BILL NUMBER: AB 1840	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  MARCH 17, 2016

INTRODUCED BY   Assembly Member Gipson

                        FEBRUARY 9, 2016

    An act to amend Section 64122 of the Government Code,
relating to transportation.   An act to amend Section
8546.10 of the Government Code, relating to state government. 


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1840, as amended, Gipson.  California Transportation
Financing Authority.   California State Auditor. 

   Existing law establishes the California State Auditor's Office,
headed by the appointed California State Auditor and under the
direction of the Milton Marks "Little Hoover" Commission on
California State Government Organization and Economy, with specified
duties that include, among others, conducting financial and
performance audits as directed by statute. Existing law also
establishes the State Audit Fund as a continuously appropriated fund
for the expenses of the office. Existing law authorizes the auditor
to establish a high-risk local government agency audit program for
the purpose of identifying, auditing, and issuing reports on any
local government agency he or she identifies as at high risk for,
among others, fraud and abuse. Existing law requires the office to be
responsible for the state costs associated with the program and
further requires an audit conducted pursuant to the program to be
approved by the Joint Legislative Audit Committee.  
   This bill would further require the auditor to obtain approval
from the Joint Legislative Audit Committee to conduct onsite
assessments or any work at a local government agency.  
   The California Transportation Financing Authority Act creates the
California Transportation Financing Authority, with specified powers
and duties relative to issuance of bonds to fund transportation
projects to be backed, in whole or in part, by various revenue
streams of transportation funds, and toll revenues under certain
conditions, in order to increase the construction of new capacity or
improvements for the state transportation system consistent with
specified goals. Existing law provides that bonds issued under these
provisions are free from taxation.  
   This bill would make a nonsubstantive change to this provision.

   Vote: majority. Appropriation: no. Fiscal committee:  no
  yes  . State-mandated local program: no.


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

   SECTION 1.    Section 8546.10 of the  
Government Code   is amended to read: 
   8546.10.  (a) The California State Auditor may establish a
high-risk local government agency audit program for the purpose of
identifying, auditing, and issuing reports on any local government
agency, including, but not limited to, any city, county, special
district, or any publicly created entity, whether created by the
California Constitution or otherwise, that the California State
Auditor identifies as being at high risk for the potential of waste,
fraud, abuse, or mismanagement or that has major challenges
associated with its economy, efficiency, or effectiveness.
   (b) In addition to identifying a local government agency as high
risk on the basis of weaknesses identified in audit and investigative
reports produced by the office, the California State Auditor may
consult with the Controller, Attorney General, and other state
agencies that have oversight responsibilities over any local
government agency, in identifying local governments that are at high
risk.
   (c) The California State Auditor's Office shall be responsible for
the state costs associated with the high-risk local government
agency audit program, shall conduct the program as funds permit,
 and  shall only conduct the program to the extent
that it does not interfere with duties related to mandated audits and
requests from the Joint Legislative Audit  Committee.
  Committee, and shall obtain approval from the Joint
Legislative Audit Committee to conduct any work at a local government
agency. 
   (d) (1) The California State Auditor shall notify the Joint
Legislative Audit Committee whenever he or she identifies a local
government as at high risk.
   (2) The California State Auditor shall provide the Joint
Legislative Audit Committee, at a public hearing of the committee, an
annual update of all audits in progress.
   (3) If a local government agency has taken significant corrective
measures for deficiencies identified by the California State Auditor,
that agency shall be removed from the high-risk local government
agency audit program.
   (e) Notwithstanding the requirements of Section 10231.5, if the
California State Auditor establishes the program provided for in this
section and the California State Auditor determines that a local
agency is at high risk, the California State Auditor shall issue
audit reports at least once every two years with recommendations for
improvement in such a local government so identified.
   (f)  Audits   Audits, onsite assessments, and
any other work at a local government agency  conducted pursuant
to this section shall be approved by the Joint Legislative Audit
Committee. 
  SECTION 1.    Section 64122 of the Government Code
is amended to read:
   64122.  Any bonds issued under this division, their transfer, and
the income therefrom shall at all times be free from taxation of any
kind by the state and by all political subdivisions in the state.