BILL NUMBER: AB 548	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  JUNE 1, 2009

INTRODUCED BY   Assembly Member Krekorian
   (Coauthor: Senator Benoit)

                        FEBRUARY 25, 2009

   An act to amend Section 17558.5 of the Government Code, relating
to state mandates.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 548, as amended, Krekorian. State mandates.
   Under the California Constitution, whenever the Legislature or a
state agency mandates a new program or higher level of service on any
local government, including school districts, the state is required
to provide a subvention of funds to reimburse the local government,
with specified exceptions. Existing law establishes a procedure for
local governmental agencies to file claims for reimbursement of these
costs with the Commission on State Mandates. Under this procedure,
the commission is required to hear and decide upon each claim for
reimbursement and then determine the amount to be subvened for
reimbursement, which the Controller is required to pay to eligible
claimants. The procedure also provides that a reimbursement claim for
actual costs filed by a local agency or school district is subject
to an audit by the Controller no later than 3 years after the date
that the actual reimbursement claim is filed or last amended,
whichever is later, but that, if no funds are appropriated or no
payment is made to a claimant for the fiscal year for which the claim
is filed, the audit is required to be commenced no later than 3
years from the date of the initial payment of the claim.
   This bill would delete the provision that authorizes the
Controller to commence an audit more than 3 years from the date of
the initial payment of the claim if those conditions exist.  The
bill would also extend the time in which the Controller is authorized
to audit a claim for reimbursement to 4 years after the date 
 the claim is filed or amended, whichever is later. 
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 17558.5 of the Government Code is amended to
read:
   17558.5.  (a) A reimbursement claim for actual costs filed by a
local agency or school district pursuant to this chapter is subject
to the initiation of an audit by the Controller no later than
 three   four  years after the date that
the actual reimbursement claim is filed or last amended, whichever is
later. An audit shall be completed not later than two years after
the date that the audit is commenced.
   (b) The Controller may conduct a field review of any claim after
the claim has been submitted, prior to the reimbursement of the
claim.
   (c) The Controller shall notify the claimant in writing within 30
days after issuance of a remittance advice of any adjustment to a
claim for reimbursement that results from an audit or review. The
notification shall specify the claim components adjusted, the amounts
adjusted, interest charges on claims adjusted to reduce the overall
reimbursement to the local agency or school district, and the reason
for the adjustment. Remittance advices and other notices of payment
action shall not constitute notice of adjustment from an audit or
review.
   (d) The interest rate charged by the Controller on reduced claims
shall be set at the Pooled Money Investment Account rate and shall be
imposed on the dollar amount of the overpaid claim from the time the
claim was paid until overpayment is satisfied.
   (e) Nothing in this section shall be construed to limit the
adjustment of payments when inaccuracies are determined to be the
result of the intent to defraud, or when a delay in the completion of
an audit is the result of willful acts by the claimant or inability
to reach agreement on terms of final settlement.