2020 -- S 2409

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LC003760

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2020

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A N   A C T

RELATING TO STATE AFFAIRS AND GOVERNMENT -- ESTABLISHING AN OFFICE OF

INSPECTOR GENERAL

     

     Introduced By: Senators Algiere, de la Cruz, Paolino, Morgan, and Rogers

     Date Introduced: February 13, 2020

     Referred To: Senate Rules, Government Ethics and Oversight

     It is enacted by the General Assembly as follows:

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     SECTION 1. Title 42 of the General Laws entitled "STATE AFFAIRS AND

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GOVERNMENT" is hereby amended by adding thereto the following chapter:

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CHAPTER 9.4

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INSPECTOR GENERAL

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     42-9.4-1. Purpose.

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     The office of inspector general shall be an independent administrative agency charged

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with the purpose of preventing and detecting fraud, waste, abuse and mismanagement in the

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expenditure of public funds, whether federal, state, or local, and relating to any and all state

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programs and operations as well as the procurement of any supplies, services, or construction, by

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agencies, bureaus, divisions, sections, departments, offices, commissions, institutions and

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activities of the state of Rhode Island, including those districts, authorities, or political

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subdivisions created by the general assembly, the governor, and any court, including any city or

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town within the state of Rhode Island. Investigations may include the expenditures by

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nongovernmental agencies of federal, state and local public funds.

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     42-9.4-2. Definitions.

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     As used in this chapter, unless the context requires otherwise, the following terms shall

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have the following meanings:

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     (1) "Construction" means the process of building, altering, repairing, improving, or

 

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demolishing any public structure or building, or other improvements of any kind to any public

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property.

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     (2) "Contract" means all types of agreements, including grants and orders, for the

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purchase or disposal of supplies, services, construction, or any other item. It includes:

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     (i) Awards;

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     (ii) Contracts of a fixed-price, cost, cost-plus-a-fixed-fee, or incentive type;

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     (iii) Contracts providing for the issuance of job or task orders;

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     (iv) Leases;

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     (v) Letter contracts;

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     (vi) Purchase orders; and

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     (vii) Construction management contracts.

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     It also includes supplemental agreements with respect to any of the foregoing.

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     (3) "Contractor" means any person, corporation, partnership, business, union, committee,

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or other organization entity or group of individuals performing any tasks, or duties defined under

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a written or oral contract with and for the state of Rhode Island or the joint committee on

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legislative services.

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     (4) "Procurement" means the purchasing, buying, renting, leasing, or otherwise obtaining

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any supplies, services, or construction. It also includes all functions that pertain to the obtaining

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of any supply, service, or construction item, including a description of requirements, selection

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and solicitation of sources, preparation, and award of contract, and all phases of contract

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administration.

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     (5) "Public funds" means state, federal or local funds, either appropriated, non-

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appropriated or given under right of grant.

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     (6) "Services" means the rendering by a contractor of its time and effort rather than the

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furnishing of a specific end product, other than reports which are merely incidental to the required

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performance of services.

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     (7) "Supplies" means all property, including, but not limited to, leases of real property,

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printing, and insurance, except land or permanent interest in land.

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     42-9.4-3. Establishment of office -- Appointment and removal of inspector general.

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     There is hereby established an office of inspector general, (hereinafter referred to as the

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"office"). There shall be in the office an inspector general, who shall be the administrative head of

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the office and who shall be appointed by a majority vote of the governor, the attorney general, the

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general treasurer, the lieutenant governor, secretary of state, the speaker and the minority leader

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of the house of representatives and the president and minority leader of the senate for a five (5)

 

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year term to begin July 1 and end June 30, five (5) years later. The appointee shall serve one term

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only. The person so appointed shall be selected without regard to political affiliation and with a

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demonstrated ability in more than one of the following areas: accounting, auditing, financial

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analysis, law, management analysis, public administration, investigation and criminal justice

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administration.

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     The selection process of a qualified inspector general shall include at least one public

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forum. If an inspector general is not selected within one month of a new inspector general term,

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the governor shall appoint an inspector general. The inspector general shall have at least five (5)

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years experience in accounting, criminal justice, or a closely related profession and a bachelor’s

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degree from an accredited college or university with a major in accounting, criminal justice, or a

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closely related field of study.

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     No inspector general shall hold, or be a candidate for, any other elective or appointed

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public office while an inspector general and for one year prior. No inspector general shall hold a

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position in any political party or political committee, or participate in any political campaign of

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any candidate for public office while an inspector general.

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     In case of a vacancy in the position of inspector general, their successor shall be

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appointed in the manner described above, and shall serve from their date of appointment until the

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fifth June 30 following their appointment. If this vacancy is not filled within one month, then the

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governor shall appoint an inspector general.

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     The person so appointed may be removed from office for cause by a two-thirds (2/3) vote

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of the governor, the attorney general, the general treasurer, the lieutenant governor, secretary of

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state, the speaker and the minority leader of the house of representatives and the president and

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minority leader of the senate. Cause may include substantial neglect of duty, gross misconduct or

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conviction of a crime whether or not it is work related. The reasons for removal of the inspector

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general shall be stated in writing and shall include the basis for such removal. The writing shall

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be a public document. The inspector general shall have ten (10) days to submit a written appeal,

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which shall be a public document. If no appeal is made, the inspector general shall be dismissed

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from office. If an appeal is made, a vote shall be taken in the senate. A two-thirds (2/3) vote of

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the senate shall be required to dismiss the inspector general.

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     42-9.4-4. Employees -- Appointment and removal, salaries, qualifications.

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     The inspector general may appoint and remove such employees as deemed necessary to

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perform the duties of the office, including, but not limited to, assistant inspectors general, chief

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and deputy counsels, clerks, paralegals, accountants, auditors, financial management analysts and

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investigators. The inspector general may determine their salaries and duties; provided, however,

 

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that the total amount of all such salaries shall not exceed the sum appropriated therefor by the

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general assembly.

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     The inspector general shall file an annual personnel report not later than the first

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Wednesday in February with the senate and house finance committees containing the job

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classifications, duties and salary of each officer and employee within the office together with

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personnel regulations applicable to said officers and employees. The inspector general shall file

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amendments to such report with the senate and house finance committees whenever any change

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becomes effective.

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     No officer or employee of the office of inspector general shall hold, or be a candidate for,

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any elective public office while an officer or employee, or for one year thereafter, nor shall they

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hold a position in any political party or political committee, or participate in any political

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campaign of any candidate for public office while an officer or employee.

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     42-9.4-5. Inspector general -- Salary and budget.

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     The general assembly shall annually set the salary of the inspector general and shall

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appropriate sufficient funds for the total budget for the office.

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     42-9.4-6. Rules and regulations.

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     The office shall, pursuant to the provisions of chapter 35 of title 42, ("administrative

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procedures act"), promulgate rules and regulations which shall govern its proceedings.

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     42-9.4-7. Duties.

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     (a) The inspector general shall supervise, coordinate and/or conduct audits, criminal, civil

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and administrative investigations and inspections or oversight reviews, when necessary, relating

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to programs and operations listed in § 42-9.4-1. The inspector general shall review laws and

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regulations relating to programs and operations listed in § 42-9.4-1 and shall determine if public

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bodies listed in § 42-9.4-1 are in compliance, and shall make recommendations concerning the

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effect of such laws or regulations on the prevention and detection of fraud, waste and abuse. The

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inspector general may recommend policies that will assist in the prevention or detection of fraud,

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waste and abuse and mismanagement. The person in charge of, or the governing body of any

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public body listed in § 42-9.4-1, may request the assistance of the inspector general with respect

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to implementation of any reviews, audits, and/or investigations as deemed appropriate, and

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implement suggested policy or procedure changes. In such events the inspector general may

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assign personnel to conduct, supervise, or coordinate such activity as deemed necessary and

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appropriate to perform their duties in a diligent and prudent manner. The inspector general may

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recommend policies for the conduct, supervision or coordination of relationships, between state

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and county agencies and other state and local governmental agencies, as well as federal

 

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governmental agencies and nongovernmental entities with respect to all matters relating to the

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prevention and detection of fraud, waste, abuse and mismanagement in or relating to any and all

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programs and activities of the state of Rhode Island as set forth in § 42-9.4-1.

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     (b) The inspector general shall establish and maintain an information system to receive

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communications from the general public relating to the duties of the office to guarantee the

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anonymity of the individual supplying the information consisting of the transmission by email,

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regular mail or other electronic system that does not involve the use of a telephone line.

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     42-9.4-8. Inspection of records and papers –Investigations – Subpoenas.

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     (a) The inspector general, in carrying out the duties outlined in this chapter, shall have

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access to all records, reports, audits, reviews, papers, books, documents, recommendations,

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correspondence, including information relative to the purchase of services or anticipated purchase

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of services from any contractor by any public body set forth in § 42-9.4-1, and any other data and

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material that is maintained by or available to any public body, regardless of the media in which it

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is maintained which is, in any way, related to the programs and operations with respect to the

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state of Rhode Island, including any local town, municipality or city.

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     (b) The inspector general may request information, cooperation and assistance from any

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state, county or local governmental agency as may be necessary for carrying out their duties and

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responsibilities. Upon receipt of such request, each person in charge of, or the governing body of

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any public body set forth in § 42-9.4-1, shall furnish to the inspector general or their authorized

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agent or representative such information, cooperation and assistance, including information

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relative to the purchase of services or anticipated purchase of services from any contractor by any

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public body within ten (10) business days of receipt of the inspector general’s request. If the

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request for the information requested cannot be complied with, within ten (10) business days, the

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senior official of the governmental agency must notify the inspector general before the expiration

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of the ten (10) business days as to the reason that the request cannot be complied within the time

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frame of this section, and shall provide a specific date for expected compliance.

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     (c) The inspector general may initiate and conduct investigations, audits and compliance

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reviews, and shall prepare detailed reports relating to findings and conclusions concerning the

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administration of the programs and operations of the applicable public bodies listed in § 42-9.4-1,

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as are in the judgment of the inspector general necessary and may conduct an examination of any

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public documents, and any information with respect to whether internal quality controls are in

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place and operating.

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     (d) The inspector general shall have direct and prompt access to the head of any public

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body set forth in § 42-9.4-1 when necessary for any purpose pertaining to the performance of

 

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their duties and responsibilities under this chapter.

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     (e) The inspector general may request the production, on a voluntary basis, of testimony

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or documents from any individual, firm or nongovernmental entity which relate to actions or

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matters that pertain to state, municipal or local governmental agencies as dictated by their duties

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and responsibilities.

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     (f)(1) The inspector general may issue a subpoena for the production of all records,

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reports, audits, reviews, papers, books, documents, recommendations, correspondence and any

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other data and material relevant to any matter under audit or investigation pursuant to the

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provisions of this chapter, no matter in which media the information is maintained.

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     (2) A subpoena may be issued only when a person, corporation or other entity under

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investigation or being audited refuses to voluntarily comply with a request from the inspector

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general.

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     (3) The subpoena shall be served in the same manner as a subpoena for the production of

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documents in civil cases issued on behalf of the state of Rhode Island, and all provisions of law

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relative to the subpoena shall apply to a subpoena issued pursuant to this chapter. Any justice of

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the superior court may, upon application by the inspector general, issue an order to compel the

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production of records, reports, audits, reviews, papers, books, documents, recommendations,

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correspondence, and any other data and material as aforesaid in the same manner and to the same

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extent as before said superior court. Any failure to obey the order may be punished by the

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superior court as a contempt of court.

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     (4) Any subpoena issued pursuant to this section shall not be made public by the

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inspector general or any officer or employee of that office, nor shall any documents or records

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provided pursuant to this section be made public until such time as it is necessary for the

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inspector general to do so in the performance of their official duties. The production of

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documents or records pursuant to subpoena shall be governed by the same provisions with

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reference to secrecy, which govern the proceedings of a grand jury. Disclosure of such

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production, attendance, and testimony may be made to such members of the staff of the office of

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the inspector general as is deemed necessary in the performance of the inspector general's duties

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and responsibilities under this chapter, and such members of the staff may be present at the

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production of records.

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     42-9.4-9. Subpoena for witness testimony and for release of material evidence.

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     (a) Whenever the inspector general has reason to believe that a person has information or

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evidence in their possession with respect to any matter which is within the inspector general’s

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jurisdiction to investigate, a subpoena must issue for the attendance and testimony under oath of

 

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any person as designated, or the surrender of identified items of evidence; provided, however,

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that the subpoena may be issued by the inspector general only in the performance of official

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duties relating to the detection of fraud, waste, abuse and mismanagement. The subpoena for

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testimony or specific items identified as needed in support of an investigation shall include: the

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name and address of the prospective witness or specific items identified as needed for the

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investigation and the reasons for requesting a subpoena for testimony or production of items

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deemed necessary to support the investigation.

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     (b) The inspector general or any other person duly authorized by law shall serve a

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subpoena. Once the subpoena is served, the serving officer shall annotate the time and date

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served, the person served and the location of service.

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     (c) A witness required by subpoena to attend and testify under oath and/or produce books

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and records or other items as demanded, shall be given not less than forty-eight (48) hours notice

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of the time and place for the taking of testimony or delivery of subpoenaed items, unless such

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notice shall unduly interfere with the conduct of the investigation.

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     (d) The witness, at the time of service of a subpoena, shall be notified of the matter under

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investigation concerning which the witness will be required to testify. A subject of an

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investigation is a person whose conduct is within the scope of the investigation and is suspected

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of committing or being party to an offense under investigation. The failure to furnish the witness

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with any notice or information required to be given by this section shall cause the issued

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subpoena to be invalid.

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     (e) A person subpoenaed to testify under oath shall appear and testify under oath at the

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time and place designated on the subpoena. In addition, the witness shall be notified that they

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have a right to consult with, and to have an attorney present at the time the testimony is taken,

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and that they have a constitutional right not to furnish or produce evidence that may tend to

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incriminate the person.

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     (f) The terms of any such subpoena must be reasonable and focused on specific testimony

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or evidence sought and must directly relate to the matters under investigation. A subpoena issued

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that is broad in nature is not considered valid. No subpoena may be issued for purposes of

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harassment or for any illegitimate or improper purpose. All constitutional and statutory rights and

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privileges which exist with respect to any subpoena issued by the inspector general, including the

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privilege against self-incrimination, shall have the same force and effect with any and all existing

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laws and constitutional rights.

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     (g) A subpoenaed person may object to the subpoena served upon them in advance of the

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return date of the subpoena by a motion to quash filed in the superior court of the state of Rhode

 

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Island. The filing of a motion to quash shall stay all pending subpoenas until further order of the

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superior court. Any justice of the superior court may, upon application by the inspector general,

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issue an order to compel the attendance of witnesses subpoenaed, and the giving of testimony

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under oath in furtherance of any audit or investigation under this chapter in the same manner and

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to the same extent as before the superior court. Failure to obey any order of the court with respect

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to a subpoena may be punished by the court as contempt.

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     (h) Any subpoena issued pursuant to this section shall not be made public by the

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inspector general or any persons subject to their direction or by any member of the inspector

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general's office designated to hear testimony under this section, and the same provisions with

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reference to secrecy, which govern grand jury proceedings, shall govern testimony given.

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Whoever violates the provisions of this subsection shall be punished by imprisonment for not

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more than six (6) months or by a fine of not more than one thousand dollars ($1,000). Disclosure

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of such testimony may be made to such members of the staff of the office of inspector general as

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is deemed necessary by the inspector general to assist in the performance of the office's duties

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and responsibilities and such members of the staff may be present at the taking of such testimony.

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     42-9.4-10. Compact – Investigation.

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     (a) The inspector general must accept and may investigate or audit complaints or

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information from any individual concerning the possible existence of any activity constituting

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fraud, waste, abuse and mismanagement relating to programs and operations as set forth in § 42-

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9.4-1.

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     (b) The inspector general shall not, after receipt of a complaint or information from an

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employee, contractor or private citizen who requests confidentiality, disclose the identity of that

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individual without the written consent of said individual, unless the inspector general determines

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such disclosure is necessary and unavoidable during the course of an investigation. In such event,

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the individual shall be notified immediately of the disclosure. The inspector general shall set up

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an anonymous hotline for reporting possible wrongdoings.

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     (c) Employees are protected under chapter 50 of title 28, the ("Rhode Island

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Whistleblower's Protection Act").

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     42-9.4-11. Reports to the attorney general or United States Attorney.

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     (a) In carrying out their duties and responsibilities, the inspector general shall report to

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the attorney general, the United States Attorney or both whenever the inspector general has

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reasonable grounds to believe there has been a violation of federal or state criminal law. The

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attorney general shall institute appropriate proceedings in the furtherance of completing an

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investigation and, if warranted, refer a matter for prosecution.

 

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     (b) The inspector general shall refer audit or investigative findings to the state ethics

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commission, or to any other federal, state or local agency, which has an interest in said findings.

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     (c) Any referrals made under this section shall not be made public.

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     42-9.4-12. Coordination with other state agencies.

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     The inspector general may coordinate with other state agencies that are responsible for

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investigating, auditing, reviewing or evaluating the management of state agencies for the purpose

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of sharing information and avoiding duplication of effort.

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     42-9.4-13. Civil actions.

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     The inspector general shall have the authority to institute a civil recovery action if

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authorized by the attorney general. In any case where the inspector general has discovered

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fraudulent acts and believes that civil recovery proceedings may be appropriate, the matter shall

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be referred to the attorney general. The attorney general may institute whatever proceedings

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deemed appropriate, may refer the matter to another state or local agency, may authorize the

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initiation of appropriate civil proceedings by the inspector general, may retain the matter for

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further investigation, or may remand the matter to the inspector general for further investigation.

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     42-9.4-14. Annual and interim reports.

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     (a) The office of inspector general shall, no later than April 1 of each year, prepare a

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report summarizing the activities of the office for the prior calendar year. The office may also

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prepare interim reports. These reports shall be forwarded to the governor, lieutenant governor,

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attorney general, secretary of state, general treasurer and the general assembly, and shall be made

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available to the public.

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     (b) The report shall include, but not be limited to:

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     (i) A description of significant problems in the areas of fraud, waste and abuse within

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programs and operations within the jurisdiction of the office; and

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     (ii) A description of the recommendations for corrective action made by the office during

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the reporting period with respect to significant deficiencies in the areas of fraud, waste and abuse;

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and

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     (iii) The identification of each significant recommendation described in previous annual

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reports on which corrective action has not been completed; and

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     (iv) A summary of matters referred to prosecuting authorities and the prosecutions and

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convictions which have resulted; and

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     (v) A summary of any matters concerning the recovery of monies as a result of a civil suit

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by the office or a referral to another agency for the purposes of such suit; and

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     (vi) A list of all audit reports completed by the office during the reporting period and a

 

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statement of recommendations of amendments to this chapter or the rules, regulations or

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procedures governing the office of inspector general which would improve the effectiveness or

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the operation of the office.

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     (c) The head or governing body of each public body may, within sixty (60) days of

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receipt, comment upon any references to the public body contained within the report. The

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comment, if any, shall be forwarded to the governor, the attorney general, the general assembly

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and the office of inspector general.

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     (d) The report of the inspector general shall be made public on the day of filing;

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provided, that the report shall not list the names of individuals or corporations, nor describe them

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with sufficient particularity as to readily identify them to the general public in those cases in

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which no official disposition has been made by the office of inspector general, the department of

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the attorney general or the local office of the United States Attorney.

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     SECTION 2. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO STATE AFFAIRS AND GOVERNMENT -- ESTABLISHING AN OFFICE OF

INSPECTOR GENERAL

***

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     This act would establish the office of inspector general as an independent administrative

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agency charged with the responsibility to investigate, detect, and prevent fraud, waste, abuse, and

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mismanagement in the expenditure of public funds.

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     This act would take effect upon passage.

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