Subcommittee backs bill to create statewide fiscal monitoring and risk designations for school systems

Floor leader Will Wade (speaker 13) presented House Bill 1164 (LC 472670s) as legislation to strengthen fiscal oversight, transparency and accountability in K–12 public education. He said the bill creates a formal fiscal monitoring framework, requires local boards to establish an audit committee meeting at least six times per year, mandates audit‑readiness certifications by Dec. 31, and authorizes state agencies to designate school systems as moderate or high risk based on multi‑year irregularities.

Key provisions described include a corrective‑action process with a 60‑day response window and a 120‑day board approval deadline for corrective plans, monthly expenditure reviews while under risk designation, mandatory audits for systems with persistent irregularities, and authority for the state board to amend or terminate flexibility contracts for charter systems in high‑risk cases (the sponsor emphasized this is discretionary, not mandatory).

The sponsor told the committee that implementation would begin with an initial readiness program by 07/01/2026, with a full phased rollout through 2029, and that additional appropriations are being considered to hire accounting staff to support monitoring. Members asked about reserve levels and use of outside audit firms; the sponsor said local control remains but that DOA will flag concern areas and require accredited firms when necessary. The committee moved and passed HB 1164 by voice vote.

The bill now advances for additional legislative consideration.