Connecticut 2019 Regular Session

Connecticut Senate Bill SB00961 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1	1
2	2
3		-	LCO \\PRDFS1\SCOUSERS\FORZANOF\WS\2019SB-00961-~~R02~~-
	3	+	LCO \\PRDFS1\SCOUSERS\FORZANOF\WS\2019SB-00961-R01-
4	4		SB.docx
5	5		1 of 6
6	6
7	7		General Assembly Substitute Bill No. 961
8	8		January Session, 2019
9	9
10	10
11	11
12	12
13	13
14	14		AN ACT CONCERNING TH E AUDIT OF MUNICIPAL ELECTRIC
15	15		ENERGY COOPERATIVES BY THE AUDITORS OF PUBLIC
16	16		ACCOUNTS, THE MUNICI PAL ELECTRIC CONSUME R ADVOCATE
17	17		AND RECOMMENDATIONS FROM A MUNICIPAL ELE CTRIC ENERGY
18	18		COOPERATIVE FORENSIC EXAMINATION.
19	19		Be it enacted by the Senate and House of Representatives in General
20	20		Assembly convened:
21	21
22	22		Section 1. Section 2-90 of the general statutes is repealed and the 1
23	23		following is substituted in lieu thereof (Effective from passage): 2
24	24		(a) The Auditors of Public Accounts shall organize the work of their 3
25	25		office in such manner as they deem most economical and efficient and 4
26	26		shall determine the scope and frequency of any audit they conduct. 5
27	27		(b) Said auditors, with the Comptroller, shall, at least annually and 6
28	28		as frequently as they deem necessary, audit the books and accounts of 7
29	29		the Treasurer, including, but not limited to, trust funds, as defined in 8
30	30		section 3-13c, and certify the results to the Governor. The auditors 9
31	31		shall, at least annually and as frequently as they deem necessary, audit 10
32	32		the books and accounts of the Comptroller and certify the results to the 11
33	33		Governor. They shall examine and prepare certificates of audit with 12
34	34		respect to the financial statements contained in the annual reports of 13
35	35		the Treasurer and Comptroller, which certificates shall be made part of 14
36	36		such annual reports. In carrying out their responsibilities under this 15
37	37		section, said auditors may retain independent auditors to assist them. 16 Substitute Bill No. 961
38	38
39	39
40	40		LCO {\\PRDFS1\SCOUSERS\FORZANOF\WS\2019SB-00961-
41		-	~~R02~~-SB.docx }
	41	+	R01-SB.docx }
42	42		2 of 6
43	43
44	44		(c) Said auditors shall audit, on a biennial basis if deemed most 17
45	45		economical and efficient, or as frequently as they deem necessary, the 18
46	46		books and accounts of each officer, department, commission, board 19
47	47		and court of the state government, all institutions supported by the 20
48	48		state and all public and quasi-public bodies, politic and corporate, 21
49	49		created by public or special act of the General Assembly and not 22
50	50		required to be audited or subject to reporting requirements, under the 23
51	51		provisions of chapter 111. Each such audit may include an examination 24
52	52		of performance in order to determine effectiveness in achieving 25
53	53		expressed legislative purposes. The auditors shall report their findings 26
54	54		and recommendations to the Governor, the State Comptroller and the 27
55	55		joint standing committee of the General Assembly having cognizance 28
56	56		of matters relating to appropriations and the budgets of state agencies. 29
57	57		(d) The Auditors of Public Accounts may enter into such contractual 30
58	58		agreements as may be necessary for the discharge of their duties. Any 31
59	59		audit or report which is prepared by a person, firm or corporation 32
60	60		pursuant to any contract with the Auditors of Public Accounts shall 33
61	61		bear the signature of the person primarily responsible for the 34
62	62		preparation of such audit or report. As used in this subsection, the 35
63	63		term "person" means a natural person. 36
64	64		(e) (1) If the Auditors of Public Accounts discover, or if it should 37
65	65		come to their knowledge, that any unauthorized, illegal, irregular or 38
66	66		unsafe handling or expenditure of state funds or quasi-public agency 39
67	67		funds or any breakdown in the safekeeping of any resources of the 40
68	68		state or a quasi-public agency has occurred or is contemplated, they 41
69	69		shall forthwith report the facts to the Governor, the State Comptroller, 42
70	70		the clerk of each house of the General Assembly and the Attorney 43
71	71		General, except that if a matter reported to the Auditors of Public 44
72	72		Accounts pursuant to section 4-33a is still under investigation by a 45
73	73		state or quasi-public agency, the Auditors of Public Accounts may give 46
74	74		the agency a reasonable amount of time to conduct such investigation 47
75	75		prior to the auditors reporting the matter to said officials. (2) If the 48
76	76		Auditors of Public Accounts decide to delay reporting such matter in 49 Substitute Bill No. 961
77	77
78	78
79	79		LCO {\\PRDFS1\SCOUSERS\FORZANOF\WS\2019SB-00961-
80		-	~~R02~~-SB.docx }
	80	+	R01-SB.docx }
81	81		3 of 6
82	82
83	83		accordance with subdivision (1) of this subsection, the auditors shall 50
84	84		immediately notify the Attorney General of such decision. (3) Any 51
85	85		Auditor of Public Accounts neglecting to make the report required 52
86	86		under subdivision (1) of this subsection, or any agent of the auditors 53
87	87		neglecting to report to the Auditors of Public Accounts any such 54
88	88		matter discovered by such agent or coming to such agent's knowledge, 55
89	89		shall be fined not more than one hundred dollars or imprisoned not 56
90	90		more than six months, or both. 57
91	91		(f) All reports issued or made pursuant to this section shall be 58
92	92		retained in the offices of the Auditors of Public Accounts for a period 59
93	93		of not less than five years. The auditors shall file one copy of each such 60
94	94		report with the State Librarian. 61
95	95		(g) Each state agency shall keep its accounts in such form and by 62
96	96		such methods as to exhibit the facts required by said auditors and, the 63
97	97		provisions of any other general statute notwithstanding, shall make all 64
98	98		records and accounts available to them or their agents, upon demand. 65
99	99		(h) Where there are statutory requirements of confidentiality with 66
100	100		regard to such records and accounts or examinations of 67
101	101		nongovernmental entities which are maintained by a state agency, 68
102	102		such requirements of confidentiality and the penalties for the violation 69
103	103		thereof shall apply to the auditors and to their authorized 70
104	104		representatives in the same manner and to the same extent as such 71
105	105		requirements of confidentiality and penalties apply to such state 72
106	106		agency. In addition, the portion of (1) any audit or report prepared by 73
107	107		the Auditors of Public Accounts that concerns the internal control 74
108	108		structure of a state information system or the identity of an employee 75
109	109		who provides information regarding alleged fraud or weaknesses in 76
110	110		the control structure of a state agency that may lead to fraud, or (2) any 77
111	111		document that may reveal the identity of such employee, shall not be 78
112	112		subject to disclosure under the Freedom of Information Act, as defined 79
113	113		in section 1-200. 80
114	114		(i) Said auditors shall audit, in accordance with the provisions of 81 Substitute Bill No. 961
115	115
116	116
117	117		LCO {\\PRDFS1\SCOUSERS\FORZANOF\WS\2019SB-00961-
118		-	~~R02~~-SB.docx }
	118	+	R01-SB.docx }
119	119		4 of 6
120	120
121	121		section 10-91g, the records and accounts of any private provider of 82
122	122		special education services, as defined in said section. Any private 83
123	123		provider of special education services being audited by said auditors 84
124	124		shall provide any information said auditors deem necessary to conduct 85
125	125		such audit. 86
126	126		(j) Said auditors shall audit, in accordance with the provisions of 87
127	127		chapter 101a, the records and accounts of any municipal electric 88
128	128		energy cooperative, as defined in said chapter. Any municipal electric 89
129	129		energy cooperative being audited by said auditors shall provide any 90
130	130		information said auditors deem necessary to conduct such audit. 91
131	131		Sec. 2. Subsection (a) of section 7-121f of the general statutes is 92
132	132		repealed and the following is substituted in lieu thereof (Effective from 93
133	133		passage): 94
134	134		(a) There is established a Municipal Electric Consumer Advocate to 95
135	135		act as an independent advocate for consumer interests in all matters 96
136	136		which may affect municipal electric energy cooperative consumers, 97
137	137		including, but not limited to, electric rates. Costs related to the 98
138	138		Municipal Electric Consumer Advocate, including, but not limited to, 99
139	139		hourly fees, [and] necessary expenses and fees for consultants hired by 100
140	140		the Municipal Electric Consumer Advocate as needed, shall be paid for 101
141	141		by all municipal electric energy cooperatives. The annual amount of 102
142	142		such costs (1) for such consultants shall not exceed thirty thousand 103
143	143		dollars, and (2) for all other fees and expenses that are not for 104
144	144		consultants shall not exceed seventy thousand dollars for the first 105
145	145		[year] six years and fifty thousand dollars for each year thereafter, 106
146	146		unless there is a demonstration of substantial need made by the 107
147	147		Municipal Electric Consumer Advocate and approved by the 108
148	148		cooperative utility boards of all municipal electric energy cooperatives. 109
149	149		Sec. 3. Subsection (h) of section 7-233c of the general statutes is 110
150	150		repealed and the following is substituted in lieu thereof (Effective from 111
151	151		passage): 112 Substitute Bill No. 961
152	152
153	153
154	154		LCO {\\PRDFS1\SCOUSERS\FORZANOF\WS\2019SB-00961-
155		-	~~R02~~-SB.docx }
	155	+	R01-SB.docx }
156	156		5 of 6
157	157
158	158		(h) A municipal electric energy cooperative shall cause a forensic 113
159	159		examination to be conducted by a certified forensic auditor which shall 114
160	160		include a review of the revenue and expenditures of a municipal 115
161	161		electric energy cooperative for the preceding five years. The auditor 116
162	162		shall submit a report that includes a review of whether such municipal 117
163	163		electric energy cooperative's operating procedures conform with the 118
164	164		provisions of chapter 101a and the bylaws of the municipal electric 119
165	165		energy cooperative, and any recommendations for any corrective 120
166	166		actions needed to ensure such conformance. The auditor shall not be 121
167	167		required to perform a full financial audit of the five-year period or 122
168	168		submit an opinion regarding the financial statements or a management 123
169	169		letter. The municipal electric energy cooperative shall incorporate any 124
170	170		such recommendations for corrective actions into its operating 125
171	171		procedures. The municipal electric energy cooperative shall post on its 126
172	172		Internet web site and provide to participants such reports not later 127
173	173		than seven days after such reports are received by the municipal 128
174	174		electric energy cooperative. Each participant shall post on its Internet 129
175	175		web site and provide to the municipality in which it operates such 130
176	176		reports not later than five days after such reports are received from the 131
177	177		municipal electric energy cooperative. Each such municipality shall 132
178	178		post on its Internet web site such reports not later than five days after 133
179	179		such reports are received from the participant. 134
180	180		Sec. 4. Section 7-233c of the general statutes is amended by adding 135
181	181		subsection (k) as follows (Effective from passage): 136
182	182		(NEW) (k) (1) The Auditors of Public Accounts shall conduct two 137
183	183		audits of each municipal electric energy cooperative in the state. (A) 138
184	184		On or before October 1, 2020, the Auditors of Public Accounts shall 139
185	185		conduct a financial audit and performance audit of each municipal 140
186	186		electric energy cooperative in the state. (B) On or before October 1, 141
187	187		2023, the Auditors of Public Accounts shall conduct an audit of each 142
188	188		municipal electric energy cooperative in the state, provided (i) if the 143
189	189		auditors made any recommendations in an audit of a municipal 144
190	190		electric energy cooperative conducted pursuant to subparagraph (A) of 145 Substitute Bill No. 961
191	191
192	192
193	193		LCO {\\PRDFS1\SCOUSERS\FORZANOF\WS\2019SB-00961-
194		-	~~R02~~-SB.docx }
	194	+	R01-SB.docx }
195	195		6 of 6
196	196
197	197		this subdivision, the auditors may, at their discretion, in the audit 146
198	198		conducted pursuant to this subparagraph, only review such 147
199	199		recommendations for the same such municipal electric energy 148
200	200		cooperative, and (ii) if the auditors did not make any 149
201	201		recommendations in an audit of a municipal electric energy 150
202	202		cooperative conducted pursuant to subparagraph (A) of this 151
203	203		subdivision, the auditors shall conduct a financial audit and 152
204	204		performance audit for the same such municipal electric energy 153
205	205		cooperative. Nothing in this section shall be interpreted to limit the 154
206	206		scope of any audit conducted pursuant to this section if additional 155
207	207		information becomes available to the auditors during the course of an 156
208	208		audit conducted pursuant to subparagraph (B)(i) of this subdivision. 157
209	209		The Auditors of Public Accounts, in accordance with the provisions of 158
210	210		section 11-4a, shall report their findings to the joint standing 159
211	211		committee of the General Assembly having cognizance of matters 160
212	212		relating to energy. 161
213	213		(2) On two occasions, once on or before October 1, 2020, and once on 162
214	214		or before October 1, 2023, each municipal electric energy cooperative in 163
215	215		the state shall remit payment to the state in an amount not less than 164
216	216		forty thousand dollars for the costs associated with the audits 165
217	217		performed pursuant to subdivision (1) of this subsection. 166
218	218		This act shall take effect as follows and shall amend the following
219	219		sections:
220	220
221	221		Section 1 from passage 2-90
222	222		Sec. 2 from passage 7-121f(a)
223	223		Sec. 3 from passage 7-233c(h)
224	224		Sec. 4 from passage 7-233c
225	225
226	226		ET Joint Favorable Subst.
227		-	APP Joint Favorable
228	227