Enrolled Copy H.B. 77
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Flag Display Amendments
2025 GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Trevor Lee
Senate Sponsor: Daniel McCay
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LONG TITLE
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General Description:
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This bill allows the display of certain flags on government property.
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Highlighted Provisions:
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This bill:
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▸ defines terms;
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▸ prohibits a government entity or employee of a government entity from displaying a flag
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in or on the grounds of government property except certain exempted flags;
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▸ requires the state auditor to ensure compliance, including by imposing fines;
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▸ requires the attorney general to defend and the state to hold harmless an individual acting
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under color of state law to enforce the flag display statute within the public education
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system; and
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▸ provides severability.
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Money Appropriated in this Bill:
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None
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Other Special Clauses:
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None
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Utah Code Sections Affected:
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AMENDS:
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67-3-1, as last amended by Laws of Utah 2024, Chapters 3, 158
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ENACTS:
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63G-1-704, Utah Code Annotated 1953
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Be it enacted by the Legislature of the state of Utah:
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Section 1. Section 63G-1-704 is enacted to read: H.B. 77 Enrolled Copy
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63G-1-704 . Display of flags on government property -- Indemnification --
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Severability.
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(1) As used in this section:
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(a) "Display" means, in regards to a flag, to place a flag in a prominent location on
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government property where the flag is easily visible.
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(b) "Flag" means a usually rectangular piece of fabric with a specific design that
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symbolizes a location, government entity, or cause.
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(c) "Government entity" means:
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(i) any local government entity, as defined in Section 63A-5b-901, including a school
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within the public education system; or
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(ii) any state agency, as defined in Section 63A-5b-901.
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(d) "Government property" means any property under the ownership or control of a
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government entity.
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(e) "LEA governing board" means the same as that term is defined in Section 53E-1-102.
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(2) Except as provided in Subsection (3), a government entity, or an employee of a school
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district or school within the public education system acting within the employee's
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official duties, may not:
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(a) display a flag in or on the grounds of government property; or
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(b) display an exempt flag described in Subsection (3) with alterations in color, symbols,
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or appearance.
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(3) The prohibition described in Subsection (2) does not apply to the following flags:
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(a) the official flag of the United States described in Title 4 U.S.C., Ch. 1, The Flag, and
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Executive Order 1959-10834, and in accordance with Section 53G-7-211;
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(b) an official Utah state flag as described in Title 63G, Chapter 1, Part 5, State Flags;
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(c) the current and official flag of another country, state, or political subdivision of
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another country or state;
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(d) a flag that represents a city, municipality, county, or political subdivision of the state,
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as those terms are defined in Sections 10-1-104, 10-2-301, 17-50-101, and 17B-1-102;
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(e) a flag that represents a branch, unit, or division of the United States military;
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(f) the National League of Families POW/MIA flag as described in 36 U.S.C. Sec. 902;
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(g) a flag that represents an Indian tribe as defined in federal law;
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(h) an officially licensed flag of a college or university depicting only the colors, logos,
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and marks consistent with official college or university branding;
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(i) a historic version of a flag described in Subsections (3)(a) and (b);
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(j) an official public school flag;
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(k) an official flag of the United States Olympic Committee, United States Paralympic
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Committee, International Olympic Committee, or International Paralympic
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Committee;
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(l) an official flag of an olympiad or paralympiad that occurred or will occur within the
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state; or
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(m) a flag of an organization authorized to use a public school facility at the location and
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during the time in which the organization is authorized to use the public school
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facility.
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(4)(a) The state auditor shall:
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(i) establish a process to receive and investigate alleged violations of this section;
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(ii) provide notice to the relevant government entity of:
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(A) each alleged violation of this section involving the government entity;
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(B) each violation that the state auditor determines to be substantiated, including
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an opportunity to cure the violation not to exceed 30 calendar days;
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(iii) if a government entity, other than a school district or a school within the public
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education system, fails to cure a violation in accordance with Subsection
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(4)(a)(ii)(B), impose a fine of $500 per violation per day; and
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(iv) deposit fines described in Subsection (4)(a)(iii) into the General Fund.
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(b) A government entity may seek judicial review of a fine the state auditor imposes
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under this section to determine whether the imposition of the fine is clearly erroneous.
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(5) Nothing in this section, for a local education agency, as defined in Section 53E-1-102:
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(a) limits the authority of the agency related to student expression under applicable
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federal or state law; or
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(b) removes the agency's obligation to protect all students from discrimination.
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(6) Regarding a school district or a school within the public education system, the attorney
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general shall defend and the state shall indemnify and hold harmless a person acting
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under color of state law to enforce this section for any claims or damages, including
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court costs and attorney fees, that:
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(a) arise as a result of this section; and
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(b) are not covered by the person's insurance policies or by any coverage agreement the
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State Risk Management Fund issues.
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(7) If any provision of this section or the application of any provision of this section to any
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person or circumstance is held invalid by a final decision of a court, the remainder of
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this section shall be given effect without the invalidated provision or application.
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Section 2. Section 67-3-1 is amended to read:
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67-3-1 . Functions and duties.
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(1)(a) The state auditor is the auditor of public accounts and is independent of any
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executive or administrative officers of the state.
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(b) The state auditor is not limited in the selection of personnel or in the determination
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of the reasonable and necessary expenses of the state auditor's office.
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(2) The state auditor shall examine and certify annually in respect to each fiscal year,
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financial statements showing:
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(a) the condition of the state's finances;
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(b) the revenues received or accrued;
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(c) expenditures paid or accrued;
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(d) the amount of unexpended or unencumbered balances of the appropriations to the
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agencies, departments, divisions, commissions, and institutions; and
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(e) the cash balances of the funds in the custody of the state treasurer.
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(3)(a) The state auditor shall:
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(i) audit each permanent fund, each special fund, the General Fund, and the accounts
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of any department of state government or any independent agency or public
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corporation as the law requires, as the auditor determines is necessary, or upon
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request of the governor or the Legislature;
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(ii) perform the audits in accordance with generally accepted auditing standards and
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other auditing procedures as promulgated by recognized authoritative bodies; and
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(iii) as the auditor determines is necessary, conduct the audits to determine:
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(A) honesty and integrity in fiscal affairs;
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(B) accuracy and reliability of financial statements;
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(C) effectiveness and adequacy of financial controls; and
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(D) compliance with the law.
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(b) If any state entity receives federal funding, the state auditor shall ensure that the
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audit is performed in accordance with federal audit requirements.
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(c)(i) The costs of the federal compliance portion of the audit may be paid from an
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appropriation to the state auditor from the General Fund.
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(ii) If an appropriation is not provided, or if the federal government does not
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specifically provide for payment of audit costs, the costs of the federal compliance
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portions of the audit shall be allocated on the basis of the percentage that each
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state entity's federal funding bears to the total federal funds received by the state.
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(iii) The allocation shall be adjusted to reflect any reduced audit time required to
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audit funds passed through the state to local governments and to reflect any
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reduction in audit time obtained through the use of internal auditors working
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under the direction of the state auditor.
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(4)(a) Except as provided in Subsection (4)(b), the state auditor shall, in addition to
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financial audits, and as the auditor determines is necessary, conduct performance and
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special purpose audits, examinations, and reviews of any entity that receives public
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funds, including a determination of any or all of the following:
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(i) the honesty and integrity of all the entity's fiscal affairs;
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(ii) whether the entity's administrators have faithfully complied with legislative intent;
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(iii) whether the entity's operations have been conducted in an efficient, effective, and
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cost-efficient manner;
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(iv) whether the entity's programs have been effective in accomplishing the intended
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objectives; and
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(v) whether the entity's management, control, and information systems are adequate,
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effective, and secure.
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(b) The auditor may not conduct performance and special purpose audits, examinations,
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and reviews of any entity that receives public funds if the entity:
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(i) has an elected auditor; and
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(ii) has, within the entity's last budget year, had the entity's financial statements or
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performance formally reviewed by another outside auditor.
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(5) The state auditor:
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(a) shall administer any oath or affirmation necessary to the performance of the duties of
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the auditor's office; and
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(b) may:
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(i) subpoena witnesses and documents, whether electronic or otherwise; and
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(ii) examine into any matter that the auditor considers necessary.
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(6) The state auditor may require all persons who have had the disposition or management
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of any property of this state or its political subdivisions to submit statements regarding
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the property at the time and in the form that the auditor requires.
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(7) The state auditor shall:
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(a) except where otherwise provided by law, institute suits in Salt Lake County in
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relation to the assessment, collection, and payment of revenues against:
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(i) persons who by any means have become entrusted with public money or property
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and have failed to pay over or deliver the money or property; and
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(ii) all debtors of the state;
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(b) collect and pay into the state treasury all fees received by the state auditor;
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(c) perform the duties of a member of all boards of which the state auditor is a member
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by the constitution or laws of the state, and any other duties that are prescribed by the
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constitution and by law;
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(d) stop the payment of the salary of any state official or state employee who:
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(i) refuses to settle accounts or provide required statements about the custody and
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disposition of public funds or other state property;
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(ii) refuses, neglects, or ignores the instruction of the state auditor or any controlling
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board or department head with respect to the manner of keeping prescribed
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accounts or funds; or
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(iii) fails to correct any delinquencies, improper procedures, and errors brought to the
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official's or employee's attention;
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(e) establish accounting systems, methods, and forms for public accounts in all taxing or
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fee-assessing units of the state in the interest of uniformity, efficiency, and economy;
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(f) superintend the contractual auditing of all state accounts;
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(g) subject to Subsection (8)(a), withhold state allocated funds or the disbursement of
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property taxes from a state or local taxing or fee-assessing unit, if necessary, to
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ensure that officials and employees in those taxing units comply with state laws and
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procedures in the budgeting, expenditures, and financial reporting of public funds;
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(h) subject to Subsection (9), withhold the disbursement of tax money from any county,
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if necessary, to ensure that officials and employees in the county comply with
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Section 59-2-303.1; and
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(i) withhold state allocated funds or the disbursement of property taxes from a local
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government entity or a limited purpose entity, as those terms are defined in Section
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67-1a-15 if the state auditor finds the withholding necessary to ensure that the entity
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registers and maintains the entity's registration with the lieutenant governor, in
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accordance with Section 67-1a-15.
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(8)(a) Except as otherwise provided by law, the state auditor may not withhold funds
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under Subsection (7)(g) until a state or local taxing or fee-assessing unit has received
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formal written notice of noncompliance from the auditor and has been given 60 days
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to make the specified corrections.
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(b) If, after receiving notice under Subsection (8)(a), a state or independent local
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fee-assessing unit that exclusively assesses fees has not made corrections to comply
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with state laws and procedures in the budgeting, expenditures, and financial reporting
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of public funds, the state auditor:
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(i) shall provide a recommended timeline for corrective actions;
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(ii) may prohibit the state or local fee-assessing unit from accessing money held by
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the state; and
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(iii) may prohibit a state or local fee-assessing unit from accessing money held in an
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account of a financial institution by filing an action in a court with jurisdiction
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under Title 78A, Judiciary and Judicial Administration, requesting an order of the
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court to prohibit a financial institution from providing the fee-assessing unit
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access to an account.
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(c) The state auditor shall remove a limitation on accessing funds under Subsection (8)(b)
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upon compliance with state laws and procedures in the budgeting, expenditures, and
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financial reporting of public funds.
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(d) If a local taxing or fee-assessing unit has not adopted a budget in compliance with
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state law, the state auditor:
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(i) shall provide notice to the taxing or fee-assessing unit of the unit's failure to
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comply;
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(ii) may prohibit the taxing or fee-assessing unit from accessing money held by the
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state; and
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(iii) may prohibit a taxing or fee-assessing unit from accessing money held in an
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account of a financial institution by:
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(A) contacting the taxing or fee-assessing unit's financial institution and
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requesting that the institution prohibit access to the account; or
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(B) filing an action in a court with jurisdiction under Title 78A, Judiciary and
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Judicial Administration, requesting an order of the court to prohibit a financial
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institution from providing the taxing or fee-assessing unit access to an account.
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(e) If the local taxing or fee-assessing unit adopts a budget in compliance with state law,
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the state auditor shall eliminate a limitation on accessing funds described in
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Subsection (8)(d).
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(9) The state auditor may not withhold funds under Subsection (7)(h) until a county has
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received formal written notice of noncompliance from the auditor and has been given 60
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days to make the specified corrections.
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(10)(a) The state auditor may not withhold funds under Subsection (7)(i) until the state
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auditor receives a notice of non-registration, as that term is defined in Section
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67-1a-15.
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(b) If the state auditor receives a notice of non-registration, the state auditor may
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prohibit the local government entity or limited purpose entity, as those terms are
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defined in Section 67-1a-15, from accessing:
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(i) money held by the state; and
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(ii) money held in an account of a financial institution by:
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(A) contacting the entity's financial institution and requesting that the institution
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prohibit access to the account; or
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(B) filing an action in a court with jurisdiction under Title 78A, Judiciary and
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Judicial Administration, requesting an order of the court to prohibit a financial
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institution from providing the entity access to an account.
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(c) The state auditor shall remove the prohibition on accessing funds described in
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Subsection (10)(b) if the state auditor received a notice of registration, as that term is
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defined in Section 67-1a-15, from the lieutenant governor.
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(11) Notwithstanding Subsection (7)(g), (7)(h), (7)(i), (8)(b), (8)(d), or (10)(b), the state
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auditor:
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(a) shall authorize a disbursement by a local government entity or limited purpose entity,
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as those terms are defined in Section 67-1a-15, or a state or local taxing or
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fee-assessing unit if the disbursement is necessary to:
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(i) avoid a major disruption in the operations of the local government entity, limited
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purpose entity, or state or local taxing or fee-assessing unit; or
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(ii) meet debt service obligations; and
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(b) may authorize a disbursement by a local government entity, limited purpose entity,
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or state or local taxing or fee-assessing unit as the state auditor determines is
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appropriate.
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(12)(a) The state auditor may seek relief under the Utah Rules of Civil Procedure to take
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temporary custody of public funds if an action is necessary to protect public funds
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from being improperly diverted from their intended public purpose.
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(b) If the state auditor seeks relief under Subsection (12)(a):
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(i) the state auditor is not required to exhaust the procedures in Subsection (7) or (8);
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and
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(ii) the state treasurer may hold the public funds in accordance with Section 67-4-1 if
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a court orders the public funds to be protected from improper diversion from their
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public purpose.
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(13) The state auditor shall:
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(a) establish audit guidelines and procedures for audits of local mental health and
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substance abuse authorities and their contract providers, conducted pursuant to Title
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17, Chapter 43, Part 2, Local Substance Abuse Authorities, Title 17, Chapter 43, Part
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3, Local Mental Health Authorities, Title 26B, Chapter 5, Health Care - Substance
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Use and Mental Health, and Title 51, Chapter 2a, Accounting Reports from Political
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Subdivisions, Interlocal Organizations, and Other Local Entities Act; and
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(b) ensure that those guidelines and procedures provide assurances to the state that:
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(i) state and federal funds appropriated to local mental health authorities are used for
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mental health purposes;
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(ii) a private provider under an annual or otherwise ongoing contract to provide
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comprehensive mental health programs or services for a local mental health
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authority is in compliance with state and local contract requirements and state and
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federal law;
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(iii) state and federal funds appropriated to local substance abuse authorities are used
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for substance abuse programs and services; and
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(iv) a private provider under an annual or otherwise ongoing contract to provide
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comprehensive substance abuse programs or services for a local substance abuse
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authority is in compliance with state and local contract requirements, and state and
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federal law.
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(14)(a) The state auditor may, in accordance with the auditor's responsibilities for
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political subdivisions of the state as provided in Title 51, Chapter 2a, Accounting
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Reports from Political Subdivisions, Interlocal Organizations, and Other Local
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Entities Act, initiate audits or investigations of any political subdivision that are
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necessary to determine honesty and integrity in fiscal affairs, accuracy and reliability
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of financial statements, effectiveness, and adequacy of financial controls and
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compliance with the law.
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(b) If the state auditor receives notice under Subsection 11-41-104(7) from the
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Governor's Office of Economic Opportunity on or after July 1, 2024, the state auditor
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may initiate an audit or investigation of the public entity subject to the notice to
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determine compliance with Section 11-41-103.
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(15)(a) The state auditor may not audit work that the state auditor performed before
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becoming state auditor.
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(b) If the state auditor has previously been a responsible official in state government
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whose work has not yet been audited, the Legislature shall:
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(i) designate how that work shall be audited; and
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(ii) provide additional funding for those audits, if necessary.
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(16) The state auditor shall:
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(a) with the assistance, advice, and recommendations of an advisory committee
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appointed by the state auditor from among special district boards of trustees, officers,
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and employees and special service district boards, officers, and employees:
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(i) prepare a Uniform Accounting Manual for Special Districts that:
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(A) prescribes a uniform system of accounting and uniform budgeting and
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reporting procedures for special districts under Title 17B, Limited Purpose
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Local Government Entities - Special Districts, and special service districts
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under Title 17D, Chapter 1, Special Service District Act;
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(B) conforms with generally accepted accounting principles; and
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(C) prescribes reasonable exceptions and modifications for smaller districts to the
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uniform system of accounting, budgeting, and reporting;
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(ii) maintain the manual under this Subsection (16)(a) so that the manual continues to
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reflect generally accepted accounting principles;
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(iii) conduct a continuing review and modification of procedures in order to improve
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them;
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(iv) prepare and supply each district with suitable budget and reporting forms; and
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(v)(A) prepare instructional materials, conduct training programs, and render other
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services considered necessary to assist special districts and special service
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districts in implementing the uniform accounting, budgeting, and reporting
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procedures; and
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(B) ensure that any training described in Subsection (16)(a)(v)(A) complies with
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Title 63G, Chapter 22, State Training and Certification Requirements; and
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(b) continually analyze and evaluate the accounting, budgeting, and reporting practices
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and experiences of specific special districts and special service districts selected by
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the state auditor and make the information available to all districts.
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(17)(a) The following records in the custody or control of the state auditor are protected
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records under Title 63G, Chapter 2, Government Records Access and Management
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Act:
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(i) records that would disclose information relating to allegations of personal
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misconduct, gross mismanagement, or illegal activity of a past or present
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governmental employee if the information or allegation cannot be corroborated by
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the state auditor through other documents or evidence, and the records relating to
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the allegation are not relied upon by the state auditor in preparing a final audit
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report;
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(ii) records and audit workpapers to the extent the workpapers would disclose the
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identity of an individual who during the course of an audit, communicated the
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existence of any waste of public funds, property, or manpower, or a violation or
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suspected violation of a law, rule, or regulation adopted under the laws of this
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state, a political subdivision of the state, or any recognized entity of the United
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States, if the information was disclosed on the condition that the identity of the
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individual be protected;
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(iii) before an audit is completed and the final audit report is released, records or
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drafts circulated to an individual who is not an employee or head of a
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governmental entity for the individual's response or information;
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(iv) records that would disclose an outline or part of any audit survey plans or audit
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program; and
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(v) requests for audits, if disclosure would risk circumvention of an audit.
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(b) The provisions of Subsections (17)(a)(i), (ii), and (iii) do not prohibit the disclosure
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of records or information that relate to a violation of the law by a governmental entity
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or employee to a government prosecutor or peace officer.
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(c) The provisions of this Subsection (17) do not limit the authority otherwise given to
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the state auditor to classify a document as public, private, controlled, or protected
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under Title 63G, Chapter 2, Government Records Access and Management Act.
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(d)(i) As used in this Subsection (17)(d), "record dispute" means a dispute between
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the state auditor and the subject of an audit performed by the state auditor as to
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whether the state auditor may release a record, as defined in Section 63G-2-103,
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to the public that the state auditor gained access to in the course of the state
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auditor's audit but which the subject of the audit claims is not subject to disclosure
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under Title 63G, Chapter 2, Government Records Access and Management Act.
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(ii) The state auditor may submit a record dispute to the State Records Committee,
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created in Section 63G-2-501, for a determination of whether the state auditor
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may, in conjunction with the state auditor's release of an audit report, release to
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the public the record that is the subject of the record dispute.
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(iii) The state auditor or the subject of the audit may seek judicial review of a State
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Records Committee determination under Subsection (17)(d)(ii), as provided in
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Section 63G-2-404.
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(18) If the state auditor conducts an audit of an entity that the state auditor has previously
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audited and finds that the entity has not implemented a recommendation made by the
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state auditor in a previous audit, the state auditor shall notify the Legislative
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Management Committee through the Legislative Management Committee's audit
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subcommittee that the entity has not implemented that recommendation.
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(19) The state auditor shall, with the advice and consent of the Senate, appoint the state
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privacy officer described in Section 67-3-13.
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(20) Except as provided in Subsection (21), the state auditor shall report, or ensure that
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another government entity reports, on the financial, operational, and performance
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metrics for the state system of higher education and the state system of public education,
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including metrics in relation to students, programs, and schools within those systems.
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(21)(a) Notwithstanding Subsection (20), the state auditor shall conduct regular audits of:
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(i) the scholarship granting organization for the Carson Smith Opportunity
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Scholarship Program, created in Section 53E-7-402;
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(ii) the State Board of Education for the Carson Smith Scholarship Program, created
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in Section 53F-4-302; and
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(iii) the scholarship program manager for the Utah Fits All Scholarship Program,
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created in Section 53F-6-402, including an analysis of the cost effectiveness of the
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program, taking into consideration the amount of the scholarship and the amount
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of state and local funds dedicated on a per-student basis within the traditional
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public education system.
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(b) Nothing in this subsection limits or impairs the authority of the State Board of
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Education to administer the programs described in Subsection (21)(a).
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(22) The state auditor shall, based on the information posted by the Office of Legislative
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Research and General Counsel under Subsection 36-12-12.1(2), for each policy, track
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and post the following information on the state auditor's website:
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(a) the information posted under Subsections 36-12-12.1(2)(a) through (e);
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(b) an indication regarding whether the policy is timely adopted, adopted late, or not
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adopted;
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(c) an indication regarding whether the policy complies with the requirements
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established by law for the policy; and
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(d) a link to the policy.
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(23)(a) A legislator may request that the state auditor conduct an inquiry to determine
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whether a government entity, government official, or government employee has
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complied with a legal obligation directly imposed, by statute, on the government
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entity, government official, or government employee.
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(b) The state auditor may, upon receiving a request under Subsection (23)(a), conduct
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the inquiry requested.
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(c) If the state auditor conducts the inquiry described in Subsection (23)(b), the state
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auditor shall post the results of the inquiry on the state auditor's website.
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(d) The state auditor may limit the inquiry described in this Subsection (23) to a simple
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determination, without conducting an audit, regarding whether the obligation was
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fulfilled.
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(24) The state auditor shall:
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(a) ensure compliance with Title 63G, Chapter 31, Distinctions on the Basis of Sex, in
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accordance with Section 63G-31-401; and
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(b) report to the Legislative Management Committee, upon request, regarding the state
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auditor's actions under this Subsection (24).
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(25) The state auditor shall report compliance with Sections 67-27-107, 67-27-108, and
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67-27-109 by:
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(a) establishing a process to receive and audit each alleged violation; and
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(b) reporting to the Legislative Management Committee, upon request, regarding the
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state auditor's findings and recommendations under this Subsection (25).
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(26) The state auditor shall ensure compliance with Section 63G-1-704 regarding the
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display of flags in or on government property.
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Section 3. Effective Date.
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This bill takes effect on May 7, 2025.
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