(c) Family members as employees.

1. (1) This part does not prohibit an administrator’s family members from being employed by:

   1. (A) The public educational entity the administrator serves; or
   2. (B) Any other public educational entity.
2. (2) However, a member of an administrator’s family or former spouse may not be initially employed as a disbursing officer of the public educational entity where the administrator is employed unless the public educational entity receives written approval from the Commissioner of Elementary and Secondary Education.
3. (3) Before issuing written approval or denial, the commissioner shall request Arkansas Legislative Audit to review the internal controls, including the segregation of duties, present at the public educational entity.
4. (4) Arkansas Legislative Audit shall report its findings to the commissioner.

(d) Exceptions.

1. (1) In unusual and limited circumstances and only with prior written approval from the commissioner, an administrator may contract with a public educational entity other than the public educational entity employing him or her.
2. (2) In unusual and limited circumstances and only with prior written approval from the commissioner, an administrator’s family members may contract with a public educational entity employing the administrator.

3. (3)

   1. (A) An administrator seeking to contract with other public educational entities, or an administrator’s family member seeking to contract with the public educational entity employing the administrator, shall first present the request, with all relevant facts and circumstances justifying approval, to the public educational entity’s board currently employing the administrator at an open meeting.
   2. (B) Such request should include without limitation the contract disclosure form, Appendix Form B.

4. (4)

   1. (A)

(i) After reviewing the request in an open meeting, the public educational entity’s board may by written resolution (Appendix Form C) approve the contract subject to approval by the commissioner.

1. (ii) A copy of the approval resolution (Appendix Form C) and all relevant data, including Appendix Form B, shall be forwarded by the public educational entity’s board president to the commissioner.

   1. (B) The written resolution and other relevant data shall be sent by:

      1. (i) Certified mail, return receipt requested; or
      2. (ii) Other method approved by the State Board of Education to:

(b) (b) Provide a record for the school district board of directors sending the request for approval.

1. (C) Upon review of the submitted data, the commissioner shall within twenty (20) days of receipt of the resolution and other relevant data approve or disapprove in writing the public educational entity’s board’s request.

   1. (D)

      1. (i) The commissioner may request additional information or testimony before ruling on a request.
      2. (ii) If additional data are needed for a proper determination, the commissioner shall approve or disapprove the contract within twenty (20) days of receipt of the additional requested data.
   2. (E) If the commissioner does not respond to the public educational entity within the twenty-day period or request additional time or data for a proper review of the contract, the contract shall be deemed to be approved by the commissioner.

   3. (F)

      1. (i) If approved, the approval letter shall state:

(b) (b) Any restrictions or limitations of the approval.

1. (ii) The commissioner may grant an approval for a:

(b) (b) Series of related transactions.

1. (iii) No approval shall be granted for a period greater than two (2) complete and consecutive fiscal years.
2. (5) The department and the public educational entity shall maintain, under their respective record retention policies, a record and copy of all documentation relating to an exemption from the provisions of this part.

3. (6) A contract subject to this section is not valid until the commissioner:

   1. (A) Approves the contract; or
   2. (B) Fails to respond to the public educational entity within the time periods specified in this section.

(e) Providing false or incomplete information. Any administrator knowingly furnishing false information or knowingly not disclosing relevant information necessary for a proper determination by the public educational entity or the commissioner shall be guilty of violating the provisions of:

1. (1) This part; and
2. (2) Arkansas Code § 6-24-101 et seq.

(f) “Contract” defined. For the purposes of this section only, “contract” does not apply to employment contracts issued to an administrator of a public educational entity for administrative or other duties such as, but not limited to:

1. (1) Teaching;
2. (2) Bus driving; or
3. (3) Sponsorship of clubs or activities.