Shown verbatim: the complete text as captured from the official PDF posted by the Oklahoma Legislature, fetched 2026-07-23. Page and line markers are part of the official record; nothing is edited or removed. The official bill page.
1 STATE OF OKLAHOMA
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2 2nd Session of the 60th Legislature (2026)
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3 SENATE BILL 1786 By: Jett
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6 AS INTRODUCED
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7 An Act relating to state government; granting State
7 Auditor and Inspector certain authority; prohibiting
8 certain noncompliance; stating penalty for violation;
8 requiring submission of certain report to the
9 Attorney General and district attorney; requiring
9 Attorney General to take certain actions; requiring
10 Attorney General to submit certain annual report;
10 requiring State Auditor and Inspector to submit
11 certain audit to certain officers; providing for
11 certain conditional public release of certain audit;
12 requiring certain entities to create certain plan;
12 providing for State Auditor and Inspector to monitor
13 implementation of certain plan; creating the
13 Investigative Division of the Office of the State
14 Auditor and Inspector; allowing for certain recovery
14 of costs by State Auditor and Inspector; making
15 certain appropriation; providing for codification;
15 providing for noncodification; providing an effective
16 date; and declaring an emergency.
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19 BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
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20 SECTION 1. NEW LAW A new section of law to be codified
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21 in the Oklahoma Statutes as Section 212.5 of Title 74, unless there
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22 is created a duplication in numbering, reads as follows:
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23 A. The State Auditor and Inspector shall have discretionary
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24 authority to initiate performance audits, operational audits,
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1 forensic audits, or special investigative audits of any state
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2 agency, board, commission, or local government entity. Such audits
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3 may be initiated based on:
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4 1. Risk assessments;
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5 2. Credible allegations of waste, fraud, abuse, or
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6 inefficiency; or
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7 3. The State Auditor and Inspector's independent determination.
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8 B. The audits provided for in subsection A of this section may
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9 be initiated by the State Auditor and Inspector without requiring
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10 the prior request of the Governor, the Attorney General, an agency
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11 director, a district attorney, or a legislative resolution.
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12 C. The State Auditor and Inspector shall have the authority to
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13 issue administrative subpoenas to any public entity, officer,
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14 employee, contractor, or third party receiving or managing public
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15 funds for:
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16 1. Documents;
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17 2. Records;
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18 3. Testimony under oath;
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19 4. Electronic data; and
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20 5. Physical evidence.
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21 D. Any person who does not comply with an administrative
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22 subpoena issued by the State Auditor and Inspector under the
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23 provisions of subsection A of this section shall, upon conviction,
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24 be guilty of a misdemeanor punishable by a fine not more than One
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1 Thousand Dollars ($1,000.00), or by imprisonment in the custody of
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2 the Department of Corrections for not more than thirty (30) days, or
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3 by both such fine and imprisonment.
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4 E. The State Auditor and Inspector is authorized to conduct
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5 audits or inspections without prior announcement.
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6 F. The State Auditor and Inspector is authorized to secure
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7 premises or records on a temporary basis when deemed necessary by
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8 the State Auditor and Inspector to preserve evidence of potential
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9 wrongdoing.
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10 SECTION 2. NEW LAW A new section of law to be codified
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11 in the Oklahoma Statutes as Section 212.6 of Title 74, unless there
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12 is created a duplication in numbering, reads as follows:
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13 A. The State Auditor and Inspector shall, within thirty (30)
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14 days of the finalization of an audit, refer all audit findings that
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15 indicate potential criminal violations, fraud, embezzlement, or
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16 misappropriation of public funds to the Attorney General and the
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17 district attorney for the county where such violations occurred.
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18 B. The Attorney General shall review such referral from the
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19 State Auditor and Inspector and shall:
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20 1. Initiate investigation or prosecution where probable cause
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21 exists; or
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22 2. Electronically submit a written explanation to the State
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23 Auditor and Inspector and the Legislature for any decision to not
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24 proceed with such investigation or prosecution.
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1 C. The Attorney General shall annually submit a report to the
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2 Legislature and the State Auditor and Inspector by electronic
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3 submission on the status and outcomes of all referrals received from
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4 the State Auditor and Inspector, including:
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5 1. Actions taken;
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6 2. Cases prosecuted;
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7 3. Recoveries achieved; and
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8 4. The written explanations provided for in paragraph 2 of
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9 subsection B of this section.
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10 D. Any audit that provides serious findings of waste, fraud, or
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11 abuse shall be automatically transmitted by the State Auditor and
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12 Inspector to the President Pro Tempore of the Senate, the Speaker of
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13 the House of Representatives, and the chairs of the legislative
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14 committee relating to the audited entity. Additionally, unless
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15 confidentiality is required for an ongoing criminal investigation,
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16 the contents of such audit shall be released for public viewing.
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17 SECTION 3. NEW LAW A new section of law to be codified
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18 in the Oklahoma Statutes as Section 212.7 of Title 74, unless there
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19 is created a duplication in numbering, reads as follows:
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20 A. Any entity audited by the State Auditor and Inspector shall
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21 submit a corrective action plan to the State Auditor and Inspector
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22 within sixty (60) days after receiving an audit report with adverse
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23 findings.
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1 B. The State Auditor and Inspector shall monitor the
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2 implementation of the corrective action plan and report
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3 noncompliance with such plan to the Attorney General and the
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4 Legislature. An entity reported to be in noncompliance by the State
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5 Auditor and Inspector may be subject to sanctions, including but not
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6 limited to the withholding of state funds.
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7 SECTION 4. NEW LAW A new section of law to be codified
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8 in the Oklahoma Statutes as Section 212.8 of Title 74, unless there
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9 is created a duplication in numbering, reads as follows:
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10 A. There is hereby established within the Office of the State
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11 Auditor and Inspector the Investigative Division.
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12 B. The Division shall:
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13 1. Be staffed with certified fraud examiners and investigators;
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14 and
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15 2. Support expanded forensic and special audits.
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16 C. The State Auditor and Inspector shall promulgate rules to
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17 effectuate the provisions of this section.
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18 SECTION 5. NEW LAW A new section of law to be codified
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19 in the Oklahoma Statutes as Section 212.9 of Title 74, unless there
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20 is created a duplication in numbering, reads as follows:
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21 The Office of the State Auditor and Inspector is authorized to
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22 recover costs from audited entities for expenses related to special
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23 or investigate audits.
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1 SECTION 6. NEW LAW A new section of law not to be
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2 codified in the Oklahoma Statutes reads as follows:
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3 There is hereby appropriated to the State Auditor and Inspector
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4 from any monies not otherwise appropriated from the General Revenue
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5 Fund of the State Treasury for the fiscal year ending June 30, 2027,
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6 One Million Five Hundred Thousand Dollars ($1,500,000.00) for the
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7 purposes of supporting enhanced staffing and operations as provided
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8 for in this act.
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9 SECTION 7. This act shall become effective July 1, 2026.
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10 SECTION 8. It being immediately necessary for the preservation
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11 of the public peace, health or safety, an emergency is hereby
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12 declared to exist, by reason whereof this act shall take effect and
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13 be in full force from and after its passage and approval.
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Req. No. 3110 Page 6Every fact on this page links to its source, starting with the official bill record.