Report 2011-118/2011-613 Recommendation 6 Responses
Report 2011-118/2011-613: Conduit Bond Issuers: Issuers Complied With Key Bond Requirements, but Two Joint Powers Authorities' Compensation Models Raise Conflict-of-Interest Concerns (Release Date: August 2012)
Recommendation #6 To: Statewide Communities Development Authority, California
As suggested by the Government Finance Officers Association guidance, California Communities and Municipal Finance should include provisions in their contracts prohibiting consultants from engaging in activities on behalf of the issuers that produce a direct or indirect financial gain to the consultants, other than the agreed-upon compensation, without the issuer's informed consent.
60-Day Agency Response
In October 2012 California Communities amended its contract with HB Capital to prohibit HB Capital from receiving any additional compensation, payment, or other financial benefit from any person in connection with the issuance of bonds by the joint powers authority, except for the compensation authorized by its contract. (See 2013-406, p. 33)
- Response Date: November 2012
California State Auditor's Assessment of 60-Day Status: Fully Implemented
Agency responses received after June 2013 are posted verbatim.