SB 128 - LEGISLATIVE AUDITS Number 050 SENATOR RANDY PHILLIPS, CHAIR OF THE JOINT LEGISLATIVE BUDGET AND AUDIT COMMITTEE, SPONSOR OF SB 128, stated the purpose of SB 128 was to authorize a formal process to follow up on audits. Number 074 RANDY WELKER, LEGISLATIVE AUDITOR, LEGISLATIVE AUDIT DIVISION, LEGISLATIVE AFFAIRS AGENCY, testified in support of SB 128. He said that the Legislative Audit Division issues many audits each year and does not have the ability to follow-up. He continued to explained that SB 128 would put in place a formal mechanism that would involve the Office of Management and Budget (OMB). The bill, in Section 1, provides for the Legislative Budget and Audit Committee to make referrals to OMB that merit monitoring. Section 2 states that OMB will follow up on any recommendations referred to them. If the agencies have agreed with the recommendations, they are required to monitor the implementation. If the agencies have disagreed to the recommendations, OMB is responsible for getting agency to implement the recommendation or go back to Legislative Budget and Audit (LBA) with an alternative solution. Each year they would be required to submit a report to the LBA detailing the status of any recommendation referred to them for monitoring, thus improving accountability. Number 131 SENATOR PHILLIPS said the bill would provide continuity. Number 170 CHAIRMAN VEZEY commented on the difference between the 1993 fiscal note and the zero fiscal note from 1994. Number 175 MR. WELKER said he supported a zero fiscal note. Number 222 CHAIRMAN VEZEY commended the committee adopt a zero fiscal note for SB 128. REPRESENTATIVE KOTT asked Mr. Welker what the governor's response was to SB 128. Number 238 MR. WELKER said there was no strong objection to the bill. Number 276 CHAIRMAN VEZEY asked for clarification on Section 2. Number 305 MR. WELKER explained that Section 1 states the LBA Committee can identify an item for monitoring, and Section 2 outlines the responsibility of the OMB to review those items. Number 359 REPRESENTATIVE KOTT asked Mr. Welker what percentage of total requests are special audit requests. Number 365 MR. WELKER said that one out of thirty audits is a special audit request. Number 400 SENATOR PHILLIPS reiterated the importance of having a mechanism in place to follow up on the implementation of audit requests. Number 421 REPRESENTATIVE KOTT aired his skepticism on the role of the Office of Management and Budget. Number 432 MR. WELKER told Representative Kott that there is a reporting mechanism in the bill for the Office of Management and Budget to report to the auditors and the Budget and Audit Committee detailing the degree of implementation of items referred to them. Number 445 CHAIRMAN VEZEY asked for further questions. Hearing none, he announced that SB 128 would be heard February 8, 1994, to allow for an opportunity for the Office of Management and Budget to testify. Number 454 NINA MAGNISON testified from Eagle River on SB 128. She said the job should be done by independent audit.