March 13, 2012 at 5:50 pm
By Megan Poinski
Republicans in the General Assembly are proposing a constitutional amendment to create an elected state inspector general to root out waste, fraud and financial problems in state agencies.
There were few questions and no supporting or opposing testimony when Senate Majority Leader E.J. Pipkin, Cecil County, presented his version of two bills to establish the new office to the Budget and Tax Committee on Tuesday. One bill creates a constitutional amendment for the new office, while the other sets up the new office’s parameters.
Del. Warren Miller, R – Howard, presented his version to the House Government Operations committee on March 1. Miller has 49 cosponsors of both partes on his bill. Both sponsors brought up similar concerns.
“There’s not much done after an auditor finds a problem,” Miller said. Some departments do have an inspector general, including the health and public safety departments, but they are not at a high level, Miller said.
Pipkin said that the new office would be responsible for investigating allegations of fraud in the executive branch. The Office of Legislative Audits investigates government departments’ use of resources and policies on a periodic or as-needed basis.
Bad audit reports show need for office
Several damning audit reports in the past year that showed widespread waste, fraud and abuse. These included two audits involving contract fraud and noncompliance in the State Highway Administration, one involving questionable grants from the Maryland Department of the Environment, and one involving millions in uncollected child support fees from the Child Support Enforcement Administration. These made it clear to Pipkin that the new office was needed.
“I think we’ve had a series of run-ins regarding audits that show maybe the current structures in the state that we’ve devised are not adequate,” Pipkin said.
In the House hearing, Del. Dan Morhaim, D-Baltimore County, said, “We’re doing an OK job of finding, we’re not doing an OK job of enforcing,” Morhaim said he preferred another bill by Miller’s Howard County colleague, Del. Gail Bates, that would cut an agency’s budget if repeat audit problems were found.
No one offered testimony from the Office of Legislative Audits, which looks at finances and processes in executive branch departments on a regular basis every three years, as well as investigates reports of possible fraud.
Pipkin said that the bill is not an affront to what auditors do. He said their audit reports show “significant courage” in uncovering problems entrenched in state government.
However, he said, the way the system is currently set up is like a “never-ending loop.” People can call a tip line to report problems, but otherwise most agencies are really only looked at every three years. There’s less direct communication and less infrastructure to deal with large issues that stretch on for years, he said.
If the constitutional amendment passes, voters would choose whether to create this new office.
Powers of IG
The inspector general would be responsible for investigating waste, fraud, abuse, mismanagement, misconduct and corruption, as well as conducting audits of executive branch departments. The position would look into use of government-owned vehicles and other property, excessive charges on state contracts, unauthorized use of leave, mismanagement of operations, waste or abuse of property, and construction and maintenance of facilities. In order to fully investigate these items, the inspector general would be able to issue subpoenas with a local judge’s approval.
Every year, the inspector general would put together a report of the previous year’s investigations and outcomes for the governor and General Assembly. Periodically, the inspector general would make policy recommendations to departments.
Members of the Senate Budget and Taxation Committee were confused about why the new office would be needed.
Sen. Verna Jones-Rodwell, D-Baltimore City, said that it sounds like Pipkin’s bill would create more government bureaucracy.
“Rather than putting on a new layer of government, we might want to do more forensic investigation,” Jones-Rodwell said. “This might not get us what we want.”
–Len Lazarick contributed to this story.