Amended in Senate June 30, 2015

Amended in Assembly March 26, 2015

California Legislature—2015–16 Regular Session

Assembly BillNo. 783


Introduced by Assembly Member Daly

February 25, 2015


An act to amendbegin delete Section 37105 ofend deletebegin insert Sections 25303, 26881, and 53087.6 of, and to add Sections 25250.5 and 26915 to,end insert the Government Code,begin insert and to amend Section 4108.5 of the Revenue and Taxation Code,end insert relating tobegin delete localend deletebegin insert countyend insert government.

LEGISLATIVE COUNSEL’S DIGEST

AB 783, as amended, Daly. begin deleteCities: legislative bodies: subpoena power. end deletebegin insertCounty auditors.end insert

begin insert

(1) Existing law enumerates the officers of a county, including the office of the auditor, prescribes their duties, and permits a county board of supervisors to consolidate, separate, and reconsolidate their duties, as specified. Existing law requires the board of supervisors, at least biennially, to audit county financial accounts and records of all county officers responsible for the care, management, collection, or disbursement of county money, as specified. Existing law requires the board of supervisors to supervise the official conduct of all county officers, particularly with regard to the functions and duties of these county officers as they relate to the assessing, collecting, safekeeping, management, or disbursement of public funds.

end insert
begin insert

This bill would require, in any county with both an elected auditor-controller and a population exceeding 3,000,000 people, that the auditor-controller, and not the board of supervisors, examine and audit, or cause to be audited, the financial accounts and records of all officers having responsibility for the care, management, collection, or disbursement of county money, as described above. The bill would require this audit to be filed with the board of supervisors. The bill would require, in any county with both an elected auditor-controller and a population exceeding 3,000,000 people, that the authority of the board of supervisors to supervise the official conduct of county officers not be construed to affect the independent auditing and accounting functions of the auditor-controller and would prohibit the board of supervisors from obstructing his or her auditing and accounting functions. By increasing the duties of local officials in a county with the above-described characteristics, this bill would impose a state-mandated local program.

end insert
begin insert

(2) Existing law generally prescribes the duties of the county auditor. Existing law requires the county auditor or auditor-controller, as specified, to be the chief accounting officer of the county. Upon order of the board of supervisors, existing law requires the auditor or auditor-controller to prescribe the accounting forms and methods of all offices under the control of the board of supervisors and to supervise generally practices in those offices, which includes the ability to review departmental and countywide internal controls.

end insert
begin insert

This bill would require a county auditor or auditor-controller also to be the chief auditor of the county. The bill would grant the auditor or auditor-controller, as part of its supervisory powers, the authority to audit, rather than review, departmental and countywide internal controls. The bill would require, in reference to the duties of auditors, that the term “county auditor” include certain county offices that have been consolidated. The bill would prescribe requirements for the head of a county auditing unit. The bill would prohibit a board of supervisors from creating or operating a separate auditing unit outside of the county auditor, except if the separate auditing unit was established before 1981, and would prohibit the board from transferring any auditing unit away from the county auditor. By increasing the duties of local officials in a county with the above-described characteristics, this bill would impose a state-mandated local program.

end insert
begin insert

(3) Existing law authorizes a county auditor or controller to establish and maintain a whistleblower hotline for receiving information regarding fraud, waste, or abuse by local government employees, subject to certain requirements.

end insert
begin insert

This bill would require, in a county with an elected auditor-controller and a population exceeding 3,000,000, that the county auditor-controller be the sole county officer with the authority to maintain a whistleblower hotline, as described above. By increasing the duties of local officials in a county with the above-described characteristics, this bill would impose a state-mandated local program.

end insert
begin insert

(4) Existing law authorizes tax-defaulted property to be redeemed until the right of redemption terminates. Existing law requires the audit of a tax collector’s records and accounts related to redemption of tax-defaulted property at least once every 3 years.

end insert
begin insert

This bill would require, in a county with an elected auditor-controller and a population exceeding 3,000,000 people, that the auditor-controller either conduct the audit described above or retain the services of an independent certified public accountant or licensed public accountant to perform the audit, in accordance with specified standards. By increasing the duties of local officials in a county with the above-described characteristics, this bill would impose a state-mandated local program.

end insert
begin insert

(5) The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

end insert
begin insert

This bill would provide that, if the Commission on State Mandates determines that the bill contains costs mandated by the state, reimbursement for those costs shall be made pursuant to these statutory provisions.

end insert
begin delete

Existing law authorizes the legislative body of a city to issue subpoenas requiring the attendance of witnesses or production of books or other documents for evidence or testimony in any action or proceeding pending before the legislative body. Existing law requires these subpoenas to be signed by the mayor and attested by the city clerk.

end delete
begin delete

This bill would authorize a city attorney to attest to a subpoena signed by a mayor.

end delete

Vote: majority. Appropriation: no. Fiscal committee: begin deleteno end deletebegin insertyesend insert. State-mandated local program: begin deleteno end deletebegin insertyesend insert.

The people of the State of California do enact as follows:

P3    1begin insert

begin insertSECTION 1.end insert  

end insert

begin insertSection 25250.5 is added to the end insertbegin insertGovernment Codeend insertbegin insert,
2to read:end insert

begin insert
P4    1

begin insert25250.5.end insert  

Notwithstanding Section 25250, in any county with
2both an elected auditor-controller and a population exceeding
33,000,000 people, at least biennially, the county auditor-controller
4shall examine and audit, or cause to be audited, the financial
5accounts and records of all officers having responsibility for the
6care, management, collection, or disbursement of money belonging
7to the county or money received or disbursed by them under
8authority of law. The audit shall encompass the immediately
9preceding two-year period, or any portion thereof not included in
10a prior audit. This financial examination or audit may be
11performed in coordination with the investigations conducted by
12the grand jury under Section 925 of the Penal Code, or the
13auditor-controller may elect to accept reports delivered pursuant
14to Section 933 of the Penal Code in lieu of its own separate
15examination if these reports are found to fulfill some or all of the
16requirements of this section. In connection with the requirements
17of this section and Section 25253, the county auditor-controller
18may employ the services of an independent certified public
19accountant or licensed public accountant to perform an
20examination of the financial statements in accordance with
21generally accepted auditing standards. The audit shall be filed
22with the board of supervisors to enable the board to supervise
23county officers and county fiscal affairs.

end insert
24begin insert

begin insertSEC. 2.end insert  

end insert

begin insertSection 25303 of the end insertbegin insertGovernment Codeend insertbegin insert is amended to
25read:end insert

26

25303.  

begin insert(a)end insertbegin insertend insertThe board of supervisors shall supervise the official
27conduct of all county officers, and officers of all districts and other
28subdivisions of the county, and particularly insofar as the functions
29and duties of such county officers and officers of all districts and
30subdivisions of the county relate to the assessing, collecting,
31safekeeping, management, or disbursement of public funds. It shall
32see that they faithfully perform their duties, direct prosecutions
33for delinquencies, and when necessary, require them to renew their
34official bond, make reports and present their books and accounts
35for inspection.

begin insert

36(b) In any county with both an elected auditor-controller and
37a population exceeding 3,000,000 people:

end insert
begin insert

38(1) This section shall not be construed to affect the independent
39and statutorily designated auditing and accounting functions of
40the county auditor-controller.

end insert
begin insert

P5    1(2) The board of supervisors shall not obstruct the auditing and
2accounting functions of the elected county auditor-controller.

end insert
begin delete

3This

end delete

4begin insert(c)end insertbegin insertend insertbegin insertThisend insert section shall not be construed to affect the independent
5and constitutionally and statutorily designated investigative and
6prosecutorial functions of the sheriff and district attorney of a
7county. The board of supervisors shall not obstruct the investigative
8function of the sheriff of the county nor shall it obstruct the
9investigative and prosecutorial function of the district attorney of
10a county.

begin delete

11Nothing

end delete

12begin insert(d)end insertbegin insertend insertbegin insertNothingend insert contained herein shall be construed to limit the
13budgetary authority of the board of supervisors over the district
14attorney or sheriff.

15begin insert

begin insertSEC. 3.end insert  

end insert

begin insertSection 26881 of the end insertbegin insertGovernment Codeend insertbegin insert is amended to
16read:end insert

17

26881.  

The county auditor, or in counties that have the office
18of controller, the auditor-controller shall be the chief accounting
19officer of thebegin delete county.end deletebegin insert county and the chief auditor of the county.end insert
20 Upon order of the board of supervisors, the auditor or
21auditor-controller shall prescribe, and shall exercise a general
22supervision, including the ability tobegin delete reviewend deletebegin insert auditend insert departmental and
23countywide internal controls, over the accounting forms and the
24method of keeping the accounts of all offices, departments and
25institutions under the control of the board of supervisors and of
26all districts whose funds are kept in the county treasury.

27begin insert

begin insertSEC. 4.end insert  

end insert

begin insertSection 26915 is added to the end insertbegin insertGovernment Codeend insertbegin insert, to
28read:end insert

begin insert
29

begin insert26915.end insert  

(a) Any reference to “county auditor” shall also mean
30county auditor-controller, county auditor-recorder, county
31clerk-auditor-recorder, county clerk-auditor, county
32auditor-controller-treasurer-tax collector, any office consolidated
33under Section 24300.5, and any office into which the office of
34county auditor is consolidated.

35(b) The head of any county auditing unit, division, branch, or
36group shall be one of the following:

37(1) The county auditor.

38(2) A person who shall be answerable directly to the county
39auditor, shall have direct access to the county auditor, and shall
40report the audit results to the county auditor.

P6    1(c) A board of supervisors shall not create or operate a separate
2auditing unit, division, branch, or group outside of the county
3auditor, except if the separate auditing unit, division, branch, or
4group was established before 1981. A board of supervisors shall
5not transfer any auditing unit, division, branch, or group away
6from the county auditor.

end insert
7begin insert

begin insertSEC. 5.end insert  

end insert

begin insertSection 53087.6 of the end insertbegin insertGovernment Codeend insertbegin insert is amended
8to read:end insert

9

53087.6.  

(a) (1) A city, county, or city and county auditor or
10controller who is elected to office may maintain a whistleblower
11hotline to receive calls from persons who have information
12regarding fraud, waste, or abuse by local government employees.

13(2) A city, county, or city and county auditor or controller who
14is appointed by, or is an employee of, a legislative body or the
15government agency that is governed by the city, county, or city
16and county, shall obtain approval of that legislative body or the
17government agency, as the case may be, prior to establishing the
18whistleblower hotline.

begin insert

19(3) In any county with both an elected auditor-controller and
20a population exceeding 3,000,000 people, the county
21auditor-controller shall be the sole county officer with the authority
22to maintain a whistleblower hotline to receive calls from persons
23who have information regarding fraud, waste, or abuse by county
24government employees.

end insert

25(b) The auditor or controller may refer calls received on the
26whistleblower hotline to the appropriate government authority for
27review and possible investigation.

28(c) During the initial review of a call received pursuant to
29subdivision (a), the auditor or controller, or other appropriate
30governmental agency, shall hold in confidence information
31disclosed through the whistleblower hotline, including the identity
32of the caller disclosing the information and the parties identified
33by the caller.

34(d) A call made to the whistleblower hotline pursuant to
35subdivision (a), or its referral to an appropriate agency under
36subdivision (b), may not be the sole basis for a time period under
37a statute of limitation to commence. This section does not change
38existing law relating to statutes of limitation.

39(e) (1) Upon receiving specific information that an employee
40or local government has engaged in an improper government
P7    1activity, as defined by paragraph (2) of subdivision (f), a city or
2county auditor or controller may conduct an investigative audit of
3the matter. The identity of the person providing the information
4that initiated the investigative audit shall not be disclosed without
5the written permission of that person, unless the disclosure is to a
6law enforcement agency that is conducting a criminal investigation.
7If the specific information is in regard to improper government
8activity that occurred under the jurisdiction of another city, county,
9or city and county, the information shall be forwarded to the
10appropriate auditor or controller for that city, county, or city and
11county.

12(2) Any investigative audit conducted pursuant to this
13subdivision shall be kept confidential, except to issue any report
14of an investigation that has been substantiated, or to release any
15findings resulting from a completed investigation that are deemed
16necessary to serve the interests of the public. In any event, the
17identity of the individual or individuals reporting the improper
18government activity, and the subject employee or employees shall
19be kept confidential.

20(3) Notwithstanding paragraph (2), the auditor or controller may
21provide a copy of a substantiated audit report that includes the
22identities of the subject employee or employees and other pertinent
23information concerning the investigation to the appropriate
24appointing authority for disciplinary purposes. The substantiated
25audit report, any subsequent investigatory materials or information,
26and the disposition of any resulting disciplinary proceedings are
27subject to the confidentiality provisions of applicable local, state,
28and federal statutes, rules, and regulations.

29(f) (1) For purposes of this section, “employee” means any
30individual employed by any county, city, or city and county,
31including any charter city or county, and any school district,
32community college district, municipal or public corporation, or
33political subdivision that falls under the auditor’s or controller’s
34jurisdiction.

35(2) For purposes of this section, “fraud, waste, or abuse” means
36any activity by a local agency or employee that is undertaken in
37the performance of the employee’s official duties, including
38activities deemed to be outside the scope of his or her employment,
39that is in violation of any local, state, or federal law or regulation
40relating to corruption, malfeasance, bribery, theft of government
P8    1property, fraudulent claims, fraud, coercion, conversion, malicious
2prosecution, misuse of government property, or willful omission
3to perform duty, is economically wasteful, or involves gross
4misconduct.

5begin insert

begin insertSEC. 6.end insert  

end insert

begin insertSection 4108.5 of the end insertbegin insertRevenue and Taxation Codeend insertbegin insert is
6amended to read:end insert

7

4108.5.  

(a) The records and accounts of the tax collector
8pursuant to this part shall be audited at least once each three years.

9(b) begin deleteThis section shall become inoperative on July 1, 1993, and
10shall remain inoperative until July 1, 1994, on which date this
11section shall become operative. end delete
begin insertIn any county with both an elected
12auditor-controller and a population exceeding 3,000,000 people,
13the county auditor-controller shall either conduct the audit
14required by this section or shall employ the services of an
15independent certified public accountant or licensed public
16 accountant to perform the audit required by this section in
17accordance with the general and specified standards prescribed
18by the Institute of Internal Auditors or the Government Auditing
19Standards issued by the Comptroller General of the United States,
20as appropriate.end insert

21begin insert

begin insertSEC. 7.end insert  

end insert
begin insert

If the Commission on State Mandates determines that
22this act contains costs mandated by the state, reimbursement to
23local agencies and school districts for those costs shall be made
24pursuant to Part 7 (commencing with Section 17500) of Division
254 of Title 2 of the Government Code.

end insert
begin delete26

SECTION 1.  

Section 37105 of the Government Code is
27amended to read:

28

37105.  

Subpoenas shall be signed by the mayor and attested
29by the city clerk or the city attorney. They may be served as
30subpoenas are served in civil actions.

end delete


O

    97