AMENDED IN ASSEMBLY MAY 26, 2026
AMENDED IN SENATE APRIL 23, 2026
AMENDED IN SENATE APRIL 8, 2026
CALIFORNIA LEGISLATURE— 2025–2026 REGULAR SESSION
94
CHAPTER 119
Statutes of 2026
[ Approved by Governor August 22, 2026. Filed with Secretary of State August 22, 2026. ]
Introduced by Senator Choi
(Coauthors: Senators Alvarado-Gil and Strickland)
February 17, 2026
An act to add Article 10.2 (commencing with Section 53905) to Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code, relating to local government.
Vote: majority Appropriation: no Fiscal committee: yes Local program: yes
LEGISLATIVE COUNSEL’S DIGEST
Existing law requires, within 7 months after the close of each fiscal year or within the time prescribed by the Controller, whichever is later, the officer of each local agency, as defined, who has charge of the financial records to furnish to the Controller a report of all the financial transactions of the local agency during the preceding fiscal year, as specified. Existing law requires the report to contain underlying data from audited financial statements prepared in accordance with generally accepted accounting principles, as specified, and to state certain information, including the aggregate income during the preceding fiscal year. Existing law requires the legislative body, upon completion of the report, to either post the report in a conspicuous location on its internet website or to cause copies of the report to be prepared and the clerk of the legislative body to furnish a copy to any person requesting it, as specified.
This bill would require a local agency, as defined, that maintains an internet website to post its audited financial statements, or its annual comprehensive financial report, on its internet website within 30 days of the date that the statements or report are completed by the local agency, as specified. The bill would make its provisions operative on January 1, 2028. By imposing additional duties on local agencies, the bill would impose a state-mandated local program.
The bill would include findings and declarations related to these provisions.
The bill would include findings that changes proposed by this bill address a matter of statewide concern rather than a municipal affair and, therefore, apply to all cities, including charter cities.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that, if the Commission on State Mandates determines that the bill contains costs mandated by the state, reimbursement for those costs shall be made pursuant to the statutory provisions noted above.
The people of the State of California do enact as follows:
SECTION 1.
The Legislature finds and declares all of the following:
(a) Under the California Constitution, the people have the right of access to information concerning the conduct of the people’s business. Access to the audited financial statements of local agencies is a fundamental and necessary right of every resident to ensure the proper stewardship of public funds.
(b) Recent instances of fiscal distress and mismanagement in various local jurisdictions have highlighted the need for timely, accessible, and transparent financial reporting. Publicly available audits serve as an “early warning system” for taxpayers, creditors, and state oversight agencies.
(c) While existing law requires the performance of annual audits, there is currently no uniform requirement for these documents to be posted prominently online. This lack of standardization creates “transparency deserts,” where residents must navigate complex requests under the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code) to view basic financial health data.
(d) In a modern democracy, “publicly available” must mean “available online.” Requiring local agencies to host their audited financial statements on their internet websites ensures that information is accessible to all Californians regardless of their ability to visit a physical government office during business hours.
(e) It is the intent of the Legislature in enacting this act to provide a simple, no-cost mechanism for the public to monitor the fiscal health of their local governments and to ensure that financial accountability is a proactive duty of the state’s political subdivisions rather than a reactive response to inquiry.
SEC. 2.
Article 10.2 (commencing with Section 53905) is added to Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code, to read:
Article 10.2. Financial Postings
53905.
(a) Notwithstanding any other law, for purposes of this section, “local agency” means a city, including a charter city, county, city and county, or an independent special district, as defined in Section 56044.
(b) If a local agency maintains an internet website, the local agency shall post its audited financial statements, or its annual comprehensive financial report, on that internet website. All the following apply to the posting:
(1) The audited financial statement or annual comprehensive financial report shall be posted in a prominent location on the internet website and be accessible to the public without a password or fee.
(2) The audited financial statement or annual comprehensive financial report shall be posted within 30 days of the date that the statements or report are completed by the local agency.
(3) The local agency shall maintain the posted audited financial statement or annual comprehensive financial report on its internet website for a period of not less than three years.
(c) This section shall become operative on January 1, 2028.
SEC. 3.
The Legislature finds and declares that the fiscal integrity of local agencies is a matter of statewide concern and is not a municipal affair as that term is used in Section 5 of Article XI of the California Constitution, and that the financial failure of a single local entity can have cascading effects on the state’s credit rating, the stability of the public employee retirement systems, and the delivery of essential services like public safety. Therefore, Section 2 of this act adding Article 10.2 (commencing with Section 53905) to Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code applies to all cities, including charter cities.
SEC. 4.
If the Commission on State Mandates determines that this act contains costs mandated by the state, reimbursement to local agencies and school districts for those costs shall be made pursuant to Part 7 (commencing with Section 17500) of Division 4 of Title 2 of the Government Code.