Rep. Norm Thurston — Voting Record

Bill

Number

S.B. 26 Third Substitute (2019GS)

Sponsor

Sen. Henderson, D.

Final action

Governor Signed 3/27/2019

Outcome

Became law — signed by Gov. Gary R. Herbert

Summary

What it does

• This bill:
• requires the state auditor to:
• develop a training or other informational resource regarding best practices for financial controls and board governance;
• distribute the training or other informational resource to certain state and local entities and governmental nonprofit corporations; and
• issue notices of noncompliance to certain boards of directors of governmental nonprofit corporations and board members;
• requires each member of a board of directors of a governmental nonprofit corporation to complete the training that the state auditor provides regarding best practices for financial controls and board governance;
• provides for the disqualification of a board member who fails to complete the required training within certain time periods;
• amends an informational requirement for the local government and limited purpose entity registry; and
• makes technical and conforming changes.

Every vote on this bill

Bill text

GOVERNMENTAL NONPROFIT CORPORATION ACT
AMENDMENTS
GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Deidre M. Henderson
House Sponsor: 
Craig Hall
LONG TITLE
General Description:
This bill amends definitions and provides for certain training relating to governmental
nonprofit corporations.
Highlighted Provisions:
This bill:
▸ requires the state auditor to:
• develop a training or other informational resource regarding best practices for
financial controls and board governance;
• distribute the training or other informational resource to certain state and local
entities and governmental nonprofit corporations; and
• issue notices of noncompliance to certain boards of directors of governmental
nonprofit corporations and board members;
▸ requires each member of a board of directors of a governmental nonprofit
corporation to complete the training that the state auditor provides regarding best
practices for financial controls and board governance;
▸ provides for the disqualification of a board member who fails to complete the
required training within certain time periods;
▸ amends an informational requirement for the local government and limited purpose
entity registry; and
▸ makes technical and conforming changes.
Money Appropriated in this Bill:
None
Other Special Clauses:
None
Utah Code Sections Affected:
AMENDS:
67-1a-15
, as enacted by Laws of Utah 2018, Chapter 256
ENACTS:
11-13a-106
, Utah Code Annotated 1953
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 
11-13a-106
 is enacted to read:
 11-13a-106.
Training for board members.
(1) (a) (i) Each member of a board of directors of a governmental nonprofit corporation
shall complete the training described in Subsection (2)(a):
(A) within six months after the day on which the member becomes a board member; or
(B) for a member already in the position of board member on May 14, 2019, before
November 14, 2019.
(ii) If a board member fails to complete the training described in Subsection (2)(a)
within the time period specified in Subsection (1)(a)(i):
(A) the state auditor shall issue a notice of noncompliance to the board member and the
relevant board of directors; and
(B) if the board member fails to complete the training described in Subsection (2)(a)
within 30 calendar days after the date of the auditor's notice of noncompliance, the board
member is disqualified and may not act as a board member.
(b) For the purposes of Subsection (1)(a), a member of a board of directors of a
governmental nonprofit corporation takes office each time the member is elected or appointed
to a new term.
(2) The state auditor shall:
(a) develop a training or other informational resource to aid a governmental nonprofit
corporation in implementing best practices for financial controls and board governance;
(b) provide the training or other informational resource described in Subsection (2)(a)
to each of the following entities that provides any required budgeting, expenditure, or financial
report to the state auditor:
(i) a governmental nonprofit corporation; and
(ii) a state agency or political subdivision of the state that wholly controls or has a
controlling interest in a governmental nonprofit corporation, as described in Section
11-13a-102
;
(c) ensure that the training described in Subsection (2)(a) complies with Title 63G,
Chapter 22, State Training and Certification Requirements; and
(d) issue a certificate of completion to each board member that completes the training
described in Subsection (2)(a).
Section 2. Section 
67-1a-15
 is amended to read:
67-1a-15.
Local government and limited purpose entity registry.
(1) As used in this section:
(a) "Entity" means a limited purpose entity or a local government entity.
(b) (i) "Limited purpose entity" means a legal entity that:
(A) performs a single governmental function or limited governmental functions; and
(B) is not a state executive branch agency, a state legislative office, or within the
judicial branch.
(ii) "Limited purpose entity" includes:
(A) area agencies, area agencies on aging, and area agencies on high risk adults, as
those terms are defined in Section 
62A-3-101
;
(B) charter schools created under Title 53G, Chapter 5, Charter Schools;
(C) community reinvestment agencies, as that term is defined in Section 
17C-1-102
;
(D) conservation districts, as that term is defined in Section 
17D-3-102
;
(E) governmental nonprofit corporations, as that term is defined in Section 
11-13a-102
;
(F) housing authorities, as that term is defined in Section 
35A-8-401
;
(G) independent entities and independent state agencies, as those terms are defined in
Section 
63E-1-102
;
(H) interlocal entities, as that term is defined in Section 
11-13-103
;
(I) local building authorities, as that term is defined in Section 
17D-2-102
;
(J) local districts, as that term is defined in Section 
17B-1-102
;
(K) local health departments, as that term is defined in Section 
26A-1-102
;
(L) local mental health authorities, as that term is defined in Section 
62A-15-102
;
(M) nonprofit corporations that receive an amount of money requiring an accounting
report under Section 
51-2a-201.5
;
(N) school districts under Title 53G, Chapter 3, School District Creation and Change;
(O) special service districts, as that term is defined in Section 
17D-1-102
; and
(P) substance abuse authorities, as that term is defined in Section 
62A-15-102
.
(c) "Local government and limited purpose entity registry" or "registry" means the
registry of local government entities and limited purpose entities created under this section.
(d) "Local government entity" means:
(i) a county, as that term is defined in Section 
17-50-101
; and
(ii) a municipality, as that term is defined in Section 
10-1-104
.
(e) "Notice of failure to register" means the notice the lieutenant governor sends, in
accordance with Subsection (7)(a), to an entity that does not register.
(f) "Notice of failure to renew" means the notice the lieutenant governor sends to a
registered entity, in accordance with Subsection (7)(b).
(g) "Notice of noncompliance" means the notice the lieutenant governor sends to a
registered entity, in accordance with Subsection (6)(c).
(h) "Notice of non-registration" means the notice the lieutenant governor sends to an
entity and the state auditor, in accordance with Subsection (9).
(i) "Notice of registration or renewal" means the notice the lieutenant governor sends,
in accordance with Subsection (6)(b)(i).
(j) "Registered entity" means an entity with a valid registration as described in
Subsection (8).
(2) The lieutenant governor shall:
(a) create a registry of each local government entity and limited purpose entity within
the state that:
(i) contains the information described in Subsection (4); and
(ii) is accessible on the lieutenant governor's website or otherwise publicly available;
and
(b) establish fees for registration and renewal, in accordance with Section 
63J-1-504
,
based on and to directly offset the cost of creating, administering, and maintaining the registry.
(3) Each local government entity and limited purpose entity shall:
(a) on or before July 1, 2019, register with the lieutenant governor as described in
Subsection (4);
(b) on or before one year after the day on which the lieutenant governor issues the
notice of registration or renewal, annually renew the entity's registration in accordance with
Subsection (5); and
(c) within 30 days after the day on which any of the information described in
Subsection (4) changes, send notice of the changes to the lieutenant governor.
(4) Each entity shall include the following information in the entity's registration
submission:
(a) the resolution or other legal or formal document creating the entity or, if the
resolution or other legal or formal document creating the entity cannot be located, conclusive
proof of the entity's lawful creation;
(b) 
if the entity has geographic boundaries,
 a map or plat establishing the geographic
boundaries of the entity, or if it is impossible or unreasonably expensive to create a map or plat,
a metes and bounds description, or another legal description that identifies the boundaries of
the entity, [
conclusive
] 
reasonable
 proof of the entity's geographic boundaries;
(c) the entity's name;
(d) the entity's type of local government entity or limited purpose entity;
(e) the entity's governmental function;
(f) the entity's 
website,
 physical address
,
 and phone number, including the name and
contact information of an individual whom the entity designates as the primary contact for the
entity;
(g) names of the members of the entity's governing board or commission, managing
officers, or other similar managers and the method by which the members or officers are
appointed, elected, or otherwise designated;
(h) the entity's sources of revenue; and
(i) if the entity has created an assessment area, as that term is defined in Section
11-42-102
, information regarding the creation, purpose, and boundaries of the assessment area.
(5) Each entity shall include the following information in the entity's renewal
submission:
(a) identify and update any incorrect or outdated information the entity previously
submitted during registration under Subsection (4); or
(b) certify that the information the entity previously submitted during registration under
Subsection (4) is correct without change.
(6) Within 30 days of receiving an entity's registration or renewal submission, the
lieutenant governor shall:
(a) review the submission to determine compliance with Subsection (4) or (5);
(b) if the lieutenant governor determines that the entity's submission complies with
Subsection (4) or (5):
(i) send a notice of registration or renewal that includes the information that the entity
submitted under Subsection (4) or (5) to:
(A) the registering or renewing entity;
(B) each county in which the entity operates, either in whole or in part, or where the
entity's geographic boundaries overlap or are contained within the boundaries of the county;
(C) the Division of Archives and Records Service; and
(D) the Office of the Utah State Auditor; and
(ii) publish the information from the submission on the registry; and
(c) if the lieutenant governor determines that the entity's submission does not comply
with Subsection (4) or (5) or is otherwise inaccurate or deficient, send a notice of
noncompliance to the registering or renewing entity that:
(i) identifies each deficiency in the entity's submission with the corresponding statutory
requirement;
(ii) establishes a deadline to cure the entity's noncompliance that is the first business
day that is at least 30 calendar days after the day on which the lieutenant governor sends the
notice of noncompliance; and
(iii) states that failure to comply by the deadline the lieutenant governor establishes
under Subsection (6)(c)(ii) will result in the lieutenant governor sending a notice of
non-registration to the Office of the Utah State Auditor, in accordance with Subsection (9).
(7) (a) If the lieutenant governor identifies an entity that does not make a registration
submission in accordance with Subsection (4) by the deadline described in Subsection (3), the
lieutenant governor shall send a notice of failure to register to the registered entity that:
(i) identifies the statutorily required registration deadline described in Subsection (3)
that the entity did not meet;
(ii) establishes a deadline to cure the entity's failure to register that is the first business
day that is at least 10 calendar days after the day on which the lieutenant governor sends the
notice of failure to register; and
(iii) states that failure to comply by the deadline the lieutenant governor establishes
under Subsection (7)(a)(ii) will result in the lieutenant governor sending a notice of
non-registration to the Office of the Utah State Auditor, in accordance with Subsection (9).
(b) If a registered entity does not make a renewal submission in accordance with
Subsection (5) by the deadline described in Subsection (3), the lieutenant governor shall send a
notice of failure to renew to the registered entity that:
(i) identifies the renewal deadline described in Subsection (3) that the entity did not
meet;
(ii) establishes a deadline to cure the entity's failure to renew that is the first business
day that is at least 30 calendar days after the day on which the lieutenant governor sends the
notice of failure to renew; and
(iii) states that failure to comply by the deadline the lieutenant governor establishes
under Subsection (7)(b)(ii) will result in the lieutenant governor sending a notice of
non-registration to the Office of the Utah State Auditor, in accordance with Subsection (9).
(8) An entity's registration is valid:
(a) if the entity makes a registration or renewal submission in accordance with the
deadlines described in Subsection (3);
(b) during the period the lieutenant governor establishes in the notice of
noncompliance or notice of failure to renew during which the entity may cure the identified
registration deficiencies; and
(c) for one year beginning on the day the lieutenant governor issues the notice of
registration or renewal.
(9) (a) The lieutenant governor shall send a notice of non-registration to the Office of
the Utah State Auditor if an entity fails to:
(i) cure the entity's noncompliance by the deadline the lieutenant governor establishes
in the notice of noncompliance;
(ii) register by the deadline the lieutenant governor establishes in the notice of failure
to register; or
(iii) cure the entity's failure to renew by the deadline the lieutenant governor establishes
in the notice of failure to renew.
(b) The lieutenant governor shall ensure that the notice of non-registration:
(i) includes a copy of the notice of noncompliance, the notice of failure to register, or
the notice of failure to renew; and
(ii) requests that the state auditor withhold state allocated funds or the disbursement of
property taxes and prohibit the entity from accessing money held by the state or money held in
an account of a financial institution, in accordance with Subsections 
67-3-1
(7)(i) and
67-3-1
(10).
(10) The lieutenant governor may extend a deadline under this section if an entity
notifies the lieutenant governor, before the deadline to be extended, of the existence of an
extenuating circumstance that is outside the control of the entity.