2023 Utah Code › Title 67 - State Officers and Employees › Chapter 3 - Auditor › Section 3 - Disbursements of public funds -- Suspension of disbursements -- Procedure upon suspension.

Effective 5/8/2018
67-3-3.
Disbursements of public funds -- Suspension of disbursements -- Procedure upon suspension.
(1) The state auditor may suspend any disbursement of public funds whenever, in the state auditor's opinion, the disbursement is contrary to law.
(2)
(a) If the validity of a disbursement described in Subsection (1) is not established within six months from the date of original suspension, the state auditor shall refer the matter to the attorney general for appropriate action.
(b) If, in the attorney general's opinion, the suspension described in Subsection (2)(a) was justified, the attorney general shall immediately notify the state auditor, who shall immediately make demand upon the surety of the disbursing or certifying officer.
(c) If the state auditor makes a demand under Subsection (2)(b), the surety shall immediately meet the demand and pay into the state treasury by certified check or legal tender any amount or amounts disbursed and involved in the suspension.
(3)
(a) The state auditor shall ensure that each suspension is in writing.
(b) The state auditor shall:
(i) prepare a form to be known as the notice of suspension;
(ii) ensure that the form contains complete information as to:
(A) the payment suspended;
(B) the reason for the suspension;
(C) the amount of money involved; and
(D) any other information that will clearly establish identification of the payment;
(iii) retain the original of the suspension notice;
(iv) serve one copy of the suspension notice upon:
(A) the disbursing or certifying officer;
(B) any member of the finance commission; and
(C) the surety of the disbursing or certifying officer, except that mailing the copy to the surety company constitutes legal service;
(v) attach one copy of the suspension notice to the document under suspension; and
(vi) take receipts entered upon the original suspension notice held by the state auditor from the disbursing or certifying officer, the finance commission, and the surety.
(4)
(a) Immediately upon any suspension becoming final, the finance commission shall:
(i) cause an entry to be made debiting the disbursing or certifying officer with the amount of money involved in any suspension notice; and
(ii) credit the account originally charged by the payment.
(b) Upon release of final suspension by the state auditor, the finance commission shall make a reversing entry, crediting the disbursing or certifying officer, and like credit shall be given in all recoveries from the surety.
(5)
(a) In accordance with this Subsection (5), the state auditor may prohibit the access of a state or local taxing or fee-assessing unit to money held by the state or in an account of a financial institution, if the state auditor determines that the local taxing or fee-assessing unit is not in compliance with state law regarding budgeting, expenditures, financial reporting of public funds, and transparency.
(b) The state auditor may not withhold funds under Subsection (5)(a) until the state auditor:
(i) sends formal notice of noncompliance to the state or local taxing or fee-assessing unit; and
(ii) allows the state or local taxing or fee-assessing unit 60 calendar days to:
(A) make the specified corrections; or
(B) demonstrate to the state auditor that the specified corrections are not legally required.
(c) If, after receiving notice under Subsection (5)(b), the state or local fee-assessing unit does not make the specified corrections and the state auditor does not agree with any demonstration under Subsection (5)(b)(ii)(B), the state auditor:
(i) shall provide notice to the taxing or fee-assessing unit of the unit's failure to comply;
(ii) shall provide a recommended timeline for corrective actions;
(iii) may prohibit the taxing or fee-assessing unit from accessing money held by the state; and
(iv) may prohibit the taxing or fee-assessing unit from accessing money held in an account of a financial institution by:
(A) contacting the taxing or fee-assessing unit's financial institution and requesting that the institution prohibit access to the account; or
(B) filing an action in district court requesting an order of the court to prohibit a financial institution from providing the taxing or fee-assessing unit access to an account.
(d) The state auditor shall remove the prohibition on accessing funds described in Subsections (5)(c)(iii) and (iv) if:
(i) the state or local taxing or fee-assessing unit makes the specified corrections described in Subsection (5)(b); or
(ii) the state auditor agrees with a demonstration under Subsection (5)(b)(ii)(B).
Amended by Chapter 256, 2018 General Session