Background: In 2005 the Legislature enacted ESHB 1064, creating the Citizen Advisory Board (Board), a ten-member board charged with improving efficiency, effectiveness, and accountability in state government. The Board's purpose is to establish criteria for performance audits consistent with the criteria and standards followed by the Joint Legislative Audit and Review Committee (JLARC). The State Auditor is to use the criteria developed by the Board and contract for a statewide performance review to be completed as expeditiously as possible as a preliminary to a draft work plan for conducting performance audits. The purpose of the performance reviews is to identify those agencies, programs, functions, or activities most likely to benefit from performance audits and to identify likely areas warranting early review, taking into account prior performance audits, if any, and prior fiscal audits.

In November 2005 Initiative 900 (I-900) was passed by Washington voters. I-900 requires the State Auditor to conduct independent, comprehensive performance audits of state government; local governments; state and local education governmental entities; state and local transportation; and other governmental entities and each of their agencies, accounts, and programs. The scope of each performance audit includes nine specific elements: (1) identification of cost savings; (2) identification of services that can be reduced or eliminated; (3) identification of programs or services that can be transferred to the private sector; (4) analysis of gaps or overlaps in programs or services and recommendations to correct gaps or overlaps; (5) feasibility of pooling information technology systems within a department; (6) analysis of the roles and functions of a department and recommendations to change or eliminate departmental roles or functions; (7) recommendations for statutory or regulatory changes that may be necessary for a department to properly carry out its functions; (8) analysis of departmental performance data, performance measures, and self-assessment systems; and (9) identification of best practices.

The State Auditor is given authority to contract out for performance audits.