Auditors Point the Way Toward Sane Spending

June 4, 2009

In 2006, during a pro forma examination of the agency that runs the General Assembly, Connecticut’s Office of the Auditors of Public Accounts discovered an entity no one knew much about: the Commission on Innovation and Productivity.

Its purpose, according to statute, is to “recommend innovations for the improvements of cost-effectiveness and efficiency in state government” and find “ways to increase state government productivity, reduce costs and provide the highest quality services.”

The baffling factoid uncovered by auditors? There was “no evidence to support that the Commission on Innovation and Productivity has ever met since being established in 1993.”

Headed by former legislators Robert G. Jaekle and Kevin P. Johnston, the Office of the Auditors of Public Accounts has an impressive history of ferreting out the waste, mismanagement, and unaccountability that are rampant in state government. A look at its work over the last few years shows that if decisionmakers in Hartford somehow found the courage to address auditors’ concerns, a hefty portion of Connecticut’s fiscal woe would vanish.

With compensation costs taking up as much as a third of the state budget, the personnel chicanery auditors frequently expose is disturbing. Sometimes the findings are small -- for example, in 2004, investigators learned that despite a bidding process, the director of surveys at the Department of Environmental Protection (DEP) hired his inexperienced daughter as a contractor. But often, the Jaekle/Johnston team documents department-wide problems. In 2007, a report found that State Treasurer Denise Nappier hadn’t complied with the law that requires “work-at-home agreements” for telecommuting employees, and failed “to adequately monitor employees with patterns of usage that suggest excessive absenteeism.” In addition, “card-key records were inconsistent with the documented work schedules in that employees were arriving later than their scheduled work times.”

Also that year, a Connecticut Post analysis of auditor documents revealed that DEP bureaucrats regularly accessed non-work-related websites, including “national and international newspapers, mail-order merchants such as L.L. Bean, travel sites, automobile manufacturers, [and] private e-mail services.” (One employee’s computer visited www.womenrussia.com 2,062 times, www.ukraineloves.com 761 times, and www.honestmarriageagencies.com 279 times.)

Not-so-funny money management makes constant appearances in auditors’ reports. A 2004 investigation found that the Bureau of Public Transportation mishandled contracts and falsified invoices -- what Johnston called “pretty conscious decisions to subvert public procedures and the spending of public dollars.” The following year, the office issued the first in a series of examinations of the disastrous “UConn 2000” construction initiative. In the words of The Hartford Courant, auditors concluded that “UConn has designed a system that has all but eliminated competitive, open bidding for contracts.” In 2007, the university was criticized for choosing the highest bidder to build an energy plant, a project originally budgeted at $52 million that wound up costing tens of millions of dollars more.

“Core-CT,” new software overseen by State Comptroller Nancy Wyman, is also a repeat offender. Auditors’ most recent report concluded that it “still has certain deficiencies in functionality that should not exist considering the $129 million investment in the new accounting system.” Educrat malfeasance is another recurring theme. Last year, in response to a whistleblower complaint, a report found that excessive student-enrollment projections “could result in oversized school buildings, excess State grant reimbursements and unnecessary construction and operating costs borne by State and local taxpayers.”

Opponents of Connecticut’s corporate-welfare schemes need look no further than auditors’ reports for ammunition. The 2001 performance audit of the Department of Economic and Community Development is a must-read. It offered a warning of the subsidies being bestowed on the misguided attempt to “redevelop” the former American Thread complex in Windham. Despite well over $20 million in taxpayer “investments,” the Windham Mills Development Corporation filed for bankruptcy in December 2004.

By itself, a sloppy personnel procedure, no-bid contract, corporatist boondoggle, or act of nepotism will not bankrupt Connecticut. But the state spends $18 billion a year and has more than 75,000 employees on its payroll. In such a massive enterprise, little things can add up to quite a lot of squandered tax revenue.

Unfortunately, auditors lack the authority to correct the problems they document. It’s elected officials who must take action.

Before they worsen Connecticut’s heaviest-in-the-nation tax burden, the governor and lawmakers should familiarize themselves with the work of the state’s auditors, who would be happy to suggest ways to combat big budget deficits with saner spending policies. Jaekle and Johnston are easy to find. Their office is located at 20 Trinity Street in Hartford -- right across the street from the capitol.

D. Dowd Muska is a writer, commentator and lecturer. His website is www.dowdmuska.com.

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