California

Accountability Scandals in California Spark Reaction

Legislators want civil fines as option if agency provides bad information

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Two of the most frequently used but infrequently followed words in Sacramento are "transparency" and "accountability." Gubernatorial administrations and legislators seem to understand the importance of these good-government terms when it comes to keeping the state's massive bureaucracy in check, but it's hard to stand up for such things when one's pet programs are on the line—or when powerful employee groups protect their own.

One of the most entertaining examples: After becoming the Senate president pro tempore, Kevin De Leon (D-Los Angeles) shut down an oversight and accountability office started by his predecessor and staffed by former journalists who investigated the way state agencies were performing. But to prove that he wasn't against oversight, the Senate leader has slapped the "oversight" label on myriad Senate hearings.

The state tries in various ways to oversee the officials who spend tens of billions of tax dollars each year, but it's often a cumbersome process. Even when misbehavior is spotlighted by a news story or an inspector general report, it's rare to see individual officials get punished. That's been a source of frustration for a number of legislators from both parties on a wide variety of projects ranging from the Bay Bridge reconstruction to the high-speed rail project.

Last year, former state Sen. Mark DeSaulnier (D-Concord) called for criminal investigation into the problems that plagued the Bay Bridge project, which was completed a decade late and billions of dollars above budget. As the Sacramento Bee reported, DeSaulnier said a Senate report shows Caltrans "knowingly accepted substandard work at taxpayer expense." Now a congressman, he told Politico last year he wants state and federal reviews of the bridge project. "Someone should be held accountable," he told the publication.

That project and others prompted legislators to pass a bill in 2013 by DeSaulnier to require agency heads to sign a statement declaring the information in official reports is true to the best of their knowledge. It was vetoed, but has come back in a bill by Assembly members Jim Patterson (R-Fresno) and Scott Wilk (R-Santa Clarita).

"This bill would also make any person who declares as true any material matter pursuant to these provisions that he or she knows to be false, liable for a civil penalty not to exceed $20,000," according to AB 1566's official bill language. Patterson has been an outspoken critic of the $68 billion high-speed rail project Gov. Jerry Brown is committed to building. An investigative report last year regarding that project is a main impetus.

One of the project's main contractors, Parsons Brinckerhoff, produced a confidential report showing that the cost of building the project's first phase had gone up by 31 percent. The Los Angeles Times reported that the firm "briefed state officials on the estimate in October 2013, according to the document… But the state used a lower cost estimate when it issued its 2014 business plan four months later." The newspaper was given the report by an engineer—the rail authority would not provide it under the state public-records act.

After the report, some Republican legislators including Patterson called on Assembly Speaker Toni Atkins (D-San Diego) to subpoena the report. They complained that the Legislature used those inaccurately low budget numbers "to continuously appropriate 25 percent of cap-and-trade revenue for high-speed rail."

The legislators haven't gotten any satisfaction since that conflagration, so the legislation is their response. "In a perfect world, I would like to be able to put everyone who comes before a committee under oath," Patterson told me. "The Democrats won't even consider that. So agency officials are giving us happy talk… This is why people don't trust the government." Even if the governor is likely to veto it, Patterson said the bill "will send a very clear signal there are some watchdog members here."

And Wilk emphasized this bill isn't just about the rail project. "We do not fulfill our constitution duty (to provide) proper oversight. We can barely do the minimum." He pointed to several examples of state bureaucratic scandals that call out for more accountability.

In 2012 the Sacramento Bee reported on the state parks department, which squirreled away $54 million in a hidden account "because the parks department had a pattern of underreporting the actual size of the funds in its regular dealings with the state Department of Finance." Ultimately the parks director resigned and another employee was fired. That's some level of accountability, but there's often little recourse.

Would AB 1566 change much? Critics see it as little more than symbolism. Whatever the case, it would be nice to see some transparent oversight hearings that evaluate the state of transparency and oversight in the state bureaucracy.

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  1. Caltrans “knowingly accepted substandard work at taxpayer expense.” ? “This bill would also make any person who declares as true any material matter pursuant to these provisions that he or she knows to be false, liable for a civil penalty not to exceed $20,000”

    So let me get this straight. The safety of the taxpaying public is worth at most a $20K civil penalty?

    How about a criminal penalty of at least 20 years *and* restitution?

    1. Relax. No guilty bureaucrat is ever going to pay anywhere near that $20,000 unless they’ve run afoul of a party apparatchik.

      1. Whew. You’re right.

        *** calms down, continues to avoid California ***

        1. *** calms down, continues to avoid California ***

          I was born here. Fourth generation native. SF no less.

          What can I say? 🙁

    2. In my line of work, even in cases having no possible impact on safety, we could be on the hook for millions of dollars in the other side’s attorney fees. But I guess we need one law for the rulers and one for the ruled.

      1. They have our best interest at heart – even if we have to die. Just collateral damage on the path to that utopian state in the sky.

    3. “*knowingly* accepted substandard work” “The bill would also make any person who declares as true any material matter… that he or she *knows* to be false.”

      Because we really need the people running these government projects to be motivated to ensure that they have as little knowledge and accountability as possible.

  2. If government can’t lie to the governed, what good is it?

    1. No, no, no. This is government lying to government. Our CEO has to certify each and every grant that we receive from other governmental agencies. The threat of prosecution for lying has never deterred him from doing so. When was the last time you saw a government official go to jail for such trivial matters?

  3. This seems like a good way to make sure no one in their right might ever took the job as head of a state agency.

    1. no one in their right might ever took the job as head of a state agency.

      Which leads us to where we are today: people in their wrong mind heading state after state agency.

  4. ” institute fines of up to $20,000 for agency heads knowingly passing false information.”

    Who pays that? the agency or the official? (i presume the agency) or does it matter? if the former, the latter will build it into their compensation.

    Hello, new insurance category.

    The trick of course is the ‘knowingly’ part, which costs the state a hell of a lot more than 20,000 *trying to prove*… and which they won’t, but rather use as a lever to try and simply pressure as much transparency as possible out of their union contractors

    in the end, what would it be? simply another dimension of red-tape which officials use to cover their ass in the long grand process of throwing taxpayer money into a bottomless pit. It wouldn’t provide any incentives for better cost-management or make ‘transparency’ something that is actually rewarded.

    1. Cost cutting is an unknown practice in the public sector. We only know “increase revenue sources”.

      Before my public sector tenure, I spent more than fifteen years in the private sector as a finance manager/exec cost cutting. Or at least providing cost/benefit analysis to senior management. I know what I’m talking about.

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  6. None of these laws matter if no one will enforce them. We’ve got the IRS still continuing to delay tax exempt status to conservative groups while green-lighting liberal groups doing the same activities. Lois Lerner is still free. Hillary is still being protected by the State Department, who keeps dragging their feet on releasing court-ordered emails. The EPA still hasn’t been held accountable for the Animas River mine spill while it fines private citizens into bankruptcy for collecting rainwater into a pond on their own property.

    The lack of the rule of law isn’t libertarianism, it’s anarchy. We’re living in a barely-papered-over anarchy now that could only be called an oligarchy at the facade.

    1. Enforcement is key.

      We need to start whistle blower rewards programs. And, whistle blower protections. You wouldn’t believe how much dirty laundry would get aired under those conditions.

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  8. “Critics see it as little more than symbolism.”

    And, they are right. I’ve worked in local government at the management and executive level – a utility, a city and a transit district – since 1996. I’ve never encountered gross corruption. Something like bribery. But, the smaller infidelities that occur, like junketing, forcing campaign contributions to politicians you don’t like, nepotism, is like death by a thousand cuts.

    The saddest part is, there is absolutely no where you can turn. Not the feds, the state, local pols or even your agency counsel. Whistle blowing amounts to cutting your own throat.

    I’m in the process of filing my own Form 700 right now. Do you know how many agency staff and pols are too stupid to understand when they have to report gifts in excess of $50? They can’t do the math.

    1. Most of the “corruption” in the US and Europe is institutionalized; that is, it’s legal rent seeking and regulatory capture. There is nothing to report there, and the only way to fight it is to downsize government.

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