceeds.  The Committee shall engage in the following activities to carry out this purpose:

• Actively review and report on the proper expenditure of taxpayers' money for school construction;
• Advise the public as to whether the school district is in compliance with the requirements of Article XIIIA, Section 1(b)(3) of the California Constitution; and
• Convene to provide oversight for, but not limited to:
  • Ensuring that bond revenues are expended only 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;
  • Ensuring that no funds are used for any teacher or administrative salaries or other school operating expenses. [Education Code Section 15278(b)

It is the express intent of the Legislature that the members of the Committee "promptly alert the public to any waste or improper expenditure of school construction bond money."  [Education Code Section 15264]

The Committee is authorized to engage in any of the following activities in furtherance of its purpose:

• Receive and review copies of the annual independent performance audit required by Article XIIIA, Section 1(b)(3)(C) of the California Constitution;
• Receive and review copies of the annual independent financial audit required by Article XIIIA, Section 1(b)(3)(C) of the California Constitution;
• Inspect school facilities and grounds to ensure bond revenues are expended in compliance with Article XIIIA, Section 1(b)(3) of the California Constitution;
• Receive and review copies of any deferred maintenance proposals or plans developed by the school district; and
• Review efforts by the school district to maximize bond revenues by implementing cost saving measures, including, but not limited to:
• Mechanisms designed to reduce the cost of professional fees;
  • Mechanisms designed to reduce the costs of site preparation;
  • Recommendations regarding the joint use of core facilities;
  • Mechanisms designed to reduce costs by incorporating efficiencies in school site design; and
  • Recommendation regarding the use of cost-effective and efficient reusable plans.  [Education Code Section 15278©

The Committee shall at least annually issue regular annual reports of the results of its activities.  [Education Code Section 15280(b)]

Governing Board Support of the Committee

The governing board shall provide the Committee with (a) any necessary technical assistance and administrative assistance in furtherance of the Committee's purpose and (b) sufficient resources to publicize the conclusions of the Committee.  No bond funds may be used to pay any of these expenses.  [Education Code Section 15280(a)]

Meetings of and Documents Provided to the Committee

All Committee proceedings shall be open to the public and shall be subject to the provisions of the Ralph M. Brown Act.  All documents received by the Committee and reports issued by the Committee shall be a matter of public record and be made available on an Internet website maintained by the governing body of the school district.  [Education Code Section 15280(b)]

Limits On Committee Members

Members Subject to Prohibitions Regarding Conflict of Financial Interests in Contracts

Under the provisions of Education Code Section 35233, members of the Committee must abide by the prohibitions contained in Article 4, commencing with Section 1090, and Article 4.7, commencing with Section 1125, of Division 4 of Title 1 of the Government Code, which prohibit public officials from having a financial interest in any contracts made in their official capacity.  [Education Code Section 15282(b)]

Committee Members May Be Subject to The Political Reform Act of 1974 and Its Conflict of Interest Provisions

The legislation is silent as to whether members of the Committee are subject to the provisions of The Political Reform Act of 1974 (The "PRA") and the conflict of financial interest rules and regulations promulgated by the Fair Political Practices Commission ("FPPC").  The FPPC has not issued an opinion of this question as yet.

If the Committee is solely advisory, its members are not likely to be subject to The PRA.  On the other hand, if the Committee makes or participates in the making of final decisions, it may be deemed by the FPPC to have decision making authority, and its members would be subject to the provisions of The PRA.  At this time, we can only speculate.  For information purposes, the FPPC has determined that a board or commission possesses decision-making authority whenever the following occur:

1. It may make a final governmental decision. (C.C.R., Title 2, Section 18700(a)(1) (A); see also In Re Maloney, No. 76-082, 3 FPPC Ops. 69);
2. It exerts such influence that its advice is routinely and regularly followed by its recipient board. (C.C.R., title 2, Section 18700(a)(1)(C); see also In re Rotman, No. 86-001, 10 FPPC Ops. 3); see also Commission on Cal. State Gov. Org. & Econ. V. Fair Political Practices Com. (1977) 75 Cal.App.3d 716)).
3. It may compel or prevent the making of a board decision by its action or inaction. (C.C.R., title 2, Section 18700(a)(1)(B)).

Public officials who make or participate in the making of final decisions are covered by the conflict of interest codes adopted pursuant to Government Code sections 87300-87313 of The PRA.  Local governmental agencies like school districts are required to include in their conflict of interest codes the positions within the agency which involve the making or participation in the making of final decisions which may foreseeably have a material effect on any private financial interest.

New Legal Actions To Prevent Or Restrain The Expenditure Of Bond Funds 

The legislation creates a form of legal action called a "School Bond Waste Prevention Action" which may be brought by a citizen who is assessed and required to pay an ad valorem tax to repay bonds issued pursuant to the 55% bond approval option.  In order to prevail, the citizen must show that the challenged expenditure of bond funds is not in compliance with the law, that the expenditure will produce waste or great or irreparable injury, or that the governing board has willfully failed to appoint an Oversight Committee.  This legal remedy supplements existing remedies to challenge school bond elections and expenditures.

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