Bill Text: CA AB1237 | 2013-2014 | Regular Session | Amended
Bill Title: Local government finance.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2013-05-22 - From committee without further action pursuant to Joint Rule 62(a). [AB1237 Detail]
Download: California-2013-AB1237-Amended.html
BILL NUMBER: AB 1237 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY APRIL 1, 2013
INTRODUCED BY Assembly Member Garcia
FEBRUARY 22, 2013
An act to add Sections 53891.2 and 53891.3 to, and to add Article
10.1 (commencing with Section 53902) to Chapter 4 of Part 1 of
Division 2 of Title 5 of, the Government Code, relating to local
government finance.
LEGISLATIVE COUNSEL'S DIGEST
AB 1237, as amended, Garcia. Local government finance.
Existing law requires the Controller to prescribe uniform
accounting and reporting procedures that are applicable to specified
types of local agencies. Existing law excludes certain agencies from
this requirement, including cities.
This bill would specifically require the Controller to prescribe
uniform accounting procedures for cities, conforming to Generally
Accepted Accounting Principles, and in consultation with the
Committee on City Accounting Procedures, which would be created by
the bill. The bill would specify the composition of the committee.
This bill would create the City Budget Act, which would be
applicable to certain fiscal procedures of cities, dependent special
districts, and other agencies whose affairs and finances are under
the supervision and control of the city council. The bill would
require the Controller to promulgate rules, regulations, and
classifications as he or she deems necessary and commensurate with
the accounting procedures for cities prescribed pursuant to the bill.
The bill would require that the city budget process be conducted
pursuant to the specified procedures, and would require a copy of the
city's audited comprehensive annual financial report for the next
preceding fiscal year to be filed by the city in the office of the
Controller, not later than January 15 March
31 of each year. Because it would impose new duties on cities
and agencies under their supervision and control, this bill would
impose a state-mandated local program.
The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that, if the Commission on State Mandates
determines that the bill contains costs mandated by the state,
reimbursement for those costs shall be made pursuant to these
statutory provisions.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 53891.2 is added to the Government Code, to
read:
53891.2. Pursuant to this division, the Controller shall
prescribe for cities uniform accounting procedures conforming to
Generally Accepted Accounting Principles (GAAP). The Controller shall
prescribe these procedures after consultation, with and approval by,
the Committee on City Accounting Procedures created by Section
53891.3. Approval of these procedures shall be by a majority vote of
the total membership of the committee. The vote may be conducted by
mail at the discretion of the chairperson of the committee, provided,
however, that if one or more members of the committee request a
meeting for the purpose of voting, the chairperson shall call a
meeting of the committee, as provided in Section 53891.3.
SEC. 2. Section 53891.3 is added to the Government Code, to read:
53891.3. (a) The Committee on City Accounting Procedures, which
is hereby created, shall consist of 10 members appointed by the
Controller, who shall serve at the pleasure of the Controller. The
committee members shall have the following qualifications:
(1) Four members shall be city finance officers.
(2) Three members shall be city managers, including one each from
the northern, southern, and central California region.
(3) One member shall be a city representative from a rural area.
(4) One member shall be a county auditor-controller.
(5) One member shall be a representative appointed by the
California Society of Certified Public Accountants.
(b) The members of the committee shall serve without compensation,
but shall be reimbursed for their necessary traveling and other
expenses incurred in attending meetings of the committee. These
expenses shall be paid by the city or county of which the member is
an officer. The expenses incurred in attending meetings by the
certified public accountant shall be paid by the California Society
of Public Accountants.
(c) The Controller shall designate a member of the committee to
serve as chairman. The committee shall meet at the call of the
chairman and each member shall be given written notice of any meeting
at least 10 days prior to the date of the meeting.
SEC. 3. Article 10.1 (commencing with Section 53902) is added to
Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code,
to read:
Article 10.1. City Budget Act
53902. This article shall be known, and may be cited, as the City
Budget Act. Unless the context otherwise requires or provides, the
general provisions set forth in this article, and the requirements
concerning city budget matters prescribed by the Controller under
Section 53891.2, shall govern the construction of this article.
53902.1. Except as otherwise defined in this section, the meaning
of terms used in this article shall be as defined in the uniform
accounting procedures for Cities prescribed by the Controller
pursuant to Section 53891.2. As used in this article, the following
terms have the following meanings:
(a) "Adopted budget" means the budget document formally approved
by the city council after the required public hearings and
deliberations on the recommended budget.
(b) "Budget year" means the fiscal year for which the budget is
being prepared.
(c) "City official" means the chief administrative officer, city
administrator, city executive, city finance officer, city manager, or
any other official employed in any of the several cities under
various titles whose duties and responsibilities are comparable to
any of the officials named in this subdivision.
(d) "Controller" means the State Controller.
(e) "Council" means the city council of the city, or the same
legislative body acting as the governing board of a special district
whose affairs and finances are under its supervision and control.
(f) "Final budget" means the adopted budget adjusted by all
revisions throughout the fiscal year as of June 30.
(g) "Fiscal year" means the current 12-month period to which the
annual operating budget applies and at the end of which a government
determines its financial position and the results of its operations.
(h) "Obligated fund balance" means the nonspendable, restricted,
committed, and assigned fund balances.
(i) "Recommended budget" means the budget document recommended to
the city council by the designated City city
official.
53902.2. This article shall apply to cities, dependent special
districts, and other agencies whose affairs and finances are under
the supervision and control of the council.
53902.3. Except as otherwise specifically provided by law, a
majority vote of the total membership of the council is required for
the council to take action pursuant to this article.
53902.4. (a) The Controller shall promulgate any rules,
regulations, and classifications as he or she deems necessary and
commensurate with the accounting procedures for cities prescribed
pursuant to Section 53891.2, to secure standards of uniformity among
the various cities in carrying out the provisions of this article.
The rules, regulations, and classifications shall be adopted with
consultation and approval in accordance with Section 53891.2.
(b) The Controller shall prescribe the forms required to be used
in presenting the required information in the budget document after
consultation with the Committee on City Accounting Procedures
established in Section 53891.3. Any city may add to the information
required, or display it in more detail, provided that the financial
information and the classifications or items required to be included
in the budget are clearly and completely set forth. Any change
proposed by a city in the arrangement of the information required on
the forms shall be subject to review and approval by the Controller.
53903. For the adopted budget, the various forms, as prescribed
by the Controller pursuant to Section 53902.4, shall provide for the
presentation of data and information to include, at a minimum,
estimated or actual amounts of the following items, by fund:
(a) Fund balances, including the following.
balances:
(1) Nonspendable.
(2) Restricted.
(3) Committed.
(4) Assigned.
(5) Unassigned.
(b) Additional financing sources shall be classified by source, in
accordance with the accounting procedures for cities as prescribed
by the Controller pursuant to Section 53891.2. For comparative
purposes, the amounts of financing sources shall be shown as follows:
(1) On an actual basis for the fiscal year two years prior to the
budget year.
(2) On an actual basis, except for those sources that can only be
estimated, for the fiscal year prior to the budget year.
(3) On an estimated basis for the budget year, as submitted by the
city official.
(4) On an estimated basis for the budget year, as approved, or as
adopted, by the council.
(c) Financing uses for each budget unit, classified by the fund or
funds from which financed, by the objects of expenditure, other
financing uses, intrafund transfers, and transfers out, in accordance
with the accounting procedures for cities and by any further
classifications or requirements pertaining to city budget matters as
prescribed by the Controller pursuant to Section 53891.2. For
comparative purposes, the amounts of financing uses shall be shown as
follows:
(1) On an actual basis for the fiscal year two years prior to the
budget year.
(2) On an actual basis, except for those uses that can only be
estimated, for the fiscal year prior to the budget year.
(3) On an estimated basis for the budget year, as submitted by the
city official.
(4) On an estimated basis for the budget year, as approved, or as
adopted, by the council.
(d) Appropriations for contingencies.
(e) Provisions for nonspendable, restricted, committed, and
assigned fund balances.
(f) The appropriations limit and the total annual appropriations
subject to limitation as determined pursuant to Division 9
(commencing with Section 7900) of Title 1.
53903.1. There shall be a schedule in, or supporting, the adopted
budget document or separate ordinance or resolution, setting forth
for each budget unit the following data for each position
classification:
(a) Salary rate or range, as applicable.
(b) Total allocated positions approved by the council.
53903.2. At a minimum, within the object of capital assets, the
budget amounts for the following shall be reported, as specified:
(a) Land shall be reported in total amounts, except when included
as a component of a project.
(b) Structures and improvements shall be reported separately for
each project, except that minor improvement projects may be reported
in totals.
(c) Equipment shall be reported in total amounts, by budget unit.
(d) Infrastructure shall be reported in total amounts, by budget
unit.
(e) Intangible assets may be reported in total amounts, by budget
unit.
53903.3. Funding sources shall equal the financing uses, in both
the adopted budget and the final budget.
53903.4. The budget may contain one or more
appropriations, an appropriation or appropriation
s for contingencies, in an amount or
such amounts as the council deems sufficient.
53903.5. The resolution of adoption of the budget of the city,
each dependent special district, and each other agency, as defined in
Section 53902.2, shall specify the following:
(a) Appropriations, by objects of expenditure within each budget
unit, except for capital assets that are appropriated at the
subobject level pursuant to Section 53903.2.
(b) Other financing uses, by budget unit.
(c) Intrafund transfers, by budget unit.
(d) Transfers out, by fund.
(e) Appropriations for contingencies, by fund.
(f) Provisions for nonspendable, restricted, committed, and
assigned fund balances, by fund and purpose.
(g) The means of financing the budget requirements.
53904. The adoption of the budget may be accomplished by a
resolution in which the adoption is effectuated by reference to the
financing uses in the budget as finally determined, provided that the
minimum requirements set forth in Section 53903.5 are met in the
budget document. If adopted by reference, the budget shall have the
same effect, and be subject to the same provisions of law, as if the
resolution of adoption had been accomplished by specific designation.
53904.1. The council may set forth appropriations in greater
detail than required in Section 53903.5, and may authorize any
additional controls for the administration of the budget as it deems
necessary. The council may designate a city official to exercise
these administrative controls.
53905. (a) A copy of the adopted budget in the format prescribed
by the Controller shall be filed by the city official in the office
of the clerk of the board and the office of the Controller not later
than December 1 of each year.
(b) (1) If the city official, after receipt of written notice from
the Controller, fails to transmit a copy of the adopted budget
within 20 days, the city shall forfeit to the state one thousand
dollars ($1,000), to be recovered in an action brought by the
Attorney General, in the name of the Controller.
(2) Upon a satisfactory showing of good cause, the Controller may
waive the penalty for late filing provided in paragraph (1).
53906. The adopted budget shall include a schedule showing the
managerial budget of each service activity financed by a proprietary
fund. The schedule shall set forth expected operations of the
activity in that such detail for
revenues, expenses, and reserves as will adequately display the
nature and the approximate size of its operations. Comparative data,
as prescribed in Section 53903, shall be provided.
53907. A copy of the audited comprehensive annual financial
report for the next preceding fiscal year shall be filed by the
appropriate city official in the office of the Controller not later
than January 15 March 31 of each year.
SEC. 4. If the Commission on State Mandates determines that this
act contains costs mandated by the state, reimbursement to local
agencies and school districts for those costs shall be made pursuant
to Part 7 (commencing with Section 17500) of Division 4 of Title 2 of
the Government Code.
