HB516 • 2026

Water boards; expand types of water boards that Department of Examiners of Public Accounts may audit

Passed Legislature

This bill passed both chambers and reached final enrollment, even if later executive action is not shown here.

Sponsor: Givan
Last action: 2026-02-26
Official status: Pending Committee Action in House of Origin
Effective date: Not listed

Plain English Breakdown

The bill text contains a contradiction: The synopsis states it authorizes audits for boards organized under Title 11, while the actual enacted text (Section 41-5A-12.2) explicitly targets nonprofits NOT incorporated pursuant to Title 11 and excludes Title 11 entities in subsection (c). This explanation follows the specific language of the bill's operative sections.

HB516: Expanding Audits for Certain Nonprofit Water Corporations

This bill allows the Department of Examiners of Public Accounts to audit nonprofit water corporations that are not organized under Title 11 of the Code of Alabama.

What This Bill Does

Authorizes one standard audit after June 14, 2023, following the close of a fiscal year for eligible nonprofits.
Permits an additional audit if the department suspects fraud or mismanagement of funds.
Allows the department to charge a reasonable fee for these audits.

Who It Names or Affects

Nonprofit corporations that provide water service but are not incorporated under Title 11.
The Department of Examiners of Public Accounts, which gains new auditing authority over these entities.

Terms To Know

Department of Examiners of Public Accounts: A state agency authorized to audit the financial records and operations of specific public and nonprofit entities.
Title 11: The section of Alabama law under which certain water boards are organized; these Title 11 entities remain exempt from this new audit authority.

Limits and Unknowns

This bill does not apply to public water systems owned by cities, counties, or entities created under Title 11.
Audits can only occur after the close of a fiscal year following June 14, 2023.

Bill History

2026-02-26 House
Pending Committee Action in House of Origin
2026-02-26 House
Read for the first time and referred to the House Committee on State Government

Official Summary Text

Water boards; expand types of water boards that Department of Examiners of Public Accounts may audit

Current Bill Text

Read the full stored bill text

HB516 INTRODUCED
Page 0
HB516
QNE9V44-1
By Representative Givan
RFD: State Government
First Read: 26-Feb-26
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QNE9V44-1 02/25/2026 INT (L)INT 2026-1054
Page 1
First Read: 26-Feb-26
SYNOPSIS:
Under existing law, local water boards and
authorities organized under Title 11 of the Code of
Alabama 1975 are not subject to audit by the Department
of Examiners of Public Accounts.
This bill would authorize the department to
audit local water boards and authorities organized
under Title 11 of the Code of Alabama 1975.
A BILL
TO BE ENTITLED
AN ACT
Relating to local water boards and authorities; to
amend Section 41-5A-12.2, Code of Alabama 1975; to revise the
types of water boards that may be audited by the Department of
Examiners of Public Accounts.
BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
Section 1. Section 41-5A-12.2 of the Code of Alabama
1975, is amended to read as follows:
"§41-5A-12.2
(a) After June 14, 2023, beginning after the close of
the then current fiscal year, any nonprofit Any corporation
organized under the laws of this state as a nonprofit
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HB516 INTRODUCED
Page 2
organized under the laws of this state as a nonprofit
corporation that is not incorporated pursuant to Title 11,
which that provides water service to its members or the
public , may be audited or examined one time by the Department
of Examiners of Public Accounts in the same manner as provided
in Chapter 5A of Title 41. The department may charge a
reasonable fee for the audits.
(b) After June 14, 2023, beginning after the close of
the then current fiscal year, any nonprofit Any corporation
that is not incorporated pursuant to Title 11, which that
provides water service to its members or the public , may be
audited or examined one time in addition to the audit provided
in subsection (a) by the Department of Examiners of Public
Accounts in the same manner as provided in this chapter, if
the department suspects fraud or mismanagement of funds by the
nonprofit corporation. The department may charge a reasonable
fee for the audits or examinations.
(c) This section does not apply to or affect any public
water supply system, waterworks plant, or water distribution
system owned or operated by a municipality or county, or by a
public corporation, board, or other entity organized, created,
or incorporated pursuant to Title 11. "
Section 2. This act shall become effective on October
1, 2026.
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