Yesterday afternoon, the State Auditor’s Office released an audit report that was critical of Caltrans. This is not the first disappointing audit of Caltrans by the State Auditor (see MOORLACH UPDATE — Caltrans Fairways — August 28, 2015 august 28, 2015 john moorlach).
We’ve already discussed the architects and engineers side of Caltrans most of last year (for a recap, see MOORLACH UPDATE — Blame the Unions — November 9, 2015 november 9, 2015 john moorlach). This latest audit report addressed the maintenance division. What did they find?
* "The maintenance division does not use key indicators that could identify a need for maintenance or performance information to strategically plan field maintenance activities."
* A budget model obtained in 2009, at a cost of $250,000, "that would have considered key factors . . . for allocating funds [was] . . . never implemented. [Consequently, Caltrans] allocates funds based on historical budgets rather than key indicators of need."
* "Although the model was not implemented [during the last seven years], Caltrans reported to the Legislature that it is using the model to allocate funding to its districts."
* "The maintenance division cannot demonstrate that it promptly performs field maintenance work."
* "Caltrans’ weak cost controls over field maintenance work orders create opportunities for fraud, waste, and abuse."
Below is the State Auditor’s announcement with appropriate links:
The CBS affiliate in Sacramento was able to interview me yesterday afternoon on the porch of the Capitol Building, facing the Sacramento River (to view the clip, see http://sacramento.cbslocal.com/2016/03/17/state-auditor-warns-caltrans-spending-habits-open-door-to-fraud/). It is the first piece below.
Enough evidence is building that Caltrans needs major reform. Consequently, I will be announcing a bill next week to implement a pilot program for a potential solution.
The second piece is the second editorial in the OC Register, and it covers Sunshine Week (see MOORLACH UPDATE — Sunshine Week — March 16, 2016 march 16, 2016 john moorlach). The piece also mentions the GASB gasp (see MOORLACH UPDATE — State of the Municipalities — January 24, 2016 January 24, 2016 john moorlach).
It is great to get editorial board support for SB 1251, especially from our home town newspaper (also see MOORLACH CAMPAIGN UPDATE — Don Quixote and SB 1251 — March 15, 2016 march 15, 2016 john moorlach).
State Auditor Warns Caltrans Spending Habits Open Door To Fraud
By Steve Large
A scathing report from the state auditor warns Caltrans’ spending habits are inviting “waste, fraud and abuse” of taxpayer dollars.
That rough ride on your way to work on uneven, potholed roadways now has the auditor calling out the state agency spends on maintenance.
The audit says Caltrans “never implemented a budget model it paid $250,000 to develop,” then “reported to the Legislature it is using the model.”
The audit reports the Caltrans maintenance division “has weak cost controls,” which “creates opportunities for fraud, waste, and abuse.”
Caltrans spokesman Matt Rocco responded to the report.
“Which says Caltrans division of maintenance paid $250,000 for development of a budget model, and abandoned it,” he said. “Well we didn’t abandon it.”
The biggest error in his opinion is Caltrans mischaracterizing its work.
“What I’m saying is Caltrans can do a better job, of more clearly explaining how we allocate resources,” he said.
But the audit has renewed state Sen. John Moorlach’s criticisms of the agency.
“We’re wasting money left and right,” he said.
In 2014, another government report showed Caltrans was overstaffed by 3,500 positions.
“Because if they’re telling us they’re using new tools, and they’re not?” He said. “That’s deceit. That’s not acceptable to any boss, especially the stakeholders in this state.”
Pull government into light
Push for open government makes headway.
Happy Sunshine Week! The event is sponsored by the American Society of News Editors since 2005 and has been advanced by good-government supporters of all types: journalists, investigators, policy groups and citizens. The point is to shine a light into the dark crevices of government.
In recent years California has seen some progress. Notably, state Controller Betty Yee has continued the work of her predecessor, John Chiang (now state treasurer), to put online salary information for every state and local employee. Just last month, she put online data from 2,947 special districts, including “137,181 positions and a total of more than $6.8 billion in wages and $2.3 billion in retirement and health care costs,” as her website noted.
This year also has seen stricter implementation of Governmental Accounting Standards Board accounting reforms, providing a fuller accounting of assets and liabilities. The Register reported that, under the new GASB standards, Orange County government’s “positive Unrestricted Net Assets – at a historic high of $331 million last year – went to a historic low negative Unrestricted Net Deficit of nearly $3 billion for fiscal year 2014-15.”
More exposure is needed. State Sen. John Moorlach, R-Costa Mesa, has sponsored Senate Bill 1251. It would require the secretary of state to “create and maintain a dedicated Web page … that lists specific state financial obligations.” And “all the information” would be included in the “ballot pamphlet” sent to voters just before elections. The numbers would come from the state’s nonpartisan Legislative Analyst.
For example, Gov. Jerry Brown’s proposed budget for fiscal year 2016-17, which begins July 1, calculated the state has outstanding unfunded liabilities of $224 billion, almost all of it being pension obligations. That figure would be good to know on Nov. 8, when voters decide the fate of a $9 billion school construction bond, which, with interest, will cost $17.6 billion to pay off.
We urge the passage of SB 1251 and for the governor to sign it. As a great California vocal group The 5th Dimension sang, “Let the sun shine in.”
This e-mail has been sent by California State Senator John M. W. Moorlach, 37th District.
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