Transcript Highlights:

• Tiered certifications and agreed-upon procedure reporting under the state audit act.
• First, you must have complied with your audit.
• So basically, we help with audit compliance and assistance.
• We help them with their audit compliance.
• So, all federal legislation has to have a long name and an appropriate acronym.

Transcript Highlights:

• . audit. audit.
• <00:08:07.200> that<00:08:07.360> is an audit that is an audit that is already<00:08:09.840
• Um the funding wouldn't be audit.
• That the auditor producing an audit.
• schools accountable for producing audits schools accountable for producing audits um<00:15:05.480

Keywords: 1191, senate, all

Transcript Highlights:

• Introducing regulations or legislation to restrict what they're doing.
• Which is it, my concern with this legislation?
• This legislation does nothing to improve healthcare.
• It's a legislative bull. In a china shop, and so, Mr.
• I may have received 2/3 vote of those legislators.

Bills: HR1036, HB2975, HB3026, HB3297, HB2981, HB2978, HB4144, HB1322, HB1818, HB3194, HB3767, HB3342, HB3344, HB4170, HB3287, HB3288, HB4454, HB3264, HB3266, HB3268, HB4095, HB4115, HB4316, HB3530, HB3428, HB4272, HB4273, HB4274, HB3405, HB3406, HB3467, HB3469, HB3931

Keywords: poultry waste, nutrient management, environmental regulations, agriculture, water quality, pollution prevention, best management practices, kindergarten, military families, education policy, school districts, international military dependents, age eligibility, towing services, Oklahoma Wrecker and Towing Services Fund, Department of Labor, vehicle storage fees, consumer protection, nonconsensual towing, open meetings

Transcript Highlights:

• I want to welcome everybody to the Legislative Audit Education Institution Subcommittee.
• Today there are 57 education audit reports for the committee’s review.
• We will begin with the three audits which were referred to the prosecuting attorney and attorney general
• So since these were not a repeat finding or a deferred audit report, they were not required to be here
• And so we're on each audit now when we go out, we try to ask questions along these lines to see.

Summary: The Legislative Audit Education Institution Subcommittee met to review 57 education audit reports, including 52 with no findings and five with findings. The committee adopted the previous meeting’s minutes and then heard staff summaries of the findings, which focused largely on school district spending and internal control issues. Two reports, Camden-Fairview and Forest City, involved district use of operating funds for staff end-of-year celebrations that staff said conflicted with the Arkansas Constitution and AG opinions. Camden-Fairview’s questioned costs totaled $10,668, including meals, door prizes, and facility rental, and Forest City’s totaled $33,436, including decorations, catering, entertainment, and rental fees. Members discussed whether district officials should attend to answer questions, and both reports were deferred to the June meeting with requests for district attendance. The committee also reviewed a referred finding at Nettleton School District involving a $1.9 million fraud scheme tied to emailed bank-account change requests; the district recovered $1.5 million from the bank and arranged for the vendor to reimburse the remaining $204,890 loss. Members questioned why the vendor would repay money it did not receive, and the report was also held over to the June meeting for further explanation. A separate referred case at Camden-Fairview noted unauthorized credit card charges of $2,140, with $262 remaining as a loss after bank reversals. Staff also presented non-referred findings at Cedar Ridge, including improper Title I payroll charges, salary overpayment and underpayment errors, and an unreconciled bank account variance, and at Green County Technical School District, where a $1,400 vendor check was fraudulently diverted but later recovered. Those reports were filed after no objections. During discussion, staff explained that Legislative Audit is trying to reduce recurring fraud and control problems by advising schools on verifying banking changes in person or through other direct contact, using bank controls such as positive pay, and monitoring accounts more frequently. Members encouraged schools to take audit training seriously and noted that clean reports should be recognized as a positive result. The remaining 52 reports with no findings were filed as reviewed, and the meeting adjourned with no new business.

Transcript Highlights:

• Utility audits branch staff, and these are auditors, bring diverse professional certifications and auditing
• auditing expertise.
• Office of Audits.
• So the Utility Audits and Risk Compliance division that I mentioned, they are doing external audits of
• So we have a different division that does internal audits.

Summary: The committee first heard Issue 1 on trailer bill language to redirect funding for emergency demand-response programs. The Department of Finance proposed using about $26.9 million in General Fund originally set aside for the Distributed Energy Backup Assets program to bolster the Demand-Side Grid Support Program for summer 2026, and using about $70 million in CalCHAP interest to support ratepayer-funded demand response in summers 2027 and 2028. The CEC and CPUC said they are working on a transition from DSGS to ELRP or a successor program, while the LAO noted the General Fund money would otherwise revert to savings. Members pressed the administration on whether demand response remains important, whether DSGS has been successful, and whether the state should keep funding it through the CEC rather than shifting to a ratepayer-funded CPUC program. The CEC and CPUC said the programs are not directly comparable, emphasized different cost structures and enrollment metrics, and said a CPUC rulemaking is underway with a proposed decision expected in Q3 2026. No vote was taken in the transcript. The committee then took up Issue 2, a budget proposal tied to SB 254 and the new transmission accelerator. GoBiz and the California Infrastructure and Economic Development Bank described a five-year, roughly $26 million request to staff and administer the accelerator and manage Proposition 4 and AB 1207 funds for transmission financing. Members asked about state liability, ownership of financed lines, FERC revenue requirements, and whether the program would help underserved regions and offshore wind development. Staff explained that the accelerator would only consider projects already identified through CAISO’s competitive transmission planning process, and that state financing would be a small portion of large projects intended to lower overall costs to ratepayers. The LAO said it had no specific concerns but urged the Legislature to ensure the final language matches its intent. The committee also heard Issue 3 on petroleum market oversight. The CEC and its Division of Petroleum Market Oversight requested additional positions and funding to implement ABX2-1 and continue work on supply stabilization, refinery monitoring, and transportation fuels analysis. Members questioned why the work was funded through the Energy Resources Programs Account, whether existing staff from the paused price-gouging work could be reassigned, and whether the program had produced evidence of price gouging or improved supply conditions. CEC and Finance said the new positions are needed because the workload has expanded, while some existing staff remain on related analysis and reporting duties. The discussion ended without a vote in the transcript.

Transcript Highlights:

• auditing expertise.
• auditing expertise.
• office of audits.
• And as we’ve, through a mix of legislation—” “And as we’ve, through a mix of legislative action or other
• So the Utility Audits and Risk Compliance Division that I mentioned, they are doing external audits of

Keywords: 988, house, all

Transcript Highlights:

• In our discussions, you and I have often said that I appreciate audit, and that audits are something
• The next thing are our performance audits, which are internal control and compliance audits.
• we layer more process for legislators we layer more process for legislators before<00:56:48.200>
• <00:57:35.720> can processes that you as legislators can processes that you as legislators
• <01:15:19.560> and I'm the director of legislative and I'm the director of legislative and

Keywords: 1183, house

Summary: The committee met on February 11 and began with introductions from members and staff, who shared brief personal and district facts. Chair Jim Nash then outlined the committee’s goals for the session, emphasizing bipartisan cooperation, the need to address a looming structural deficit, and the committee’s role in moving legislation forward. The committee also reviewed its rules for the year. The main item was House File 3, authored by Chair Nash and referred to Ways and Means. The bill would require the Office of the Legislative Auditor to produce an annual report tracking whether agencies have implemented prior audit and evaluation recommendations, with the goal of improving internal controls, transparency, and accountability and helping legislators make funding decisions. Nash described the bill as a preventative measure to reduce waste, fraud, and abuse, and said it was modeled in part on practices used in Colorado. Legislative Auditor Judy Randall testified that the office already produces similar update reports but lacks resources to independently verify many agency responses; she said the bill would provide a framework for more regular reporting and discussion, not a “shame tool.” Ranna Lee of Americans for Prosperity testified in support, saying the bill would increase accountability and transparency for how public agencies manage taxpayer resources. A letter from the Minnesota Council on Nonprofits was also noted in support. Representative Clardy offered the A7 amendment to add an appropriation matching the fiscal note; Nash accepted it, saying savings could be found later in the process. The committee approved the A7 amendment by voice vote. During discussion, Representative Quam supported the bill’s focus on accountability, and Representative Freiberg questioned the Legislative Auditor about the office’s expertise on a specific ambulance-services recommendation in the report. Randall responded that the office’s staff are policy research generalists who use standards, best practices, interviews, surveys, and site visits to develop recommendations, and that the goal is to prompt further discussion rather than require blind acceptance. The transcript ends during that exchange, with no final committee vote on House File 3 shown.

Transcript Highlights:

• I'm trying to think that if I've seen any legislation or any particular points that I think where legislation
• Legislators have made many positive reforms to pre- and post-election auditing, like the reconciliation
• audit after each election.
• With any legislators interested in continuing to approve the overall audit process for Texas elections
• And auditable.

Keywords: 1184, house, all

Transcript Highlights:

• So, external or internal audits, would that include the state auditor's audits?
• the state auditors um audits? the state auditors um audits?
• , performance audits, and program audits, performance audits, and things<01:25:29.240> like<01
• > audit, the heat abatement audit, the heat abatement audit, I<01:27:30.760> suspect<01
• >> The driver's ed audit? >> The driver's ed audit?

Bills: SB3263, SB3261

Keywords: student-athletes, name image likeness, NIL, compensation, transparency, University of Hawaii, Title IX, funding, protections, athlete agents, student athletes, endorsement contracts, professional representation, registration requirements, sports law, 912, senate, all

Summary: The joint committees heard testimony on Senate Bill 3263, which would create a state-supported endowment for University of Hawaii athletics NIL (name, image, and likeness) funding. University of Hawaii Athletics Director Matt Eliott supported the bill, saying NIL requires both immediate funding and a longer-term sustainable solution. He asked for several changes: lowering the initial endowment target from $10 million to $2 million so the fund could start sooner, allowing NIL reporting by team rather than by individual student-athlete, and clarifying that athletes may choose whether to use an agent, while still allowing certified agents or a parent/guardian if desired. Committee members raised concerns about using taxpayer dollars for athlete compensation, the burden on a small-state budget, and whether the university could realistically raise the required matching funds. Several senators questioned whether the university had a concrete fundraising plan and whether the endowment would meaningfully help UH compete with larger programs. Eliott said UH is already fundraising privately for current NIL obligations, had raised more than $1.6 million toward a $3 million annual goal, and would continue fundraising for both short-term needs and the endowment match. He also said the university is not trying to compete with Power Five schools on the same scale, but to be successful at its own conference level. Members also discussed transparency and privacy, with some senators arguing that if state money is used, the public should know how it is spent, while Eliott said individual student-athlete NIL information should remain private and team-level reporting would be preferable. He confirmed international student-athletes are eligible for NIL and said about 60 to 70 UH athletes are currently participating, with more than 100 expected next year. The discussion also touched on UH’s Mountain West media rights and local TV rights, with Eliott explaining that the conference distribution is expected to remain around $3.5 million and that local TV rights would be negotiated separately. No vote or final action was taken during the portion of the hearing provided.

Transcript Highlights:

• So if no one else is interested, I will go forward and put it legislation, you know, work with legislative
• Legislative consent for...
• He's my director of audit services.
• The last audit they had was 2018.
• My desire is how do we shorten the time frame from the audit, executing on the audit, the planning phase

Keywords: 908, all

Transcript Highlights:

• We make it a practice to look at audits from other agencies that the legislative audit commission looks
• We make it a practice to look at audits from other agencies that the legislative audit commission looks
• We make it a practice to look at audits from other agencies that the legislative audit commission looks
• We make it a practice to look at audits from other agencies that the legislative audit commission looks
• We make it a practice to look at audits from other agencies that the legislative audit commission looks

Keywords: 919, house, all

Summary: The Minnesota Department of Agriculture presented an overview of its budget, staffing, and major program areas, including protection services, marketing, and administration. Commissioners also highlighted concerns about federal funding uncertainty after a January letter suspending active and future USDA awards to the department. They said the issue affected about 13% of the agency’s budget, created confusion for farmers, and briefly disrupted poultry lab testing and HPAI-related work, though they later received assurances from USDA leadership that existing programs would continue processing. The department also described its anti-fraud efforts, including internal controls, a compliance coordinator, a grants administrator, review committees, site visits, and participation in the state’s Inspector General Coordinating Council. The committee then discussed several agriculture support programs. For dairy margin coverage, the department said Minnesota’s sign-up is open and supported a bill to extend assistance to farmers who began operations in 2023-2025 and were not covered under the earlier production-based formula. The renamed Farm to Food Security program, formerly LFPA, was described as a state-created local food purchasing effort funded at $700,000 per year. The down payment assistance grant for first-time farm buyers was also reviewed; the department said it has supported 112 farmers so far, with additional awards pending, but noted timing problems when purchase agreements fall through. Members asked whether priority should be given to applicants with signed purchase agreements, and the department said that was under consideration. The grain indemnity account update focused on the Hansen-Mueller facility failure and related claims. The department said the account holds about $10.7 million, has received 19 claims totaling $1.1 million, and that $842,000 of those claims were tied specifically to Minnesota transactions. It explained the difference by noting that some claims involved Minnesota farmers selling in North Dakota and Wisconsin, and that the indemnity account covers grains sold in Minnesota. The committee also heard updates on elk and wolf depredation payments, with the department projecting shortfalls in both funds and noting that payments are being delayed into later months. The agriculture response fund balance was said to be about $2.5 million. Finally, the Rural Finance Authority and the East Grand Forks potato facility were discussed. The RFA reported strong demand for low-interest loans, about $26 million remaining from the prior $50 million authorization, and a new $50 million bonding request in the governor’s proposal to avoid a funding gap. The department said the program has issued 3,951 loans totaling about $390.3 million with very low defaults. It also requested $1.38 million in bonding for building improvements at the East Grand Forks potato facility, which it said is the department’s only owned building and supports a significant potato industry. In response to a question from Rep. Bang, the commissioner said recent ICE activity had affected farms, processing plants, immigrant workers, and some rural food businesses, and that the department had relayed those concerns to the governor’s office and congressional delegation.

Transcript Highlights:

• Just as independent audits help stabilize capital markets, we believe that AI audits will similarly build
• They have the ability to provide good quality audits.
• That’s where we’ve seen legislators proposing that we should have AI audits, just like we have financial
• I find myself compelled as a parent and as a legislator to bring this piece of legislation back because
• And as a legislator to bring this piece of legislation back, because despite the legislature's diligent

Summary: The committee heard several privacy and consumer protection bills, with most of the discussion focused on AI and social media. AB 1405 would create a state registry for AI auditors and set basic transparency, ethics, and qualification standards for those auditors; supporters said it would build trust and provide a foundation for future AI oversight, while some members questioned whether government should define auditor qualifications instead of industry groups. The bill was moved out on a 5-1 vote to Appropriations, with the roll left open. AB 2, by Assemblymember Lowenthal, would impose enhanced financial penalties on large social media companies when their negligence causes harm to children and teens. Supporters, including a grieving parent and Common Sense Media, argued the bill would create accountability for harmful algorithms and design choices, while opponents from TechNet, EFF, CCIA, and CalChamber warned it was vague, could chill speech, invite censorship, and raise Section 230 and First Amendment concerns. Committee members debated private right of action versus public enforcement, possible shakedown lawsuits, and whether the bill should be narrowed; the bill passed 6-0 to Judiciary with the roll left open. AB 410 would expand California’s bot disclosure law so bots must identify themselves up front and truthfully if asked, rather than only prohibiting deceptive bots in limited commercial or election contexts. Supporters said the measure would help users, especially youth and vulnerable people, know when they are interacting with AI and reduce deception online; one privacy group withdrew opposition after amendments, and other industry groups said they were no longer opposed or had no formal position. The bill passed 9-1 to Appropriations with the roll left open. The committee also approved AB 1327, which lets consumers cancel home improvement contracts by email instead of only by mail and requires phone assistance for cancellations; the Contractor State License Board withdrew opposition after amendments, and the bill passed 11-0 to Judiciary with the roll left open.

Transcript Highlights:

• We've taken a look at the legislation.
• Same with just having the tax audit. If it's general, it's not very useful data.
• I'm asking you to stop bad legislation by not voting for this bill.
• The policy limits would only come up in an audit.
• So some information doesn't come up until you need an audit? Correct.

Summary: The House Insurance Committee met on April 23 with a quorum present and first deferred HB 1142. The committee then heard HB 1187, which would direct any excess Louisiana Citizens emergency assessment funds, after related debt is paid, toward the Louisiana Fortified Homes Program or future Citizens debt. Representative Sawyer and Commissioner Tim Temple said the bill would likely redirect about $50 million in one-time surplus funds and would help expand a popular roof-mitigation program that has already awarded more than 4,600 fortified roofs. The bill drew support from several witnesses and was reported as amended without objection. Next, HB 1210, dealing with insurance claim disputes and a pre-suit review process for Louisiana Citizens claims, was discussed. Representative Dana Henry said he was voluntarily deferring the bill and instead pursuing a study resolution after hearing concerns from members and stakeholders. Department and Citizens officials said the proposal was modeled on Florida’s process and could help resolve disputes faster and cheaper, but the bill was ultimately voluntarily deferred after testimony and some opposition cards were noted. The committee then took up HB 1199, which requires coverage for genetic testing and treatment related to SCN2A-associated disorders. Representative Jordan and the Diedon family gave emotional testimony about their daughter Emily’s diagnosis and the importance of timely genetic testing. The bill was amended to require that testing be ordered by a provider and deemed medically necessary by the health plan, with discussion about whether a neurologist should be involved; members said that issue could be refined later. HB 1199 was reported as amended. Finally, the committee considered HB 880, the Louisiana Artificial Intelligence Insurance Fairness Act, which would regulate AI use in underwriting, rating, and claims. After a lengthy discussion about state insurance regulation, McCarran-Ferguson, and concerns that the bill could jeopardize federal broadband funding, Representative Jordan voluntarily deferred HB 880, and HB 920 was also deferred. The committee then heard HB 1221, which would limit the policy data collected for the Louisiana Fortified Program Fund. Former Representative Bowler argued the bill was needed to protect policyholder privacy, while the Department of Insurance and Commissioner Temple said the data is needed for surplus-lines premium tax audits, fraud detection, and consumer assistance after disasters. The discussion continued with questions about what data would be visible and how it would be used, but the transcript ends before a final action on HB 1221 is shown.

Transcript Highlights:

• Public Funding prevent negative audit Public Funding prevent negative audit findings<00:20:21.799
• finding from 2019 in which the an audit finding from 2019 in which the legislative<00:21:00.000>
• um by the office of the legislative um by the office of the legislative auditor<00:30:17.840>
• <00:32:57.159> audit<00:32:57.480> Commission the legislative audit Commission the
• legislative audit Commission and<00:32:58.760> seen<00:32:59.120> a<00:32:59.279> lot

Bills: HF1470, HF1310, HF1837

Keywords: opioids, substance use, addiction recovery, mental health, state cabinet, HF1310, Office of Cannabis Management, cannabis, marijuana, tribal consultation, government-to-government relationship, Minnesota tribes, Tribal governments, state government, consultation, rulemaking, Indian affairs, cannabis regulation, tribal sovereignty, state-tribal relations

Transcript Highlights:

• Well, if you do take further amendments, please add me to your legislation.
• You don't have to do it through an audit.
• but you could do this directly through legislation, the budget, etc.
• You could do it through the audit.
• That's not a part... ...the audit piece gets you to that. You don't yet.

Keywords: 987, senate, all

Transcript Highlights:

• audit that was done.
• And so the legislature does an audit.
• Governor Leavitt reacts to that audit and says, I want to reform these...
• So the legislature does an audit.
• Louisiana just passed legislation to do a similar thing as well.

Summary: The committee met to hear an update from consultants Mason Bishop and Cameron Christie on Arkansas’s “one door” or “no wrong door” workforce and social services modernization effort. The discussion focused on moving the state toward a work-first system that better connects job seekers, employers, education, and public assistance programs, with goals of increasing upward mobility, improving labor force attachment, reducing inefficiencies, and adapting to changes such as AI and other economic disruptions. The consultants argued that Arkansas’s current system is fragmented across multiple offices, portals, agencies, and funding streams, and that people often have to navigate separate doors for workforce services, TANF, SNAP, Medicaid, and related supports. Bishop repeatedly pointed to Utah as the model, describing how that state integrated workforce and human services into a single department, used cost allocation to blend funding behind the scenes, and saw improved customer service and outcomes after reform. He said TANF should be treated as a workforce program, not just a benefits program, and suggested that Arkansas could use TANF and other tools to cross-train DHS staff, co-locate services, and create a more unified service delivery model. Members asked about federal flexibility, waivers, and whether the state could use one large waiver or a broader restructuring to simplify the system. Bishop explained that a federal pilot authority proposal failed in Congress, so the current approach relies on waivers, cost allocation plans, and possible state-level changes. The committee also discussed the relationship between DHS and workforce offices, the role of local workforce boards, how disability and vocational rehabilitation cases would be handled, and how the governor’s Restore Hope/Hope Hub and faith- and community-based initiatives might fit into the broader plan. Bishop said Arkansas already has rehabilitation services within the workforce department and emphasized that case managers should focus on people rather than programs. No votes were taken. The chair said the committee would revisit case management at its August meeting and adjourned the meeting after thanking the consultants.

Transcript Highlights:

• Uh they're a large document audits.
• Uh in the 18 through22 audit, further.
• <00:39:51.680> happened, still pending when this audit happened, still pending when this audit
• Did 22 through 24 audit were similar.
• <01:42:57.360> So so many findings in their audits. So so many findings in their audits.

Keywords: 1136, house, all

Transcript Highlights:

• The last CPUC audit, the first and last CPUC audit, was done to... said no.
• The last CPUC audit, the first and last CPUC audit, was done to.
• The last CPUC audit, the first and last CPUC audit, was done in 2021, and it found that utilities got
• I think that the legislative...
• And who does those audits?

Summary: The Assembly Committee on Utilities and Energy held a hearing on the California Earthquake Authority’s SB 254 report and broader options for reforming California’s utility wildfire recovery system. The chair framed the discussion around the Palisades and Eaton fires, the scale of wildfire-related costs on utility bills, and the need to weigh trade-offs among survivors, ratepayers, utilities, insurers, and taxpayers. The first panel featured wildfire survivors William Abrams and Joy Chen, who described long delays in compensation, housing insecurity, and what they viewed as a system that protects utility shareholders more than victims. They urged greater transparency, clearer accountability for utility spending and safety performance, faster and fuller compensation for survivors, and reforms such as independent audits and better alignment of utility incentives with wildfire prevention and restitution. The second panel began with Tom Welsh of the California Earthquake Authority, who explained that the SB 254 report was intended as a broad inventory of policy pathways rather than recommendations. He described the report’s process, including stakeholder submissions, workstreams, and a convergence process, and outlined the current wildfire fund structure: utilities remain liable, the fund reimburses eligible claims after a covered wildfire, and the CPUC later determines prudency and possible reimbursement back to the fund. RAND’s Lloyd Dixon summarized compensation data, saying utilities paid about $38 billion between 2017 and 2024, with major shares going to injured parties, insurers, and public entities, while litigation costs and survivors’ own losses remain substantial. He noted that legal fees and delays reduce the amount survivors ultimately receive. Utility and public-interest witnesses offered differing views on the report’s pathways. PG&E’s Tyson Smith said the report shows inaction is the worst outcome and argued for community wildfire risk reduction, equitable allocation of catastrophe costs, and state-led resilience tools. LADWP’s Fernando Valero emphasized the vulnerability of municipal utilities and cities, and supported inverse condemnation reform, a state-sponsored liability insurance framework, damages and subrogation limits, and stronger insurance access. Consumer Attorneys of California’s John Fisk argued that IOU-caused fires are not natural disasters but the result of negligence and sometimes criminal conduct, and opposed reducing utility liability while supporting stronger oversight and audits. The Public Advocates Office’s Nathaniel Skinner focused on affordability, saying ratepayers already bear large and growing wildfire costs and warning against shifting more costs onto bills without measurable risk reduction and tighter accountability. Committee members then began questioning witnesses about what counts as measurable mitigation, how to define full and fair compensation, and how any fast-pay process should work.

Transcript Highlights:

• Approximately two years ago, the Federal Department of Justice audited and identified a finding stating
• Is there anybody in the audience that is in support of this legislation?
• Is there anybody in the audience in support of this legislation? Recording none.
• The audience: is there anybody in this large group of people in support of this legislation?
• The whole auditing system needed to be rebuilt from the ground up.

Transcript Highlights:

• , whether it was a financial audit or a programmatic audit.
• audit or a programmatic audit financial audit or a programmatic audit is<00:53:07.359> the<00
• When we say LBA audits, it doesn't include the KPMG audit. I apologize.
• When we say LBA audits, it doesn't include the KPMG audit. I apologize.
• audits. So, it's it's a different audit. audits. So, it's it's a different audit.

Keywords: 928, house, all

Summary: The committee met with DHS Chief Financial Officer Nathan White to receive an update on the department’s budget lapse and vacancy rates. White explained the difference between the “back-of-the-budget” reduction and lapse assumptions, saying DHS is facing a current biennium reduction of about $23 million and estimating roughly a $60 million general fund lapse in state fiscal year 2025, compared with about $13.5 million the prior year. He said DHS’s lapse is driven largely by program utilization, labor market conditions, contract spending, and statutory carry-forwards in areas such as Medicaid and developmental disabilities, which tend to produce a smaller lapse in the first year of the biennium and a larger one in the second year. He also noted that the House and Senate budgets differ on some operating items, including Medicaid rates, with the Senate having struck a House proposal to reduce rates by 3%. Members questioned White about whether DHS ever spends down lapse money on last-minute purchases. He said the department does not engage in that practice, though it does retain some flexibility in its facilities budget for emergencies. He also described the process for transferring funds within and between class lines, including the need for fiscal committee approval above statutory thresholds, and gave examples such as moving funds to cover overtime in the SYSC budget and to ensure Medicaid payments for nursing facilities. White said such transfers are public and transparent and are reviewed by the governor and Executive Council. The committee then discussed DHS staffing. White said the department has a little over 3,200 authorized positions, with a vacancy rate around 14.5%, and that a hiring freeze had been imposed a few months earlier while exempting direct care positions. He said DHS is planning for about a $30 million general fund reduction to personnel, equivalent to just under 400 positions, and is managing postings centrally to stay within budget by July 1. In response to questions about the loss of about $80 million in federal funds, White and Associate Commissioner Patricia Tilly said DHS avoided layoffs by shifting staff into vacant positions, but that the cuts affected community contracts, public health workers, laboratory work, and some IT/data projects. Tilly said roughly 20 positions were affected, most were reassigned, a few staff left voluntarily, and the department has less flexibility going forward if more federal funding ends.