§ 45-12-22.2 - Monitoring of financial operations – Corrective action.
SECTION 45-12-22.2
§ 45-12-22.2 Monitoring of financialoperations – Corrective action. – (a) The chief financial officer of each municipality and each school districtwithin the state shall continuously monitor their financial operations bytracking actual versus budgeted revenue and expense.
(b) The chief financial officer of the municipality shallsubmit a report on a monthly basis to the municipality's chief executiveofficer, each member of the city or town council, and school district committeecertifying the status of the municipal budget including the school departmentbudget or regional school district. The chief financial officer of themunicipality shall also submit a report on a quarterly basis to the division ofproperty valuation certifying the status of the municipal budget. The chieffinancial officer of the school department or school district shall certify thestatus of the school district's budget and shall assist in the preparation ofthese reports. The monthly and quarterly reports shall be in a formatprescribed by the division of property valuation and the state auditor general.The reports shall contain a statement as to whether any actual or projectedshortfalls in budget line items are expected to result in a year-end deficit,the projected impact on year-end financial results including all accruals andencumbrances, and how the municipality and school district plans to address anysuch shortfalls.
(c) If any reports required under this section project ayear-end deficit, the chief financial officer of the municipality shall submitto the state office of municipal affairs a corrective action plan no later thanthirty (30) days after completion of the monthly budget analysis referred to insubsection (b) above, which provides for the avoidance of a year-end deficit.The plan may include recommendations as to whether an increase in propertytaxes and/or spending cuts should be adopted to eliminate the deficit. The planshall include a legal opinion by municipal counsel that the proposed actionsunder the plan are permissible under federal, state, and local law. The stateoffice of municipal affairs may rely on the written representations made by themunicipality in the plan and will not be required to perform an audit.
(d) If the division of property valuation concludes the planrequired hereunder is insufficient and/or fails to adequately address thefinancial condition of the municipality, the division of property valuation canelect to pursue the remedies identified in § 45-12-22.7.
(e) The reports required shall include the financialoperations of any departments or funds of municipal government including theschool department or the regional school district, notwithstanding the statusof the entity as a separate legal body. This provision does not eliminate theadditional requirements placed on local and regional school districts by§§ 16-2-9(f) and 16-3-11(e)(3).