BILL NUMBER: AB 1891	AMENDED
	BILL TEXT

	AMENDED IN SENATE  JUNE 28, 2010
	AMENDED IN SENATE  JUNE 21, 2010
	AMENDED IN SENATE  MAY 27, 2010

INTRODUCED BY    Assembly Member  
Portantino   Committee on Higher Education   (
  Portantino (Chair), Block, Cook, Fong, Galgiani, Huber,
Ma, and Ruskin   ) 

                        FEBRUARY 16, 2010

    An act to amend Sections 8543, 8543.1, 8543.2, 8543.3,
8543.5, 8543.6, 8543.7, 8544, 8544.4, 8544.5, 8545, 8545.1, 8545.2,
8545.3, 8545.4, 8545.5, 8546, 8546.1, 8546.2, 8546.3, 8546.4, 8546.5,
8546.6, 8546.7, 8546.8, 8547.4, 8547.5, 8547.6, 8547.7, 8547.11,
8548.1, 8548.2, 8548.4, and 8548.9 of, and to amend the heading of
Chapter 6.5 (commencing with Section 8543) of Division 1 of Title 2
of, the Government Code, relating to state government.  
An act to add Article 8 (commencing with Section 550) to Chapter 3
of Part 1 of Division 1 of the Food and Agricultural Code, relating
to agriculture. 



	LEGISLATIVE COUNSEL'S DIGEST


   AB 1891, as amended,  Portantino   Committee
on Higher Education  .  State government: Bureau of
State Audits and Inspector General .   Sustainable
agriculture research agricultural chemicals.  
   Until January 1, 2010, existing law requested the Regents of the
University of California to establish the Sustainable Agriculture
Research and Education Program to support competitive grants to
promote more research and education on sustainable agricultural
practices, and to support the giving of instructions and practical
demonstrations in agriculture.  
   This bill would reestablish this program, except it would not
require the regents to biennially report to the Legislature on the
program.  
   Existing law establishes the Bureau of State Audits under the
direction of the Milton Marks "Little Hoover" Commission on
California State Government Organization and Economy. Existing law
provides that the duties of the bureau are to examine and report
annually upon financial statements prepared by the executive branch
and to perform other related assignments, including performance
audits, mandated by statute.  
   This bill would rename the bureau the Bureau of State Audits and
Inspector General and specify certain duties that the renamed bureau
is to undertake as part of its existing responsibilities, relating to
the investigation, review, and auditing of state entities under its
jurisdiction. The bill would make conforming changes to existing law.

   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.    Article 8 (commencing with Section 550)
is added to Chapter 3 of Part 1 of Division 1 of the   Food
and Agricultural Code   , to read:  

      Article 8.  Sustainable Agriculture


   550.  This article shall be known and may be cited as the
Sustainable Agriculture Research and Education Act of 1986.
   551.  The Legislature finds and declares all of the following:
   (a) There is a growing movement in California and the nation to
change farming techniques by adopting more resource-conserving,
energy-efficient systems of agriculture. The objective of these
changes is to produce agricultural products that may reduce the use
of petrochemicals, improve means of biological pest management,
improve soil productivity, improve erosion control, and improve
irrigation, cultivation, and harvesting techniques.
   (b) Over the long term, adoption of more efficient
resource-conserving systems of agricultural production can benefit
both the producing and consuming public.
   (c) The resolution of many agricultural problems depends on
immediate efforts to provide farmers with practices that are both
resource conserving and economical for food producers, and to foster
food production and distribution methods that reduce dependence on
petroleum-based inputs.
   552.  The purpose of this article is to promote more research and
education on sustainable agricultural practices, such as organic
methods, biological control, and integrated pest managements,
including the analysis of economic factors influencing the long-term
sustainability of California agriculture. This article is intended to
foster economically and ecologically beneficial means of soil
improvement, pest management, irrigation, cultivation, harvesting,
transportation, and marketing for California agriculture based on
methods designed to accomplish all of the following:
   (a) The control of pests and diseases of agricultural importance
through alternatives that reduce or eliminate the use of pesticides
and petrochemicals.
   (b) The production, processing, and distribution of food and fiber
in ways that consider the interactions among soil, plants, water,
air, animals, tillage, machinery, labor, energy, and transportation
to enhance agricultural efficiency, public health, and resource
conservation.
   553.  (a) It is the intent of the Legislature that the Regents of
the University of California establish the Sustainable Agriculture
Research and Education Program to support all of the following:
   (1) Competitive grants for research on topics described in Section
552.
   (2) The giving of instructions and practical demonstrations in
agriculture and imparting information through demonstrations,
publications, and otherwise, and for printing and distribution of
information in connection with the Sustainable Agriculture Research
and Education Program. Where feasible, these demonstrations shall
include field research conducted on cooperating farms.
   (3) Planning for and management of University of California
farmlands committed to supporting long-term continuous research in
sustainable agricultural practices and farming systems.
   (b) Those eligible to apply for competitive grants under
subdivision (a) shall include individuals affiliated with public and
private institutions of higher education and with nonprofit
tax-exempt organizations.
   (c) All grant applications shall be subject to peer review for
scientific merit.
   (d) In awarding grants, preference shall be given to projects that
include field evaluation and offer the greatest potential for
measurable progress toward attaining the long-term goals pursuant to
Section 552.
   554.  (a) If the Sustainable Agriculture Research and Education
Program is established by the regents, the President of the
University of California shall establish and appoint a Program
Advisory Committee and a Technical Advisory Committee.
   (b) The duties of the Program Advisory Committee shall include
recommending goals and priorities for this program, including, but
not limited to, reviewing the priority of grant applications.
   (c) The Program Advisory Committee shall be composed of a majority
of individuals representing agriculture, as well as representatives
from government, public organizations, and institutions of higher
education, all of whom are knowledgeable regarding the issues and
practices of sustainable agriculture.
   (d) The duties of the Technical Advisory Committee shall include
making recommendations about the scientific merit of grant
applications submitted pursuant to Section 553.
   (e) The Technical Advisory Committee shall be composed of faculty
and staff of the University of California and other experts from
outside the university.
   (f) Members of the Program Advisory Committee and Technical
Advisory Committee who are not employed by the University of
California shall be appointed for a period not exceeding three years
and receive compensation for expenses incurred in the performance of
their duties according to applicable university regulations and
guidelines.
   555.  If the Sustainable Agriculture Research and Education
Program is established by the regents, it shall be established from
existing resources.  
  SECTION 1.    The heading of Chapter 6.5
(commencing with Section 8543) of Division 1 of Title 2 of the
Government Code is amended to read:
      CHAPTER 6.5.  STATE AUDITOR INSPECTOR GENERAL

 
  SEC. 2.    Section 8543 of the Government Code is
amended to read:
   8543.  (a) There is hereby created in state government the Bureau
of State Audits and Inspector General under the direction of the
Milton Marks "Little Hoover" Commission on California State
Government Organization and Economy. In order to be free of
organizational impairments to independence, the bureau shall be
independent of the executive branch and legislative control.
   (b) Whenever a reference is made to the "Bureau of State Audits"
by the provisions of any statute or regulation, it shall be construed
as referring to the Bureau of State Audits and Inspector General.
 
  SEC. 3.    Section 8543.1 of the Government Code
is amended to read:
   8543.1.  The duties of the Bureau of State Audits and Inspector
General are to examine and report annually upon the financial
statements prepared by the executive branch of the state and to
perform other related assignments, including performance audits, that
are mandated by statute. For the purposes of this chapter "bureau"
means the "Bureau of State Audits and Inspector General," unless the
context clearly requires otherwise. The bureau shall, as part of its
existing auditing, administrative, and investigative duties, detect,
investigate, deter, and eliminate corruption, fraud, criminal
activity, conflicts of interest, abuses of office, and waste in the
state entities under its jurisdiction, including, but not limited to,
state agencies, departments, divisions, offices, boards, and
commissions. The bureau shall vigorously and fairly investigate
allegations of misconduct and conduct audits and systematic reviews
of state agency programs and procedures, and recommend improvements
for positive and permanent reform of agency operations. 

  SEC. 4.    Section 8543.2 of the Government Code
is amended to read:
   8543.2.  (a) The head of the bureau is the State Auditor Inspector
General, who shall be appointed by the Governor from a list of three
qualified individuals nominated by the Joint Legislative Audit
Committee by a vote of at least a majority of the committee
membership from each house of the Legislature. The term of any
individual appointed as the State Auditor Inspector General shall be
four years. Any vacancy in the office shall be filled in the same
manner provided by this subdivision for a full term.
   (b) As the head of the bureau, the State Auditor Inspector General
may establish constituent parts of the bureau to carry out the
powers and duties of the bureau unless otherwise specified by law.
   (c) The bureau has a Chief Deputy State Auditor.
   (d) The bureau has a Chief Deputy State Inspector General.
 
  SEC. 5.    Section 8543.3 of the Government Code
is amended to read:
   8543.3.  The State Auditor Inspector General shall be chosen
without reference to party affiliation and solely on the ground of
fitness to perform the duties of the office. Prior to selection, the
State Auditor Inspector General shall possess a combination of
education and experience in auditing and management necessary to
perform the duties of the office.  
  SEC. 6.    Section 8543.5 of the Government Code
is amended to read:
   8543.5.  The Chief Deputy State Auditor shall be appointed by the
State Auditor Inspector General. The Chief Deputy State Auditor shall
carry out those duties prescribed by the State Auditor Inspector
General and shall act for the State Auditor Inspector General when
the State Auditor Inspector General is absent or unable to serve or
when the office of the State Auditor Inspector General is vacant. The
tenure of any incumbent Chief Deputy State Auditor shall expire on
any date that an individual is appointed State Auditor Inspector
General, but any incumbent Chief Deputy State Auditor may be
reappointed pursuant to this section.  
  SEC. 7.    Section 8543.6 of the Government Code
is amended to read:
   8543.6.  The State Auditor Inspector General may be removed for
cause at any time by concurrent resolution of the Legislature. A
State Auditor Inspector General removed pursuant to this section may
not be reappointed to the office.  
  SEC. 8.    Section 8543.7 of the Government Code
is amended to read:
   8543.7.  (a) The annual salary for the State Auditor Inspector
General shall be equal to that of agency secretaries of the executive
branch of government pursuant to Section 11550.
   (b) The State Auditor Inspector General shall be repaid all actual
expenses incurred or paid by him or her in the discharge of his or
her duties.  
  SEC. 9.    Section 8544 of the Government Code is
amended to read:
   8544.  (a) Consistent with subdivision (i) of Section 8546, the
State Auditor Inspector General may employ and fix the compensation,
in accordance with Article VII of the California Constitution, of
those professional assistants and technical, clerical, deputy state
auditors, and other officers and employees as he or she deems
necessary for the effective conduct of the work under his or her
charge.
   (b) In establishing and adjusting classes of positions, and
establishing and adjusting salary ranges for each class of position,
to provide for the continued ability to attract and maintain
qualified individuals within the bureau, consideration shall be given
to the fact that the level of education, experience, knowledge, and
ability required of the employees in the bureau is generally higher
than that of state service generally, due to the unique duties and
responsibilities imposed on the bureau and the relatively small
number of employees.
   (c) When fixing compensation for employees, the State Auditor
Inspector General shall consider prevailing rates for comparable
service in other public employment and private business. 

  SEC. 10.    Section 8544.4 of the Government Code
is amended to read:
   8544.4.  The permanent office of the State Auditor Inspector
General shall be in Sacramento, where he or she shall be provided
with suitable and sufficient offices. When in his or her judgment the
conduct of the work requires, he or she may maintain offices at
other places in the state.  
  SEC. 11.    Section 8544.5 of the Government Code
is amended to read:
   8544.5.  (a) There is hereby established in the State Treasury the
State Audit Fund. Notwithstanding Section 13340, the State Audit
Fund is continuously appropriated for the expenses of the State
Auditor Inspector General. There shall be appropriated annually in
the Budget Act to the State Audit Fund, from the General Fund and the
Central Service Cost Recovery Fund, the amount necessary to
reimburse the State Audit Fund for the cost of audits to be performed
that are not directly reimbursed under subdivision (c). "Cost of
audits" means all direct and indirect costs of conducting the audits
and any other expenses incurred by the State Auditor Inspector
General in fulfilling his or her statutory responsibilities.
   (b) With regard to the funds appropriated pursuant to subdivision
(a), upon certification by the State Auditor Inspector General of
estimated costs on a monthly basis, the Controller shall transfer the
amount thus certified from the General Fund or the Central Service
Cost Recovery Fund, as applicable, to the State Audit Fund. The
Controller shall thereafter issue warrants drawn against the State
Audit Fund upon receipt of claims certified by the State Auditor
Inspector General.
   (c) To ensure appropriate reimbursement from federal and special
funds for the costs of the duties performed pursuant to Section
8546.3, the State Auditor Inspector General may directly bill state
agencies for the costs incurred, subject to the approval of the
Director of Finance.
   (d) To ensure adequate oversight of the operations of the bureau,
the Milton Marks "Little Hoover" Commission on California State
Government Organization and Economy shall annually obtain the
services of an independent public accountant to audit the State Audit
Fund and the operation of the bureau to assure compliance with state
law, including Section 8546. The results of this audit shall be
submitted to the commission and shall be a public record.
   (e) To ensure that audits of the Milton Marks "Little Hoover"
Commission on California State Government Organization and Economy
are conducted in conformity with government auditing standards, any
audit of the commission that is required or permitted by law shall be
conducted by the independent public accountant selected pursuant to
subdivision (d).  
  SEC. 12.    Section 8545 of the Government Code is
amended to read:
   8545.  The State Auditor Inspector General shall not destroy any
papers or memoranda used to support a completed audit sooner than
three years after the audit report is released to the public. All
books, papers, records, and correspondence of the bureau pertaining
to its work are public records subject to Chapter 3.5 (commencing
with Section 6250) of Division 7 of Title 1 and shall be filed at any
of the regularly maintained offices of the State Auditor Inspector
General, except that none of the following items or papers of which
these items are a part shall be released to the public by the State
Auditor Inspector General, his or her employees, or members of the
commission:
   (a) Personal papers and correspondence of any person providing
assistance to the State Auditor Inspector General when that person
has requested in writing that his or her papers and correspondence be
kept private and confidential. Those papers and correspondence shall
become public records if the written request is withdrawn or upon
the order of the State Auditor Inspector General.
   (b) Papers, correspondence, memoranda, or any substantive
information pertaining to any audit not completed.
   (c) Papers, correspondence, or memoranda pertaining to any audit
that has been completed, which papers, correspondence, or memoranda
are not used in support of any report resulting from the audit.
 
  SEC. 13.    Section 8545.1 of the Government Code
is amended to read:
   8545.1.  (a) The State Auditor Inspector General, and any employee
or former employee of the bureau, shall not divulge or make known to
any person not employed by the bureau in any manner not expressly
permitted by law any particulars of any record, document, or
information the disclosure of which is restricted by law from release
to the public. This prohibition includes, but is not limited to, the
restrictions on the release of records, documents, or information
set forth in Section 8545.
   (b) Subdivision (a) also applies to either of the following:
   (1) Any person or business entity that is contracting with or has
contracted with the bureau and to the employees and former employees
of that person or business entity.
   (2) The officers and employees of and any person or business
entity that is contracting with or has contracted with any state or
local governmental agency or publicly created entity that has
assisted the bureau in the course of any audit or investigation or
that has received a draft copy of any report or other draft document
from the bureau for comment or review.
   (c) Any officer, employee, or person who discloses the particulars
of any record, document, or other information in violation of this
section is guilty of a misdemeanor.  
  SEC. 14.    Section 8545.2 of the Government Code
is amended to read:
   8545.2.  (a) Notwithstanding any other provision of law, the State
Auditor Inspector General during regular business hours shall have
access to and authority to examine and reproduce, any and all books,
accounts, reports, vouchers, correspondence files, and all other
records, bank accounts, and money or other property, of any agency of
the state, whether created by the California Constitution or
otherwise, any local governmental entity, including any city, county,
and school or special district, and any publicly created entity, for
any audit or investigation. Any officer or employee of any agency or
entity having these records or property in his or her possession,
under his or her control, or otherwise having access to them, shall
permit access to, and examination and reproduction thereof, upon the
request of the State Auditor Inspector General or his or her
authorized representative.
   (b) For the purposes of access to and examination and reproduction
of the records and property described in subdivision (a), an
authorized representative of the State Auditor Inspector General is
an employee or officer of the state or local governmental agency or
publicly created entity involved and is subject to any limitations on
release of the information as may apply to an employee or officer of
the state or local governmental agency or publicly created entity.
For the purpose of conducting any audit or investigation, the State
Auditor Inspector General or his or her authorized representative
shall have access to the records and property of any public or
private entity or person subject to review or regulation by the
public agency or public entity being audited or investigated to the
same extent that employees or officers of that agency or public
entity have access. No provision of law providing for the
confidentiality of any records or property shall prevent disclosure
pursuant to subdivision (a), unless the provision specifically refers
to and precludes access and examination and reproduction pursuant to
subdivision (a). This subdivision does not apply to records compiled
pursuant to Part 1 (commencing with Section 8900) or Part 2
(commencing with Section 10200) of Division 2.
   (c) Any officer or person who fails or refuses to permit access
and examination and reproduction, as required by this section, is
guilty of a misdemeanor.  
  SEC. 15.    Section 8545.3 of the Government Code
is amended to read:
   8545.3.  It is a misdemeanor for the State Auditor Inspector
General or any employee of the State Auditor Inspector General to
release any information received pursuant to Section 10850 of the
Welfare and Institutions Code or that is otherwise prohibited by law
to be disclosed.  
  SEC. 16.    Section 8545.4 of the Government Code
is amended to read:
   8545.4.  (a) In connection with any audit or investigation
conducted by the State Auditor Inspector General, the State Auditor
Inspector General or his or her designee, may do any of the
following:
   (1) Administer oaths.
   (2) Certify to all official acts.
   (3) Issue subpoenas for the attendance of witnesses and the
production of papers, books, accounts, or documents, or for the
making of oral or written sworn statements, in any interview
conducted as part of an audit or investigation.
   (b) Any subpoena issued under this section extends as process to
all parts of the state and may be served by any person authorized to
serve process of courts of record or by any person designated for
that purpose by the State Auditor Inspector General or his or her
designee. The person serving this process may receive compensation as
allowed by the State Auditor Inspector General or his or her
designee, not to exceed the fees prescribed by law for similar
service.
   (c) Notwithstanding Section 7470, 7474, or 7491, subpoenas issued
under this section for financial records of financial institutions
concerning customers of financial institutions or for information
contained in those records shall not be subject to the requirement or
conditions of Section 7474.  
  SEC. 17.    Section 8545.5 of the Government Code
is amended to read:
   8545.5.  (a) The superior court in the county in which any
interview is held under the direction of the State Auditor Inspector
General or his or her designee has jurisdiction to compel the
attendance of witnesses, the making of oral or written sworn
statements, and the production of papers, books, accounts, and
documents, as required by any subpoena issued by the State Auditor
Inspector General or his or her designee.
   (b) If any witness refuses to attend or testify or produce any
papers required by the subpoena, the State Auditor Inspector General
or his or her designee may petition the superior court in the county
in which the hearing is pending for an order compelling the person to
attend and answer questions under penalty of perjury or produce the
papers required by the subpoena before the person named in the
subpoena. The petition shall set forth all of the following:
   (1) That due notice of the time and place of attendance of the
person or the production of the papers has been given.
   (2) That the person has been subpoenaed in the manner prescribed
in Section 8545.4.
   (3) That the person has failed and refused to attend or produce
the papers required by subpoena before the State Auditor Inspector
General or his or her designee as named in the subpoena, or has
refused to answer questions propounded to him or her in the course of
the interview under penalty of perjury.
   (c) Upon the filing of the petition, the court shall enter an
order directing the person to appear before the court at a specified
time and place and then and there show cause why he or she has not
attended, answered questions under penalty of perjury, or produced
the papers as required. A copy of the order shall be served upon him
or her. If it appears to the court that the subpoena was regularly
issued by the State Auditor Inspector General or his or her designee,
the court shall enter an order that the person appear before the
person named in the subpoena at the time and place fixed in the order
and answer questions under penalty of perjury or produce the
required papers. Upon failure to obey the order, the person shall be
dealt with as for contempt of court.  
  SEC. 18.    Section 8546 of the Government Code is
amended to read:
                                                             8546.
It is the intent of the Legislature that the bureau have the
independence necessary to conduct all of its audits in conformity
with "Government Auditing Standards" published by the Comptroller
General of the United States and the standards published by the
American Institute of Certified Public Accountants, free from
influence of existing state control agencies that could be the
subject of audits conducted by the bureau. Therefore, all of the
following exclusions apply to the office:
   (a) Notwithstanding Section 19790, the State Auditor Inspector
General shall establish an equal employment opportunity program that
shall meet the criteria and objectives established by the State
Personnel Board. The State Auditor Inspector General shall report
annually to the State Personnel Board and the commission regarding
the program.
   (b) Notwithstanding Section 12470, the State Auditor Inspector
General shall be responsible for maintaining its payroll system. In
lieu of audits of the uniform payroll system performed by the
Controller or any other department, the office shall contract
pursuant to subdivision (e) of Section 8544.5 for an annual audit of
its payroll and financial operations by an independent public
accountant.
   (c) Notwithstanding Section 13292, the State Auditor Inspector
General is delegated the authority to establish and administer the
fiscal and administrative policies of the bureau in conformity with
the State Administrative Manual without oversight by the Department
of Finance, the Department of Information Technology, or any other
state agency.
   (d) Notwithstanding Section 11032, the State Auditor Inspector
General may approve actual and necessary traveling expenses for
travel outside the state for officers and employees of the bureau.
   (e) Notwithstanding Section 11033, the State Auditor Inspector
General or officers and employees of the bureau may be absent from
the state on business of the state upon approval of the State Auditor
Inspector General or Chief Deputy State Auditor.
   (f) Sections 11040, 11042, and 11043 shall not apply to the Bureau
of State Audits. The State Auditor Inspector General may employ
legal counsel under those terms that he or she deems necessary to
conduct the legal business of, or render legal counsel to, the State
Auditor Inspector General.
   (g) The provisions and definitions of Article 2 (commencing with
Section 11342.510) of Chapter 3.5 of Division 3 shall not be
construed to include the Bureau of State Audits. The State Auditor
Inspector General may adopt regulations necessary for the operation
of the bureau pursuant to the provisions of the Administrative
Procedure Act (Chapter 3.5 (commencing with Section 11340) of
Division 3), but these regulations shall not be subject to the review
or approval of the Office of Administrative Law.
   (h) The State Auditor Inspector General shall be exempt from all
contract requirements of the Public Contract Code that require
oversight, review, or approval by the Department of General Services
or any other state agency. The State Auditor Inspector General may
contract on behalf of the State of California for goods and services
that he or she deems necessary for the furtherance of the purposes of
the bureau.
   (i) (1) Subject to Article VII of the California Constitution, the
State Auditor Inspector General is delegated the authority to
establish and administer the personnel policies and practices of the
Bureau of State Audits in conformity with Part 2.6 (commencing with
Section 19815) of Division 5 of Title 2 without oversight or approval
by the Department of Personnel Administration.
   (2) At the election of the State Auditor Inspector General,
officers and employees of the bureau may participate in benefits
programs administered by the Department of Personnel Administration
subject to the same conditions for participation that apply to civil
service employees in other state agencies. For the purposes of
benefits programs administration only, the State Auditor Inspector
General is subject to the determinations of the department. The
Bureau of State Audits shall reimburse the Department of Personnel
Administration for the normal administrative costs incurred by the
Department of Personnel Administration and for any extraordinary
costs resulting from the inclusion of the bureau employees in these
state benefit programs.  
  SEC. 19.    Section 8546.1 of the Government Code
is amended to read:
   8546.1.  (a) The State Auditor Inspector General shall conduct
financial and performance audits as directed by statute. The State
Auditor Inspector General may conduct these audits of any state
agency as defined by Section 11000, whether created by the California
Constitution or otherwise, any local governmental agency, including
any city, county, and school or special district, or any publicly
created entity. However, the State Auditor Inspector General shall
not audit the activities of the Milton Marks Commission on California
State Government Organization and Economy or the Legislature to
assure compliance with government auditing standards.
   (b) The State Auditor Inspector General shall conduct any audit of
a state or local governmental agency or any other publicly created
entity that is requested by the Joint Legislative Audit Committee to
the extent that funding is available and in accordance with the
priority established by the committee with respect to other audits
requested by the committee. Members of the Legislature may submit
requests for audits to the committee for its consideration and
approval. Any audit request approved by the committee shall be
forwarded to the State Auditor Inspector General as a committee
request.
   (c) The State Auditor Inspector General shall complete any audit
in a timely manner and in accordance with the "Government Auditing
Standards" published by the Comptroller General of the United States.

   (d) Immediately upon completion of the audit, the State Auditor
Inspector General shall transmit a copy of the audit report to the
commission. Not later than 24 hours after delivery to the commission,
the State Auditor Inspector General shall deliver the report to the
Legislature, appropriate committees or subcommittees of the
Legislature, and the Governor. Once transmitted to these parties, the
report shall be made available to the public.  
  SEC. 20.    Section 8546.2 of the Government Code
is amended to read:
   8546.2.  (a) The State Auditor Inspector General shall request
that any state agency, as defined in Section 11000, whether created
by the California Constitution or otherwise, any local governmental
agency, including any city, county, city and county, school, or
special district, or any publicly created entity, that is the subject
of an audit or investigation conducted pursuant to this chapter
provide updates on its progress in implementing the recommendations
made by the State Auditor Inspector General, at intervals prescribed
by the State Auditor Inspector General.
   (b) Any state agency described in subdivision (a) shall provide
the State Auditor Inspector General, in the form prescribed by the
State Auditor Inspector General, with updates on implementation of
recommendations as described in subdivision (a).  
  SEC. 21.    Section 8546.3 of the Government Code
is amended to read:
   8546.3.  The State Auditor Inspector General shall examine and
report annually upon the financial statements otherwise prepared by
the executive branch of the state so that the Legislature and the
public will be informed of the adequacy of those financial statements
in compliance with generally accepted accounting principles. In
making that examination, the State Auditor Inspector General may make
the audit examination of accounts and records, accounting
procedures, and internal auditing performance that he or she
determines to be necessary to disclose all material facts necessary
to proper reporting in accordance with the federal Single Audit Act
of 1984 (31 U.S.C. Section 7501 and following) and the purposes set
forth in Section 8521.5.  
  SEC. 22.    Section 8546.4 of the Government Code
is amended to read:
   8546.4.  (a) The State Auditor Inspector General shall annually
issue an auditor's report based upon the general purpose financial
statements included in the Controller's annual report that is
submitted to the Governor pursuant to Section 12460. The report shall
be in accordance with the "Government Auditing Standards" published
by the Comptroller General of the United States and the standards
published by the American Institute of Certified Public Accountants.
   (b) The State Auditor Inspector General, in the performance of
this annual audit and any other audit or investigation undertaken by
the bureau, may examine all the financial records, accounts, and
documents of any state agency as defined by Section 11000.
   (c) The State Auditor Inspector General shall rely, to the maximum
extent possible, upon the audits performed by the Controller, the
Department of Finance, internal auditors of state agencies, and
independent contractors. The Director of Finance shall be responsible
for coordinating and providing technical assistance to the internal
auditors of state agencies. Nothing in this article is intended to
reduce or restrict the operations of internal auditors whose review
of internal financial and administrative controls of state agencies
is essential for coordinated audits.
   (d) State agencies receiving federal funds shall be primarily
responsible for arranging for federally required financial and
compliance audits. State agencies shall immediately notify the
Director of Finance, the State Auditor Inspector General, and the
Controller when they are required to obtain federally required
financial and compliance audits. The Director of Finance, the State
Auditor Inspector General, and the Controller shall coordinate the
procurement by state agencies, including any negotiations with
cognizant federal agencies, of federally required financial and
compliance audits.
   (e) To prevent duplication of the annual audit conducted by the
State Auditor Inspector General pursuant to subdivision (a), except
for those state agencies that are required by state law to obtain an
annual audit, no state agency shall enter into a contract for a
financial or compliance audit without prior written approval of the
Controller and the Director of Finance, which approval shall state
the reason for the contract and shall be filed with the State Auditor
Inspector General at least 30 days prior to the award of the
contract. No funds appropriated by the Legislature shall be
encumbered for the purpose of funding any contract for an audit that
duplicates the annual financial audit conducted by the State Auditor
Inspector General.
   (f) Notwithstanding any other provision of this article, nothing
in this section shall be construed to limit, restrict, or otherwise
infringe upon the constitutional or statutory authority of the
Controller to superintend the fiscal concerns of the state.
   (g) Except as provided in subdivision (b), notwithstanding any
other provision of this article, nothing in this section shall be
construed to limit, restrict, or otherwise infringe upon the
statutory authority of the Director of Finance to supervise the
financial and business policies of the state.  
  SEC. 23.    Section 8546.5 of the Government Code
is amended to read:
   8546.5.  (a) The State Auditor Inspector General may establish a
high-risk government agency audit program for the purpose of
identifying, auditing, and issuing reports on any agency of the
state, whether created by the California Constitution or otherwise,
that the State Auditor Inspector General identifies as being at high
risk for the potential of waste, fraud, abuse, and mismanagement or
that has major challenges associated with its economy, efficiency, or
effectiveness.
   (b) In addition to identifying an agency as high risk on the basis
of weaknesses identified in audit and investigative reports produced
by the bureau, the State Auditor Inspector General may consult with
the Legislative Analyst, the Milton Marks "Little Hoover" Commission
on California State Government Organization and Economy, the Office
of Inspector General within the Department of Corrections, the
Department of Finance, and other state agencies that have oversight
responsibilities over any other agency of the state, in identifying
state agencies that are at high risk.
   (c) The State Auditor Inspector General shall notify the Joint
Legislative Audit Committee whenever it identifies a state agency as
at high risk.
   (d) The State Auditor Inspector General may issue audit reports
with recommendations for improvement in state agencies identified as
at high risk not less than once every two years.
   (e) The State Auditor Inspector General may require state agencies
identified as high risk to periodically report to the auditor
regarding the status of recommendations for improvement made by the
State Auditor Inspector General or other state oversight agencies.
 
  SEC. 24.    Section 8546.6 of the Government Code
is amended to read:
   8546.6.  The State Auditor Inspector General, in connection with
any audit or investigation conducted pursuant to this chapter, shall
be deemed to be a department head for the purposes of Section 11189.
 
  SEC. 25.    Section 8546.7 of the Government Code
is amended to read:
   8546.7.  Notwithstanding any other provision of law, every
contract involving the expenditure of public funds in excess of ten
thousand dollars ($10,000) entered into by any state agency, board,
commission, or department or by any other public entity, including a
city, county, city and county, or district, shall be subject to the
examination and audit of the State Auditor Inspector General, at the
request of the public entity or as part of any audit of the public
entity, for a period of three years after final payment under the
contract. Every contract shall contain a provision stating that the
contracting parties shall be subject to that examination and audit.
The failure of a contract to contain this provision shall not
preclude the State Auditor Inspector General from conducting an
examination and audit of the contract at the request of the public
entity entering into the contract or as part of any audit of the
public entity.
   It is the intent of the Legislature that the Regents of the
University of California include in contracts involving the
expenditure of state funds in excess of ten thousand dollars
($10,000) a provision stating that the contracting parties shall be
subject to the examination and audit of the State Auditor Inspector
General, at the request of the regents or as part of any audit of the
university, for a period of three years after final payment under
the contract.
   The examinations and audits under this section shall be confined
to those matters connected with the performance of the contract,
including, but not limited to, the costs of administering the
contract.  
  SEC. 26.    Section 8546.8 of the Government Code
is amended to read:
   8546.8.  Unless the contrary is stated or clearly appears from the
context, any reference to the Auditor General or the Office of the
Auditor General in any statute or contract in effect on the effective
date of this chapter, other than Chapter 4 (commencing with Section
10500), with respect to the performance of audits, shall be construed
to refer to the State Auditor Inspector General and the Bureau of
State Audits and Inspector General, respectively.  
  SEC. 27.    Section 8547.4 of the Government Code
is amended to read:
   8547.4.  The State Auditor Inspector General shall administer this
article and shall investigate and report on improper governmental
activities. If, after investigating, the State Auditor Inspector
General finds that an employee may have engaged or participated in
improper governmental activities, the State Auditor Inspector General
shall prepare an investigative report and send a copy of the
investigative report to the employee's appointing power. Subject to
the limitations of Section 8547.5, the State Auditor Inspector
General may provide to the employee's appointing power any evidence
gathered during the investigation that, in the judgment of the State
Auditor Inspector General, is necessary to support an adverse action
or an action recommended pursuant to subdivision (a) of Section
8547.7. Within 60 days after receiving a copy of the State Auditor
Inspector General's investigative report, the appointing power shall
either serve a notice of adverse action upon the employee who is the
subject of the investigative report or set forth in writing its
reasons for not taking adverse action. The appointing power shall
file a copy of the notice of adverse action with the State Personnel
Board in accordance with Section 19574, and shall submit a copy to
the State Auditor Inspector General. If the appointing power does not
take adverse action within 60 days of receiving a copy of the State
Auditor Inspector General's investigative report, it shall submit its
written reasons for not doing so to the State Auditor Inspector
General and the State Personnel Board, and adverse action may be
taken as provided in Section 19583.5. Any employee who is served with
a notice of adverse action may appeal to the State Personnel Board
in accordance with Section 19575.  
  SEC. 28.    Section 8547.5 of the Government Code
is amended to read:
   8547.5.  (a) The State Auditor Inspector General shall create the
means for the submission of allegations of improper governmental
activity both by transmission via mail or other carrier to a
specified mailing address and electronic submission through an
Internet Web site portal. The State Auditor Inspector General may
request that a person submitting an allegation provide his or her
name and contact information and provide the names and contact
information for any persons who could help to substantiate the claim.
However, the State Auditor Inspector General shall not require any
person submitting an allegation to provide his or her name or contact
information and shall clearly state on the agency Web site that this
information is not required in order to submit an allegation.
   (b) Upon receiving specific information that any employee or state
agency has engaged in an improper governmental activity, the State
Auditor Inspector General may conduct an investigation of the matter.
The identity of the person providing the information that initiated
the investigation, or of any person providing information in
confidence to further an investigation, shall not be disclosed
without the written permission of the person providing the
information except that the State Auditor Inspector General may make
the disclosure to a law enforcement agency that is conducting a
criminal investigation.  
  SEC. 29.    Section 8547.6 of the Government Code
is amended to read:
   8547.6.  The State Auditor Inspector General may request the
assistance of any state department, agency, or employee in conducting
any investigation required by this article. If an investigation
conducted by the State Auditor Inspector General involves access to
confidential academic peer review records of University of California
academic personnel, these records shall be provided in a form
consistent with university policy effective on August 1, 1992. No
information obtained from the State Auditor Inspector General by any
department, agency, or employee as a result of the State Auditor
Inspector General's request for assistance, nor any information
obtained thereafter as a result of further investigation, shall be
divulged or made known to any person without the prior approval of
the State Auditor Inspector General.  
  SEC. 30.    Section 8547.7 of the Government Code
is amended to read:
   8547.7.  (a) If the State Auditor Inspector General determines
that there is reasonable cause to believe that an employee or state
agency has engaged in any improper governmental activity, he or she
shall report the nature and details of the activity to the head of
the employing agency, or the appropriate appointing authority, and
may include recommended actions to prevent the continuation or
recurrence of the activity. If appropriate, the State Auditor
Inspector General shall report this information to the Attorney
General, the policy committees of the Senate and Assembly having
jurisdiction over the subject involved, and to any other authority
that the State Auditor Inspector General determines appropriate.
   (b) The State Auditor Inspector General shall not have any
enforcement power. In any case in which the State Auditor Inspector
General submits a report of alleged improper activity to the head of
the employing agency or appropriate appointing authority, that
individual shall report to the State Auditor Inspector General with
respect to any action taken by the individual regarding the activity,
the first report being transmitted no later than 60 days after the
date of the State Auditor Inspector General's report and monthly
thereafter until final action has been taken.
   (c) The State Auditor Inspector General shall keep confidential
every investigation, including, but not limited to, all investigative
files and work product, except that the State Auditor Inspector
General may issue any report of an investigation that has been
substantiated, keeping confidential the identity of the individual or
individuals involved, or, subject to the limitations of Section
8547.5, release any findings or evidence supporting any findings
resulting from an investigation conducted pursuant to this article
that is deemed necessary to serve the interests of the state.
   (d) This section does not limit any authority conferred upon the
Attorney General or any other department or agency of government to
investigate any matter.  
  SEC. 31.    Section 8547.11 of the Government Code
is amended to read:
   8547.11.  (a) A University of California employee, including an
officer or faculty member, may not directly or indirectly use or
attempt to use the official authority or influence of the employee
for the purpose of intimidating, threatening, coercing, commanding,
or attempting to intimidate, threaten, coerce, or command any person
for the purpose of interfering with the right of that person to
disclose to a University of California official, designated for that
purpose by the regents, or the State Auditor Inspector General
matters within the scope of this article.
   (b) For the purpose of subdivision (a), "use of official authority
or influence" includes promising to confer, or conferring, any
benefit; effecting, or threatening to effect, any reprisal; or taking
or directing others to take, or recommending, processing, or
approving, any personnel action, including, but not limited to,
appointment, promotion, transfer, assignment, performance evaluation,
suspension, or other disciplinary action.
   (c) Any employee who violates subdivision (a) may be liable in an
action for civil damages brought against the employee by the offended
party.
   (d) Nothing in this section shall be construed to authorize an
individual to disclose information otherwise prohibited
                            by or under law.  
  SEC. 32.    Section 8548.1 of the Government Code
is amended to read:
   8548.1.  No later than April 1, 2002, the State Auditor Inspector
General shall prepare for state employees a written explanation of
the California Whistleblower Protection Act contained in Article 3
(commencing with Section 8547). The explanation shall include, but
not be limited to, the following information:
   (a) Instructions on how to contact the State Auditor Inspector
General by mail or telephone.
   (b) A general overview of improper governmental activities and
examples of three of the most common types of improper governmental
activities that may be reported to the State Auditor Inspector
General.
   (c) Examples of two of the most commonly reported governmental
activities that the State Auditor Inspector General does not have
authority to investigate.
   (d) An explanation of whistleblower protection available to state
employees who report improper governmental activities to the State
Auditor Inspector General.
   (e) The requirement that the State Auditor Inspector General
protect the anonymity of a person who reports improper governmental
activity to the State Auditor Inspector General.
   (f) The State Auditor Inspector General's authority in connection
with violations of law discovered during an investigation of improper
governmental activities.  
  SEC. 33.    Section 8548.2 of the Government Code
is amended to read:
   8548.2.  The State Auditor Inspector General shall prepare for
distribution to each state agency in an electronic format a notice
containing the information in the written explanation prepared
pursuant to Section 8548.1. No later than July 1, 2002, each state
agency shall print and post this notice at its state office or
offices in a location or locations where employee notices are
maintained. A state agency shall not edit the written text of the
notice but it may publish the notice in a manner it chooses, and it
may include its own introductory language in the notice, provided
that the language and the format selected do not alter the meaning of
the notice.  
  SEC. 34.    Section 8548.4 of the Government Code
is amended to read:
   8548.4.  The State Auditor Inspector General shall post the
information described in Section 8548.1 on the Web site of the
bureau.  
  SEC. 35.    Section 8548.9 of the Government Code
is amended to read:
   8548.9.  (a) The State Auditor Inspector General shall, by January
15th of each year, report to the Joint Legislative Budget Committee,
the Joint Legislative Audit Committee, and the Department of Finance
with respect to each recommendation he or she has made based on an
audit or investigation that was reported more than one year prior and
that has not been fully implemented by the affected agency.
   (b) The report shall clearly identify the state agency audited or
investigated, the audit or investigation that contained the
recommendation, a brief description of the recommendation, the date
it was issued, and the most recent explanation provided by the agency
to the State Auditor Inspector General on the status of the
recommendation.
   (c) Any state agency that is notified by the State Auditor
Inspector General that it has not fully implemented a recommendation
made pursuant to this chapter more than one year prior, shall do
either of the following:
   (1) Provide a written report to the State Auditor Inspector
General, the respective policy committees and budget subcommittees of
the Assembly and Senate with oversight of the agency, and the
Department of Finance, explaining why the audit recommendation or
investigation has not been fully implemented.
   (2) Notify all entities described in subdivision (a) that it will
begin implementing the audit recommendation or investigation
recommendation within 90 days of the notification by the State
Auditor Inspector General, and include the estimated date of full
implementation.