The state would take over responsibility for auditing all local mental health authorities if proposed legislation gets approval from Utah lawmakers in the next legislative session.

Legislative Auditor General Wayne Welsh told county commissioners from across the state Friday the proposed bill is his recommendation to strengthen oversight of local mental health authorities in the wake of the Timpanogos Mental Health scandal earlier this year.Commissioners and other county officials are gathered in St. George for the three-day annual convention of the Utah Association of Counties.

Under the draft bill, local authorities - in most cases county commissioners - will retain responsibility for administering local mental health services. But the state auditor's office would assume responsibility for conducting outside audits of those local mental health authorities.

That auditing responsibility currently lies with the local authorities.

The proposal would have two results that would protect both local authorities and the state Division of Mental Health from abuses, Welsh said.

First, there would be assurance that outside auditors are completely independent and, second, local mental health authorities could not be held responsible if an outside auditor does a poor job.

Welsh's audit of Timpanogos last April turned up alleged misuse of $3.5 million in state and local funding by Timp directors. Three former directors now face trial on criminal charges for their alleged involvement in the misuse of funds.

An earlier outside audit of Timp failed to reveal the abuses, but the proposed bill will strengthen the system against inadequate audits, Welsh said.

The outside auditor hired to do the earlier Timp audit was chosen by Timp directors, and so his independence was compromised, Welsh said. The auditor was also inexperienced in government auditing practices, and before the Timp audit was completed he was hired by a school district where one Timp director served on the school board.

By giving the state auditor responsibility to perform or contract for audits of local mental health authorities, the complete independence of the auditor will be assured, Welsh said.

"You wouldn't have to worry if the auditor doesn't do his job," he told commissioners. "As it is now, you have local responsibility, so you're responsible if the audit is not done correctly."

The proposed bill also contains a provision to divert from local mental health authorities those state funds appropriated to pay for outside audits. The money would instead go to the state auditor's office to pay the added costs of auditing the local authorities.

As proposed, the legislation affects only mental health authorities. Welsh acknowledged there is a broader issue of whether the state should have auditing responsibility for all state-mandated programs generally administered by counties, such as alcohol and drug abuse treatment, aging programs and others.

A separate, but related bill already reviewed at legislative interim committee sessions would require outside auditors hired to audit locally administered government programs to make public reports identifying specific accounts examined and detailing any problems uncovered.

A public response from the county or other local administering authority to the outside auditor's report would also be required.