46th legislature - STATE OF NEW MEXICO - first session, 2003

RELATING TO GOVERNMENT ACCOUNTABILITY; CREATING THE STATE COMPTROLLER AND OFFICE; PROVIDING POWERS AND DUTIES; PROVIDING THE LEGISLATIVE FINANCE COMMITTEE WITH THE DUTY TO CONDUCT PERFORMANCE AUDITS; PROVIDING PENALTIES; MAKING AN APPROPRIATION.

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

Section 1. [NEW MATERIAL] STATE COMPTROLLER--OFFICE--CREATED--PERSONNEL.--

A. The "office of the state comptroller" is created as an adjunct agency as provided in the Executive Reorganization Act. The office shall be headed by the "state comptroller", who shall be appointed by the governor with the advice and consent of the senate.

B. The state comptroller shall be a certified public accountant with audit and government experience and shall be appointed solely on the basis of ability to perform the duties of his office. The state comptroller shall serve for six years, and may be reappointed for succeeding six-year terms. The state comptroller shall be removed only for cause.

C. Within available appropriations, the state comptroller may employ such professional and clerical assistants as deemed necessary.

Section 2. [NEW MATERIAL] STATE COMPTROLLER--DUTIES.--The state comptroller shall:

A. have general oversight authority over the executive branch's implementation of the Accountability in Government Act;

B. oversee the statutory oversight duties of the state budget division, the financial control division, the local government division and the management and contracts review division of the department of finance and administration; the state personnel office; the state department of public education; and the commission on higher education to ensure that statutory requirements are being met and statutory duties are being performed;

C. receive and review periodic reports from state agency inspectors general and internal auditors;

D. work closely with the state auditor's office on annual and special audits of state agencies;

E. as requested by interim legislative committees, gather state agency information and analyze and validate the information; provided, however, that this duty shall not affect the duty of a state agency to otherwise provide information in a timely manner upon request of an interim legislative committee;

F. pursuant to the Accountability in Government Act, conduct such performance audits as are necessary to ensure compliance with that act; provided that, in conducting the audits, the state comptroller shall:

(1) to the maximum extent possible, plan and coordinate the audits with the legislative finance committee; and

(2) share audit work papers and findings with the legislative finance committee;

G. perform such other duties as may be assigned by the governor;

H. assist state agencies in resolving audit findings and reviewing performance measures;

I. contract for such special audits and investigations as are necessary; and

J. promulgate such rules as are necessary to carry out the duties of the office.

Section 3. [NEW MATERIAL] STATE COMPTROLLER--COOPERATION OF STATE AGENCIES.--Inspectors general and internal auditors of state agencies shall report to the state comptroller periodically and as requested. Inspectors general, internal auditors, the state auditor, the office of the attorney general and the state police division of the department of public safety shall conduct such audits and special investigations as are requested by the state comptroller.

Section 4. Section 2-5-4 NMSA 1978 (being Laws 1967, Chapter 267, Section 1) is amended to read:

"2-5-4. LEGISLATIVE FINANCE COMMITTEE--ADDITIONAL DUTIES.--

A. The legislative finance committee, in addition to all other duties prescribed by law, shall:

(1) annually review budgets and appropriations requests; [and]

(2) review the operation and management of selected state agencies, departments and institutions; [and shall]

(3) conduct performance audits pursuant to the Accountability in Government Act; and

(4) make recommendations with respect thereto to the legislature.

B. To carry out the purposes of this section, the legislative finance committee shall establish a budget analysis division staffed with persons knowledgeable and proficient in budget analysis and budget preparation.

C. Each state agency, department and institution shall furnish to the legislative finance committee a copy of its appropriation request made to the department of finance and administration at the same time [such] the request is made [to such department]. Each state agency, department or institution shall also furnish to the legislative finance committee and its staff any other supporting information or data deemed necessary to carry out the purposes of this section.

D. The legislative finance committee or, when it deems necessary, its staff may hold such hearings and require such testimony from officers and employees of each state agency, department or institution as is necessary to carry out the purposes of this section.

E. Not later than the first week of any regular legislative session, the legislative finance committee shall furnish a document containing its budget recommendations to each member of the senate finance committee, the house appropriations and finance committee and to those other members of the legislature [which] who may request it. A copy shall also be furnished to the governor and to the department of finance and administration."

Section 5. Section 6-3A-1 NMSA 1978 (being Laws 1999, Chapter 5, Section 1 and Laws 1999, Chapter 15, Section 1) is amended to read:

"6-3A-1. SHORT TITLE.--[Sections 1 through 8 of this act] Chapter 6, Article 3A NMSA 1978 may be cited as the "Accountability in Government Act"."

Section 6. Section 6-3A-3 NMSA 1978 (being Laws 1999, Chapter 5, Section 3 and Laws 1999, Chapter 15, Section 3) is amended to read:

"6-3A-3. DEFINITIONS.--As used in the Accountability in Government Act:

A. "agency" means a branch, department, institution, board, bureau, commission, district or committee of the state;

B. "approved program" means a program included in an approved list of programs issued by the division pursuant to Section [4 of the Accountability in Government Act] 6-3A-4 NMSA 1978;

C. "baseline data" means the current level of a program's performance measures established pursuant to guidelines established by the division in consultation with the committee;

D. "committee" means the legislative finance committee or a designated member of its staff;

E. "division" means the state budget division of the department of finance and administration;

F. "outcome" means the measurement of the actual impact or public benefit of a program;

G. "performance-based program budget" means a budget that identifies a total allowed expenditure for a program and includes performance measures, performance standards and program evaluations;

H. "performance measure" means a quantitative or qualitative indicator used to assess the output or outcome of an approved program;

I. "performance standard" means a targeted level of an output or outcome as indicated by performance measures; and

J. "program" means a set of activities undertaken in accordance with a plan of action organized to realize identifiable goals and objectives based on legislative authorization."

Section 7. A new section of the Accountability in Government Act is enacted to read:

"[NEW MATERIAL] PERFORMANCE AUDITS.--

A. The committee and the state comptroller shall cooperate in developing an audit plan to conduct performance audits of programs operating under performance-based program budgets. The plan may provide for joint audits, separate audits of different programs or separate audits of the same programs and may include programs provided by other agencies that are integrally related to the program being audited.

B. Performance audits shall be conducted:

(1) on programs identified by the legislature;

(2) at the direction of the committee, if the audit is to be conducted by the committee;

(3) at the direction of the governor, if the audit is to be conducted by the state comptroller; and

(4) in a manner that is cost-effective and avoids duplication of effort.

C. An agency shall offer its complete cooperation to the committee or the state comptroller in the conduct of a performance audit. The committee or the state comptroller, in the performance of an audit, shall have access to, and authority to examine, books, accounts, reports, vouchers, correspondence files and other records, bank accounts, criminal history record information, money and other property of an agency, or such property of a contractor relating to a contract with an agency. It is the duty of an officer or employee of an agency having such records under the officer's or employee's control to permit access to and examination of the records on the request of the committee or state comptroller. Any person who willfully fails or refuses to furnish or produce any book, record, paper, document, data or sufficient information necessary to a proper audit that the committee or the state comptroller is authorized to perform shall be subject to removal from office and is guilty of a petty misdemeanor and shall be sentenced in accordance with the provisions of Section 31-19-1 NMSA 1978.

D. For the purposes of conducting performance audits, the committee or the state comptroller may attend executive sessions of the governing body of an agency and the facilities of any agency shall be available for use by the committee or the state comptroller in carrying out its functions.

E. At a minimum, a performance audit shall specifically determine the following:

(1) the identifiable cost of the program;

(2) the specific purpose of the program, including the specific outputs and outcomes derived therefrom;

(3) progress toward achieving the performance standards associated with the program;

(4) an explanation of circumstances contributing to the agency's ability to achieve, not achieve or exceed the performance standards associated with the program;

(5) alternative courses of action that would result in administration of the same program in a more efficient or effective manner. The courses of action to be considered shall include:

(a) whether the program could be organized in a more efficient and effective manner;

(b) whether the program's mission, goals or objectives should be redefined;

(c) when the agency cannot demonstrate that its efforts have had a positive effect, whether the program should be reduced in size or eliminated;

(d) whether the program could be administered more efficiently or effectively to avoid duplication of activities and ensure that activities are adequately coordinated;

(e) whether the program could be performed more efficiently or more effectively by another unit of government or a private entity or whether a program performed by a private entity could be performed more efficiently and effectively by an agency;

(f) when compared to costs, whether effectiveness warrants elimination of the program or, if the program serves a limited interest, whether it should be redesigned to require users to finance program costs;

(g) whether the cost to administer the program exceeds license and other fee revenues paid by those being regulated; and

(h) whether other changes could improve the efficiency and effectiveness of the program;

(6) the consequences of discontinuing the program. If discontinuation is recommended, the recommendation shall be accompanied by a description of alternatives to implement the recommendation, including an implementation schedule for discontinuation and recommended procedures for assisting agency employees affected by the discontinuation;

(7) whether agency management has established control systems sufficient to ensure that performance measures are maintained and supported by agency records and accurately presented in agency performance reports; and

(8) if the performance audit report contains recommendations or alternative courses of action, the estimated financial consequences, including any potential savings, that could be realized if the recommendations or alternative courses of action were implemented.

F. Working papers and other audit files maintained by the committee or the state comptroller in conducting a performance audit are confidential and are not public records.

G. Final performance audit reports shall be transmitted to the governor and the committee. Copies of the reports shall be made available to the members of the senate finance committee, the house appropriations and finance committee, any other interested legislator, users of the program audited and any interested member of the public. The reports shall be considered by the director of the division when a budget is prepared pursuant to Section 6-3-15 NMSA 1978, by the governor when he prepares budgets pursuant to Section 6-3-21 NMSA 1978 and by the committee when it develops budget recommendations pursuant to Section 2-5-4 NMSA 1978.

H. As used in this section, "performance audit" means an examination of a program activity or function of an agency, conducted in accordance with applicable government auditing standards or auditing and evaluation standards of other appropriate authoritative bodies. The term includes an examination of issues related to:

(1) economy, efficiency or effectiveness of the program;

(2) structure or design of the program to accomplish its goals and objectives;

(3) adequacy of the program to meet the needs identified by the legislature or governing body;

(4) alternative methods of providing program services or products;

(5) goals, objectives and performance measures used by the agency to monitor and report program accomplishments;

(6) the accuracy or adequacy of public documents, reports or requests prepared under the program by agencies; and

(7) compliance of the program with appropriate policies, rules or laws."

Section 8. APPROPRIATION.--Seven hundred fifty thousand dollars ($750,000) is appropriated from the general fund to the state comptroller for expenditure in fiscal year 2004 to carry out the provisions of this act. Any unexpended or unencumbered balance remaining at the end of fiscal year 2004 shall revert to the general fund.