Report 2013-122 Recommendations and Responses in 2015-041

Report 2013-122: California Department of Toxic Substances Control: Its Lack of Diligence in Cost Recovery Has Contributed to Millions in Unbilled and Uncollected Costs

Department Number of Years Reported As Not Fully Implemented Total Recommendations to Department Not Implemented After One Year Not Implemented as of 2014-041 Response Not Implemented as of Most Recent Response
Department of Toxic Substances Control 1 9 3 N/A 1

Recommendation To: Toxic Substances Control, Department of

To ensure that it maximizes the recovery of its costs from responsible parties, by October 2014, the department should do the following:

- Continue its plan to update policies and procedures for using liens whenever appropriate.

Response

Audit Report 2013-122 recommended that the Department of Toxic Substances Control (DTSC) should continue its plan to update policies and procedures for using liens whenever appropriate. On November 6, 2015, DTSC issued its Statutory Lien Policy and Procedures (DTSC-15-001), outlining DTSC's use of statutory liens pursuant to Health and Safety Code section 25365.6 to secure unreimbursed response costs incurred by DTSC in conducting or overseeing response actions pursuant to the Hazardous Substances Account Act (HSAA), Health and Safety Code section 25300 et seq. DTSC worked with the Attorney General's Office to finalize DTSC's Lien Policy and Procedure to ensure that it: (1) complies with the constitutional due process principles articulated in December 2014 by the Third District Court of Appeal in Van Horn v. State of Cal. Dept. of Toxic Substances Control, Case No. C073173; and (2) provides sufficient guidance to DTSC staff regarding the appropriate use of statutory liens to secure response costs incurred by the Department.

Note: Statutory Lien Policy and Procedures (DTSC-15-001) sent as attachment via e-mail to State Auditor.

  • California State Auditor's Assessment of Status: Fully Implemented
  • Completion Date: November 2015
  • Response Date: November 2015

Recommendation To: Toxic Substances Control, Department of

To ensure it loads only accurate billing data into FI$Cal, the department should continue evaluating projects with outstanding costs in its billing system to meet the July 2015 implementation date.

Response

In previous audit responses, DTSC reported that Fi$Cal had determined it could not meet the Department's billing needs. DTSC now is working with the Department of Technology to implement a new billing system as soon as possible. On Oct. 14, 2015 DTSC submitted a Stage 1 Business Analysis (S1BA) document to the Department of Technology to begin the project approval process. A meeting with the Department of Technology to discuss the business analysis as well as next steps in the project approval process is scheduled in November. Development and deployment for the new billing system are expected to take three to four additional years beyond project approval. DTSC continues to clean up data and reduce unresolved costs. DTSC is on track to complete data cleanup on backlog sites by June 30, 2016, well before a new billing system would be in place. DTSC's new procedures include enhanced guidelines and controls to help ensure that new data will be accurate.

  • California State Auditor's Assessment of Status: Not Fully Implemented
  • Completion Date: TBD
  • Response Date: November 2015

Recommendation To: Toxic Substances Control, Department of

The department should continue to resolve its questions about its authority to write off outstanding costs under $5,000. To the extent that it determines it cannot write off outstanding costs, it should pursue collecting the costs.

Response

AB 274 authorizes DTSC to write off uncollected accounts of $5,000 or less incurred between Dec. 31, 1987 and Dec. 31, 2013, if the cost to pursue the recovery exceeds the value of the uncollectible account. AB 274 was signed by the Governor on Oct. 2, 2015 and takes effect Jan. 1, 2016. DTSC created procedures to process the write-offs and will begin implementation in January 2016. When cost effective, and within established guidelines, DTSC continues to make progress in resolving costs of $5,000 or less through collection; data cleanup; and write offs. DTSC will use all available tools and processes to resolve the remainder of audit backlog costs of $5,000 or less as quickly as possible by July 2016.

  • California State Auditor's Assessment of Status: Fully Implemented
  • Completion Date: October 2015
  • Response Date: November 2015

Current Status of Recommendations

All Recommendations in 2015-041