SPEAKER Edmund S. Villagomez is expected to introduce in a House session Wednesday, May 24, House Bill 22-102 which would exempt public corporations and autonomous agencies from paying the 1% public auditor’s fee.
The House will hold its session at Rota Court House in Sinapalo II at 10:30 a.m.
Villagomez’s bill proposes to amend Public Law 3-91 or the Commonwealth Auditing Act which imposes a public auditor’s fee in the amount of 1% of the funds appropriated for all government entities, including autonomous agencies. The collected fees are deposited in the general fund and may be spent without further appropriation by the Office of Public Auditor.
H.B. 22-102 strikes out the provision that includes public corporations and autonomous agencies from agencies required to pay 1% of their respective budgets.
The bill would add the following language to the law: “(e) The public corporations and autonomous agencies are exempt from the withholding and payment requirements of subsection (a) of this section. Any and all past unpaid amounts accrued under this section by public corporations and autonomous agencies shall either be waived by the Commonwealth or otherwise be considered appropriated to the respective public corporation or autonomous agency. Notwithstanding the foregoing, the Office of the Public Auditor may charge a fee for the reasonable value of its services to such public corporations or agencies for enforcement or review. The Office of the Public Auditor shall publish for notice and comment a proposed fee or rate schedule through regulations, pursuant to this provision, in the Commonwealth Register and which shall take effect upon final promulgation. The Office of the Public Auditor shall be reimbursed the reasonable value of any service requested and directly provided to a public corporation or autonomous agency no later than the end of the subsequent fiscal year following the year in which such service, investigation or other review was requested or performed relating to that public corporation or autonomous agency.”
Financial burden
According to the bill, autonomous and public corporations need exemption from paying the public auditor’s fee. This exemption, the bill stated, would ease the financial burden on autonomous agencies and public corporations.
There are certain autonomous agencies and public corporations that do not utilize the audit service of OPA, the bill stated.
In particular, the Commonwealth Ports Authority is required by its bond indentures to file its complete financial statements, audit report and opinion of an independent certified accountant nationally recognized in the U.S., and a certificate that CPA is in compliance with its bond payments.
H.B. 22-102 states that the public auditor’s fee “constitutes revenue diversion” from CPA which would violate federal entitlement or discretionary grant conditions or jeopardize such grants for airport or seaport improvements.
The Commonwealth Utilities Corp. also engages its own independent auditor for its annual audit, the bill stated.
Last year, then-Public Auditor Kina B. Peter informed the Legislature that autonomous agencies had almost never remitted 1% of their allocations for OPA since 1996, and the amount had accumulated to approximately $30 million.
Variety was told on Tuesday that autonomous agencies now owe OPA over $40 million of which $20 million is owed by CUC.
OPA does not just perform financial audits, it also issues performance audits, carries out investigations and other legislative mandates imposed on OPA.
