"The goal is greater fiscal accountability and transparency," Davy said. "The Legislature wants it, and the public wants it."

The regulations cover budgeting, school consolidation, the role of the new executive county superintendents and provisions of the new school-funding law that relate to spending and local tax levies.

"This is not an attempt to usurp all local authority," Davy said. "There is still a lot of local decision-making. We can still red-line items, but we want to do this in collaboration with districts."

Davy had come under criticism from legislators during recent budget hearings because the regulations were not already in place to begin school-consolidation efforts. The department must also prepare to defend its new school-funding formula before the state Supreme Court, which must rule on its constitutionality as it applies to the 31 urban Abbott special-needs districts.

Davy said most districts in the state are doing a good job with their budgets but that more collaboration with the state may help find more room for improvement.

DOE Director of Field Services William King said they want the local districts to see the state and executive county superintendents as resources to help them. Two county superintendents at the news conference, Carole Morris of Monmouth County and Lester Richens of Burlington County, said they already have begun meeting with their districts to discuss budgets and begin consolidation discussions.

"This is just a different way of doing what we had done in the past," Morris said. "We are asking more questions, making more specific suggestions."

Some counties still do not have a new executive county superintendent. Locally, Ocean and Cape May counties do but Atlantic and Cumberland counties do not, and are still served by the existing county superintendent. Davy said the final nominations will be made shortly. Under the new law, nominations are made by the governor and approved by the Senate Judiciary Committee.

School superintendents attending the news conference said school districts must be more transparent to keep the public trust, especially when a few districts get a lot of publicity for waste or fraud.

"Good fiscal management is a demand of citizens," Ewing Superintendent Raymond Broach said. "People are not opposed to education, they just want to be able to afford it."

"People look at us like mini-Enrons," Tenafly Superintendent Morton Sherman said. "I think the overwhelming majority of superintendents will roll up their sleeves and go along with this."

To e-mail Diane D'Amico at The Press:

DDamico@pressofac.com

THE NEW RULES

Excerpts from the 205-page Draft Accountability Regulations:

n Establish a countywide task force to provide advice on the consolidation of school district administrative services and the creation of consolidated school districts.

n A forensic audit shall be done if there is a specific complaint or allegation of waste, or when a board member or district employee is indicted or pleads guilty to criminal charges relating to district operations.

n School district budget review standards include budgeting all vacant positions at the first step of the salary guide; including only aides mandated by law and operating food service without a deficit.

n The executive county superintendent must approve all employment contracts for the superintendent, assistant superintendents and business administrators to assure they are reasonable and do not include excess benefits.

n Any early termination agreement of a superintendent's contract that includes a payment as a condition of separation must be approved by the Department of Education commissioner.

n The Department of Education can withhold or recover state aid if a district is found to have excessive or inefficient expenditures.

n Schools boards must adopt a policy to minimize the cost of public relations and professional services.

n School board nepotism policies must prohibit the employment of any relative of a school board member or superintendent. Existing employees may stay, but cannot be promoted unless approved by the county superintendent.

n District school boards must pre-approve all field trips, establish dollar thresholds for student awards and establish a not-to-exceed budget for all student activities in a nondiscriminatory manner.

n Refreshments for board members at board meetings are limited to $10 per person and may include employees who must remain at the district to prepare for and attend the meeting.

(Complete regulations are online at www.state.nj.us/education)