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By: Nicholaus Norvell, Partner and Stephanie Cook, Associate, Best Best & Krieger LLP

Current law requires certain elected and appointed local public officials to receive training on ethics principles and laws relevant to the official’s public service for a minimum of two hours every two years. Starting in 2026, an additional two-hour fiscal and financial training will be required and certain local government staff will be required to take the respective trainings.

In October of 2025, Governor Gavin Newsom signed into law SB 827, a bill authored by State Senate Majority Leader Lena Gonzalez. The new law builds upon current ethics training requirements, commonly known as “AB 1234 training”, by adding a new “fiscal and financial training” requirement aimed at providing local officials with the tools and knowledge necessary to practice good governance and effective stewardship of public funds. While the requirements of SB 827 are largely similar to the ethics training requirements of AB 1234, there are a few notable differences that local agencies will need to become familiar with before impending deadlines. 

New Fiscal and Financial Training for Board Members and Certain Employees

The legislative history of SB 827 notes that local officials hold a fiduciary duty to the public and a requirement to act as responsible stewards in guiding and managing local funds. Further, because this duty involves extensive and complex fiscal management responsibilities—including tracking multiple revenue streams, creating restrictions on how funds may be used, and broadly acting to ensure the management of funds is carried out in the public interest—an expansion of current ethics training requirements to include a fiscal component helps ensure local officials are adequately educated on the fiscal responsibilities relevant to their public office, and, thereby, can effectively execute their duties, avoid mismanagement of funds, and, additionally, promote transparency and bolster public confidence.

Under current law, a member of a local agency legislative body or an elected local agency official who receives any type of compensation, salary, or stipend or reimbursement for actual and necessary expenses incurred in the performance of official duties is deemed to be a “local agency official,” and all local agency officials are currently required to complete biennial ethics trainings under AB 1234 (Salinas, 2005). SB 827 builds on this requirement by additionally mandating completion of “fiscal and financial training.”

The newly required fiscal and financial trainings must include education on at least the following subjects:

1. laws and principles relating to financial administration and short- and long-term fiscal management, including, but not limited to, the role and responsibilities of financial administration, financial policies, municipal budgets and budget processes, and financial reporting and auditing;
2. laws and principles relating to, but not limited to, capital financing and debt management, mechanisms for local agency revenues, pensions and other postemployment benefits, cash management and investments, the prudent investor standard, and the ethics of safeguarding public resources; and
3. general fiscal and financial planning principles and any pertinent laws relevant to the local agency official’s public service and role in overseeing the local agency’s operations and relevant to the local agency’s procurement and contracting practices and responsibilities.  

As is the requirement under AB 1234, all local agency officials must complete the new fiscal and financial training every two years. To address initial implementation of this new training, all local agency officials in the service of the local agency before January 1, 2026 will be required to comply with the fiscal and financial training requirements no later than January 1, 2028. However an exception to this requirement applies to local agency officials whose term of office ends before January 9, 2028.  Unlike AB 1234, which historically granted local agency officials one year from the start of their service to comply with ethics trainings, AB 827 requires that all local agency officials who begin their service on, or after, January 1, 2026 complete the fiscal and financial training no later than six months following the start of their service.

SB 827 provides only limited guidance on how local agencies can provide the training to their officials. Under the new law, local agencies may broadly “contract or otherwise collaborate” with a training course provider. However, the new law specifically requires that training courses and materials must be developed “in consultation with widely recognized experts in local government finances, including local government associations.” Trainings must be provided in the form of a course, or self-study materials with tests, and the training may be completed in person or online.

Details as to the training course or materials must be made available to local agency officials at least annually, and participants must be provided with proof of participation upon completion of the training requirements. Similar to prior law on ethics training, if an official serves on more than one local agency, they are only required to comply with the requirement once within the required time period, but must provide a copy of proof of their participation to all local agencies that they serve.

Aligned with the AB 1234 record-keeping requirements, SB 827 requires local agencies to maintain records demonstrating both the date the local agency official completed the fiscal and financial training as well as the entity that provided the training. The local agency must maintain the records for at least five years after the official’s completion of the training, and these records are public records subject to disclosure under California’s Public Records Act. However, SB 827 adds an additional requirement with regard to record-keeping for both fiscal and financial training and ethics training; specifically, local agencies must post clear instructions and contact information on their websites, if the agency has one, for the purpose of assisting the public to request or access both fiscal and financial training records and ethics training records. This posting requirement goes into effect on July 1, 2026 thereby providing local agencies with additional time to compile training records and post the required information on their agency website.

Expansion of AB 1234 Ethics Training to Department Heads and Similar Employees

Finally, in addition to imposing a new two-hour fiscal and financial training requirement, SB 827 also expands the types of officials required to receive AB 1234 ethics training. Previously, the law provided most types of public agencies with discretion on which employees would be required to receive AB 1234 ethics training. Under the new law, “department heads and other similar administrative officers of a local agency” are now required to comply with ethics training requirements.

Who Must Take Statutorily Required Trainings for Local Officials?

*Subdivision (d) of Government Code Section 3511.1 defines “Local agency executive” to mean any person employed by a local agency who is not subject to the Meyers-Milias-Brown Act (Chapter 10 (commencing with Section 3500)), Chapter 5 (commencing with Section 45100) of Part 25 of Division 3 of Title 2 of the Education Code, or Chapter 4 (commencing with Section 88000) of Part 51 of Division 7 of Title 3 of the Education Code, and who meets any of the following requirements:

1. The person is the chief executive officer, a deputy chief executive officer, or an assistant chief executive officer of the local agency.
2. The person is the head of a department of a local agency.
3. The person’s position within the local agency is held by an employment contract between the local agency and that person.

Deadlines for Completing Statutorily Required Trainings

This article was contributed by Nicholaus Norvell and Stephanie Cook from Best Best & Krieger LLP (BBK), a CSDA Business Affiliate. CSDA Members can contact BBK through the CSDA Buyer’s Guide at csda.net.

This communication is provided for general information only and is not offered or intended as legal advice. Readers should seek the advice of an attorney when confronted with legal issues and attorneys should perform an independent evaluation of the issues raised in these communications.

Take a look back at previous parts of the 2026 New Laws Series in CSDA eNews for more in-depth overviews of new laws affecting special districts:

Missed Part 7? Read it now: 45-Day Notification Prior to Contracting for Services (AB 339)
Missed Part 6? Read it now: Positioning Special Districts for Success Under New Permitting and Planning Laws
Missed Part 5? Read it now: Biggest Brown Act Revamp in Decades (SB 707)
Missed Part 4? Read it now: Clarifying Timing for Collection of Development Related Fees (SB 499)
Missed Part 3? Read it now: Certified Payroll Records Requests on Prevailing Wage Public Works Projects (AB 538)
Missed Part 2? Read it now: Additional CEQA Exemptions and Reforms
Missed Part 1? Read it now: CA Supreme Court Denies Elected Officials Right to Sue as “Employees” Under Whistleblower Statute

We've got you covered. Register for our upcoming trainings to ensure you meet the updated SB 827 requirements.

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