SENATE RULES COMMITTEE SUBSTITUTE FOR

SENATE BILL 227

51st legislature - STATE OF NEW MEXICO - first session, 2013

AN ACT

RELATING TO GOVERNMENT ACCOUNTABILITY; CREATING THE GOVERNMENT ACCOUNTABILITY OFFICE OF THE LEGISLATIVE FINANCE COMMITTEE; ENACTING THE STATE INSPECTORS GENERAL ACT; PROVIDING POWERS AND DUTIES; REQUIRING DEPARTMENT INSPECTORS GENERAL TO REPORT TO THE OFFICE.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

     SECTION 1. A new section of Chapter 2, Article 5 NMSA 1978 is enacted to read: 

     "[NEW MATERIAL] LEGISLATIVE FINANCE COMMITTEE--GOVERNMENT ACCOUNTABILITY OFFICE--CREATED--POWERS AND DUTIES.--

          A. As used in this section and Section 2 of this 2013 act, "agency" means any department, agency, institution or instrumentality of the state or a political subdivision of the state.

          B. The "government accountability office" is created as a division of the legislative finance committee. The office shall be staffed by persons knowledgeable and proficient in program and performance evaluation, and research or policy analysis. The director of the legislative finance committee shall appoint government accountability office staff without regard to party affiliation and solely on the appointees' fitness to perform the duties of the positions for which they are hired.

          C. The government accountability office shall conduct program evaluations, information technology evaluations and special reviews of agencies to provide policymakers with objective, independent and credible assessments of those agencies to allow the policymakers to:

                (1) determine whether expenditures of public funds are producing desired results;

                (2) determine whether agencies are complying with state and federal procedures relevant to their operation and funding;

                (3) determine whether policy alternatives could improve operations and save money; and

                (4) assess the effect of agency operations on state finances.

          D. The government accountability office shall coordinate its activities with executive agency offices of inspector general as necessary.

          E. The government accountability office shall report the results of work performed pursuant to this section to the legislative finance committee and shall make final reports available to the legislature and the public. Background materials, including working papers and notes used as part of any program evaluation or review, are not public records for the purpose of the Inspection of Public Records Act.

          F. Each agency shall, upon request, furnish to the government accountability office such documents, material or information as may be requested by the director or staff of the office. Information provided by an agency pursuant to this section that is confidential by law or exempt from public inspection under the Inspection of Public Records Act shall not be disclosed by the director or staff. Penalties for improper disclosure of confidential or exempt information shall apply to the director or staff."

     SECTION 2. A new section of Chapter 2, Article 5 NMSA 1978 is enacted to read:

     "[NEW MATERIAL] LEGISLATIVE FINANCE COMMITTEE--REPORTS OF INSPECTORS GENERAL.--

          A. Pursuant to the State Inspectors General Act, the legislative finance committee shall receive and review from offices of inspector general:

                (1) annual work plans and quarterly updates of investigations and planned audits, including internal audits and compliance audits;

                (2) annual reports;

                (3) reports on the results of investigations and individual audits, including internal audits and compliance audits; and

                (4) other reports and information as a result of coordination with offices of inspector general.

          B. Information and reports containing information made confidential by law or exempt from the Inspection of Public Records Act shall not be disclosed by the legislative finance committee."

     SECTION 3. [NEW MATERIAL] SHORT TITLE.--Sections 3 through 8 of this act may be cited as the "State Inspectors General Act".

     SECTION 4. [NEW MATERIAL] DEFINITIONS.--As used in the State Inspectors General Act:

          A. "department" means a cabinet department listed in Section 6 of the State Inspectors General Act; and

          B. "state-funded entity" means a school district; charter school; public post-secondary educational institution, including a branch campus and a community college; and persons who receive grants from or who contract with a department.

     SECTION 5. [NEW MATERIAL] PURPOSE OF OFFICES OF INSPECTOR GENERAL.--The purpose of the State Inspectors General Act is to create independent and objective units of each department enumerated in Section 4 of the State Inspectors General Act to:

          A. conduct and supervise internal audits, compliance audits and investigations relating to the programs and operations of the department and state-funded entities;

          B. provide coordination and recommendations designed to promote economy, efficiency and effectiveness and to prevent and detect fraud and abuse in departments and state-funded entities; and

          C. provide a means for keeping cabinet secretaries, the governor, the state auditor and the legislature informed about problems and deficiencies relating to the administration of departments and state-funded entities and progress of corrective action.

     SECTION 6. [NEW MATERIAL] OFFICES OF INSPECTOR GENERAL--DUTIES--ORGANIZATION--CONFIDENTIALITY.--

          A. The following departments shall establish and maintain offices of inspector general:

                (1) children, youth and families department;

                (2) corrections department;

                (3) department of health;

                (4) higher education department;

                (5) human services department;

                (6) public education department;

                (7) department of finance and administration;

                (8) department of transportation; and

                (9) taxation and revenue department.

          B. Each office of inspector general shall:

                (1) have the authority to audit, including internal audits and compliance audits, and investigate its department and related state-funded entities to ensure efficient and effective operations; the proper use of public funding; and the detection and prevention of fraud, waste and abuse;

                (2) have unrestricted access to records, data, reports, contracts, memoranda, correspondence and any other information necessary to carry out the duties of the office;

                (3) coordinate activities with the state auditor; the medicaid fraud and elder abuse division of the attorney general's office, as applicable; and the legislative finance committee;

                (4) recommend changes or corrective action and report on progress made to improve operations and to recover misspent public funding;

                (5) refer potential criminal matters to the attorney general or a district attorney and report violations to the state auditor;

                (6) as requested by the governor or an interim legislative committee, gather department and state-funded entity information and analyze and validate the information; provided, however, that this duty shall not affect the duty of a department or state-funded entity to otherwise provide information in a timely manner upon request of an interim legislative committee;

                (7) review and report on the progress of the department and the progress of related state-funded entities to resolve financial post-audit findings and validate performance measures reported in accordance with the Accountability in Government Act;

                (8) contract for professional services as necessary to carry out the duties of the office;

                (9) have the authority to accept federal funds to perform duties consistent with the State Inspectors General Act; and

                (10) adopt professional standards to carry out the provisions of the State Inspectors General Act.

          C. The offices of inspector general shall not:

                (1) perform audits of department financial statements; or

                (2) publicly disclose information or records made confidential by law or exempt from the Inspection of Public Records Act.

     SECTION 7. [NEW MATERIAL] OFFICES OF INSPECTOR GENERAL--REPORTS.--

          A. Each office of inspector general shall submit an annual work plan on planned reports and reports in progress to its department secretary and the legislative finance committee.

          B. An office of inspector general shall issue reports on the results of audits, including internal audits and compliance audits, and investigations to the department secretary, the legislative finance committee and the public; provided that information in reports containing information made confidential by law or exempt from the Inspection of Public Records Act shall not be disclosed by the office, the department or the legislative finance committee.

          C. Each inspector general shall issue an annual report not later than September 1 summarizing the work of the office during the preceding fiscal year, including reports issued; findings and cost savings identified and recommendations made to the department and its related state-funded entities; and the progress of the department and state-funded entities to resolve findings, save or recover public money and implement recommendations.

     SECTION 8. [NEW MATERIAL] APPOINTMENT--ORGANIZATION.--

          A. The secretary of a department shall appoint an inspector general without regard to political affiliation and solely on the basis of integrity and demonstrated ability in accounting, auditing, financial analysis, law, management analysis, public administration or investigations, and any action taken to hire, remove or suspend the inspector general shall be reported to the legislative finance committee within fifteen days with the reason for such action. An inspector general and employees in the department's office of inspector general shall be classified employees as provided by the Personnel Act.

          B. The office of inspector general shall be operationally separate from other divisions of the department and shall report directly to the secretary. The department shall not prevent, impair or prohibit its inspector general from initiating, carrying out or completing an audit, including an internal audit or a compliance audit, or an investigation.

     SECTION 9. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2013.

- 9 -