2001 Montana Legislature

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SENATE BILL NO. 138

INTRODUCED BY L. NELSON

Montana State Seal

AN ACT GENERALLY REVISING THE LAWS RELATING TO LOCAL GOVERNMENT ACCOUNTING, BUDGETING, AND FINANCIAL MATTERS; AMENDING SECTIONS 2-7-501, 2-7-503, 2-7-504, 2-7-505, 2-7-513, 2-9-316, 2-9-804, 3-5-602, 3-5-901, 7-1-114, 7-3-4432, 7-6-204, 7-6-2111, 7-4-2514, 7-6-2113, 7-6-2202, 7-6-2521, 7-6-2524, 7-6-2601, 7-6-2602, 7-6-2607, 7-6-4302, 7-6-4501, 7-12-4181, 7-12-4183, 50-60-302, 53-2-322, AND 85-3-423, MCA; REPEALING SECTIONS 7-6-601, 7-6-603, 7-6-604, 7-6-2112, 7-6-2201, 7-6-2203, 7-6-2211, 7-6-2212, 7-6-2213, 7-6-2214, 7-6-2218, 7-6-2219, 7-6-2220, 7-6-2221, 7-6-2301, 7-6-2302, 7-6-2303, 7-6-2311, 7-6-2312, 7-6-2313, 7-6-2314, 7-6-2315, 7-6-2316, 7-6-2317, 7-6-2318, 7-6-2319, 7-6-2320, 7-6-2321, 7-6-2322, 7-6-2323, 7-6-2324, 7-6-2325, 7-6-2326, 7-6-2327, 7-6-2328, 7-6-2329, 7-6-2330, 7-6-2331, 7-6-2335, 7-6-2341, 7-6-2342, 7-6-2343, 7-6-2345, 7-6-2348, 7-6-2351, 7-6-2352, 7-6-2502, 7-6-2525, 7-6-2702, 7-6-4101, 7-6-4104, 7-6-4121, 7-6-4123, 7-6-4124, 7-6-4134, 7-6-4135, 7-6-4140, 7-6-4141, 7-6-4201, 7-6-4202, 7-6-4203, 7-6-4205, 7-6-4206, 7-6-4207, 7-6-4208, 7-6-4209, 7-6-4232, 7-6-4234, 7-6-4237, 7-6-4238, 7-6-4240, 7-6-4259, 7-6-4260, 7-6-4261, 7-6-4262, 7-6-4263, 7-6-4264, 7-6-4265, 7-6-4266, 7-6-4267, 7-6-4270, 7-6-4271, 7-6-4272, 7-6-4407, AND 7-6-4408, MCA; AND PROVIDING AN EFFECTIVE DATE AND AN APPLICABILITY DATE.



BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:



     Section 1.  Declaration of policy.  (1) It is the policy of the state of Montana that all governmental accounting systems be established and maintained in accordance with generally accepted accounting principles that are nationally recognized as set forth by the governmental accounting standards board or its generally recognized successor.

     (2)  The codifications, pronouncements, and interpretations of the governmental accounting standards board or its generally recognized successor must be recognized as the primary authoritative reference for governmental accounting.



     Section 2.  Fiscal year for local governments. The fiscal year of local governments commences on July 1 of each calendar year and ends on June 30 of the following calendar year.



     Section 3.  Role of department of commerce. (1) The department of commerce shall prescribe for all local governments:

     (a)  general methods and details of accounting in accordance with generally accepted accounting principles as provided in 2-7-504;

     (b)  uniform internal and interim reporting systems as part of the uniform reporting systems provided for in 2-7-503;

     (c)  the form of the annual financial report as provided in 2-7-503; and

     (d)  general methods and details of accounting for the annual financial report as provided in 2-7-513.

     (2)  Local governments shall file with the department of commerce:

     (a)  an annual financial report within 6 months of the fiscal yearend; and

     (b)  an audit report within 12 months of the end of the audited period.

     (3) The governing body of each county or municipality shall notify the department of commerce in writing, on a form prescribed by the department of commerce, of the creation, dissolution, combination, or other legal alteration of any special purpose district within the county or municipality.

     (4) Each special purpose district shall obtain a permanent mailing address and notify the department of commerce of the address and of any subsequent changes of the district's address.



     Section 4.  Additional records and reports. (1) The chief executive or governing body of a county or municipality may require any elected or appointed local government official or employee to:

     (a)  maintain new or additional financial records;

     (b)  perform new or additional financial reconciliations; and

     (c)  submit new or additional financial reports.

     (2)  This part does not provide for the consolidation or reassignment, but does not prohibit delegation by mutual agreement, of any duties of elected county officials. Continuing county duties include but are not limited to the following:

     (a)  The county treasurer shall make a detailed monthly report to the governing body of the county of all receipts, disbursements, debt, and other proceedings of the treasurer's office.

     (b)  The county clerk shall compile and present to the governing body of the county the annual financial report provided for in [section 3(2)(a)].

     (3)  The designated county or municipal treasurer shall:

     (a)  receive, disburse, and serve as the custodian of all public money;

     (b)  provide for accountability of all local government cash receipts and for deposits and investments of all departments, offices, and boards;

     (c)  pay out, in the order registered, all warrants presented for payment when there are funds in the treasury to pay the warrants; and

     (d)  require periodic departmental reports of money receipts and their disposition on forms that the designated county or municipal treasurer prescribes.

     (4)  All local governments:

     (a)  shall deposit all public money with the county or municipal treasurer within a month of receipt unless otherwise specifically authorized by law;

     (b)  may not maintain separate bank accounts unless specifically authorized by the county or municipal governing body;

     (c)  may not maintain separate investments.

     (5) The provisions of subsections (3) and (4) apply to local governments that are not subject to an independent audit pursuant to 2-7-503 and are in addition to laws specifically applying to those local governments.

     (6)  The governing body of a county or municipality shall direct the county or municipal treasurer to open separate accounts for the receipt of money for the governing body. Only the county or municipal treasurer may open an account for the receipt of local government money.



     Section 5.  Procedure to transfer funds. Money may not be transferred from one fund to another except by resolution of a county or municipal governing body unless the transfer is:

     (1) previously authorized by a budget resolution;

     (2) provided for by [section 6];

     (3) made in the usual course of county or municipal business for:

     (a) school transfers;

     (b) tax increment finance districts;

     (c) specialized tax situations;

     (d) the purpose of distributing refunds, protested taxes, or interest charges for interest in lieu of registered warrants;

     (e) bond sinking fund transfers;

     (f) residual equity transfers;

     (g) transfers of investments; or

     (h) corrections of errors; or

     (4) otherwise authorized by statute.



     Section 6.  Procedure to close inactive funds. A county or municipal governing body may transfer balances from inactive funds and close the inactive funds.



     Section 7.  Authorization to maintain petty cash fund. (1) A county or municipal governing body may set aside a sum out of the general fund, which must be known as a petty cash fund. The petty cash fund must be used for the purpose of paying incidental expenses, such as freight charges, express charges, postage, and other similar expenses that must be immediately paid in cash.

     (2)  In counties that have a county auditor, the county auditor is responsible for expenditures from the petty cash fund. In counties that do not have a county auditor, the county clerk is responsible for expenditures from the petty cash fund.



     Section 8.  Capital improvement program. A county or municipal governing body may provide for a capital improvement program for the replacement, improvement, and acquisition of property, facilities, or equipment that costs in excess of $5,000 and that has a life expectancy of 5 years or more. The capital improvement program must be formally adopted by the county or municipal governing body. The capital improvement program may receive funds from up to 10% of one or more property tax levies and may receive funds from any source.



     Section 9.  Short title -- applicability. (1) [Sections 9 through 32] may be referred to as the "Local Government Budget Act".

     (2) [Sections 9 through 32] apply to all local governments.



     Section 10.  Definitions. As used in [sections 9 through 32], unless the context requires otherwise, the following definitions apply:     

     (1) "Governing body" means the elected body responsible for the administration of a local government.

     (2) "Local government" has the meaning provided in 7-6-602.

     (3) "Municipality" means an incorporated city or town.

     (4) "Working capital" means the current assets of a fund minus the current liabilities and designated reserves of a fund.



     Section 11.  Budget and levies supplied to department of commerce. (1) A local government shall submit a complete copy of the final budget together with a statement of tax levies to the department of commerce by the later of October 1 or 60 days after receipt of taxable values from the department of revenue. The county clerk and recorder shall make this submission for counties.

     (2) The local government shall use standard forms prescribed by the department of commerce or may use an alternative budget format acceptable to the department of commerce.



     Section 12.  Budget fund structure. Local government budgets must conform to the fund structure prescribed by the department of commerce.



     Section 13.  Expenditures limited to appropriations. (1) Local government officials may not make a disbursement or an expenditure or incur an obligation in excess of the total appropriations for a fund.

     (2) A local government official who violates subsection (1) is liable for the amount of the excess disbursement, expenditure, or obligation personally and upon the official's bond.

     (3) The subsequent claims approval process may not be considered as the making of a disbursement or an expenditure or as incurring an obligation and does not otherwise limit or mitigate the local government official's personal liability.



     Section 14.  Appropriation power -- requirements. (1) A governing body may appropriate money and provide for the payment of the debts and expenses of the local government.

     (2) Money may not be disbursed, expended, or obligated except pursuant to an appropriation for which working capital is or will be available.

     (3) Appropriations may be adjusted according to procedures authorized by the governing body for:

     (a) debt service funds for obligations related to debt approved by the governing body;

     (b) trust funds for obligations authorized by trust covenants;

     (c) any fund for federal, state, local, or private grants and shared revenue accepted and approved by the governing body;

     (d) any fund for special assessments approved by the governing body;

     (e) the proceeds from the sale of land;

     (f) any fund for gifts or donations; and

     (g) money borrowed during the fiscal year.

     (4) The governing body may amend the budget during the fiscal year by conducting public hearings at regularly scheduled meetings. Budget amendments providing for additional appropriations must identify the fund reserves, unanticipated revenue, or previously unbudgeted revenue that will fund the appropriations.



     Section 15.  Use of bond proceeds and borrowed money. (1) Except as otherwise provided by law, money borrowed by a local government may be used only for the purpose for which the money was borrowed. Unless restricted by law, surplus borrowed money may be used to redeem the debt for which the money was borrowed.

     (2) The authorization of bonds by the electors or the governing body constitutes the appropriation of the bond proceeds for the purpose for which the bonds are authorized.



     Section 16.  Fee based budgets -- adjustable appropriation. (1) In its final budget resolution, the governing body may authorize adjustments to appropriations funded by fees throughout the budget period. Adjustable appropriations are:

     (a) proprietary fund appropriations; or

     (b) other appropriations specifically identified in the local government's final budget resolution as fee-based appropriations.

     (2) Adjustments of fee-based appropriations must be:

     (a) based upon the cost of providing the services supported by the fee; and

     (b) fully funded by the related fees for services, fund reserves, or nonfee revenue such as interest.



     Section 17.  Fees for services -- hearing and resolution. (1) If a local government has the authority to regulate, establish, and change fees, rates, charges, and classifications that are imposed for services to its inhabitants and other persons served by the local government, the fees, rates, charges, and classifications must be reasonable and related to the cost of providing the service.

     (2) Charges for services must comply with Title 17, chapter 2, part 3, and other applicable statutes.

     (3) In order to establish or change fees, rates, charges, or classifications imposed for services, the governing body shall order a hearing to be held as provided in 7-1-4131, unless a special hearing process is provided by law. Municipal utility rate hearings must be held as provided in 69-7-112.

     (4) Notice of a hearing must be published as provided in 7-1-2121 for a county and as provided in 7-1-4127 and 7-1-4128 for a municipality.

     (5)  After a hearing, the fees, rates, charges, or classifications must be established by resolution of the governing body.



     Section 18.  Restriction on tax-financed expenditures if voter approval required. If an expenditure is to be financed from a tax levy required to be authorized and approved at an election, the expenditure may not be made or an obligation may not be incurred against the expenditure until the tax levy is authorized and approved.



     Section 19.  Payments for judgments. (1) Judgments against a local government that are not covered by insurance may be paid:

     (a) from the general fund; or

     (b) from the fund or funds supporting the local government operation that incurred the judgment.

     (2) Judgments that are to be paid from the general fund:

     (a) must be paid in the current fiscal year if there is sufficient money in the general fund to pay both the judgment and the general fund appropriations for the current fiscal year; or

     (b) must be paid from additional tax levies made in each of the next 3 years if general fund money is insufficient to pay the judgment in the current fiscal year.



     Section 20.  Preliminary annual operating budget. (1) A preliminary annual operating budget must be prepared for the local government.

     (2) [Sections 9 through 32] do not provide for the consolidation or reassignment, but do not prohibit delegation by mutual agreement, of any duties of elected county officials.

     (3)  (a) Before June 1 of each year, the county clerk and recorder shall notify the county commission and each board, office, or official that they are required to file preliminary budget proposals for their component of the total county budget.

     (b) Component budgets must be submitted to the clerk and recorder before June 10th or on a date designated by the county commission and must be submitted on forms provided by the county clerk and recorder.

     (c) The county clerk and recorder shall prepare and submit the county's preliminary annual operating budget.

     (d) Component budget responsibilities as provided in this subsection (3) include but are not limited to the following:

     (i) The county surveyor or any special engineer shall compute road and bridge component budgets and submit them to the county commission.

     (ii) The county commission shall submit road and bridge component budgets.

     (iii) The county treasurer shall submit debt service component budgets.

     (iv) The county commission shall submit component budgets for construction or improvements to be made from new general obligation debt.

     (4) The preliminary annual operating budget for each fund must include, at a minimum:

     (a) a listing of all revenue and other resources for the prior budget year, current budget year, and proposed budget year;

     (b) a listing of all expenditures for the prior budget year, the current budget year, and the proposed budget year. All expenditures must be classified under one of the following categories:

     (i) salaries and wages;

     (ii) operations and maintenance;

     (iii) capital outlay;

     (iv) debt service; or

     (v) transfers out.

     (c) a projection of changes in fund balances or cash balances available for governmental fund types and a projection of changes in cash balances and working capital for proprietary fund types. This projection must be supported by a summary for each fund or group of funds listing the estimated beginning balance plus estimated revenue, less proposed expenditures, cash reserves, and estimated ending balances.

     (d) a detailed list of proposed capital expenditures and a list of proposed major capital projects for the budget year;

     (e) financial data on current and future debt obligations;

     (f) schedules or summary tables of personnel or position counts for the prior budget year, current budget year, and proposed budget year. The budgeted amounts for personnel services must be supported by a listing of positions, salaries, and benefits for all positions of the local government. The listing of positions, salaries, and benefits is not required to be part of the budget document.

     (g) all other estimates that fall under the purview of the budget.

     (5) The preliminary annual operating budget for each fund for which the local government will levy an ad valorem property tax must include the estimated amount to be raised by the tax.



     Section 21.  Notice of preliminary or amended budget. (1) The governing body shall cause a notice of a public hearing on the preliminary or amended budget to be published. The notice must:

     (a) provide that the governing body has completed its preliminary annual budget for the ensuing fiscal year or intends to amend its annual budget;

     (b) state that the budget or budget amendment has been placed on file and is open to inspection in the county or municipal office designated in the notice;

     (c) designate the date, time, and place of the meeting at which the governing body will meet for approving a final budget or amended budget and making appropriations; and

     (d) state that any taxpayer or resident may appear at the meeting and be heard for or against any part of the proposed budget or budget amendment.

     (2) The publication requirements must conform to the provisions of 7-1-2121 for a county or 7-1-4127 and 7-1-4128 for a municipality.



     Section 22.  District court budgets. (1) The district court must be provided with copies of the preliminary district court fund budget as soon as the preliminary county budget is prepared pursuant to [section 20].

     (2) The district court may recommend changes to any part of the district court fund budget that the court considers to be necessary for it to discharge its obligations under the law. Any recommendations must be made at the hearing on the preliminary budget held pursuant to [section 24].

     (3) The district court fund may be used only for district court operations and expenses.



     Section 23.  State grants to district courts -- rules. (1) To the extent funds are available after expenses provided for in 3-5-901 are funded, the state shall make grants to the governing body of a county for the district courts, as provided in this section.

     (2) The governing body of a county may apply to the supreme court administrator for a grant by filing a written request on forms provided by the administrator by August 20 for the previous fiscal year unless, upon the request of the county, the administrator grants a time extension. In its request for a grant, a county shall certify that:

     (a) all expenditures from the district court fund have been lawfully made;

     (b) transfers from the district court fund have not been or will not be made to any other fund; and

     (c) expenditures have not been made from the district court fund that are not specifically authorized by [section 22] and 7-6-2511.

     (3) To the extent that funds are available, the state shall award a grant if the county's district court expenditures for the previous fiscal year exceeded the sum of:

     (a) the product of the maximum mill levy authorized by law for district court purposes, whether or not assessed, multiplied by the previous year's taxable valuation of the county; and

     (b) all revenue, except district court grants, required by law to be deposited in the district court fund for the previous fiscal year.

     (4) Eligible court expenditures for grant purposes include all costs of the county associated with the operation and maintenance of the district court, except building costs, costs for capital items, and costs for library maintenance, replacement, and acquisitions.

     (5) The supreme court administrator shall notify each eligible county as soon as possible of the state's intention to award a grant to that county and the amount of the award.

     (6) The grant received by the county must be placed in the district court fund.

     (7) If an audit conducted pursuant to 2-7-503 discloses that the county received a grant in excess of the amount for which it was eligible, the county shall repay the excess to the state. The supreme court administrator shall redistribute any repaid excess amounts to the other counties that received grants from the appropriation from which the overpayment was made, on the same basis as the original awards. A county is not eligible for a district court grant if it owes the state a refund of a prior year's overpayment.

     (8) The supreme court administrator, in consultation with the supreme court, shall prescribe rules and forms necessary to effectively administer this section. The administrator may require a county to provide any information considered necessary for the administration of the program.



     Section 24.  Hearing on preliminary budget. (1) The governing body shall hold a hearing in accordance with the notice given pursuant to [section 21].

     (2)  Local government officials shall attend the budget hearing to answer questions on their proposed budgets if called upon:

     (a) by the governing body; or

     (b) by a taxpayer or resident.

     (3) The hearing may be continued from day to day and must be concluded and the budget finally approved and adopted by resolution by the later of the second Monday in August or within 45 calendar days of receiving certified taxable values from the department of revenue.



     Section 25.  Receipt and expenditure of money prior to adoption of final budget. A local government may receive and expend money between July 1 of the fiscal year and the date the final budget resolution is adopted.



     Section 26.  Final budget -- resolution -- appropriations. (1) The governing body may amend the preliminary budget after the public hearing and after considering any public comment.

     (2) The amended budget constitutes the final budget. The final budget must be balanced so that appropriations do not exceed the projected beginning balance plus the estimated revenue of each fund for the fiscal year.

     (3) The governing body shall adopt the final budget by resolution. The resolution must:

     (a) authorize appropriations to defray the expenses or liabilities for the fiscal year; and

     (b) establish legal spending limits at the level of detail in the resolution.

     (4) The effective date of the resolution is July 1 of the fiscal year, even if the resolution is adopted after that date.



     Section 27.  Budget amendment procedures. (1) The final budget resolution may authorize the governing body or a designated official to transfer appropriations between items within the same fund.

     (2) The annual budget appropriations may be amended as provided in [sections 14(3) and 16].

     (3) Except as provided in [sections 14 through 16, 19, and 28] or in the case of an emergency under Title 10, chapter 3, a public hearing is required for an overall increase in appropriation authority.



     Section 28.  Emergency expenditures. (1) Emergency budget appropriations must be adopted by two-thirds of the members of a governing body who are present at a meeting.

     (2) Emergency expenditures are limited to and must be charged to the adopted emergency budget appropriations.

     (3) The governing body may submit the question of funding emergency warrants at an election as provided by law.



     Section 29.  Expenditure limitation. Except as provided in [sections 14 through 16, 19, and 28], the governing body, each county or municipal official, and the district courts are limited to the amount of appropriations and by the classifications in the annual appropriation resolution provided for in [section 26] when making disbursements or expenditures or incurring liabilities.



     Section 30.  Determination of fund requirements -- property tax levy. (1) After determining the final budget, the governing body shall determine the property tax levy needed for each fund by:

     (a) adding the total amount of the appropriations and authorized expenditures for the budget year;

     (b) adding an additional amount, subject to the provisions of subsection (2), as a reserve to meet expenditures made from the fund during the months of July to November of the next fiscal year;

     (c) subtracting the working capital; and

     (d) subtracting the total estimated revenue, other than the property tax levy, for the budget year.

     (2) After deducting from the amount of the appropriations and authorized expenditures the total amount appropriated and authorized to be spent for election expenses and payment of emergency warrants, the amount that may be added as a reserve, as provided in subsection (1)(b), to:

     (a) a county's fund may not exceed one-third of the total amount appropriated and authorized to be spent from the fund during the current fiscal year; and

     (b) a city's or town's fund may not exceed one-half of the total amount appropriated and authorized to be spent from the fund during the current fiscal year.



     Section 31.  Tax levies for boards and commissions -- bond exemption. (1)     The proposed budget and mill levy for each board, commission, or other governing entity are subject to approval by the governing body.

     (2) Except for a port authority created under Title 7, chapter 14, part 11, the taxes, revenue, or fees legally pledged for the payment of debt are not subject to approval by the governing body.

     (3) Except for judgment levies under 2-9-316 or [section 19], all tax levies are subject to 15-10-420.



     Section 32.  Fixing tax levy. (1) The governing body shall fix the tax levy for each taxing jurisdiction within the county or municipality:

     (a) by the later of the second Monday in August or within 45 calendar days after receiving certified taxable values;

     (b) after the approval and adoption of the final budget; and

     (c) at levels that will balance the budgets as provided in [section 30].

     (2) Each levy:

     (a) must be made in the manner provided by 15-10-201; and

     (b)  except for a judgment levy under 2-9-316 or [section 19], is subject to 15-10-420.



     Section 33.  Section 2-7-501, MCA, is amended to read:

     "2-7-501.  Definitions. Unless the context requires otherwise, in this part, the following definitions apply:

     (1)  "Audit" means a financial audit and includes financial statement and financial-related audits as defined by government auditing standards as established by the U.S. comptroller general.

     (2)  "Board" means the Montana board of public accountants provided for in 2-15-1866.

     (3)  "Department" means the department of commerce.

     (4)  (a) "Financial assistance" means assistance provided by a federal, state, or local government entity to a local government entity or subrecipient to carry out a program. Financial assistance may be in the form of grants, contracts, cooperative agreements, loans, loan guarantees, property, interest subsidies, insurance, direct appropriations, or other noncash assistance. Financial assistance includes awards received directly from federal and state agencies or indirectly when subrecipients receive funds identified as federal or state funds by recipients. The granting agency is responsible for identifying the source of funds awarded to recipients. The recipient is responsible for identifying the source of funds awarded to subrecipients.

     (b)  Financial assistance does not include direct federal, state, or local government cash assistance to individuals.

     (5)  "Financial report" means a presentation of financial statements, including applicable supplemental notes and supplemental schedules, that are prepared in a format published by the department using the Budgetary Accounting and Reporting System for Montana Cities, Towns, and Counties Manual and that reflect a current financial position and the operating results for the 1-year reporting period.

     (6)  "Independent auditor" means:

     (a)  a federal, state, or local government auditor who meets the standards specified in the government auditing standards; or

     (b)  a licensed accountant who meets the standards in subsection (6)(a).

     (7)  (a) "Local government entity" means a county, city, district, or public corporation that:

     (i)  has the power to raise revenue or receive, disburse, or expend local, state, or federal government revenue for the purpose of serving the general public;

     (ii) is governed by a board, commission, or individual elected or appointed by the public or representatives of the public; and

     (iii) receives local, state, or federal financial assistance.

     (b)  Local government entities include but are not limited to:

     (i)  airport authority districts;

     (ii) cemetery districts;

     (iii) counties;

     (iv) county housing authorities;

     (v)  county road improvement districts;

     (vi) county sewer districts;

     (vii) county water districts;

     (viii) county weed control districts;

     (ix) drainage districts;

     (x)  fire department relief associations;

     (xi) fire districts;

     (xii) hospital districts;

     (xiii) incorporated cities or towns;

     (xiv) irrigation districts;

     (xv) mosquito districts;

     (xvi) municipal housing authority districts;

     (xvii) port authorities;

     (xviii) refuse disposal districts;

     (xix) rural improvement districts;

     (xx) school districts including a district's extracurricular funds;

     (xxi) soil conservation districts;

     (xxii) special education or other cooperatives;

     (xxiii) television districts;

     (xxiv) urban transportation districts;

     (xxv) volunteer fire departments; and

     (xxvi)(xxv) water conservancy districts; and

     (xxvi) other miscellaneous and special districts.

     (8)  "Revenues" means all receipts of a local government entity from any source excluding the proceeds from bond issuances."



     Section 34.  Section 2-7-503, MCA, is amended to read:

     "2-7-503.  Financial reports and audits of local government entities -- exception. (1) The governing body or managing or executive officer of a local government entity, other than a school district or associated cooperative, shall ensure that a financial report is made every year. A school district or associated cooperative shall comply with the provisions of 20-9-213. The financial report must cover the preceding fiscal year, be in a form prescribed by the department, and be completed within 6 months of the end of the reporting period. The local government entity shall submit the financial report to the department for review.

     (2)  The department shall prescribe a uniform reporting system for all local government entities subject to financial reporting requirements, other than school districts. The superintendent of public instruction shall prescribe the reporting requirements for school districts.

     (3)  (a)  The governing body or managing or executive officer of each local government entity receiving revenue or financial assistance in the period covered by the financial report in excess of $200,000 shall cause an audit to be made at least every 2 years. The audit must cover the entity's preceding 2 fiscal years. The audit must commence within 9 months from the close of the last fiscal year of the audit period. The audit must be completed and submitted to the department for review within 1 year from the close of the last fiscal year covered by the audit.

     (b)  The governing body or managing or executive officer of a local government entity that does not meet the criteria established in subsection (3)(a) shall at least once every 4 years, if directed by the department, or, in the case of a school district, if directed by the department at the request of the superintendent of public instruction, cause a financial review, as defined by department rule, to be conducted of the financial statements of the entity for the preceding fiscal year.

     (4)  An audit conducted in accordance with this part is in lieu of any financial or financial and compliance audit of an individual financial assistance program that a local government is required to conduct under any other state or federal law or regulation. If an audit conducted pursuant to this part provides a state agency with the information that it requires to carry out its responsibilities under state or federal law or regulation, the state agency shall rely upon and use that information to plan and conduct its own audits or reviews in order to avoid a duplication of effort.

     (5)  In addition to the audits required by this section, the department may at any time conduct or contract for a special audit or review of the affairs of any local government entity referred to in this part. The special audit or review must, to the extent practicable, build upon audits performed pursuant to this part.

     (6)  The fee for the special audit or review must be a charge based upon the costs incurred by the department in relation to the special audit or review. The audit fee must be paid by the local government entity to the state treasurer and must be deposited in the enterprise fund to the credit of the department.

     (7)  Subsections (1) through (3) do not apply to a local government entity that has adopted the alternative accounting method provided for in Title 7, chapter 6, part 6."



     Section 35.  Section 2-7-504, MCA, is amended to read:

     "2-7-504.  Accounting methods -- exception. (1) Unless otherwise required by law, the department shall prescribe by rule the general methods and details of accounting for the receipt and disbursement of all money belonging to local government entities and shall establish in those offices general methods and details of accounting. All local government entity officers shall conform with the accounting standards prescribed by the department.

     (2)  This section does not apply to a local government entity that has adopted the alternative accounting method provided for in Title 7, chapter 6, part 6. The rules adopted by the department must be in accordance with generally accepted accounting principles established by the governmental accounting standards board or its generally recognized successor."



     Section 36.  Section 2-7-505, MCA, is amended to read:

     "2-7-505.  Audit scope and standards. (1) Each audit must be a comprehensive audit of the affairs of the local government entity and must be made in accordance with auditing standards and in accordance with federal regulations adopted by the department by rule.

     (2)  The department, with cooperation from state agencies, shall prepare a local government compliance supplement that contains state and federal regulations applicable to local government entities. Auditors shall use the compliance supplement adopted pursuant to this section in conjunction with government auditing standards adopted by the department to determine the compliance testing to be performed during an audit.

     (3) When auditing a county or a consolidated government auditors shall perform tests for compliance with state laws relating to receipts and disbursements of agency funds maintained by the entity. Findings related to compliance tests must be reported in accordance with the reporting standards for financial audits prescribed in government auditing standards adopted by the department."



     Section 37.  Section 2-7-513, MCA, is amended to read:

     "2-7-513.  Content of audit report and financial report -- exception. (1) The audit reports must comply with the reporting requirements of government auditing standards issued by the U.S. comptroller general and federal regulations adopted by department rule.

     (2)  (a) The department shall prescribe general methods and details of accounting for the financial report for local government entities other than schools. The financial report must be submitted in a form required by the department. The superintendent of public instruction shall prescribe the general methods and details of accounting for financial reports for schools.

     (b)  Subsection (2)(a) does not apply to a local government entity that has adopted the alternative accounting method provided for in Title 7, chapter 6, part 6."



     Section 38.  Section 2-9-316, MCA, is amended to read:

     "2-9-316.  Judgments against governmental entities except state. Except as provided in 15-1-402, a A political subdivision of the state shall satisfy a final judgment or settlement out of funds that may be available from the following sources:

     (1)  insurance;

     (2)  the general fund or any other funds legally available to the governing body;

     (3)  a property tax, otherwise properly authorized by law, collected by a special levy authorized by law, in an amount necessary to pay any unpaid portion of the judgment or settlement, except that the levy may not exceed 10 mills;

     (4)  proceeds from the sale of bonds issued by a county, city, or school district for the purpose of deriving revenue for the payment of the judgment or settlement liability. The governing body of a county, city, or school district may issue bonds pursuant to procedures established by law. Property taxes may be levied to amortize the bonds, provided the levy for payment of any bonds, settlements, or judgments may not exceed, in the aggregate, 10 mills annually."



     Section 39.  Section 2-9-804, MCA, is amended to read:

     "2-9-804.  Purchase -- responsible surety. (1) The city or town council or commissioners shall purchase all surety bonds for city officers and employees.

     (2)  The city or town council or commission shall actively solicit offers on a competitive bases from available qualified insurance or surety companies before purchasing the bonds.

     (3)  Bonds purchased by the city or town council or commission shall must be executed by responsible insurance or surety companies authorized and admitted to execute surety bonds in this state."



     Section 40.  Section 3-5-602, MCA, is amended to read:

     "3-5-602.  Salary and expenses -- apportionment. (1) Each reporter is entitled to receive a base annual salary of not less than $28,000 or more than $35,000 and no other compensation, except as provided in 3-5-604, unless the judge decides to solicit bids for the work performed by the reporter, in which case the salary must be for the amount specified in the bid accepted by the judge. The salary must be set by the judge for whom the reporter works. The salary is payable in monthly installments out of the general funds of the counties composing the district for which the reporter is appointed and out of an appropriation made to the supreme court administrator as provided in subsection (2).

     (2)  The supreme court administrator shall determine the total number of civil and criminal actions commenced in the preceding year in the district court or courts in the judicial district for which a reporter is appointed. The state shall pay its portion of the reporter's salary based on the proportion of the total number of criminal actions commenced in the district court or courts in the district and the amount appropriated for that purpose. Each county shall pay its portion of the remainder of the salary based on its proportion of the total number of civil and criminal actions commenced in the district courts in the district. The judge or judges of the district shall, on January 1 of each year or as soon thereafter as possible, apportion the amount of the salary to be paid by each county in the district on the basis prescribed in this subsection. The portion of the salary payable by a county is a district court expense within the meaning of 7-6-2351, 7-6-2352, and 7-6-2511.

     (3)  In judicial districts comprising more than one county, the reporter is allowed, in addition to the salary and fees provided for in subsection (1), actual and necessary travel expenses, as defined and provided in 2-18-501 through 2-18-503, when on official business to a county of the reporter's judicial district other than the county in which the reporter resides. The expenses must be apportioned and are payable in the same way as the salary."



     Section 41.  Section 3-5-901, MCA, is amended to read:

     "3-5-901.  State assumption of certain district court expenses -- designation as district court reimbursement program. (1) To the extent that revenue is available under 61-3-509, the state shall fund:

     (a)  the following district court expenses in criminal cases only:

     (i)  salaries of court reporters;

     (ii) fees for transcripts of proceedings;

     (iii) witness fees and necessary expenses;

     (iv) juror fees;

     (v)  expenses for indigent defense; and

     (vi) expenses for psychiatric examinations;

     (b)  the district court expenses, as listed in subsection (1)(a), in all postconviction proceedings held pursuant to Title 46, chapter 21, and in all habeas corpus proceedings held pursuant to Title 46, chapter 22, and appeals from those proceedings;

     (c)  the following expenses incurred by the state in federal habeas corpus cases that challenge the validity of a conviction or of a sentence:

     (i)  transcript fees;

     (ii) witness fees; and

     (iii) expenses for psychiatric examinations; and

     (d)  the following expenses incurred by the state in a proceeding held pursuant to Title 41, chapter 3, part 4 or 6, that seeks temporary investigative authority of a youth, temporary legal custody of a youth, or termination of the parent-child legal relationship and permanent custody:

     (i)  transcript fees;

     (ii) witness fees;

     (iii) expenses for medical and psychological evaluation of a youth or the youth's parent, guardian, or other person having physical or legal custody of the youth except for expenses for services that a person is eligible to receive under a public program that provides medical or psychological evaluation;

     (iv) expenses associated with appointment of a guardian ad litem or child advocate for the youth;

     (v)  expenses for appointed counsel for the youth;

     (vi) expenses for appointed counsel for the parent, guardian, or other person having physical or legal custody of the youth; and

     (vii) expenses associated with court-ordered alternative dispute resolution.

     (2)  If revenue received under 61-3-509 exceeds the amount appropriated by the legislature to fund the expenses of the appellate defender program, the excess amount is statutorily appropriated, as provided in 17-7-502, to the supreme court to fund the expenses described in subsections (1)(a) through (1)(d) of this section, the district court grant program as described in subsection (4)(a) of this section, and the costs of administering this section.

     (3)  All revenue disbursed under this section must be deposited in and credited to the district court fund. If a district court fund does not exist, the revenue must be deposited in the county general fund for district court operations.

     (4)  If money appropriated for the expenses listed in subsection (1):

     (a)  exceeds the amount necessary to fully fund those expenses, the remaining excess amounts must be used for district court grants as provided in 7-6-2352 [section 23]; or

     (b)  is insufficient to fully fund those expenses, the county is responsible for payment of the balance."



     Section 42.  Section 7-1-114, MCA, is amended to read:

     "7-1-114.  Mandatory provisions. (1) A local government with self-government powers is subject to the following provisions:

     (a)  all state laws providing for the incorporation or disincorporation of cities and towns;, for the annexation, disannexation, or exclusion of territory from a city or town;, for the creation, abandonment, or boundary alteration of counties;, and for city-county consolidation;

     (b)  Title 7, chapter 3, part 1;

     (c)  all laws establishing legislative procedures or requirements for units of local government;

     (d)  all laws regulating the election of local officials;

     (e)  all laws that require or regulate planning or zoning;

     (f)  any law directing or requiring a local government or any officer or employee of a local government to carry out any function or provide any service;

     (g)  except as provided in subsection (3), any law regulating the budget, finance, or borrowing procedures and powers of local governments, except that the mill levy limits established by 15-10-420 apply;

     (h)  Title 70, chapters 30 and 31.

     (2)  These provisions are a prohibition on the self-government unit acting other than as provided.

     (3) (a) Notwithstanding the provisions of subsection (1)(g) and except as provided in subsection (3)(b), self-governing local government units are not subject to the mill levy limits established by state law.

     (b) The provisions of 15-10-420 apply to self-governing local government units."



     Section 43.  Section 7-3-4432, MCA, is amended to read:

     "7-3-4432.  Accounting procedures. Accounting procedure shall procedures must be devised and maintained for the municipality, that are adequate to record in detail all transactions affecting the acquisition, custodianship, and disposition of values, including cash receipts and disbursements. The accounting procedures must conform to the methods and standards provided for in 2-7-504 and Title 7, chapter 6, part 6. The recorded facts shall must be presented periodically to officials and to the public in such summaries and analytical schedules in detailed support thereof as of the summaries that may be necessary to show the full effect of such the transactions for each fiscal year upon the finances of the municipality and in relation to each department of the municipal government, including distinct summaries and schedules for each publicly owned and operated utility."



     Section 44.  Section 7-6-204, MCA, is amended to read:

     "7-6-204.  Crediting of interest. (1) Unless otherwise provided by law or by the terms of a gift, grant, or donation, interest paid and collected on deposits or investments must be credited to the general fund of the county, city, or town to whose credit the funds are deposited.

     (2)  Interest paid and collected on the deposits or investments of the funds of a volunteer fire district or department organized in an unincorporated area under Title 7, chapter 33, part 21 or 23, must be credited to the account of that fire district or department.

     (3)  Interest paid and collected on the deposits or investments of the county road fund or county bridge fund may be credited to the county road fund or county bridge fund."



     Section 45.  Section 7-6-2111, MCA, is amended to read:

     "7-6-2111.  Duties of county treasurer. (1) The county treasurer shall:

     (a)(1)  must receive all money belonging to the county and all other money directed to be paid to the treasurer by law, safely keep the money, and apply and pay the money out, and account for the money as required by law;

     (b)(2)  shall keep an account of the receipt and expenditures of the money in books provided for the purpose, in which must be entered:

     (i)(a)  the amount, and the time when, from whom, and on what account all money was received;

     (ii)(b) the amount, and time when, to whom, and on what account all disbursements were made;

     (c)(3)  shall keep books so that the amounts received and paid out on account of separate funds or specific appropriations are exhibited in separate and distinct accounts, with the whole receipts and expenditures shown in one general or cash account;

     (d)  may not enter money received for the current year on the treasurer's account with the county for the past fiscal year until after the treasurer's annual settlement for the past year has been made with the county clerk;

     (e)(4)  shall disburse the county money only on county warrants issued by the county clerk, based on orders of the board of county commissioners, or as otherwise provided by law.

     (2)  This section does not apply to a county that has adopted the alternative accounting method provided for in Title 7, chapter 6, part 6."



     Section 46.  Section 7-4-2514, MCA, is amended to read:

     "7-4-2514.  Filing required to receive salary. The board of county commissioners must may not order the payment of the salary of any such officer until he the officer has filed the duplicate receipt with the county clerk, properly signed by the treasurer, showing that he the officer has made the statement and settlement for that month, as required in this part, and filed the report prescribed in 7-6-2213."



     Section 47.  Section 7-6-2113, MCA, is amended to read:

     "7-6-2113.  Effect of failure to make treasurer's report. If any a county treasurer neglects or refuses to settle or report as required in 7-6-2112 [section 4], he the county treasurer forfeits and must shall pay to the county the sum of $500 for every such each neglect or refusal. The board of county commissioners must shall institute suits for the recovery thereof of the sum."



     Section 48.  Section 7-6-2202, MCA, is amended to read:

     "7-6-2202.  Duties of county clerk related to finance -- exception. (1) The county clerk shall draw warrants on the county treasury in favor of all persons entitled to the warrants in payment:

     (a)  of all claims and demands chargeable against the county which that have been legally examined, allowed, and ordered paid by the board of county commissioners; and

     (b)  for all debts and demands against the county when the amounts are fixed by law and are not directed to be audited by some other person or tribunal.

     (2)  The county clerk shall keep accounts current with the treasurer. When any person deposits with the county treasurer any money paid into the treasury, the county clerk must be furnished by the treasurer with a duplicate of the receipt issued to the person. The duplicate receipt must be filed in the office of the county clerk, and the county clerk shall charge the treasurer with the amount of the deposit.

     (3)  The county clerk shall make the annual statement as prescribed in 7-6-2203 prescribed by the department of commerce.

     (4)  This section does not apply to a county that has adopted the alternative accounting method provided for in Title 7, chapter 6, part 6."



     Section 49.  Section 7-6-2521, MCA, is amended to read:

     "7-6-2521.  All-purpose levy authorized for counties. A county may at its option levy an all-purpose levy as provided in 7-6-2521 through 7-6-2524 and 7-6-2526."



     Section 50.  Section 7-6-2524, MCA, is amended to read:

     "7-6-2524.  Changes from all-purpose levy. A county adopting the all-purpose levy provided for in 7-6-2521 through 7-6-2524 and 7-6-2526 is bound by that adoption during the ensuing fiscal year but may abandon the method in succeeding fiscal years."



     Section 51.  Section 7-6-2601, MCA, is amended to read:

     "7-6-2601.  Details related to county warrants -- definition. (1) Warrants issued pursuant to 7-6-2202(1) shall must be signed by the county clerk and the chairman presiding officer of the board of county commissioners, except warrants drawn on the redemption fund.

     (2)  All warrants issued by the county clerk during each year, commencing with the first Monday in January, must be numbered consecutively. The number, date, and amount of each and warrant, the name of the person to whom it is payable, and the purpose for which it is drawn must be stated thereon; on the warrant. and the warrants Warrants must, at the time they are issued, be registered by him the county clerk.

     (3)  Warrants drawn by order of the board on the county treasury for the current expenses during each year must specify the liability for which they are drawn and when the liability accrued.

     (4) For the purposes of this part, "warrant" includes a check and an electronic funds transfer."



     Section 52.  Section 7-6-2602, MCA, is amended to read:

     "7-6-2602.  Payment of warrants. (1) When a warrant is presented for payment, if there is money in the treasury for that purpose, the county treasurer must pay the same, write on the face thereof "Paid" and the date of payment, and sign his name thereto. Warrants must be paid in the order of presentation to the treasurer.

     (2)  The county treasurer must may not pay any order or warrant except to the payee thereof of the warrant or to his the payee's agent, assignee, or legal representative, whose authority must be in writing and delivered to him the county treasurer. and The written authority must be returned with such the order or warrant, when paid, to the board of county commissioners."



     Section 53.  Section 7-6-2607, MCA, is amended to read:

     "7-6-2607.  Examination and processing Processing of warrants. (1) The board, at its annual March session or more often if necessary, must examine the county warrants returned by the county treasurer by comparing each warrant with the record of warrants issued in the county clerk's office.

     (2)(1)  The board must shall cause to be canceled all county warrants that have remained uncalled for 1 year or more in the county clerk's office,. these The uncalled warrants to must be canceled in the same manner as other county warrants. At the same time, the county treasurer must shall deliver to the board all warrants or vouchers that are in the county treasurer's possession for money disbursed by him as the county treasurer and the clerk must shall issue a receipt for the same warrants or vouchers.

     (3)(2)  The board must shall cause to be entered on the record of warrants, opposite to the entry of each warrant issued, the date when the warrant was canceled and must shall make a list of the canceled warrants, specifying the number, date, amount, and the person to whom the same warrant was payable,. and must The board shall cause the list to be entered on the minutes of the board."



     Section 54.  Section 7-6-4302, MCA, is amended to read:

     "7-6-4302.  Payment of claims by warrant or check. Except as provided in 7-6-4121, all All accounts and demands against a city or town must be submitted to the council and, if found correct, must be allowed and an order must be made that the demand be paid. The demand must be paid in accordance with one of the following options:

     (1)  The mayor may draw a warrant upon the treasury in favor of the owner, specifying for what purpose and by what authority it is issued and out of what funds it is to be paid. The city treasurer or town clerk must shall pay the warrant out of the proper fund.

     (2)  The city treasurer or town clerk may pay the demand by check when there are sufficient city funds on deposit in an interest-bearing checking account in a bank within the city or town that are available to cover the check."



     Section 55.  Section 7-6-4501, MCA, is amended to read:

     "7-6-4501.  Interest on unpaid warrants -- definition. (1) When any warrant drawn upon the treasury of a city or town and pursuant to any ordinance or resolution or direction of the council of the city or town is presented to the city treasurer or town clerk for payment and the same warrant is not paid for want of funds, the city treasurer or town clerk must shall endorse thereon "Not paid for want of funds", annexing the date of presentation, and signing his the treasurer's or clerk's name thereto to the warrant.

     (2)  From the time of the endorsement until the warrant is called for payment, the warrant bears interest at a rate fixed by ordinance, or if the warrant is subject to purchase for investment by a county as provided in 7-6-2701 and is held by a county, the warrant bears interest at a rate fixed by the board of county commissioners under 7-6-2701.

     (3) As used in this part, "warrant" includes a check and an electronic funds transfer."



     Section 56.  Section 7-12-4181, MCA, is amended to read:

     "7-12-4181.  Collection of district assessments by county clerk -- certification. (1) Except as provided in 7-12-4183, in each city or town where taxes for general, municipal, and administrative purposes are certified to and collected by the county treasurer in accordance with the provisions of 7-6-4407 immediately after the second Monday of August of each year, it is the duty of the city treasurer or town clerk to certify to the department of revenue, at the same time that the copy of the resolution determining the annual levy for general taxes is certified by the city or town clerk to the county clerk as required by 7-6-4407, to the department of revenue all special assessments and taxes levied and assessed in accordance with any of the provisions of part 42 and this part.

     (2)  The department of revenue shall enter the special assessments and taxes upon the property tax record for the county. The county treasurer shall collect all taxes and assessments in the same manner and at the same time as taxes for general, municipal, and administrative purposes are collected."



     Section 57.  Section 7-12-4183, MCA, is amended to read:

     "7-12-4183.  Collection of district assessments by city treasurer in cities where county collects taxes. (1) In any city or town where taxes for general, municipal, and administrative purposes are certified to and collected by the county treasurer in accordance with the provisions of 7-6-4407 and 7-6-4423, the city or town may, nevertheless, provide by ordinance for the collection by its city treasurer or town clerk of all special assessments and taxes levied and assessed in accordance with any of the provisions of this part and part 42 and this part in the same manner and at the same time as taxes for general, municipal, and administrative purposes are collected by the county treasurer. All of the provisions of 7-6-4423 apply to the collection of the special taxes and assessments in the same manner as the provisions apply to the collection of other city or town taxes.

     (2)  (a) When the payment of any one installment of any special assessment becomes delinquent, all payments of subsequent installments shall must, at the option of the city or town council and by appropriate resolution duly adopted, become delinquent. The city or town council may order that all assessments that are delinquent as a result of acceleration be withdrawn.

     (b)  Delinquent special assessments shall must be certified to the county clerk of the county in which the city or town is situated. The county treasurer must shall collect the delinquent special assessments and taxes in the same manner and at the same time as that taxes for general, municipal, and administrative purposes are collected by him. In case they the delinquent assessments and taxes are not paid, the whole property shall must be sold in the same manner as that other property is sold for taxes. The enforcement of the lien of any installment of a special assessment by any method authorized by law does not prevent the enforcement of the lien of any subsequent installment when it becomes delinquent."



     Section 58.  Section 50-60-302, MCA, is amended to read:

     "50-60-302.  Certification of municipal and county building codes. (1) A county or municipality may not enforce a building code unless:

     (a)  the code enforcement program has been certified by the department as in compliance with applicable statutes and department certification rules;

     (b)  the current adopted code, a current list of fees to be imposed, and a current plan for enforcement of the code have been filed with and approved by the department; and

     (c)  all inspectors inspecting or approving any installations, which if accomplished commercially require state licensure, must themselves be properly and currently state-licensed as journeymen in that craft or occupation or be certified by a nationally recognized entity for testing and certification of inspectors that is approved by the department before being permitted to inspect or approve any installations.

     (2)  The department shall adopt additional rules and standards governing the certification of municipal and county building code enforcement programs which that must include provisions for prompt revocation of certification for refusal or failure to comply with any applicable statute or rule. The department may allow a county or municipality a reasonable amount of time, not to exceed 6 months, to correct identified code enforcement program deficiencies, unless the deficiencies constitute an immediate threat to the public health, safety, or welfare, in which case the department may require immediate correction. Failure to correct deficiencies within the time set by the department constitutes a basis for immediate decertification of the code enforcement program. Continued operation of a county or municipal code enforcement program in violation of a department order to correct deficiencies may be enjoined or subject to a writ of mandamus by a judge of the district court in the jurisdiction in which the county or municipality is located. The rules and standards must include provisions for the department to ensure that all code enforcement program functions are being properly performed.

     (3)  In addition to maintaining the continued compliance oversight required in subsection (1), the department shall require a detailed and fully documented annual report from a local government with a certified code enforcement program to ensure continued local government compliance with all requirements of applicable statutes and rules. If review of the annual report identifies compliance problems, the department shall immediately conduct an onsite evaluation.

     (4)(3)  If the certification of any local government code enforcement program is revoked for any violation or deficiency, the state resumes its original jurisdiction for state building code enforcement within the municipal or county area and the local government retains the responsibility for completion of inspections and issuance of certificates of occupancy on any incomplete construction projects previously permitted by the local government, unless the reason for the decertification is directly related to the protection of health, safety, and welfare of the public.

     (5)(4)  If a local government voluntarily decertifies its code enforcement program, the department must be given written notification of the intended decertification at least 90 days prior to the date of decertification. The local government retains the responsibility for completion of inspections and issuance of certificates of occupancy on any incomplete construction projects permitted by the local government prior to decertifying its code enforcement program."



     Section 59.  Section 53-2-322, MCA, is amended to read:

     "53-2-322.  County to levy taxes, budget, and make expenditures for public assistance activities. (1) Subject to 15-10-420, the board of county commissioners in each county shall levy 13.5 mills for the county poor fund as provided by law or so much of that amount as may be necessary. The board may levy up to an additional 12 mills if approved by the voters in the county. Subject to 15-10-420, a county shall levy sufficient mills to reimburse the state for any administrative or operational costs in excess of the administrative and operational costs for the previous fiscal year. The department of public health and human services shall notify the counties of the number of mills required to be levied. Once an additional levy has been approved, the amount of the approved levy may continue to be levied without voter approval.

     (2)  The board shall budget and expend so much of the funds in the county poor fund for:

     (a)  public assistance as necessary to reimburse the department for the county's proportionate share of the administrative costs and of all public assistance costs;

     (b)  salaries, travel expenses, and indirect costs, as provided in 52-1-110, of protective services employees of the department; and

     (c)  the county's proportionate share of any other public assistance activity that may be carried on jointly by the state and the county.

     (3)  The amounts set up in the budget for the reimbursements to the department must be sufficient to make all of these reimbursements in full. The budget must make separate provision for each public assistance activity and for salaries, travel expenses, and indirect costs for protective services activities of the department. Proper accounts must be established for the funds for all the activities.

     (4)  The department shall submit to the counties, no later than May 10, the most current county participation percentages that are necessary to establish preliminary county budgets. As soon as the county proposed budget provided for in 7-6-2315 has been agreed upon, a copy must be mailed to the department, and at any time before the final adoption of the budget, the department shall make recommendations with regard to changes in any part of the budget relating to the county poor fund as considered necessary in order to enable the county to discharge its obligations under the public assistance laws.

     (5)  The department shall promptly examine the county proposed budget in order to ascertain if the amounts provided for reimbursements to the department are likely to be sufficient and shall notify the county clerk of its findings. The board shall make changes in the amounts provided for reimbursements, if any are required, in order that the county will be able to make the reimbursements in full.

     (6)  The board of county commissioners may not make any transfer from the amounts budgeted for reimbursing the department without having first obtained a statement in writing from the department to the effect that the amount to be transferred will not be required during the fiscal year for the purposes for which the amounts were provided in the budget.

     (7)  The county poor fund, irrespective of the source of any part of the fund, may not be used directly or indirectly for the erection or improvement of any county building as long as the fund is needed for paying the county's proportionate share of public assistance and protective services, as described in 52-1-110, or its proportionate share of any other public assistance activity that may be carried on jointly by the state and the county. Expenditures for improvement of any county buildings used directly for care of the poor, except a county hospital or county nursing home, may be made out of money in the county poor fund, whether the money was produced by the mill levy provided for in subsection (1) or from any additional levy authorized by law. The expenditure may be authorized only when any county building used for the care of the poor must be improved in order to meet legal standards required for the building by the department and when the expenditure has been approved by the department.

     (8)  Money in the county poor fund may be used as matching funds for the receipt of federal money."



     Section 60.  Section 85-3-423, MCA, is amended to read:

     "85-3-423.  County budget waived for first appropriation -- conditions. The provisions of 7-6-2342 apply if If an emergency condition requiring prompt expenditure occurs immediately after an authority has been created by resolution of the board of county commissioners and after certification of a mill levy by the authority. In that case and only for the initial or first appropriation for the authority, the county commissioners may appropriate, from money not otherwise appropriated in the general fund, money necessary to carry out the provisions of this part. However, the appropriation may not exceed an amount equal to the amount that would be raised by a 2-mill levy upon the taxable valuation of the property in the county."



     Section 61.  Repealer. Sections 7-6-601, 7-6-603, 7-6-604, 7-6-2112, 7-6-2201, 7-6-2203, 7-6-2211, 7-6-2212, 7-6-2213, 7-6-2214, 7-6-2218, 7-6-2219, 7-6-2220, 7-6-2221, 7-6-2301, 7-6-2302, 7-6-2303, 7-6-2311, 7-6-2312, 7-6-2313, 7-6-2314, 7-6-2315, 7-6-2316, 7-6-2317, 7-6-2318, 7-6-2319, 7-6-2320, 7-6-2321, 7-6-2322, 7-6-2323, 7-6-2324, 7-6-2325, 7-6-2326, 7-6-2327, 7-6-2328, 7-6-2329, 7-6-2330, 7-6-2331, 7-6-2335, 7-6-2341, 7-6-2342, 7-6-2343, 7-6-2345, 7-6-2348, 7-6-2351, 7-6-2352, 7-6-2502, 7-6-2525, 7-6-2702, 7-6-4101, 7-6-4104, 7-6-4121, 7-6-4123, 7-6-4124, 7-6-4134, 7-6-4135, 7-6-4140, 7-6-4141, 7-6-4201, 7-6-4202, 7-6-4203, 7-6-4205, 7-6-4206, 7-6-4207, 7-6-4208, 7-6-4209, 7-6-4232, 7-6-4234, 7-6-4237, 7-6-4238, 7-6-4240, 7-6-4259, 7-6-4260, 7-6-4261, 7-6-4262, 7-6-4263, 7-6-4264, 7-6-4265, 7-6-4266, 7-6-4267, 7-6-4270, 7-6-4271, 7-6-4272, 7-6-4407, and 7-6-4408, MCA, are repealed.



     Section 62.  Codification instruction. (1) [Sections 1 through 8] are intended to be codified as an integral part of Title 7, chapter 6, part 6, and the provisions of Title 7, chapter 6, part 6, apply to [sections 1 through 8].

     (2) [Sections 9 through 32] are intended to be codified as an integral part of Title 7, chapter 6, and the provisions of Title 7, chapter 6, apply to [sections 9 through 32].



     Section 63.  Effective date. [This act] is effective July 1, 2001.



     Section 64.  Applicability. [This act] applies to special purpose districts beginning July 1, 2002.

- END -




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