BILL NUMBER: SB 186	AMENDED
	BILL TEXT

	AMENDED IN SENATE  MARCH 22, 2011
	AMENDED IN SENATE  MARCH 10, 2011

INTRODUCED BY   Senators Kehoe and DeSaulnier
   (Principal coauthor: Assembly Member Alejo)
   (Coauthor: Assembly Member Lara)

                        FEBRUARY 7, 2011

   An act to amend Section 12464 of the Government Code, relating to
the Controller.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 186, as amended, Kehoe. The Controller.
   Existing law authorizes the Controller to appoint a qualified
accountant to make an investigation and to obtain the information
required for the annual report of financial transactions.
   This bill would authorize the Controller to exercise discretionary
authority to perform an audit or investigation of any county, city,
special district, joint powers authority, or redevelopment agency, if
 necessary, to ensure compliance   the
Controller possesses documentation that results in reason to believe
that the local agency is not complying  with the financial
requirements in state law, grant agreements,  local charters,
 or local ordinances. This bill would require the Controller to
prepare a report of the results of the audit or investigation and to
file a copy with the local legislative body.  This bill would
also provide that specified costs incurred by the Controller shall
be borne by the county, city, special district, joint powers
authority, or redevelopment agency and state that reimbursements
collected, upon appropriation to the Controller, be available to
offset costs of enforcing this provision. 
   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 12464 of the Government Code is amended to
read:
   12464.  (a) If the county, city, special district, joint powers
authority, or redevelopment agency reports are not made in the time,
form, and manner required or there is reason to believe that a report
is false, incomplete, or incorrect, the Controller shall appoint a
qualified accountant to make an investigation and to obtain the
information required. The accountant appointed shall report to the
Controller the results of the investigation, and a copy shall be
filed with the legislative body of the county, city, special
district, joint powers authority, or redevelopment agency, the
accounts of which were investigated. If a similar investigation has
to be made of the accounts of any county, city, special district,
joint powers authority, or redevelopment agency, for two successive
years, a certified copy of the results of the investigation last made
shall be transmitted to the grand jury of the county that was
investigated or in which the local agency investigated is situated,
or, if the agency is situated in more than one county, in the county
in which any portion of the agency is situated.
   (b) The Controller may, at his or her discretion, perform an audit
or investigation of any county, city, special district, joint powers
authority, or redevelopment agency, if  there is 
 the Controller possesses documentation that results in a 
reason to believe that the local agency is not complying with the
financial requirements in state law, grant agreements,  local
charters,  or local ordinances. The Controller shall prepare a
report of the results of the audit or investigation, and a copy shall
be filed with the legislative body of the county, city, special
district, joint powers authority, or redevelopment agency, the
accounts of which were audited or investigated. The audit or
investigation will be designed to provide reasonable assurance on
compliance with laws and regulations that are significant to the
audit or investigation objectives. Any indication of illegal acts or
fraud shall be communicated to appropriate authorities, including the
county grand jury.
   (c) Any costs incurred by the Controller pursuant to 
subdivisions (a) and (b)   subdivision (a)  ,
including contracts with, or employment of, certified public
accountants or public accountants, in compiling a financial report
pursuant to Section 12463 or 12463.3 shall be borne by the county,
city, special district, joint powers authority, or redevelopment
agency, and shall be a charge against any unencumbered funds of the
county, city, special district, joint powers authority, or
redevelopment agency. Any forfeiture imposed by Section 53895 or
53895.5 may be offset up to the total costs incurred by the
Controller. Any remaining balance shall be forfeited in accordance
with Sections 53895 and 53895.5. Any costs incurred by the Controller
in excess of the forfeiture imposed shall be a charge against any
unencumbered funds of the county, city, special district, joint
powers authority, or redevelopment agency.  All
reimbursements collected in regard to this section shall, upon
appropriation to the Controller, be available to offset costs of
enforcing this section.