BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | SB 1475|
|Office of Senate Floor Analyses | |
|(916) 651-1520 Fax: (916) | |
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CONSENT
Bill No: SB 1475
Author: Committee on Governmental Organization
Amended: 4/21/16
Vote: 21
SENATE GOVERNMENTAL ORG. COMMITTEE: 12-0, 4/12/16
AYES: Hall, Berryhill, Block, Gaines, Galgiani, Glazer,
Hernandez, Hill, Hueso, Lara, McGuire, Vidak
NO VOTE RECORDED: Runner
SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8
SUBJECT: State warrants: records
SOURCE: Author
DIGEST: This bill makes minor changes to an existing
provision of law pertaining to canceled warrants for the purpose
of modernizing the system by which the State Treasurer's Office
(STO) and the State Controller's Office (SCO) manage records of
all canceled warrants.
ANALYSIS:
Existing law:
1)Requires the SCO and the STO to each keep a register of all
canceled warrants showing the number, date, and amount of each
warrant, the fund out of which it was payable and the date of
cancellation. (Government Code Section 17071)
2)Provides that whenever a warrant issued by the SCO is unpaid
for one year after it becomes payable, sufficient unapplied
moneys having been available for the payment of the warrant,
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and for the payment of all senior obligations, the SCO shall
cancel it. (Government Code Section 17070)
This bill modifies the existing procedure by which the SCO and
STO must each maintain a register of all canceled warrants to
instead require the SCO to keep a record of all canceled
warrants.
Background
Purpose of SB 1475. As noted above, existing law requires the
establishment of separate registers of all canceled warrants by
the STO and the SCO. According to the STO and the SCO, this
requirement was necessary following the establishment of the
Centralized Treasury in 1949 to ensure that the STO did not pay
banks for warrants that had been canceled by the SCO.
Today, as a result of technological advancements, the STO
Centralized Treasury and Securities Management Division Item
Processing Section (IPS) receives from the SCO on a daily basis
electronic files that list all outstanding warrants, and,
accordingly, any warrant presented by any bank that is not
listed on that file will not be paid, will be rejected and
returned to the presenting bank. Thus, there is no need to keep
a register of canceled warrants as defined in Government Code
Section 17070. The only warrants that the IPS processes and
approves for payment are those presented for payment by banks
that match the warrants appearing on the outstanding file
provided by the SCO.
STO staff point out that fulfilling the requirements of
Government Code Section 17071 as currently written would require
the development of a new information technology system and the
expenditure of funds and resources on a functionality that would
eventually become obsolete as it will be built into the
Financial Information System for California (FI$Cal).
Furthermore, its purpose is currently being met through the
issued and outstanding files produced by the SCO and provided to
the STO on a daily basis.
What is FI$Cal? FI$Cal is a business transformation project for
state government processes in the areas of budgeting,
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accounting, procurement and cash management. The objective of
the project is to develop a comprehensive statewide budget
system to prepare, enact, and administer the state's annual
financial plan (budget) and to provide critical information
required to make budget decisions and manage state resources.
FI$Cal is a partnership between the agencies responsible for the
state's financial management: the Department of Finance, the
SCO, the STO, and the Department of General Services,
collectively known as the "partner agencies."
Prior Legislation
SB 797 (Senate Governmental Organization Committee, Chapter 249,
Statutes of 2015) added prime-rated commercial paper, issued by
a federally- or state-chartered bank or a state-licensed branch
of a foreign bank that is approved by the Pooled Money
Investment Board, to the list of eligible securities for
investment of funds in the Pooled Money Investment Account. The
bill also made clarifying amendments and deleted obsolete
language relating to various bond acts.
FISCAL EFFECT: Appropriation: No Fiscal
Com.: Yes Local: No
SUPPORT: (Verified 5/3/16)
State Treasurer's Office
OPPOSITION: Verified 5/3/16)
None received
Prepared by:Arthur Terzakis / G.O. / (916) 651-1530
5/4/16 14:58:14
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