SB27: Bill Text

LRB-1099/2

MPG:eev:jf

2013 - 2014 LEGISLATURE

2013 Senate BILL 27

February 19, 2013 - Introduced by Joint Legislative Audit Committee. Referred to Joint Legislative Audit Committee.

SB27,2,2 An Act to repeal 13.53 (2) (d), 13.94 (1) (a), 13.94 (1) (d), 13.94 (1) (f), 13.94 (1) (g), 13.94(1) (k), 13.94 (1) (mm), 13.94 (1) (n), 13.94 (1) (q), 13.94 (8) (d) 3., 49.19 (11m) (e), 49.67 (7m), 101.973 (11), 115.52 (7), 115.525 (7), 118.153 (6), 119.23 (7) (e) 2. and 229.8273 (6); to renumber and amend 119.23 (7) (e) 1.; to amend 13.94 (1) (b), 13.94 (1) (br) 1., 13.94 (1) (br) 2., 13.94 (1) (c), 13.94 (1) (dg), 13.94 (1) (dm), 13.94 (1) (eg), 13.94 (1) (em), 13.94 (1) (L), 13.94 (1s) (a), 13.94 (1s) (b), 13.94 (1s) (bm), 18.10 (11), 39.15 (2), 39.46 (1), 119.23 (6m) (b) 3. d., 120.135 (4) (a) and 565.37 (1); and to create 13.94 (1) (br) 3., 13.94 (1) (t), 13.94 (1s) (c) 7., 13.94 (1s) (c) 8. and 71.78 (4) (s) of the statutes; relating to: the authority and responsibilities of the Legislative Audit Bureau and state auditor, eliminating certain expired audit requirements, and requiring confidentiality during investigations of reports made to the state fraud, waste, and mismanagement hotline.

Analysis by the Legislative Reference Bureau

Under current law, the Legislative Audit Bureau (LAB), headed by the state auditor, is responsible for auditing state agencies and certain other entities. LAB conducts various kinds of financial audits and also conducts performance evaluation audits to determine, among other things, whether a given program is yielding intended results. This bill makes a number of changes to the laws governing LAB, including the following:

1. Under current law, LAB is required to perform a financial audit of the records of each state agency and authority at least once every five years and a financial audit of the records of other public and quasi-public entities, including any entity that receives more than 50 percent of its annual budget from the state, at the state auditor's discretion or when LAB is so directed. The bill eliminates that five-year timeline and requires LAB to perform all of those audits at the state auditor's discretion or as the Joint Legislative Audit Committee (JLAC) directs.

2. Current law also requires LAB to perform, among other audits, (a) an annual financial audit of the State Fair Park Board and certain private entities with which that board may contract; (b) an annual financial audit of certain Department of Health Services grants; (c) a biennial financial audit of the central accounting records of the Department of Administration (DOA); (d) a biennial financial audit of the Medical College of Wisconsin's expenditures of state moneys; (e) a biennial financial audit of the Higher Education Aids Board's contract for dental education; (f) a biennial performance evaluation audit of the Division of Gaming in DOA; and (g) a biennial performance evaluation audit of the state lottery.

The bill requires LAB to perform all of those audits at the discretion of the state auditor or as JLAC directs, not on an annual or biennial basis. The bill also adds an annual financial audit of the University of Wisconsin System.

3. The bill eliminates a number of LAB audits under current law, including (a) an annual financial audit of the Division of Gaming; (b) a biennial financial audit of cash on hand and securities deposited in the state treasury or otherwise accounted for by the secretary of administration; (c) a biennial financial audit of DOA's books compared to moneys in the vaults of the state treasury or other state depositories; (d) a financial audit of moneys transferred from a school district's capital improvement fund; (e) unspecified audits to be performed at the direction of the Government Accountability Board; and (f) several one-time performance evaluation and financial audits that have expired or been completed.

4. Current law requires LAB to monitor state agencies' purchases and report to JLAC at least once every five years concerning the extent to which agency purchases were of materials, supplies, or equipment manufactured outside of the United States. The bill replaces that five-year reporting requirement with the requirement that LAB make such a report to JLAC at the state auditor's discretion or as JLAC directs.

5. Current law requires LAB to maintain a toll-free hotline to receive reports of fraud, waste, and mismanagement in state government. LAB must relay those reports to an LAB employee or an appropriate state agency for investigation. LAB's records concerning the identity of a person who makes a report to the hotline are confidential. Under the bill, LAB must also keep such a report and investigation, including any information arising from the investigation, confidential while the investigation is pending, except as necessary to conduct the investigation.

6. Finally, under current law, certain officials and state agencies may have access to Wisconsin taxpayers' tax records maintained by the Department of Revenue. The bill authorizes LAB and its employees to have access to those tax records to the extent necessary to carry out LAB's duties under the law.

For further information see the state fiscal estimate, which will be printed as an appendix to this bill.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

SB27,1 Section 1. 13.53 (2) (d) of the statutes is repealed.

SB27,2 Section 2. 13.94 (1) (a) of the statutes is repealed.

SB27,3 Section 3. 13.94 (1) (b) of the statutes is amended to read:

SB27,4,6 13.94 (1) (b) Audit At the state auditor's discretion or as the joint legislative audit committee directs, audit the records of every state each department, board, commission, independent agency or authority at least once each 5 years and audit the records of other departments as defined in sub. (4) when the state auditor deems it advisable or when he or she is so directed and, in conjunction therewith, reconcile the records of the department audited with those of the department of administration. Audits of the records of a county, city, village, town, or school district may be performed only as provided in par. (m). Within 30 days after After completion of any such audit under this paragraph, the bureau shall file with the chief clerk of each house of the legislature, the governor, the department of administration, the legislative reference bureau, the joint committee on finance, the legislative fiscal bureau, and the department audited, a detailed report thereof of the audit, including its the bureau's recommendations for improvement and efficiency and including specific instances, if any, of illegal or improper expenditures. The chief clerks shall distribute the report to the joint legislative audit committee, the appropriate standing committees of the legislature, and the joint committee on legislative organization.

SB27,4 Section 4. 13.94 (1) (br) 1. of the statutes is amended to read:

SB27,4,21 13.94 (1) (br) 1. Maintain a toll-free telephone number with voice mail at the bureau's office to receive reports of fraud, waste, and mismanagement in state government. Except as provided in subd. 2., the bureau shall relay these reports to the appropriate bureau employee for investigation. If the bureau has a bureau employee investigate the report, the employee may, subject to subd. 3., consult with any state department, board, commission, or independent agency for any purpose related to the investigation. The bureau shall publicize the toll-free telephone number on the bureau's Web Internet site. The bureau shall maintain records that permit the release of information provided by informants while protecting the identity of the informant. Any records maintained by the bureau that relate to the identity of informants shall be only for the confidential use of the bureau in the administration of this section, unless the informant expressly agrees to release the records. Appearance in court as a witness shall not be considered consent by an informant to release confidential records maintained by the bureau.

SB27,5 Section 5. 13.94 (1) (br) 2. of the statutes is amended to read:

SB27,5,3 13.94 (1) (br) 2. In lieu of requiring a bureau employee to conduct an investigation of a report received under subd. 1., the bureau may refer a report to a state department, board, commission, or independent agency for investigation. The state department, board, commission, or independent agency shall conduct the investigation and deliver the results of the investigation to the bureau in a timely manner.

SB27,6 Section 6. 13.94 (1) (br) 3. of the statutes is created to read:

SB27,5,8 13.94 (1) (br) 3. The bureau shall at all times before an investigation of a report received under subd. 1. is completed keep confidential the report and investigation and any information arising from the investigation, except as necessary to conduct the investigation.

SB27,7 Section 7. 13.94 (1) (c) of the statutes is amended to read:

SB27,5,16 13.94 (1) (c) Audit At the state auditor's discretion or as the joint legislative audit committee directs, audit the central accounting records of the department of administration at least once every 2 years. A detailed report of such audit shall be filed as provided by par. (b), and copies shall be provided to each member or member-elect of the legislature and shall be available in limited number to the public. The bureau shall also prepare a summary of such audit report, for distribution in the same manner as the Wisconsin Blue Book under s. 35.84.

SB27,8 Section 8. 13.94 (1) (d) of the statutes is repealed.

SB27,9 Section 9. 13.94 (1) (dg) of the statutes is amended to read:

SB27,5,21 13.94 (1) (dg) Annually, by October 1 At the state auditor's discretion or as the joint legislative audit committee directs, perform a financial audit of expenditures made under the grants for dental services under s. 250.10.

SB27,10 Section 10. 13.94 (1) (dm) of the statutes is amended to read:

SB27,6,2 13.94 (1) (dm) Annually At the state auditor's discretion or as the joint legislative audit committee directs, perform a financial audit of the state fair park board and of any private corporation with which the board contracts under s. 42.01 (4) (b).

SB27,11 Section 11. 13.94 (1) (eg) of the statutes is amended to read:

SB27,6,9 13.94 (1) (eg) Annually conduct a financial audit of the division of gaming in the department of administration and biennially At the state auditor's discretion or as the joint legislative audit committee directs, conduct a performance evaluation audit of the division of gaming in the department of administration. The legislative audit bureau shall file a copy of each audit report under this paragraph with the department of justice and with the distributees specified in par. (b).

SB27,12 Section 12. 13.94 (1) (em) of the statutes is amended to read:

SB27,6,19 13.94 (1) (em) Annually conduct a financial audit of the state lottery, and, to the extent of the department of revenue's participation, of any multijurisdictional lotteries in which the state participates under ch. 565, and biennially at the state auditor's discretion or as the joint legislative audit committee directs, conduct a performance audit of the state lottery and, to the extent of the department of revenue's participation, of those multijurisdictional lotteries, as provided in s. 565.37 (1). The legislative audit bureau shall file a copy of each audit report under this paragraph with the department of justice and with the distributees specified in par. (b).

SB27,13 Section 13. 13.94 (1) (f) of the statutes is repealed.

SB27,14 Section 14. 13.94 (1) (g) of the statutes is repealed.

SB27,15 Section 15. 13.94(1) (k) of the statutes is repealed.

SB27,16 Section 16. 13.94 (1) (L) of the statutes is amended to read:

SB27,7,5 13.94 (1) (L) Monitor and review purchases and purchasing procedures of state departments, boards, commissions and independent agencies, and, at the state auditor's discretion or as the joint legislative audit committee directs, report to the joint legislative audit committee at least once every 5 years concerning the extent to which state departments, boards, commissions and independent agencies purchased purchase materials, supplies, or equipment manufactured outside of the United States since the date of the preceding report.

SB27,17 Section 17. 13.94 (1) (mm) of the statutes is repealed.

SB27,18 Section 18. 13.94 (1) (n) of the statutes is repealed.

SB27,19 Section 19. 13.94 (1) (q) of the statutes is repealed.

SB27,20 Section 20. 13.94 (1) (t) of the statutes is created to read:

SB27,7,12 13.94 (1) (t) Annually conduct a financial audit of the University of Wisconsin System. The legislative audit bureau shall file a copy of each audit report under this paragraph with the distributees specified in par. (b).

SB27,21 Section 21. 13.94 (1s) (a) of the statutes is amended to read: