THE SENATE

S.B. NO.

2115

TWENTY-FIFTH LEGISLATURE, 2010

S.D. 1

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT

 

 

RELATING TO PREAUDITS FOR PROPOSED PAYMENTS.

 

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 


     SECTION 1.  The legislature finds that like the University of Hawaii, the department of education should be required to preaudit all proposed payments of $10,000 or more, but should have preaudit flexibility for proposed payments of less than $10,000.  The legislature also finds that the fiscal autonomy previously granted to the University of Hawaii and the department of education until June 30, 2011, should be extended.

The purpose of this Act is to:

     (1)  Clarify that the department of education is required to preaudit proposed payments of $10,000 or more;

     (2)  Allow the University of Hawaii and the department of education to preaudit sample populations for proposed payments of less than $10,000 to determine the propriety of expenditures and compliance with applicable laws, executive orders, and rules, as their respective chief financial officers determine to be appropriate; and

     (3)  Extend the date that allows the University of Hawaii and the department of education to have autonomous authority over their accounting systems and other purchasing responsibilities and duties.

     SECTION 2.  Section 40-1, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:

     "(b)  With respect to the executive branch, except the University of Hawaii until [June 30, 2011,] June 30, 2015, the Hawaii tourism authority, and the department of education until [June 30, 2011,] June 30, 2015, the comptroller shall have complete supervision of all accounts.  The comptroller shall preaudit all proposed payments of $10,000 or more to determine the propriety of expenditures and compliance with executive orders and rules that may be in effect.  When necessary, the comptroller shall withhold approval of any payment.  Whenever approval is withheld, the department or agency concerned shall be promptly notified.  With respect to the University of Hawaii, the Hawaii tourism authority, and the department of education, the comptroller shall issue warrants for the release of funds for the operating costs of the university, the Hawaii tourism authority, or the department of education, as applicable, in amounts and at times mutually agreed upon by the governor or director of finance and the university, the Hawaii tourism authority, or department of education, as applicable; provided:

     (1)  The amounts released shall not exceed the allotment ceilings for the respective funding sources of the university's or the department of education's appropriations established by the governor for an allotment period pursuant to section 37-34, or in the case of the Hawaii tourism authority, revenues received by the convention center enterprise special fund and the tourism special fund pursuant to section 237D-6.5; and

     (2)  The comptroller may issue warrants as an advance from the state treasury to the University of Hawaii, the Hawaii tourism authority, and the department of education to establish a checking account and provide working capital in amounts and at times mutually agreed upon by the governor or director of finance and the University of Hawaii, the Hawaii tourism authority, and the department of education.

The University of Hawaii and the department of education shall preaudit all proposed payments of $10,000 or more and [the] shall preaudit sample populations for proposed payments of less than $10,000, provided that the sample size comprises at least          per cent of the population, as the chief financial officers of the University of Hawaii and the department of education, as applicable, determine appropriate, to determine the propriety of expenditures and compliance with applicable laws, executive orders, and rules.  The Hawaii tourism authority [and the department of education] shall preaudit all proposed payments to determine the propriety of expenditures and compliance with applicable laws, executive orders, and rules as may be in effect.  The University of Hawaii, the Hawaii tourism authority, and the department of education shall make disbursements for operating expenses from the amounts released by the comptroller and maintain records and documents necessary to support those disbursements at times mutually agreed upon by the university president, the executive director of the Hawaii tourism authority, or the superintendent of education, as applicable, and the comptroller; provided that when requested by the university, the Hawaii tourism authority, or department of education, the comptroller shall make all disbursements for the university, the Hawaii tourism authority, or department of education, as applicable, subject to available allotment.  Funds released pursuant to this section shall be deposited by the university, the Hawaii tourism authority, or department of education, as applicable, in accordance with the provisions applicable to the director of finance by chapter 38.  Except for moneys deposited by the Hawaii tourism authority in the convention center enterprise special fund pursuant to section 201B-8, and in the tourism special fund pursuant to section 201B-11, any interest earned on the deposit of funds released pursuant to this section shall be deposited in the state treasury at the end of each fiscal year."

     SECTION 3.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 4.  This Act shall take effect on June 29, 2050; provided that the amendments made to section 40-1, Hawaii Revised Statutes, by this Act shall not be repealed when section 40-1, Hawaii Revised Statutes, is repealed and reenacted on June 30, 2010, by section 12 of Act 5, Special Session Laws of Hawaii 2009.



 

 

Report Title:

Preaudits for Proposed Payments; Fiscal Autonomy; Department of Education; University of Hawaii

 

Description:

Clarifies that the department of education is required to preaudit proposed payments of $10,000 or more.  Allows the University of Hawaii and the department of education to preaudit sample populations for proposed payments of less than $10,000 to determine the propriety of expenditures and compliance with applicable laws, executive orders, and rules, as their respective chief financial officers determine to be appropriate.  Extends the date until which the University of Hawaii and the department of education shall have autonomous authority over their accounting systems and other purchasing responsibilities and duties.

 

 

 

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