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New compliance audit for OC Go sales tax funds welcome news for taxpayers

October 21, 2023

At the October 9th Orange County Transportation Authority Board of Directors meeting, the board voted unanimously to fund my request, taken up initially through the Measure M2 Taxpayer Oversight Committee (TOC) for a compliance audit of Measure M2 spending. Working collaboratively together with the OCTA Board of Directors, members of the TOC, and OCTA staff, we achieved a victory for Measure M transparency, and for Orange County taxpayers.

When Measure M (now known as OC Go) was originally passed by the voters in 1990, it’s language included strong safeguards to help protect the half-cent sales tax that you pay for transportation improvements here in Orange County.

OC Go is expected to generate a total of nearly $15 billion through 2041 to maintain and improve Orange County’s transportation network.

Initially a 20-year tax with limited bonding authority, Measure M (and then extended an additional 30 years with Measure M2) included language requiring the creation of an independent Taxpayer Oversight Committee (TOC) specifically “for the purpose of overseeing compliance with the measure.” This compliance purpose is further explained “to ensure that all voter mandates are carried out as required.” As Orange County’s independently elected Auditor-Controller, one of my roles is to serve as the chair of the TOC. I am dedicated to my commitment to serving the County of Orange and its taxpayers seriously. This compliance audit will allow me and the TOC to annually certify voter mandates are met with confidence by relying on an outside auditor’s opinion.

In reading the language of the current Measure M2 as a Certified Public Accountant, I found that the audit safeguards in place as approved by the voters were not as clearly defined. While the measure states an “annual independent audit” should be conducted, it didn’t specifically state which type of audit is to be conducted.

There are many types of audits. For this situation, when measuring compliance, the gold standard of audits is intuitively – a compliance audit, which ensures an organization or fund complies with the rules, regulations, and laws of the region, state, or country it operates. More simply put – this compliance audit corresponds with the Committee’s sole purpose of compliance and provides the kind of transparency you should expect when literally billions of taxpayer dollars are being spent.

Before you get concerned that perhaps before now there has not been any audits performed, since its inception, the Measure M fund has had a financial statement audit performed each year, ensuring that the measure’s financial statements are materially correct. Although a financial statement audit has many great benefits, a compliance audit has a different scope and is a needed, additional effort to ensure our hard-earned tax dollars are being spent appropriately in accordance with the measure’s requirements.

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It is worth mentioning that performing a compliance audit comes at an expense, as you can imagine. But the drafters of Measure M2 had this in mind, and a portion of funds raised by the sales tax are dedicated for this very type of auditing expenditure.

OC Go has been and continues to be a great success and Orange County has the best road conditions in the region. Our county’s traffic flow is the envy of our county neighbors. We should be proud that the half cent sales tax we have been paying for nearly 30 years has paid great dividends. This compliance audit will ensure that this spending is in line with what was approved by the voters.

Rest assured that, along with the other members of the TOC, and I am sure the entire OCTA Board will be closely monitoring the compliance audit as it takes place and look forward to the opportunity to share the results of it with you when it is done. Ensuring our hard-earned tax dollars are spent correctly is crucial, and even more so in today’s economy, every cent counts…even a half-cent.

Andrew N. Hamilton is Orange County’s elected Auditor-Controller. Hamilton has been a Certified Public Accountant for 27 years.

Orange County Register

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New compliance audit for OC Go sales tax funds welcome news for taxpayers

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