Lara Introduces Bill to Expand Audit Program to Local Government Agencies

January 25, 2011

AB 187 empowers State Auditor to identify more local waste

Sacramento, Calif. – In light of this morning's Joint Legislative Audit Committee Hearing on Local Government Accountability and Transparency, Assembly Member Ricardo Lara (D-Bell Gardens) has introduced AB187 to expand the State Auditor's high-risk authority to apply to local government agencies. With the new authority, the program would help identify audits and issues reports on local agencies that the State Auditor identifies as being at high-risk for potential of waste, fraud, and abuse.

"The City of Bell has taught us all a great lesson in fiscal prudence. In order to fix something that is broken, we need to know every aspect of the issue and we need to be diligent in finding and implementing solutions," said Assembly Member Lara. "I want to commend State Controller Chiang, for his work on these important government audits. In addition, during the hearing, I was pleased to learn of the progress made by the City of Bell, under its interim City Manager and City Attorney."

As chair, Assembly Member Lara held his first Joint Legislative Audit Committee Hearing in conjunction with the Assembly Local Government Committee. The hearing focused on the City of Bell audit findings. This was the first time the Controller's Office summarized audit reports on administrative and internal accounting controls; the gas tax fund and the City of Bell Redevelopment Agency. Current City of Bell administrators also reported on the audits and the status of the recommendations.

Significant progress has been made in the City of Bell, including:

  1. The Gas Tax Fund has been repaid as per the Controller's recommendations - $500,000
  2. A hold has been placed on supplemental retirement plans, including100% of Cal Pers contributions until the City Council can take action
  3. CDBG Funds have been repaid as per the Controller's recommendations - $60,000
  4. Ninety percent of Bell residents have been repaid 100% of their illegal taxes
  5. City Council Salaries have been cut by 90% and all department heads have been dismissed, retired or accepted resignations.

Assemblyman Cameron Smyth, joint author of AB 187 and Chair of Assembly Local Government Committee, explained that "Today's hearing was one of the more productive oversight hearings I've been a part of. The Controller's Office, along with the officials from the City of Bell, provided us with good information, and new information, that will help prevent future instances of abuse like we saw in Bell last year. Additionally, the hearing helped to point out some inconsistencies in existing law that we otherwise may not have been aware of."

"During these times of mounting economic uncertainty, we must take the necessary steps to protect the hard working families of our state and put processes in place so that local government will never face this type of waste, fraud and abuse." AB187 is one way of making sure we are moving in the right direction," concluded Lara.

CONTACT: Julia Juarez @ (562) 927-1200