33080.8
. (a) On or before April 1 of each year, the Controller
shall compile a list of agencies that appear to have major audit
violations as defined in this section, based on the independent
financial audit reports filed with the Controller pursuant to Section
33080.
(b) On or before June 1 of each year, for each major audit
violation of each agency identified pursuant to subdivision (a), the
Controller shall determine if the agency has corrected the major
audit violation. Before making this determination, the Controller
shall consult with each affected agency. In making this
determination, the Controller may request and shall receive the
prompt assistance of public officials and public agencies, including,
but not limited to, the affected agencies, counties, and cities. If
the Controller determines that an agency has not corrected the major
audit violation, the Controller shall send a list of those agencies,
their major violations, all relevant documents, and the affidavits
required pursuant to subdivision (d) to the Attorney General for
action pursuant to this section.
(c) For each agency that the Controller refers to the Attorney
General pursuant to subdivision (b), the Controller shall notify the
agency and the legislative body that the agency was on the list sent
to the Attorney General. The Controller's notice shall inform the
agency and the legislative body of the duties imposed by Section
33080.2.
(d) Within 45 days of receiving the referral from the Controller
pursuant to subdivision (b), the Attorney General shall determine
whether to file an action to compel the agency's compliance with this
part. Any action filed pursuant to this section shall be commenced
in the County of Sacramento. The time limit for the Attorney General
to make this determination is directory and not mandatory. Any action
shall be accompanied by an affidavit or affidavits, to be provided
by the Controller with the referral, setting forth facts that
demonstrate a likelihood of success on the merits of the claim that
the agency has a major audit violation. The affidavit shall also
certify that the agency and the legislative body were informed not
less than 10 days prior to the date on which the action was filed.
The agency shall file a response to any action filed by the Attorney
General pursuant to this section within 15 days of service.
(e) (1) On the earliest day that the business of the court will
permit, but not later than 45 days after the filing of an action
pursuant to this section, the court shall conduct a hearing to
determine if good cause exists for believing that the agency has a
major audit violation and has not corrected that violation.
(2) If the court determines that no good cause exists or that the
agency had a major audit violation but corrected the major audit
violation, the court shall dismiss the action.
(3) If the court determines that there is good cause for believing
that the agency has a major audit violation and has not corrected
that major audit violation, the court shall immediately issue an
order that prohibits the agency from doing any of the following:
(A) Encumbering any funds or expending any money derived from any
source except to pay the obligations designated in subparagraphs (A)
to (G), inclusive, of paragraph (1) of subdivision (e) of Section
33334.12.
(B) Adopting a redevelopment plan.
(C) Amending a redevelopment plan except to correct the major
audit violation that is the subject of the action.
(D) Issuing, selling, offering for sale, or delivering any bonds
or any other evidence of indebtedness.
(E) Incurring any indebtedness.
(f) In a case that is subject to paragraph (3) of subdivision (e),
the court shall also set a hearing on the matter within 60 days.
(g) If, on the basis of that subsequent hearing, the court
determines that the agency has a major audit violation and has not
corrected that violation, the court shall order the agency to comply
with this part within 30 days, and order the agency to forfeit to the
state no more than:
(1) Two thousand dollars ($2,000) in the case of a community
redevelopment agency with a total revenue, in the prior year, of less
than one hundred thousand dollars ($100,000) as reported in the
Controller's annual financial reports.
(2) Five thousand dollars ($5,000) in the case of a community
redevelopment agency with a total revenue, in the prior year, of at
least one hundred thousand dollars ($100,000) but less than two
hundred fifty thousand dollars ($250,000) as reported in the
Controller's annual financial reports.
(3) Ten thousand dollars ($10,000) in the case of a community
redevelopment agency with a total revenue, in the prior year, of at
least two hundred fifty thousand dollars ($250,000) as reported in
the Controller's annual financial reports.
(h) The order issued by the court pursuant to paragraph (3) of
subdivision (e) shall continue in effect until the court determines
that the agency has corrected the major audit violation. If the court
determines that the agency has corrected the major audit violation,
the court may dissolve its order issued pursuant to paragraph (3) of
subdivision (e) at any time.
(i) An action filed pursuant to this section to compel an agency
to comply with this part is in addition to any other remedy, and is
not an exclusive means to compel compliance.
(j) As used in this section, "major audit violation" means that,
for the fiscal year in question, an agency did not:
(1) File an independent financial audit report that substantially
conforms with the requirements of subdivision (a) of Section 33080.1.
(2) File a fiscal statement that includes substantially all of the
information required by Section 33080.5.
(3) Establish time limits, as required by Section 33333.6.
(4) Deposit all required tax increment revenues directly into the
Low and Moderate Income Housing Fund upon receipt, as required by
Section 33334.3, 33334.6, 33487, or 33492.16.
(5) Establish a Low and Moderate Income Housing Fund, as required
by subdivision (a) of Section 33334.3.
(6) Accrue interest earned by the Low and Moderate Income Housing
Fund to that fund, as required by subdivision (b) of Section 33334.3.
(7) Determine that the planning and administrative costs charged
to the Low and Moderate Income Housing Fund are necessary for the
production, improvement, or preservation of low- and moderate-income
housing, as required by subdivision (d) of Section 33334.3.
(8) Initiate development of housing on real property acquired
using moneys from the Low and Moderate Income Housing Fund or sell
the property, as required by Section 33334.16.
(9) Adopt an implementation plan, as required by Section 33490.