The process for receivership is based on Arizona Revised Statutes ยง15-103, which gives the State Board of Education(SBE) the authority to appoint a receiver that is
authorized to override any decision made by the district's governing board, superintendent, or business manager. The receiver can reorganize a district's finances
nd budget and terminate any district employee, including the superintendent and business manager, if the receiver determines such actions are in the district's best interest.
Districts have rarely been placed in receivership. In fact, since 2005, the SBE has placed only 8 districts in receivership. All but 2 of
those districts have successfully exited receivership by adjusting their spending to align with their revenues and eliminating the impact of their prior overspending
and cash deficits. Some of the districts that were placed in receivership had not adequately reduced spending for a loss of student enrollment and related decreases
in funding, while other districts were placed in receivership because of overspending in part from a lack of control over expansion costs for increasing student enrollment.
