Transcript Highlights:

• Reviews. So please come forward: Jeff Cunningham, Aline, Ms.
• Today we'll present the 2025 tax preference performance reviews.
• into the brief reviews here.
• that actually built the federal highway system.
• Educators have reviewed public banking policies and have seen the value that these systems can bring

Summary: The committee first received a JLARC work session on the 2025 tax preference performance reviews, covering nine tax preferences and recommending legislative action on eight. JLARC reviewed natural gas transportation fuel preferences, travel agent and tour operator B&O rates, a property tax exemption for nonprofit low-income housing developers, and several shorter reviews including senior center property tax relief, a disabled veteran adapted housing remittance, trade convention nexus treatment, wholesale sales of fertilizer/pesticides/seed, a hazardous substance tax exemption for pesticides stored for out-of-state shipment, and three energy-related preferences for a silicon smelter. JLARC generally recommended continuing preferences that met stated or inferred objectives, modifying some to improve reporting or performance metrics, and allowing the unused silicon smelter preferences to expire. The Citizen Commission endorsed JLARC’s recommendations, and committee members asked a few clarifying questions, including about trends in travel agent/tour operator beneficiaries and the housing exemption’s performance metric and data issues. The committee then heard a work session and public hearing on Senate Bill 5754, which would create a Washington State public bank. A presentation from California public banking advocates and the Bank of North Dakota described public banks as government-owned financial institutions intended to keep public funds working locally, support lending for housing, infrastructure, and community development, and partner with community banks and credit unions. Committee questions focused on leverage, liquidity, constitutional issues, and how the model would interact with existing state investment and debt structures. Staff summarized the bill’s structure, including activation conditions, governance, powers, and fiscal impacts, noting the fiscal note was largely indeterminate and startup costs could be significant. Public testimony on SB 5754 was divided. Supporters included statewide elected officials, county and city officials, labor, educators, community advocates, and residents, who argued the bank could lower borrowing costs, improve access to capital, keep public money in Washington, and help finance infrastructure, housing, and disaster resilience. Opponents included community bankers and county treasurers, who warned about risks to safety and liquidity of public funds, questioned the need for a new institution given existing programs, and argued the proposal lacked a proven track record in Washington. The hearing concluded with no vote taken in the transcript.

Transcript Highlights:

• This is ALC subcommittees concerning the review of rules.
• This is ALC subcommittees concerning the review of rules.
• and review them for appropriate medical care.
• That's in line with the Medicare timeframe for review, which is a 10-day MMP review.
• Our members, 19, Section 529 Plan Review Committee.

Committee: All ALC-ADMINISTRATIVE RULES

Summary: The Administrative Rules Subcommittee met to review a large slate of agency rules and reports. Early agenda items included filing reports from ALC subcommittees and approving quarterly administrative directives, with no new directives from Corrections or the Post-Prison Transfer Board. The committee also noted that RDOT utility accommodations rules and one solid waste district rule had been pulled at the agencies’ request. Most agency rules were reviewed and approved without objection, including rules from the Department of Transportation on oversized/overweight vehicle permits and automatic license plate readers, the Insurance Department on vision plan coverage, the Department of Education on course choice, restroom access for athletic personnel, and school district consolidation/detachment, and several Department of Health and DHS rules covering controlled substances, acupuncture, physician assistant delegation, personal care, Medicaid eligibility, continuous glucose monitors, maternal health services, PACE, EVV, substance use disorder treatment, and hospital reimbursement. The committee also approved rules from Labor and Licensing, Parks, Heritage, and Tourism, Shared Administrative Services, the 529 Plan Review Committee, and the Treasurer’s Office, and it voted to continue the Office of Early Childhood’s rules and to accept outstanding rulemaking responses from several agencies. Two items drew notable discussion. The committee held the DHS hospital reimbursement rule for further review after concerns were raised about whether acute hospitals, especially Children’s Hospital, could legally and economically provide the newly reimbursable lower level of care; the committee first voted to hold it, then expunged that vote and instead held the item until the next day’s full ALC meeting for further discussion. The committee also denied the Arkansas Towing and Recovery Board rule after a motion that it did not match legislative intent, with concerns focused on proof of insurance and vague language about future financial responsibility. All other reviewed rules were approved.

Transcript Highlights:

• </c> backdated in the system. backdated in the system.
• </c> staffing and IT systems. staffing and IT systems.
• They're<00:36:18.040><c> reviewing</c><00:36:19.160><c> um</c> They're reviewing um They're reviewing
• </c> funding for people and IT systems. funding for people and IT systems.
• </c> and and very complex systems. and and very complex systems.

Committee: House Human Services Finance and Policy

Transcript Highlights:

• for final review and their Once the deposit is approved, the system automatically routes the document
• to the State Treasurer's Office for final review and their The system automatically routes the document
• system called S/4HANA.
• So the systems updates.
• So the systems updates.

Summary: The committee met to receive a detailed financial operations presentation from the South Carolina Vocational Rehabilitation (VR) agency, with staff walking members through funding sources, budgeting, accounts receivable, accounts payable, and grants management. Sabrina Walker explained VR’s blended funding structure, including federal grants, state appropriations, program income, and interagency contracts, and emphasized that state funds are essential to meeting the federal match and maintenance-of-effort requirements. Members asked repeatedly about transparency, audit controls, and the risk that state cuts could reduce federal drawdowns; staff responded that all reports reconcile back to the SCEIS accounting system, are subject to state audits and internal reviews, and that even modest state reductions could significantly reduce total available funding. The committee also discussed pre-employment transition services for students with disabilities, with staff confirming services are offered through school districts, charters, and private schools, and that contracts are monitored for performance and compliance. The presentation then shifted to budgeting and internal controls. Walker described a zero-based departmental budgeting process, monthly monitoring reports, contingency reserves for unexpected expenses, and a formal annual cycle that culminates in board approval. Members asked about facilities tracking, culture, and how the agency maintains accountability; staff said facilities staff inspect buildings and equipment, supervisors justify line-item requests, and the process has become smoother over time as departments learned the system. Cynthia Johnson followed with an accounts receivable overview, describing invoicing, receipting, aging, customer verification, year-end reporting, and the use of cross-training, shared email inboxes, and spreadsheets as checks and balances. She also explained work training center billing, interdepartmental transfers, and the revolving fund used to issue consumer checks more quickly than standard vendor payments. Olivia Perez presented accounts payable operations, including invoice processing through SCEIS and OnBase, the three-way match, travel reimbursements, revolving fund checks, State Treasury Office interactions, and handling of reversals, rejections, and levy notices. She reported that AP processed 67,723 SCEIS payments, 13,670 case management system invoices, 3,379 travel reimbursements, and 15,693 revolving fund checks in fiscal year 2025, with only 70 payment rejections. The final portion of the meeting covered Grants and Funds Management, where Walker explained federal reporting, drawdowns, payroll allocation, asset tracking, lease and IT contract reviews, cost allocation, and closing packages. She noted upcoming system changes such as S/4HANA, Workiva, and SC Pro, but said the agency is receiving training and feedback opportunities. No formal votes or legislative actions were taken during the presentation portion beyond approval of the prior minutes and a brief recess.

Transcript Highlights:

• system that's leading to this doubling of complaints?
• system that's leading to this doubling of complaints?
• And so are you identifying any systemic issues?
• Are these systemic, or how are—if you don't classify them as either systemic or just individual complaints—then
• We do review each complaint and the our staff member.

Summary: The Senate Budget Subcommittee heard presentations from the Office of the Inspector General (OIG), California Correctional Health Care Services (CCHCS), the California Advancing and Innovating Medi-Cal (CalAIM) program, and the Coleman mental health receivership. The hearing focused on correctional health care, reentry, aging incarcerated populations, and the state’s progress toward compliance in the Plata and Coleman receiverships. Members also discussed the OIG’s intake complaint workload and medical inspection findings, as well as broader questions about staffing, vacancies, and the cost of court oversight. The OIG requested $275,000 General Fund for two permanent positions in its intake processing unit, citing a sharp rise in complaints from 3,200 in 2022 to 7,860 in 2025. OIG officials said complaints are categorized by issue and prison, prioritized by urgency, and generally responded to within 30 days, but they do not track complaint “validity” rates. The medical inspection unit reported that in cycle seven, case review performance was generally adequate while policy compliance was often inadequate; the lowest-scoring areas included emergency services, medication management, and health care environment. Members asked for more detailed reporting on complaint types, priority levels, and systemic issues. CCHCS described rising health care costs driven by an aging prison population, staffing vacancies, and contract medical expenses. Officials said more than 80% of the budget is personal services, and they are using hiring events, social media outreach, and expanded classifications to reduce vacancies. CalAIM officials reported early implementation success in pre-release and reentry services, including 89% Medi-Cal activation at release, 87% assigned managed care plans, 88% reentry care plans, and 59% warm handoffs, with about 169,000 claims submitted and $14.7 million reimbursed. The LAO noted that the Plata medical receivership has increased per-person costs and that the state should continue oversight while seeking ways to reduce vacancies and expand federal reimbursement opportunities. For the Coleman mental health receivership, the receiver’s office requested $33.9 million from the Mental Health Special Deposit Fund, including $8.2 million for receiver office staffing and $25.3 million to make court-ordered bonus payments permanent. The LAO supported continued oversight but recommended additional steps to address vacancies, including greater out-of-state recruitment, expanded telemental health, and possible consolidation of mental health services. The LAO also recommended reducing the telemental health staffing request and monitoring its effects. Members questioned the long-term cost of receiverships, the pace of compliance, and whether more detailed benchmarks and staffing data should be provided. No formal votes were taken during the portion of the hearing provided.

Transcript Highlights:

• review teams.
• review teams.
• </c><01:23:14.239><c> team</c> reviewed solely by the local review team reviewed solely by the local
• Looking ahead, the statewide work group's interim report, case review reports, and a compliance system
• interim report, case review reports, and a<01:41:46.480><c> compliance</c><01:41:46.880><c> system</c

Transcript Highlights:

• </c> disruption the re reproductive system disruption the re reproductive system that<00:05:12.120><c
• that forward, there is a process for the system to review their request.
• that forward, there is a process for the system to review their request.
• that forward, there is a process for the system to review their request.
• </c><00:30:54.480><c> to</c> uh the system to uh the system to review<00:30:56.360><c> um</c><00:30:56.919

Transcript Highlights:

• . reviews. reviews.
• </c> protection system. protection system.
• The purpose of these reviews should be system learning and improvement versus punitive oversight.
• of the cases that we qualitative review of the cases that we review. review. review.
• of these reviews should be system<01:04:55.960><c> learning</c><01:04:56.400><c> and</c><01:04:56.560

Bills: HF3665 , HF3002 , HF4217 , HF4125 , HF4174

Committee: House Children and Families Finance and Policy

Keywords: foster care, early childhood education, child care programs, placement plan, social services, extended foster care, kinship care, relative custody, permanent legal and physical custody, Northstar kinship assistance, independent living plan, transition services, youth aging out of care, medical assistance, Medicaid, child welfare, children youth and families, out-of-home placement, case plan, relative placement

Transcript Highlights:

• So it's under review and consideration.
• Without objection, this report will be reviewed.
• partially supported by the Arkansas Division of Information Systems.
• Without objection, this report would be reviewed.
• In here it mentions a new telematic system.

Committee: All LEGISLATIVE JOINT AUDITING-STATE AGENCIES

Transcript Highlights:

• The Review Subcommittee met on Tuesday and reviewed the methods of finance, one alternative delivery
• I'm looking at the review report, review subcommittee F-12. Where is what he's talking about?
• It's for integration of the new S-Forhanna system that's going to be replacing the ASA system.
• This project is focused on a performance evaluation system that will connect to the new AISIS system.
• This system will help us do that.

Committee: All ARKANSAS LEGISLATIVE COUNCIL (ALC)

Summary: The meeting began with a prayer, approval of the prior minutes, and a February 2026 revenue report from Carlos Silva of the Bureau of Legislative Research. He reported gross revenues of $5.36 billion and net collections of $4.5 billion, both above the prior year, and said the updated forecast showed a larger expected surplus than before. Members asked about declines in some tax categories, natural gas severance fees, and possible effects of inflation and international conflict; Silva generally attributed the changes to timing issues, prior tax cuts, refund activity, and price fluctuations, and said he could not speculate on future impacts. The committee then heard and adopted several subcommittee reports, including the Executive Committee, Administrative Rules, Claims Review, Game and Fish State Police, Higher Education, Infrastructure Investment and Jobs Act, Hospital/Medicaid/Developmental Disabilities, Occupational Licensing Review, State Insurance Programs Oversight, and APER filings. Most reports were approved without objection. One budget classification transfer for the Commissioner of State Lands was reviewed and failed. The review report also led to discussion of several contracts, including DHS staffing contracts and a Department of Education security contract, with some items held or separated for individual votes. A major portion of the meeting focused on DHS and state staffing contracts for the Human Development Centers, Arkansas State Hospital, and related facilities. DHS officials said the contracts were on track against seven-year projections, but members expressed concern about heavy reliance on contract labor, vacancy rates, and the need to move workers onto state payrolls. Officials said they were preparing a recruitment and retention plan and described staffing levels, vacancies, and turnover. Members also questioned contract projections and federal-state funding matches, and several urged faster action to reduce contract labor costs. The committee also discussed a Department of Commerce reduction-in-force affecting the Division of Services for the Blind and Employment and Training. Secretary Hugh McDonald said the cuts were driven by funding shortfalls, over-obligation of funds, and federal issues, and that 27 positions would be permanently eliminated while furloughed employees would be recalled. Members raised concerns about service impacts, board appointments, and the division’s fiscal management. The meeting ended after the personnel report was adopted and APER was filed as reviewed, followed by adjournment.

Transcript Highlights:

• And it's because of the cost of the system.
• Saving the whole system money.
• I agree with the chairman that if there's gaps in our system, it sounds like there's gaps in our system
• It's the delays that are built into our system and the complexity of our system that allows for these
• Because I know that the guy I'm going to call for review is using it two or three times a day on review

Summary: The House Labor and Industrial Relations Committee met on May 7, 2026, and first deferred several measures, including House Bill 460, Senate Bill 322, Senate Bill 32, Senate Bill 22, and House Bill 561. The committee then took up House Bill 819 by Chairman Cruz, which would replace Louisiana’s current workers’ compensation medical treatment schedule with the Official Disability Guidelines (ODG) by MCG as the primary guideline, while keeping the existing variance and appeal process. Cruz and MCG representative Troy Prevo argued that ODG is more comprehensive, updated more frequently, and used in many states, and said it could reduce delays, disability duration, and costs. Dr. Jason Picard, the state medical director, testified that Louisiana already uses ODG as a secondary reference in many cases because the state schedule lacks coverage for some body parts and treatments, and said the bill would not otherwise change the appeals process or care delivery. Committee members focused heavily on whether the bill would delay care or improve it. Several members questioned the private-company nature of ODG, the $400 annual subscription cost, and whether Louisiana doctors would be forced to rely on an out-of-state guideline. Rep. Glorioso and others raised concerns about preauthorization delays and proposed amendments to create tacit approval when treatment follows the schedule, require payment within 30 days, and make the carrier prove by clear and convincing evidence that care was not medically necessary to challenge it. Chairman Cruz said he was willing to work with those ideas, and the committee also discussed adding an on-ramp or legacy language so current patients would not be disrupted. Opposition testimony came from injured-worker advocates and representatives of medical and labor groups, including Joseph Jola St. and Robin Krumholt. They argued that Louisiana’s current guidelines are already working, that rates have fallen over time, and that the real problem is delay in approval rather than the content of the schedule. They said ODG is overly rigid, cost-driven, and can lead to denials that shift costs to workers, Medicaid, or private health insurance. They urged the committee to keep Louisiana’s existing system and instead adopt tacit approval under current law. The bill was still under discussion at the close of the transcript, with amendments being read and no final vote shown.

Transcript Highlights:

• a single incident review.
• . 100% prepayment review.
• We have prepayment review on some codes.
• We will need system changes to automate data matching with members in our system and send them the required
• We will need system changes to automate data matching with members in our system and send them the required

Bills: SB1051 , SB1114 , SB1115 , SB1122 , SB1132 , SB1162 , SB1169 , SB1171 , SB1172 , SB1173 , SB1174 , SB1175 , SB1179 , SB1188 , SB1233 , SB1236 , SB1242 , SB1316 , SB1368

Committees: Senate Health and Human Services , Senate Senate Health and Human Services COR

Keywords: SB1051, Arizona hospitals, immigration status, patient intake, admission forms, registration forms, health care reporting, uncompensated care, emergency department, lawfully present, undocumented immigrants, noncitizen patients, hospital funding, Arizona Department of Health Services, ADHS, border security, health care institutions, patient privacy, medical access, immigration policy

Transcript Highlights:

• And in reviewing those, we thought that that warranted a follow-up audit.
• their tracking system and kind of the systems they have in place to help monitor and track the product
• Multi-tiered system of supports, or MTSS, seeks to help schools implement a school-wide system to identify
• Multi-tiered system of supports, or MTSS, seeks to help schools implement a school-wide system to identify
• Their MTSS system is pretty broad with being a K through 12 school.

Summary: The committee first heard a presentation from the State Auditor’s Office on its current performance audit work plan. The auditor described how topics are selected from a large pool of ideas and coordinated with JLARC to avoid duplication. Four ongoing audits were highlighted: Liquor and Cannabis Board operations, oversight of authorized entities serving students with disabilities, the long-term care provisions of Initiative 1163, and Medicaid managed care versus fee-for-service costs. Other planned topics included housing commission tenant ownership follow-up, DSHS vendor payment growth, implementation of the Since Time Memorial curriculum, and Washington State Ferries operations. Members asked about coordination with JLARC, and the auditor said the office regularly exchanges work plans and monthly updates with JLARC staff. The committee then received the State Auditor’s report on how charter schools identify and support at-risk students. Auditors reviewed four schools—Catalyst Public Schools, Innovation High School, Pinnacles Prep, and Rainier Prep—and focused on English language learners, homeless students, and special education students. The audit found that the schools met nearly all legal requirements reviewed and used many leading practices, including small-group instruction, culturally responsive environments, family engagement, and multi-tiered systems of support. The main recommendations were to improve documentation and written procedures so staff can apply practices more consistently. One area of partial compliance involved language access planning, and MTSS implementation varied across schools. Committee members asked why those four schools were selected, how the sample compared with district and statewide student populations, and whether the audit examined K-2 MTSS requirements. The auditor explained the schools were chosen for student need, geographic diversity, and authorizer representation, and that K-2 MTSS was not evaluated because only one school served those grades. Representatives from the Charter School Commission and charter school advocates responded positively, saying the report reflected strong practices and could help spread effective approaches. Public testimony from the Washington State Charter Schools Association and Excellent Schools Washington also supported the report and urged continued sharing of best practices across schools.

Transcript Highlights:

• , helps...” “...the body’s immune system.
• Second, it creates a clear structure for that review.
• Physician review panel. What does it do?
• They paid $300 to do the review panel.
• We have a very opaque system now that overcharges individuals.

Committee: House Health and Welfare

Summary: The House Committee on Health and Welfare met on April 23 and first disposed of several items without hearing them, including HB 1093 and HB 1145, and voluntarily deferring HB 946. The committee then quickly reported HB 1095 favorably without objection. That bill would require nursing facilities to have fuel or another alternative power generation source to maintain power, and supporters said it preserves existing backup-power safety requirements while giving facilities more flexibility as technology changes. The committee then took up HB 926, which concerns vaccination status and admission to public buildings and seeks to prohibit medical mandates. After adopting an amendment set and additional changes clarifying exclusions for licensed health care providers and facilities, medical masks, and child welfare/school-related provisions, the committee heard testimony both for and against the bill. Supporters framed it as a civil-liberties measure limiting vaccine-card requirements for public buildings, while opponents warned it could interfere with public health measures, school immunization rules, and the ability of health care facilities to protect patients. The bill was reported favorably on an 8-4 vote. HB 1220, a cleanup bill for the Louisiana State Board of Medical Examiners, was then reported favorably after a technical amendment set. HB 1227, which would require complaints involving medical judgment to be reviewed by a three-physician panel before formal disciplinary action, drew extensive testimony from a physician sponsor, a doctor describing his disciplinary experience, and the board’s executive director, who said the board already uses practicing physicians, nurses, and experts in its process and warned the proposed panel system could be impractical because physicians are difficult to recruit for such reviews. At the sponsor’s request, the committee voluntarily deferred HB 1227 for further work. Finally, the committee reported HB 1217 favorably with amendments to a pharmacy benefit manager transparency bill, after supporters said it would expose hidden pricing and rebate practices and opponents argued some provisions were duplicative or unnecessary. HB 1028, setting minimum Medicaid reimbursement rates for non-emergency medical transportation, was reported favorably and referred to Appropriations after supporters described the need for higher rates and members discussed funding. The committee also reported HB 1185 favorably, with amendments preserving the existing Rural Hospital Preservation Act while extending similar protections to additional rural-lookalike hospitals, and adopted HCR 76 to continue the Health Inequities and Disparities in Rural Areas Task Force for another year.

Transcript Highlights:

• I'm looking at the review report, Review Subcommittee F-12.
• Review report, Review Subcommittee F-12—where is what he's talking about? Senator Rice, can you?
• It's for integration of the new S/4HANA system that's going to be replacing the ASIS system.
• system.
• This system will help us do that.

Committee: All ARKANSAS LEGISLATIVE COUNCIL (ALC)

Transcript Highlights:

• The third-party review systems that were debated and contemplated last session didn't have a provision
• The delays are in a review.
• The delays are in a review.
• It's only expanding the system, making this business system larger.
• So I won't take much more of your time, but I do think that the third-party system and the pre-plan review

Committee: House Land & Resource Management

Transcript Highlights:

• WE DID THIS FIRST REVIEW IN 2011 AND THIS IS THE FOURTH REVIEW SINCE THEN.
• THIS YEAR'S REVIEW LOOKS AT THE NUMBER OF DEGREES AWARDED IN EACH PROGRAM IN THE SYSTEM OVER THE PAST
• COLLABORATIVELY WITH THE FLORIDA COLLEGE SYSTEM.
• FOR THAT LOW PRODUCTIVITY REVIEW WE DID NOT LOOK AT FLORIDA COLLEGE SYSTEM.
• WE SEE IT AND IT'S COMMON THROUGHOUT THE SYSTEM FOR FRESHMEN IN THE SYSTEM.

Transcript Highlights:

• relies on. ...the core application system as well as the feeder systems it relies on.
• OSPI's apportionment team reviews the data in all these feeder systems, and they make necessary modifications
• . ...reviews the data in all these feeder systems, and they make necessary modifications like decimal
• or the feeder systems.
• being redundantly reentered into the OSPI system, is how I'm hearing the system works.

Summary: The Joint Legislative Audit and Review Committee subcommittee heard a State Auditor’s Office performance audit on the accuracy and reliability of OSPI’s school apportionment system. Auditors said the system, which calculates and distributes K-12 funding using multiple feeder systems and a core apportionment engine, is outdated, unstable, inefficient, and at high risk of failure. They reported weak controls over data input, documentation, oversight, and staffing, and said OSPI relies heavily on manual workarounds, a few knowledgeable staff, and vendor support. In limited testing of three districts, the auditors found the system calculated funding correctly for the 2023-24 school year, but they identified nine small input discrepancies tied to differences between budget materials and state law, which they said could compound into larger dollar amounts. The auditors recommended replacing or modernizing the system and noted that delays in doing so prolong risk. OSPI largely agreed that the current platform needs replacement and said it has been working toward a new system for years. Agency officials clarified that the Legislature requested a feasibility study in 2022, that the study found the system at risk of catastrophic failure, and that funding for a replacement is now in the state IT pool subject to OCIO/OFM gate reviews. OSPI disputed the audit’s characterization of the rounding and budget-law discrepancies, saying the issue was an agency rule and implementation choice, not an error that caused under- or over-allocation. Officials also said the current system is too old to easily absorb future formula changes, but that the planned replacement should be flexible enough to handle a new funding model if the Legislature adopts one. Committee members asked about the amount and timing of the $16 million project funding, whether smaller districts face greater risk, how many times data is entered, and whether the funding formula should be simplified. Auditors and OSPI both emphasized that formula simplification is a policy question for the Legislature, not the audit. Public testimony came from one online witness, who urged full implementation of the audit recommendations and modernization of the system. The subcommittee took no formal vote and adjourned after the presentations and testimony.

Transcript Highlights:

• a single incident review.
• Percent prepayment review. So, Mr.
• We have prepayment review on some codes.
• We will need system changes to automate data matching with members in our system and send them the required
• The bill requires hotline workers to review.

Committee: Senate Senate Health and Human Services COR

Summary: The committee first approved the January 21 minutes and then heard SB 1179, which would remove the delayed repeal date and appropriation contingency from the Developmental Disabilities Group Home Monitoring Program. Testimony from Disability Rights Arizona and program managers described the program’s monitoring and investigative work, including identified systemic concerns in group homes, while the sponsor said the effort should continue. SB 1179 received a do-pass recommendation on a 6-1 vote, with some members reserving their right to revisit the bill on the floor. The committee then took up SB 1114, appropriating $1 million for the Maricopa County Attorney’s Office to investigate behavioral health patient brokering. Witnesses, including Native advocates, described widespread recruitment of vulnerable people—especially Native Americans—into fraudulent treatment and sober-living schemes, often through social media and across state lines. Members and the sponsor framed the bill as an enforcement response to long-running abuse. SB 1114 passed 6-0. The committee also heard SB 1115, which would require AHCCCS/Access employees to work in person rather than remotely; supporters argued remote work had harmed oversight and service delivery, while Access said it would need substantial office space and warned of costs and staffing impacts. SB 1115 passed 4-3. The committee next considered SB 1051, requiring hospitals that accept Access payments to collect patients’ citizenship or immigration status on intake forms and report aggregate data to DHS. Supporters said it was a data-collection and accountability measure; opponents, including nurses and physicians, said it would deter care, undermine trust, and function as immigration surveillance. The bill passed 4-3. SB 1122, dealing with prior authorization and prepayment review for behavioral health services under the American Indian Health Plan, was amended to require a corrective action plan before 100% prepayment review; Access said it had minimal concerns with the amended version. It passed unanimously 7-0. SB 1132, a blank appropriation for a new Arizona State Hospital wing, drew testimony from families and advocates about the shortage of psychiatric beds and the effects of the Arnold v. Sarn consent decree; it passed 7-0. The committee also approved SB 1169 for graduate medical education funding, SB 1171 on dual enrollment checks between AHCCCS and exchange plans, and SB 1172 on DCS investigations and court notification, with votes ranging from 4-2 to unanimous support. Finally, the committee heard SB 1173, which would require owners and applicants for outpatient behavioral health facility licenses to be U.S. citizens or lawfully present, with an amendment clarifying lawful permanent resident status. The sponsor said the bill was intended to curb fraud tied to behavioral health licensing and patient brokering; discussion focused on whether the bill language matched that intent. The transcript ends before a final vote on SB 1173.

Transcript Highlights:

• Welcome to the Joint Legislative Audit and Review Committee for January 7, 2026.
• both for JLARC itself and our review of tax preference statements.
• The first measure is a peer review rating.
• JLARC are the review of tax preferences.
• Now I'll explain what will be in the sunset review.

Summary: The Joint Legislative Audit and Review Committee met on January 7, 2026, approved the December minutes, and adopted an amended work plan. Staff proposed moving the drug takeback program sunset review up to 2026 and delaying the thermal energy network pilot review to 2028, which would free capacity for new studies. Members also noted bills that would eliminate two recurring JLARC reports, including one on unemployment insurance training benefits and one on lodging tax revenue reporting. The committee then discussed JLARC’s own performance measures and a pilot approach for evaluating tax preference performance statements in fiscal notes. Staff said JLARC will begin surveying members and the full legislature on satisfaction, track invitations to present to other committees, monitor recommendation resolution rates, staff retention, on-time report delivery, peer review results, and national recognition. For tax preference reviews, staff proposed a standard rubric to assess whether performance metrics match policy goals, are measurable, use reliable data, and allow enough time for evaluation; members generally supported the effort. Staff also outlined planned changes to public records reporting, including allowing agencies to opt out of tracking low-volume metrics, targeted outreach to nonreporting agencies, better data validation, clearer online guidance, and a survey of public records officers. The main audit presentation was a preliminary report on ignition interlock device compliance and monitoring. JLARC found that about 41% of drivers required to install devices had done so, with installation rates rising sharply with income; half of affected drivers earned less than $28,000 a year, and the typical annual device cost was about $2,700. Staff said the state’s financial assistance program has limited reach and lacks clear goals, performance measures, and coordination between the Department of Licensing and State Patrol. They recommended that the agencies formalize their roles and develop a coordinated strategy to improve installation rates. State Patrol and Licensing said they support the findings, described recent outreach pilots, and said they would work on a management plan and possible expansion of outreach efforts. JLARC also presented an expedited preliminary report on the drug take-back program’s fee setting and expenditures. Staff concluded that the current fee design limits the Department of Health’s ability to recover oversight costs and that public reporting of oversight expenditures would improve transparency. They recommended that DOH publicly report its oversight activities and that the legislature amend the fee structure to remove the cap tied to program operator expenditures. DOH agreed the current structure does not fully recover costs and said it would support a statutory change. The committee adjourned after noting its next regular meeting is scheduled for April 8, 2026.