Transcript Highlights:

• Instead, we found the agency lacked controls in these areas.
• This makes oversight of staff and operations difficult.
• I’m the chief financial officer with the agency.
• Agency budget requests will be.
• So we operate within the appropriations that you all provide us.

Summary: The committee heard a State Auditor’s Office performance audit on OSPI’s school apportionment system, which distributes K-12 funding to districts. Auditors said the system and its underlying 2008-era infrastructure are outdated, unstable, inefficient, and at high risk of errors or failure. They also found weak controls over data input, documentation, oversight, and monitoring, with heavy reliance on a small number of staff and vendor knowledge. In limited testing of three districts, the system calculated 2023–24 funding correctly, but auditors identified small discrepancies between state budget inputs and underlying statutory language and said broader system risks remain unresolved. JLARC members asked about the scope of the district testing, whether smaller districts face greater risk, the meaning of the funding discrepancies, and whether the system could support a future change to a simpler per-student funding formula. Auditors said the discrepancies were small but could compound into millions statewide, and that the audit did not evaluate broader policy questions or alternative system owners. They recommended OSPI modernize or replace the system and address current control weaknesses while the new platform is developed. OSPI officials largely agreed that the current platform needs replacement and said a feasibility study completed in 2024 found the system at catastrophic risk of failure. They clarified that the Legislature had approved up to $16 million in the state IT pool for the project, but that funding is released through gated oversight and not all of it had yet been appropriated for the current biennium. OSPI disputed the auditor’s characterization of some rounding and budget-law issues, saying the calculations were consistent with agency rules and legislative inputs, and explained that some manual workarounds are used to handle newer statutory requirements. One member of the public testified in support of modernizing the system and strengthening controls. The committee then adjourned.

Transcript Highlights:

• Fusion centers are ostensibly state-operated agencies that house federal, state, and local law enforcement
• Fusion centers are ostensibly state-operated agencies that house federal, state, and local law enforcement
• Before we get to that, are any of the affected agencies or subject agencies here today to testify?
• the agency is simply not doing their job.
• the agencies is simply not doing their job.

Summary: The committee met as a subcommittee for much of the hearing because it initially lacked a quorum, then later established one and began taking votes. The state auditor gave a status update on ongoing audits, including several JALAC-requested audits in progress, other statutory audits, staffing growth in his office, and the number of new JALAC audits his office could start in the coming months. The committee also heard that one audit request on Prop. 28 was held, and another PUC-related request was moved off consent and heard on the regular calendar. Members then heard and discussed several audit requests. Senator Cervantes presented a request to audit California fusion centers, with witnesses from the FBI and ACLU supporting the need for transparency and oversight; opponents argued the request was politically motivated and could interfere with counterterrorism work. Senator Allen presented a request on CPUC enforcement of Rule 21 interconnection timelines for solar and storage projects, supported by industry and school representatives who described long delays and financial harm, while CPUC staff said the issue was being addressed through workshops and a formal proceeding. Senator Perez presented a request to audit Caltrans’ administration of the former SR 710 extension properties and affordable sales program, citing tenant complaints about maintenance, pricing, and transparency; Caltrans said it was working to complete sales and improve administration. Senator Umberg presented a request to audit the Orange County Board of Education over transparency, contracting, litigation spending, charter oversight, and whistleblower issues, while board representatives said there was no factual basis for an audit and that existing legal remedies had not been invoked. After quorum was established, the committee approved the consent-calendar DMV license revocation audit and then approved the PUC utility timeliness audit and the Caltrans SR 710 audit. The fusion center audit was left on call after a split vote, and the Orange County Board of Education audit continued with testimony from the board’s representatives after the committee had already moved on to other business.

Transcript Highlights:

• There are over 700 operations around the state.
• Other agencies, I would think, employ hydrologists.
• If somebody wanted to operate a coal mining operation outside of those lands, then yes, the Department
• Agencies.
• And so, I think there's probably 12 or so different state agencies, as well as federal agencies, in that

Transcript Highlights:

• permit timelines for operators.
• The agencies, I mean, try to avoid...
• California's own energy agencies confirmed in their 2021 joint agency report that nuclear meets SB 100
• So if, under current law, under AB 1167, if an operator wants to buy a well from another operator, then
• It is not clear that any agency is in charge.

Committee: House Natural Resources

Transcript Highlights:

• Red Cross sheltering operations.
• Rising operational costs are affecting our operations.
• Rising operational costs are affecting our operations.
• So when you look at an agency that's operating, ours is a little bigger, but that's not the case for
• You're operating a contract for two or three months and not being paid.

Summary: The joint Senate and Assembly select committee hearing focused on the challenges facing California nonprofits in 2025 and possible state responses. Opening remarks emphasized the sector’s size and importance, the impact of federal funding disruptions and tax policy changes, and the need for stronger public-private partnerships, especially in disaster response and recovery. Witnesses from community foundations, food banks, Cal OES, long-term recovery groups, CalNonprofits, and nonprofit finance organizations described funding uncertainty, delayed reimbursements, reduced indirect cost coverage, staffing strain, and the effects of climate disasters and immigration-related fear on service delivery. Testimony highlighted several policy ideas, including advance payments for state grants and contracts, prompt payment standards, sustainable indirect cost rates, contract flexibility in emergencies, streamlined registration and reporting, and a possible new Office of Nonprofit Empowerment to serve as a central point of contact and coordination within state government. Speakers also described how nonprofits and VOAD networks support wildfire response and long-term recovery, but noted that recovery groups often lack stable operating funding even when they are recognized as best practice. A food bank leader described federal food aid cuts and disruptions to deliveries, while other witnesses stressed that nonprofits are increasingly forced to use reserves, loans, or service reductions to manage cash flow gaps. Committee members generally expressed support for the sector and asked how the state could better partner with nonprofits during both disasters and budget crises. Several members raised the possibility of incremental steps if full legislative changes are not immediately feasible, and witnesses suggested pilots, better sharing of best practices, and stronger state leadership on payment timelines. Public commenters echoed the need for better contracting practices, support for community-based organizations, and attention to nonprofit worker compensation and protections. No formal votes or committee actions were taken in the hearing, which concluded with adjournment.

Transcript Highlights:

• Camelot was the operator of the U.K.
• Remember, Rich Wheeler now operates the operation. In Colleyville, they sold the winning ticket.
• its authority to regulate the lottery. ...couriers operating in the state.
• A process of moving bingo over to another agency.
• But the agency didn't follow the law. The agency specifically made rule changes.

Bills: SB82 , SB1807 , SB2254 , HB 119 , HB 130 , HB581 , HJR98 , SB1988 , SB 18 , SB 34

Committee: Senate State Affairs

Transcript Highlights:

• We have Suzanne Pridgin, Deputy Commissioner, Division of Finance and Operations, here to present the
• That's what we're using them for, to eliminate staffing agency use. Thank you. Yes, sir.
• That's what we're using them for us to eliminate staff agency. Thank you. Yes, sir.
• On behalf of the Agency for Health Care Administration, my name is Brian Meyer.
• This agency is still ongoing in those kinds of conversations.

Summary: The Legislative Budget Commission considered 21 budget amendments, most of them routine authority adjustments tied to federal grants, Medicaid payment programs, and trust fund realignments. The Department of Education received $14.751 million for a Preschool Development Grant to support early learning system improvements, workforce credentialing and training, IT modernization, and related early childhood certification work. The Department of Veterans Affairs shifted $2.2 million within its trust fund to cover higher nursing home occupancy, replace contract nursing with OPS staff, and meet rising operating costs. The Department of Health moved about $9.1 million to support Disability Determinations, where roughly 140,000 cases were pending or in process, and said the change would help reduce backlog and avoid a deficit. The Agency for Health Care Administration presented multiple amendments for Medicaid-related programs, including $766 million for indirect medical education, $1.9 million for managed care network adequacy audits, $209 million for the Rural Health Transformation Program, and several large supplemental payment programs for hospitals and physicians; members asked about CMS approval delays, provider access, and how rural funds would be distributed. The commission also adopted an amendment realigning KidCare funds, placing a $32.1 million surplus into reserve, though several members objected that the state had not yet implemented the 2023 KidCare expansion and that children remained on a wait list. Another Medicaid amendment placed a $376 million surplus into reserve after updated estimating conference projections. Other agencies also received approvals. FDLE received $16.26 million to buy counter-unmanned aircraft systems equipment such as radar and RF sensors to detect and mitigate drone threats. The Department of Juvenile Justice received $1.6 million for the Florida Scholars Academy and a Social Services Block Grant realignment, with staff confirming corrective action had been taken after prior audit findings about allowable SSBG spending. The Division of Emergency Management received federal pass-through authority for FIFA World Cup security and counter-UAS funds, both controlled by the Miami host committee, and members noted the state had little direct oversight over how those local grants would be used. The Department of Commerce received $148.4 million for Community Development Block Grant Disaster Recovery work, with questions focused on the split between housing, infrastructure, and administrative costs. The Department of State received $408,377 for arts and culture federal grant obligations. All amendments were adopted, generally without objection, after brief questioning and no public testimony.

Transcript Highlights:

• Oh, there's a man who can operate with no sleep. Something like that.
• Today I'd like to highlight some of the achievements we've made as an agency.
• And so we as an agency are, have primacy from PHMSA.
• the agency.
• And an orphan well is a well that the operator has lost their permit to operate and they and their assets

Committee: Senate Natural Resources

Transcript Highlights:

• This is our operating budget.
• The executive summary now with the key points: 94300 operating budget table.
• The current operating budget is not fully spent.
• For all agency recurring budgets, including ours and the other executive agencies, the recommendation
• Chair, members of the council, Jeff McCurdy, PSA Maintenance Operations.

Committee: House Public School Capital Outlay Oversight Task Force

Transcript Highlights:

• But individual agencies might do it by agency FTE or agency budget amount or something like that.
• Just went through that was put on, stood up by an agency, you charge something to that agency then, right
• agency maybe thinks we're a three out of ten, and that agency thinks we're an eight out of ten, and
• And then other operational expenses, which was 12%, that covers the other operational expenses that would
• The system became operational in 2004, and debt service was paid The system became operational in 2004

Committee: Joint Information Technology Committee

Transcript Highlights:

• Natural Resources Agency and Environmental Protection Agency.
• So the water agencies...
• Very specifically in your agency, what federal actions has your agency or its boards, departments, or
• that your agency is now having to prepare for?
• Well, is the CDFW providing guidance to help water agencies that convey water to operate reservoirs to

Transcript Highlights:

• That statute doesn't say if the agency has time, if you feel like it; it says the agency shall control
• That statute doesn't say if the agency has time, if you feel like it; it says the agency shall control
• So starting off, the agency doesn't get as much general fund as some other natural resource agencies.
• They operate primarily like a business.
• Here is the outcome of agency-submitted outcomes for the enhancements. In FY 2027, the agency...

Summary: The Joint Finance-Appropriations Committee heard presentations on the Idaho State Department of Agriculture and the State Liquor Division. For Agriculture, legislative staff reviewed the agency’s structure, staffing, dedicated funds, and FY 2026–2027 budget requests, including pay adjustments, replacement items, IT hardware, a reappropriation for the Resilient Food Systems Grant, and two major one-time requests: a deficiency warrant for exotic pest response and a supplemental appropriation for quagga mussel treatment. Director Chanel Tewalt emphasized the history and urgency of Idaho’s invasive species program, described the state’s rapid response to quagga mussels, and explained how the program uses inspections, stations, chemicals, and other tools to reduce risk. Members asked about grant timing, vehicle replacement, signage costs, research into alternative treatments, chemical costs, possible use of sturgeon, and whether budget cuts would affect inspection stations; the director said some station openings or hours could be delayed or reduced, but priority would be given to border crossings and higher-risk locations. The committee then reviewed the State Liquor Division budget. Staff outlined the division’s dedicated-fund operations, personnel levels, statutory distributions, and FY 2027 requests for inflation, replacement items, and IT/security equipment, all recommended by the governor. Director Andrew Arulenandum said his priorities were safety, legal exposure, and operational continuity, citing a store shelving collapse and warehouse safety needs as reasons for some requests. Members asked about a policy proposal to restrict bulk lottery ticket purchases by out-of-state syndicates, the division’s pricing and markup structure, and whether Idaho might move away from a state-run liquor model. The director and his staff said the lottery restriction would not have a fiscal impact, that the markup is standardized, and that while the division remains open to efficiency ideas, the current control-state structure is intended to support revenue and temperance. The meeting ended with notice that the committee would return the next day to take action on FY 2027 maintenance budgets.

Transcript Highlights:

• and the fire agencies.
• Aloha, Mitchell Bechtel, on behalf of the Operating Engineers Local 3, in support.
• Good afternoon, Anthony Croce with Operating Engineers in support. Thank you.
• It also allows the facility owner and operator to develop their own operating plan.
• Advancing safety and sustainability in the communities where we operate is our top priority.

Committee: House Environmental Safety and Toxic Materials

Transcript Highlights:

• Our teams operated across the Guadalupe, Concho, and Colorado rivers.
• These plans are integrated into our continuity of operations plan.
• We try to get to those annually during the operation, primarily.
• We do those inspections during the summer and the operating season.
• I ask for support from the agency that this is a multiple sort of a multi-agency function.

Committee: House Culture, Recreation & Tourism

Transcript Highlights:

• :03:35.760><c> the</c><00:03:35.920><c> operating</c><00:03:36.400><c> system</c> supported by the operating
• </c> modernization funds to help agencies modernization funds to help agencies achieve<00:08:32.399><
• Applications largely remain with the agencies, but we partner closely with our agencies as they identify
• We look across the agencies to see if other agencies have similar type problems, and we can consolidate
• We look across the agencies to see if other agencies have similar type problems, and we can consolidate

Summary: The House Budget Review Subcommittee on Personnel, Public Retirement, and Finance heard a presentation from the Commonwealth Office of Technology on legacy IT modernization funds and how they are used to address outdated, unsupported, or unsustainable systems. David Carter and Carrie Welch explained the state’s definition of a legacy system under KRS 7A.180, emphasizing not only vendor support issues but also changing business needs, regulatory compliance, and the loss of institutional knowledge for older systems. They described the office’s review process for determining whether a project qualifies, including assessing business risk, comparing options such as upgrades, replacements, shared solutions across agencies, or commercial products, and then matching the project to available funding. The presenters said COT reports twice a year to the Interim Joint Committee on Appropriations and Revenue on progress with legacy modernization projects. They reported 30 projects funded to date, with 18 completed, and said remaining projects are still moving forward while agencies continue to identify modernization needs. They highlighted examples of completed work, including modernized security cameras, replacement of unsupported systems, migration of documents to the Commonwealth Enterprise Content Management Platform, restoration of vendor support, a digital policy acknowledgement portal, replacement of the State Police dispatch system, and digitization of paper records for faster retrieval and better disaster resilience. Members asked for more detail on how the $10 million request would be allocated, including system-by-system spending, the split between software, hardware, vendor contracts, and staff time, and how the office determines when a system needs replacement. COT said it did not have a system-by-system or cost-category breakdown at the hearing but could provide one later, and explained that the funds are intended for development and first-time acquisition costs rather than ongoing maintenance. They also said the $5 million annual request was based on prior years’ experience and that agencies often contribute some funding themselves, so the program could still operate if appropriated less than the full amount. The committee then approved the minutes and adjourned.

Transcript Highlights:

• And what's the shortage on the operating cost? I guess that's an operating cost for just utilities.
• However, our operational standard operating procedures dictate that we fly for safety measures with a
• This is a big money operation here.
• Are we short on heavy equipment operators?
• We have one more agency we need to hear from.

Committees: Senate Senate Finance , Senate House Appropriations & Finance

Transcript Highlights:

• So, if we fall outside of that range, they can't operate.
• So, this is a... range, they can't operate.
• It will allow us to have more efficient operations.
• We support nine local public transit agencies and approximately seven human service agencies that...
• of replacement fund is not in our operating budget. ...is not in our operating budget, and we're asking

Summary: The hearing reconvened with testimony from several agencies on their capital budget requests. The Department of Environmental Services requested a little over $38 million, with major emphasis on dam repairs and design work for aging state-owned dams, including a $5.25 million match for possible FEMA BRIC funding at Pawtuckaway/Tuckaway and other projects such as Milton Three Ponds, Murphy Dam, and Lakeport Gates. DES also requested funding for state revolving loan fund matches, a Superfund match for the Savage Well site, IT and air-monitoring upgrades, and a new $750,000 cybersecurity request for water and wastewater systems. Committee members asked about FEMA eligibility, the distinction between design and construction money, and the timing and risk of banking funds if federal grants do not materialize. The University System of New Hampshire requested $20 million in state support, primarily $15 million for a major Diamond Library renovation at UNH to create a student support hub and reduce/repurpose collection space, plus $2.5 million each for deferred maintenance at Plymouth State and Keene State. The Community College System requested about $16.6 million across seven projects, led by critical maintenance, campus safety/security upgrades, IT infrastructure, parking and site improvements, HVAC replacement at White Mountains Community College in Littleton, a building management/energy system, and modernization of NHTI’s dental clinic and radiology spaces. The Department of Education requested $29.5 million, including a $4.9 million internal management platform to replace paper-based and siloed systems, plus career and technical education capital projects; Milford’s CTE project was described as being revised after repeated failed bond votes, while ConVal said its revised project would focus on modernizing existing CTE space and adding a security vestibule. Fish and Game requested $1.075 million for three facilities: Sewall Falls in Concord, the Lancaster Armory, and the Bunker Lane Barn in Durham, focusing on structural repairs, security, reconfiguration, and in one case replacement of a failing barn with a new 40-by-60 building. The department also said hatchery work is ongoing but that it is taking a cautious approach because of the planned New Hampton Hatchery and future capital needs. The Department of Natural and Cultural Resources requested $9.26 million for eight projects, including campground electrical upgrades at Ellacoya and Lake Francis, White Lake water system replacement, Mount Washington fuel tank and safety work, Odiorne Point visitor center work funded through parks revenue, roofing and parking lot repairs, Fox Forest office safety upgrades, and historic site repairs at White Island and Fort Constitution. Members asked about revenue-based capital, the stability of the parks fund, and flexibility in choosing projects as bids come in. The Department of Transportation began its presentation at the end of the transcript, but its detailed requests were not yet discussed.

Transcript Highlights:

• In terms of the org chart, in relation to how we operate our agencies within the NDSU system, we are
• We operate our agencies within the NDSU system. We are part of NDSU.
• For our branch stations, even though each of the seven operates as a separate state agency for the purposes
• We use it for operating. A little bit different way to look at the agency budget.
• So ours is the agency that signs a multi-party agreement with all the federal agencies.

Summary: The committee first reviewed the 2024-25 tuition waiver report for the North Dakota University System. Staff explained that waivers were reported for degree-seeking students and broken out by residency, institution, and waiver type. Members asked about partial versus full waivers, institutional discretion, athletic waivers, and whether campuses have published guardrails or transparency requirements. Staff said most waivers are set by institutions, with some statutory and board-required categories, and that athletic waivers are a small share of total waiver dollars. The report showed total gross tuition of $354.5 million, tuition waived of $38.9 million, and 11,193 of 42,040 students receiving some waiver. Members also discussed how waivers affect net tuition revenue, housing and food collections, and whether campuses are using waivers strategically compared with scholarships and other funding sources. The committee then heard a presentation on tuition rates by campus and State Board policy. Staff explained the board’s tuition factors for resident, Minnesota reciprocity, contiguous-state/U.S. nonresident, and international students, and noted that campuses often seek exceptions based on program-specific competition and enrollment goals. Members asked whether rates are based on cost or competition, and staff said campuses typically bring forward estimates and market comparisons when requesting special rates. The presentation also reviewed general fund appropriations versus net tuition revenue by campus, and members discussed how local tuition decisions and waivers do not directly affect the state funding formula, though they do affect institutional revenue and reserves. Questions were also raised about the Higher Learning Commission’s financial composite indicator and how it differs from the more intuitive reserve and revenue figures. The committee next received a broad overview of non-higher-education entities affiliated with the State Board of Higher Education, beginning with NDSU agriculture-related units. Dr. Greg Lardy described the State Board of Agricultural Research and Education, the NDSU Extension Service, the Agricultural Experiment Station, and the branch research centers, emphasizing their statewide role in crop and livestock research, extension education, and county-based outreach. He outlined funding mixes for extension, the experiment station, and branch stations, noting that grants and contracts support both research and education, while the agronomy seed farm is self-funded through seed sales. Members asked about the new and vacant FTE pool, R1 research status, matching requirements for grants, and whether state appropriations count toward research expenditures. Dr. Lardy also highlighted major research impacts, including crop varieties, virtual fencing, AI-assisted weed control, and NDAWN weather data. The Northern Crops Institute and the Upper Great Plains Transportation Institute also presented. NCI described its role in market development, technical services, and education for regional agriculture, its governance through the Northern Crops Council, and its funding from state appropriations, other states, and earned revenue. Members asked about the source of out-of-state funding, intellectual property, and the institute’s international reach. UGPTI then outlined its transportation research, federal and state funding structure, and work on road and bridge condition assessments, travel demand modeling, and workforce training. No votes were taken during the portion of the meeting reflected in the transcript.

Transcript Highlights:

• That executive order asked us to review all current operations and determine, for all agencies, commissions
• We hope to see some operational savings.
• The agency didn't fill things out correctly.
• A lot of them still are a federally funded agency.
• A lot of them still are a federally funded agency.

Committee: House Resources and Conservation

Transcript Highlights:

• > um</c><00:08:54.480><c> the</c> at the agency operations and so um the at the agency operations and
• </c> operating expenses. operating expenses.
• We reorganized the agency operations to address staffing concerns. make them better.
• We reorganized<01:22:06.719><c> the</c><01:22:06.880><c> agency</c><01:22:07.360><c> operations</c><01
• :22:07.920><c> to</c> reorganized the agency operations to reorganized the agency operations to address

Committee: Joint Appropriations