3499S.02C
1
SENATE COMMITTEE SUBSTITUTE
FOR
SENATE BILL NO. 1048
AN ACT
To repeal sections 29.005, 29.235, 374.250, and
610.021, RSMo, and to enact in lieu thereof five new
sections relating to the powers of the state auditor.
Be it enacted by the General Assembly of the State of Missouri, as follows:
Section A. Sections 29.005, 29.235, 374.250, and 610.021,
RSMo, are repealed and five new sections enacted in lieu
thereof, to be known as sections 29.005, 29.225, 29.235,
374.250, and 610.021, to read as follows:
29.005. As used in this chapt er, the following terms
mean:
(1) "Accounting system", the total structure of
records and procedures which discover, record, classify, and
report information on the financial position and operating
results of a governmental unit or any of its fun ds, balanced
account groups, and organizational components;
(2) "Audit", an independent, objective assessment of
the stewardship, performance, or cost of government
policies, programs, or operations, depending upon the type
and scope of the audit . All audits shall conform to the
standards established by the comptroller general of the
United States for audits of government entities,
organizations, programs, activities, and functions as
presented in the publication Government Auditing Standards ;
(3) "Federal agency", any department, agency, or
instrumentality of the federal government and any federally
owned or controlled corporation;
(4) "Financial audits", audits providing an
independent assessment of whether an entity's reporte d
2
financial information is presented fairly in accordance with
recognized criteria. Financial audits shall consist of the
following:
(a) Financial statement audits that shall:
a. Provide or disclaim an opinion about whether an
entity's financial statements are presented fairly in all
material respects in conformity with accounting principles
generally accepted in the United States or with another
applicable financial reporting framework; or
b. Report on internal control deficiencie s and on
compliance with provisions of laws, regulations, contracts,
and grant agreements, as those controls and provisions
relate to financial transactions, systems, and processes; or
(b) Other financial audits of various scopes which may
include, but not be limited to:
a. Reporting on specified elements, accounts, or items
of a financial statement; and
b. Auditing compliance with requirements related to
federal award expenditures and other governmental financial
assistance in conjunction with a financial statement audit;
(5) "Improper governmental activity", includes
official misconduct, fraud, misappropriation, mismanagement,
waste of resources, or a violation of state or federal law,
rule, or regulation;
(6) "Internal control", the plans, policies, methods,
and procedures used to meet an entity's or organization's
mission, goals, and objectives. Internal control shall
include the processes and procedures for planning,
organizing, directing, and controlling oper ations, as well
as management's system for measuring, reporting, and
monitoring performance;
[(6)] (7) "Performance audits", audits that provide
findings or conclusions based on an evaluation of
3
sufficient, appropriate evidence against identified
criteria. Performance audit objectives shall include, but
not be limited to, the following:
(a) Effectiveness and results. This objective may
measure the extent to which an entity, organization,
activity, program, or function is achieving its goals and
objectives;
(b) Economy and efficiency. This objective shall
assess the costs and resources used to achieve results of an
entity, organization, activity, program, or function;
(c) Internal control. This objective shall assess one
or more components of an entity's internal control system,
which is designed to provide reasonable assurance of
achieving effective and efficient operations, reliable
financial and performance reporting, or compliance with
applicable legal requiremen ts; and
(d) Compliance. This objective shall assess
compliance with criteria established by provisions of laws,
regulations, contracts, and grant agreements or by other
requirements that could affect the acquisition, protection,
use, and disposition of an entity's resources and the
quantity, quality, timeliness, and cost of services the
entity produces and delivers;
[(7)] (8) "State agency", any department, institution,
board, commission, committee, division, bureau, officer, or
official which shall include any institution of higher
education, mental or specialty hospital, community college,
or circuit court and divisions of the circuit court.
29.225. 1. The auditor, or his or her authorized
representatives, may audi t all or part of any political
subdivision or other governmental entity:
(1) If, after an investigation under section 29.221 of
the political subdivision or governmental entity, or its
4
officers or employees, the auditor believes an improper
governmental activity has occurred; or
(2) When requested by a prosecuting attorney, circuit
attorney, or law enforcement agency as part of an
investigation of an improper governmental activity.
2. The costs for all audits initiated under this
section shall be paid out of the state auditor's budget.
29.235. 1. The auditor and the auditor's authorized
agents are authorized to:
(1) Examine all books, accounts, records, reports, or
vouchers of any state agency or entity subj ect to audit,
insofar as they are necessary to conduct an audit under this
chapter, provided that the auditor complies with state and
federal financial privacy requirements prior to accessing
financial records including provisions presented in chapter
408 and provided that the auditor or other public entity
reimburses the reasonable documentation and production costs
relating to compliance with examination by the auditor or
auditor's authorized agents that pertain to:
(a) Amounts received unde r a grant or contract from
the federal government or the state or its political
subdivisions;
(b) Amounts received, disbursed, or otherwise handled
on behalf of the federal government or the state;
(2) Examine and inspect all property, equip ment, and
facilities in the possession of any state agency, political
subdivision, or quasi -governmental entity that were
furnished or otherwise provided through grant, contract, or
any other type of funding by the state of Missouri or the
federal government; and
(3) Review state tax returns, except such review shall
be limited to matters of official business, and the
auditor's report shall not violate the confidentiality
5
provisions of tax laws. Notwithstanding confidentiality
provisions of tax laws to the contrary, the auditor may use
or disclose information related to overdue tax debts in
support of the auditor's statutory mission.
2. All contracts or agreements entered into as a
result of the award of a grant by state agencies or
political subdivisions shall include, as a necessary part, a
clause describing the auditor's access as provided under
this section.
3. The auditor may obtain the services of certified
public accountants, qualified management consultants, or
other professional persons and experts as the auditor deems
necessary or desirable to carry out the duties and functions
assigned under this chapter. Unless otherwise authorized by
law, no state agency shall enter into any contract for
auditing services without consultation with, and the prior
written approval of, the auditor.
4. (1) Insofar as necessary to conduct an audit under
this chapter or an investigation under section 29.221 , the
auditor or the auditor's authorized representatives shall
have the power to subpoena witnesses, to take testimony
under oath, to cause the deposition of witnesses residing
within or without the state to be taken in a manner
prescribed by law, and to assemble records and documents, by
subpoena or otherwise. The subpoena power granted by this
section shall be exercised only at the specific written
direction of the auditor or the auditor's chief deputy.
(2) If any person refuses to comply with a subpoena,
the auditor shall seek to enforce the subpoena b efore a
court of competent jurisdiction to require the attendance
and testimony of witnesses and the production of books,
papers, correspondence, memoranda, contracts, agreements,
and other records. Such court may issue an order requiring
6
such person to appear before the auditor or officers
designated by the auditor to produce records or to give
testimony relating to the matter under investigation or in
question. Any failure to comply with such order of the
court may be punished by such court as contempt.
5. Testimony and records obtained through the
authority to subpoena under this section shall be subject to
the same confidentiality and disclosure provisions as
provided under section 29.200 for audit workpapers and
related supportive m aterial.
374.250. 1. The director shall take proper vouchers
for all payments made by the department and shall take
receipts from the director of revenue for all moneys the
department pays to the director of revenue.
2. At the close of each state fiscal year, the state
auditor shall audit, adjust and settle all receipts and
disbursements in the insurance dedicated fund and the
insurance examiners' fund, and [taxes certified or collected
under sections 148.310 to 148.461 or sec tions 384.011 to
384.071] and the results shall be reported as part of the
annual audit of the state's financial statements .
610.021. Except to the extent disclosure is otherwise
required by law, a public governmental body is authorized to
close meetings, records and votes, to the extent they relate
to the following:
(1) Legal actions, causes of action or litigation
involving a public governmental body and any confidential or
privileged communications between a public governmen tal body
or its representatives and its attorneys. However, any
minutes, vote or settlement agreement relating to legal
actions, causes of action or litigation involving a public
governmental body or any agent or entity representing its
interests or acting on its behalf or with its authority,
7
including any insurance company acting on behalf of a public
government body as its insured, shall be made public upon
final disposition of the matter voted upon or upon the
signing by the parties of the sett lement agreement, unless,
prior to final disposition, the settlement agreement is
ordered closed by a court after a written finding that the
adverse impact to a plaintiff or plaintiffs to the action
clearly outweighs the public policy considerations of
section 610.011, however, the amount of any moneys paid by,
or on behalf of, the public governmental body shall be
disclosed; provided, however, in matters involving the
exercise of the power of eminent domain, the vote shall be
announced or become p ublic immediately following the action
on the motion to authorize institution of such a legal
action. Legal work product shall be considered a closed
record;
(2) Leasing, purchase or sale of real estate by a
public governmental body where public knowledge of the
transaction might adversely affect the legal consideration
therefor. However, any minutes, vote or public record
approving a contract relating to the leasing, purchase or
sale of real estate by a public governmental body shall be
made public upon execution of the lease, purchase or sale of
the real estate;
(3) Hiring, firing, disciplining or promoting of
particular employees by a public governmental body when
personal information about the employee is discussed or
recorded. However, any vote on a final decision, when taken
by a public governmental body, to hire, fire, promote or
discipline an employee of a public governmental body shall
be made available with a record of how each member voted to
the public within sevent y-two hours of the close of the
meeting where such action occurs; provided, however, that
8
any employee so affected shall be entitled to prompt notice
of such decision during the seventy -two-hour period before
such decision is made available to the publ ic. As used in
this subdivision, the term "personal information" means
information relating to the performance or merit of
individual employees;
(4) The state militia or national guard or any part
thereof;
(5) Nonjudicial mental or physica l health proceedings
involving identifiable persons, including medical,
psychiatric, psychological, or alcoholism or drug dependency
diagnosis or treatment;
(6) Scholastic probation, expulsion, or graduation of
identifiable individuals, including records of individual
test or examination scores; however, personally identifiable
student records maintained by public educational
institutions shall be open for inspection by the parents,
guardian or other custodian of students under the age of
eighteen years and by the parents, guardian or other
custodian and the student if the student is over the age of
eighteen years;
(7) Testing and examination materials, before the test
or examination is given or, if it is to be given again,
before so given again;
(8) Welfare cases of identifiable individuals;
(9) Preparation, including any discussions or work
product, on behalf of a public governmental body or its
representatives for negotiations with employee groups;
(10) Software codes for electronic data processing and
documentation thereof;
(11) Specifications for competitive bidding, until
either the specifications are officially approved by the
9
public governmental body or the specifications are published
for bid;
(12) Sealed bids and related documents, until the bids
are opened; and sealed proposals and related documents or
any documents related to a negotiated contract until a
contract is executed, or all proposals are rejected;
(13) Individually identifiable personnel records,
performance ratings or records pertaining to employees or
applicants for employment, except that this exemption shall
not apply to the names, positions, salaries and lengths of
service of officers and employees of public agen cies once
they are employed as such, and the names of private sources
donating or contributing money to the salary of a chancellor
or president at all public colleges and universities in the
state of Missouri and the amount of money contributed by the
source;
(14) Records which are protected from disclosure by
law;
(15) Meetings and public records relating to
scientific and technological innovations in which the owner
has a proprietary interest;
(16) Records relating to municipal h otlines
established for the reporting of abuse and wrongdoing;
(17) Records relating to reports of allegations of
improper governmental activities under section 29.221;
(18) Confidential or privileged communications between
a public governmental body and its auditor, including all
auditor work product; however, all final audit reports
issued by the auditor are to be considered open records
pursuant to this chapter;
[(18)] (19) (a) Security measures, global positioning
system (GPS) data, investigative information, or
investigative or surveillance techniques of any public
10
agency responsible for law enforcement or public safety
that, if disclosed, has the potential to endanger the health
or safety of an individual or the public.
(b) Any information or data provided to a tip line for
the purpose of safety or security at an educational
institution that, if disclosed, has the potential to
endanger the health or safety of an individual or the public.
(c) Any information contained in any suspicious
activity report provided to law enforcement that, if
disclosed, has the potential to endanger the health or
safety of an individual or the public.
(d) Operational guidelines, policies and specific
response plans develop ed, adopted, or maintained by any
public agency responsible for law enforcement, public
safety, first response, or public health for use in
responding to or preventing any critical incident which has
the potential to endanger individual or public safet y or
health. Financial records related to the procurement of or
expenditures relating to operational guidelines, policies or
plans purchased with public funds shall be open. When
seeking to close information pursuant to this exception, the
public governmental body shall affirmatively state in
writing that disclosure would impair the public governmental
body's ability to protect the security or safety of persons
or real property, and shall in the same writing state that
the public interest in nond isclosure outweighs the public
interest in disclosure of the records;
[(19)] (20) Existing or proposed security systems and
structural plans of real property owned or leased by a
public governmental body, and information that is
voluntarily submitted by a nonpublic entity owning or
operating an infrastructure to any public governmental body
for use by that body to devise plans for protection of that
11
infrastructure, the public disclosure of which would
threaten public safety:
(a) Records related to the procurement of or
expenditures relating to security systems purchased with
public funds shall be open;
(b) When seeking to close information pursuant to this
exception, the public governmental body shall affirmatively
state in writing that disclosure would impair the public
governmental body's ability to protect the security or
safety of persons or real property, and shall in the same
writing state that the public interest in nondisclosure
outweighs the public interest in disclo sure of the records;
(c) Records that are voluntarily submitted by a
nonpublic entity shall be reviewed by the receiving agency
within ninety days of submission to determine if retention
of the document is necessary in furtherance of a state
security interest. If retention is not necessary, the
documents shall be returned to the nonpublic governmental
body or destroyed;
[(20)] (21) The portion of a record that identifies
security systems or access codes or authorization codes for
security systems of real property;
[(21)] (22) Records that identify the configuration of
components or the operation of a computer, computer system,
computer network, or telecommunications network, and would
allow unauthorized access to or unlawful dis ruption of a
computer, computer system, computer network, or
telecommunications network of a public governmental body.
This exception shall not be used to limit or deny access to
otherwise public records in a file, document, data file or
database containing public records. Records related to the
procurement of or expenditures relating to such computer,
computer system, computer network, or telecommunications
12
network, including the amount of moneys paid by, or on
behalf of, a public governmental b ody for such computer,
computer system, computer network, or telecommunications
network shall be open;
[(22)] (23) Credit card numbers, personal
identification numbers, digital certificates, physical and
virtual keys, access codes or authorizatio n codes that are
used to protect the security of electronic transactions
between a public governmental body and a person or entity
doing business with a public governmental body. Nothing in
this section shall be deemed to close the record of a person
or entity using a credit card held in the name of a public
governmental body or any record of a transaction made by a
person using a credit card or other method of payment for
which reimbursement is made by a public governmental body;
[(23)] (24) Records submitted by an individual,
corporation, or other business entity to a public
institution of higher education in connection with a
proposal to license intellectual property or perform
sponsored research and which contains sales projections or
other business plan information the disclosure of which may
endanger the competitiveness of a business;
[(24)] (25) Records relating to foster home or kinship
placements of children in foster care under section 210.498;
and
[(25)] (26) Individually identifiable customer usage
and billing records for customers of a municipally owned
utility, unless the records are requested by the customer or
authorized for release by the customer, except that a
municipally owned utility shall make availa ble to the public
the customer's name, billing address, location of service,
and dates of service provided for any commercial service
account.