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PROPOSAL:

Issue RFP to Audit AB 2766 Fee Revenue Recipients for FYs 1995-96 and 1996-97

SYNOPSIS:

AB 2766 requires any agency that receives fee revenues subvened to the AQMD from the Department of Motor Vehicles to be audited once every two years. The audit is to be performed by an independent Certified Public Accountant selected by the AQMD.

COMMITTEE:

Administrative, June 19, 1998, Recommended for Approval

RECOMMENDED ACTION:

Approve issuance of RFP #9899-02 to Audit AB 2766 Fee Revenue Recipients for FYs 1995-96 and 1996-97.

Barry R. Wallerstein, D.Env.
Acting Executive Officer

AB 2766 was chaptered into law as Health and Safety Code Sections 44220-44247, which were enacted to authorize air pollution control districts to impose fees on motor vehicles. These fees are to be expended specifically for the purpose of mobile source air pollution reduction measures pursuant to the California Clean Air Act of 1988 and the AQMD's AQMP pursuant to Health and Safety Code Part 3, Chapter 5.5, Article 5.

The fee revenue is collected by the Department of Motor Vehicles and subvened to the AQMD. It is distributed as follows:

1. Forty cents of every dollar (40%) is placed in the Air Quality Improvement Trust Fund for quarterly disbursement to local governments;

2. Thirty cents of every dollar (30%) is placed in the Mobile Source Air Pollution Reduction Trust Fund for projects awarded by the Mobile Source Air Pollution Reduction Review Committee (MSRC) and approved by the AQMD's Board; and

3. Thirty cents of every dollar (30%) goes to support AQMD-approved programs for the reduction of emissions from mobile sources.

AB 2766 audit requirements [ Health and Safety Code, Section 44244.1(a)] state that any agency receiving fee revenues shall, at least once every two years, be subject to an audit of each program or project funded. The audit is to be conducted by an independent auditor selected by the AQMD in accordance with Division 2 (commencing with Section 1100) of the Public Contract Code.

Two biennial audits have been conducted to date for FYs 1991-92 and 1992-93 and FYs 1993-94 and 1994-95.

Proposal

The AQMD now is requesting proposals from qualified public accounting firms to perform the audit of fee revenues received in FYs 1995-96 and 1996-97. Staff proposes to present the report on the audit to the Board upon completion in early 1999. Based on an opinion issued by the Deputy Attorney General of the State of California the audit will focus on the propriety of the expenditures, not their degree of efficacy in reducing air pollution.

The audit will cover the AQMD's use of the money, projects funded by the MSRC, and the use of fee revenues by selected local governments based on the audit guidelines. Staff has worked extensively with local government representatives to assist local governments in compliance.

Resources

The cost of the audit will be borne by the entities being audited in the manner set forth in the audit guidelines included as Attachment 2 of the RFP and will be deducted from fee revenues prior to distribution. Sufficient funding to cover AQMD’s portion of the audit costs is included in the FY 1998-99 Budget.

Attachments

Request for Proposals #9899-02

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