Signed by Governor Lincoln Chafee

Vote Smart's Synopsis:

Vote to pass a bill that authorizes the Department of Revenue to appoint a fiscal overseer, a budget commission, and a receiver to work with certain fire districts.

Highlights:

• Authorizes the Director of Revenue to appoint a fiscal overseer to assess a fire district’s ability to manage its fiscal situation if 2 events have occurred that “threaten” the district’s fiscal stability and ability to provide public safety services, including, but not limited to, the following events (Sec. 1):
• The projection of a budget deficit for the current and upcoming fiscal years;
• The failure to file required audits for 2 successive fiscal years; and
• The inability to obtain necessary financing or credit.

• Requires a fire district’s fiscal overseer to perform certain financial oversight actions, including, but not limited to, the following actions (Sec. 1):
• The supervision of all financial services and activities of the district;
• The review of all proposed contracts; and
• The provision of assistance in developing the district’s budget.

• Authorizes the director to establish a budget commission if a fiscal overseer reports that a fire district requires a budget commission’s assistance to achieve fiscal stability or should otherwise be appointed (Sec. 1).

• Requires a fire district’s budget commission to consist of the following 5 members (Sec. 1):
• 3 members appointed by the director;
• 1 member who is the chairperson of the district’s governing body; and 
• 1 member who is the district’s fire chief. 

• Authorizes a fire district’s budget commission to perform certain actions to stabilize the district’s finances, including, but not limited to, the following actions (Sec. 1):
• The establishment and amendment of the district’s budget;
• The review and approval of any proposed contracts; 
• The appointment, removal, and supervision of the district’s employees; and
• The issuance of bonds and notes to fund the district’s deficits and cash flow.

• Requires all appropriations, transfers, and borrowing or spending authorizations to be approved by a fire district’s budget commission (Sec. 1).

• Authorizes the director to appoint a receiver for the fire district if the budget commission cannot stabilize the district’s fiscal situation or in the event of a fiscal emergency that does not allow for the appointment of a fiscal overseer or a budget commission first (Sec. 1).

• Authorizes a fire district’s receiver to have certain powers, including, but not limited to, the following powers (Sec. 1):
• The powers of a fiscal overseer and a budget commission; and
• The power to perform any duty of a fire district officer, employee, or elected official.

• Requires the treasurer or other fiduciary officer of a fire district to perform certain financial oversight actions, including, but not limited to, the following actions (Sec. 3):
• The continuous monitoring of the district’s budget and financial operations;
• The quarterly reporting of the district’s financial status to the Division of Municipal Finance and the governing body of the district’s municipality; and
• The establishment of a corrective action plan for avoiding a year-end or structural deficit that is predicted by a quarterly report.

• Authorizes the treasurer or other fiduciary officer of a fire district to include a recommendation to increase property taxes or make certain spending cuts on a corrective action plan (Sec. 3).

• Requires a fire district that is authorized to assess and collect property taxes in multiple towns to have their annual financial statements independently audited (Sec. 4).

Full Bill Text