Bill Summary – FastDemocracy

LEGISLATIVE GENERAL COUNSEL                                           S.B. 154
Approved for Filing: A. Houston 6                              st
                                                                     1 Sub. (Green)
          6 02-05-24 3:05 PM 6
                         Senator Michael K. McKell proposes the following substitute bill:
                         INDEPENDENT ENTITIES AMENDMENTS
                                        2024 GENERAL SESSION
                                            STATE OF UTAH
                                Chief Sponsor: Michael K. McKell
                                   House Sponsor: ____________
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 LONG TITLE
 General Description:
        This bill addresses independent entities.
 Highlighted Provisions:
        This bill:
        < defines terms;
        < requires independent entities to utilize best practices tools provided by the Office of
 the Legislative Auditor General;
        < requires the Governor's Office of Planning and Budget (office) to conduct an annual
 assessment of independent entities;
        < requires the office to provide reports to the Legislative Management Committee,
 governor, and an independent entity's governing body;
        < requires the Legislative Management Committee to assign each report from the
 office to an interim committee for study and possible action; and                                  1 stSub. S.B. 154
        < makes technical and conforming changes.
 Money Appropriated in this Bill:
        None
 Other Special Clauses:
        None
     *SB0154S01*
       1st Sub. (Green) S.B. 154                                                 02-05-24 3:05 PM
 Utah Code Sections Affected:
 ENACTS:
        63H-9-101, Utah Code Annotated 1953
        63H-9-102, Utah Code Annotated 1953
        63H-9-103, Utah Code Annotated 1953
        63H-9-104, Utah Code Annotated 1953
32
 Be it enacted by the Legislature of the state of Utah:
        Section 1. Section 63H-9-101 is enacted to read:
                   CHAPTER 9. OVERSIGHT OF INDEPENDENT ENTITIES
        63H-9-101. Definitions.
        As used in this chapter:
        (1) "Best practices toolbox" means the collection of resources for governmental entities
 provided on the website of the Office of the Legislative Auditor General that includes a best
 practice self-assessment and other resources, tools, and reports designed to help government
 organizations better serve the citizens of the state.
        (2) "Executive branch agency" means an agency or administrative subunit of state
 government that reports to the governor or lieutenant governor.
        (3) (a) "Independent entity" means an entity that:
        (i) has a public purpose relating to the state or its citizens;
        (ii) is individually created by the state;
        (iii) is separate from the judicial and legislative branches of state government; and
        (iv) is not under the direct supervisory control of the governor.
        (b) "Independent entity" does not include an entity that is:
        (i) a county;
        (ii) a municipality as defined in Section 10-1-104;
        (iii) an institution of higher education as defined in Section 53B-2-102;
        (iv) a public school as defined in Section 53G-8-701;
        (v) a special district as defined in Section 17B-1-102;
        (vi) a special service district as defined in Section 17D-1-102;
        (vii) created by an interlocal agreement as described in Section 11-13-203; or
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      02-05-24 3:05 PM                                                       1st Sub. (Green) S.B. 154
         (viii) an elective constitutional office, including the state auditor, the state treasurer,
 and the attorney general.
         (c) Independent entities that are subject to the provisions of this chapter include the:
         (i) Career Service Review Office created in Section 67-19a-201;
         (ii) Capitol Preservation Board created in Section 63C-9-201;
         (iii) Colorado River Authority created in Section 63M-14-201;
         (iv) Heber Valley Historic Railroad Authority created in Section 63H-4-102;
         (v) Military Installation Development Authority created in Section 63H-1-201;
         (vi) Office of the Great Salt Lake Commissioner created in Section 73-32-301;
         (vii) Office of Inspector General of Medicaid Services created in Section 63A-13-201;
         (viii) Point of the Mountain State Land Authority created in Section 11-59-201;
         (ix) Public Service Commission created in Section 54-1-1;
         (x) School and Institutional Trust Fund Office created in Section 53C-1-201;
         (xi) School and Institutional Trust Lands Administration created in Section 53D-1-201;
         (xii) Utah Beef Council created in Section 4-21-103;
         (xiii) Utah Capital Investment Corporation created in Section 63N-6-301;
         (xiv) Utah Communications Authority created in Section 63H-7a-201;
         (xv) Utah Dairy Commission created in Section 4-22-103;
         (xvi) Utah Education and Telehealth Network created in Section 53B-17-105;
         (xvii) Utah Housing Corporation created in Section 63H-8-201;
         (xviii) Utah Inland Port Authority created in Section 11-58-201;
         (xix) Utah Innovation Lab created in Section 63N-20-201;
         (xx) Utah Lake Authority created in Section 11-65-201;
         (xxi) Utah Retirement Systems created in Section 49-11-201; and
         (xxii) Utah State Fair Park Authority created in Section 11-68-201.
         (4) "Office" means the Governor's Office of Planning and Budget.
         Section 2. Section 63H-9-102 is enacted to read:
         63H-9-102. Independent entity best practices.
         (1) An independent entity listed in Subsection 63H-9-101(4)(c) shall:
         (a) use the best practices toolbox to assess the independent entity at least once each
 year;
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       1st Sub. (Green) S.B. 154                                                     02-05-24 3:05 PM
        (b) report the results of the assessment described in Subsection (1)(a) to the office by
 December 31 of each year; and
        (c) cooperate with the office and, upon request from the office, provide information
 and material pertaining to an assessment described in Section 63H-9-103.
        (2) An independent entity may request best practice training from the Office of the
 Legislative Auditor General.
        Section 3. Section 63H-9-103 is enacted to read:
        63H-9-103. Assessment -- Reports.
        (1) Subject to available work capacity, the office shall:
        (a) each year, conduct an assessment of one or more independent entities to determine
 the state's exposure to risk from each independent entity;
        (b) by August 1 of each year, provide a report on each assessment conducted under
 Subsection (1)(a)(i) to the Legislative Management Committee, the governor, and the
 governing body of the entity that is the subject of the assessment; and
        (c) upon request, consult with interim committees that the Legislative Management
 Committee assigns to review assessment reports under Section 63H-9-104.
        (2) An assessment described in Subsection (1)(a):
        (a) shall include an evaluation and analysis of an independent entity's:
        (i) public purpose;
        (ii) relative proximity to or independence from the state;
        (iii) governance structure;
        (iv) financial risks and controls, so far as they pertain to state funds;
        (v) oversight structure; and
        (vi) exemptions from state policies, procedures, and use of resources;
        (b) shall include consideration of an executive branch agency to which an independent
 entity may be accountable for the purposes of:
        (i) mitigating risks identified through the office's assessment; and
        (ii) improving the independent entity's compliance with applicable state policies and
 procedures.
        (3) The office shall determine which independent entity or entities to assess each year
 based on a consideration of:
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        02-05-24 3:05 PM                                                    1st Sub. (Green) S.B. 154
        (a) information provided in each independent entity's assessment report under Section
 63H-9-102;
        (b) estimated exposure to risk from each independent entity;
        (c) how recently each independent entity has been reviewed by the office, the state
 auditor, the Office of the Legislative Auditor General, or the Retirement and Independent
 Entities Interim Committee; and
        (d) any other factor the office determines relevant.
        (4) The office shall:
        (a) review each newly created entity that meets the definition of independent entity in
 Subsection 63H-9-101(4)(a) to determine if the entity should be subject to the provisions of
 this chapter;
        (b) when possible, review a proposal to create a new entity that meets the definition of
 independent entity to determine if the proposed entity should be subject to the provisions of
 this chapter;
        (c) make recommendations to the Legislature and governor concerning which entities
 should be subject to the provisions of this chapter; and
        (d) make recommendations to the Legislature and governor concerning any need to
 modify the provisions of this chapter.
        (5) To fulfill the office's duties under this section, the office may consult with the state
 auditor, the Office of the Legislative Auditor General, or the Office of Legislative Research
 and General Counsel.
        Section 4. Section 63H-9-104 is enacted to read:
        63H-9-104. Assignment and study of reports.
        (1) By September 1 of each year, the Legislative Management Committee shall assign
 each report provided pursuant to Section 63H-9-103 to an interim committee.
        (2) An interim committee that is assigned a report under Subsection (1) shall:
        (a) study the report during the interim committee's September interim meeting; and
        (b) determine, by motion and majority vote, whether to open a committee bill file to
 address issues related to the independent entity that is the subject of the report.
        Section 5. Effective date.
        This bill takes effect on May 1, 2024.
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