CA SB186

Expands the definition of "local agency" required to submit financial reports to the Controller to include all joint powers agencies, removing the previous limitation to only those issuing conduit revenue bonds.

Increases financial penalties for local agencies failing to file required financial reports: doubles fines for second consecutive year non-compliance and triples fines for third consecutive year non-compliance, with mandatory audits triggered after three consecutive years of non-filing.

Authorizes the Controller to conduct audits and investigations of local agencies suspected of non-compliance with state law, grant agreements, local charters, and ordinances, with written findings and opportunity for local agency response required before proceeding.

Establishes a voluntary Local Agency Financial Review Committee, chaired by the Controller and including state and local government representatives, to provide financial assessment and recommendations to local agencies requesting assistance with serious financial problems.

Waives investigation costs if the Controller's examination determines the filed financial report did not contain materially false, incomplete, or incorrect information; allows payment programs of up to five years for any non-waivable costs.