(a) For the purposes of this section, “local agency” means any local agency which awards direct service contracts to nonprofit organizations including, but not limited to, any city, county, or city and county, special district, housing authority, school district, community college district, or county superintendent of schools.
(b) Any local agency may establish auditing procedures for direct service contractors as prescribed by Chapter 5 (commencing with Section 38040) of Division 25 of the Health and Safety Code.