[Nfb-or] Statesman article on CFB

[T. Joseph Carter]

The top of the Statesman Journal website links to this story:
http://www.statesmanjournal.com/article/20110929/NEWS/109290327/State-audit-blasts-Commission-Blind?odyssey=tab|topnews|text|Home

Text follows:

State audit blasts Commission for the Blind
It says lax oversight of finances, operations hasn't been addressed

Written by
Dennis Thompson Jr.
Statesman Journal

State auditors are hammering the Oregon Commission for the Blind for 
a "continued pattern of fiscal irresponsibility" that has lasted for 
16 years despite repeated calls for reform.

In a report issued Wednesday, Secretary of State auditors criticized 
the commission for failure to tighten lax oversight of its finances 
and operations as recommended in a 2009 audit.

The report tied the lack of progress to a string of financial 
problems that have been raised by a series of state audits dating 
back to 1995.

"They are clearly struggling to implement our recommendations," 
Secretary of State Kate Brown said Wednesday after the report's 
release.

The Oregon Commission for the Blind operates on a $16 million budget, 
with 9 percent coming from the state's general fund and the rest 
supplied by federal grants and other donations. The agency is charged 
with assisting Oregonians who are blind or visually impaired.

Commission administrator Linda Mock said her agency will take steps 
to fix problems raised by the report.

However, she added that the procedures recommended by the Secretary 
of State auditors have proved to be hard to implement in her small, 
cash-strapped agency.

"We are interested in making more progress," Mock said. "We will 
continue to work on that. But we need to balance that with our 
mission and make sure we are best serving the more than 1,500 
Oregonians who seek our assistance each year."

The follow-up review found that the commission had instituted new 
internal controls to oversee how money is spent but did not 
consistently follow the new rules. For example:

-Necessary paperwork to track funding for special events had not been 
properly completed in a number of instances, including $3,500 for 
sponsorship of three dragon boat race teams and $3,100 for a 
living-with-blindness seminar.

-Complete documentation had not been filed for employees who 
telecommute, and two employees had been improperly reimbursed a total 
of $334 for their home Internet costs.

-Employees spent $7,500 on groceries for cooking classes and $2,043 
on wood-shop supplies without keeping paperwork to justify the 
expenses.

-Cellphone use is not being reviewed or analyzed, leading auditors to 
question the appropriateness of nearly half the $27,337 in cellphone 
expenses reported from July 2010 through April 2011.

The auditors linked these continuing problems to a string of past 
audit reports that have criticized the way the commission does 
business. Audits in 1995, 2000, 2001 and 2009 consistently have found 
fault with the agency's business practices, the report released 
Wednesday said.

The report singled out the commission's Business Enterprise Program 
as being particularly slow to adopt recommended financial practices.

The program is meant to provide business opportunities for the 
legally blind by granting them franchises to operate vending and 
cafeteria programs in public buildings throughout Oregon.

The new report found that the Business Enterprise Program:

-Failed to properly implement contracting procedures for its vending 
machine program.

-Could not provide a copy of a $4,999 contract with a consultant who 
was hired to assess the program.

-Dropped the ball on an opportunity to develop a blind-operated 
cafeteria in a state building, instead allowing a local private 
restaurant to begin operating at the location.

-Did not develop an adequate tracking system for the income generated 
by the blind vending and cafeteria managers.

The director of the Business Enterprise Program, Walter Reyes, has 
been on administrative leave since Aug. 1 as a result of the 
auditors' follow-up work, Mock said. A Department of Justice 
investigation of Reyes is ongoing.

Mock did not dispute the report's findings but said she thought the 
auditors had not taken into consideration the challenges faced by her 
agency.

"I think it's not a balanced view of the agency," she said. "It's 
looking at it from a compliance perspective and not from our mission 
and what we have the resources to do and how you balance those 
things."

Brown disagreed with this assertion.

"We expect that there be accountability, transparency and good fiscal 
management at all state agencies regardless of their size," she said. 
"We are all struggling to do more with less, but good fiscal 
management is important regardless of size."

Brown said that money saved by proper financial controls could be 
directed toward helping more blind Oregonians than are receiving 
assistance today.

"We want to make sure that all Oregonians that rely on these services 
and qualify for these services have their needs met," she said. "When 
there's poor oversight and poor accountability, some folks are not 
getting the services they need."

dmthomps at StatesmanJournal.com, (503) 399-6719, 
Twitter.com/DMThompsonJr or Facebook.com/OregonStateWorkers

End of article.

This article, like the one from the Oregonian, has a sidebar.  Its' 
text follows:

Past audit criticism
The Secretary of State's report on the Oregon Commission for the 
Blind listed a number of past audits that contained similar 
criticisms of the agency. These include:

1995: An audit report issued by the Audits Division concluded that 
the agency wasted $1.75 million and failed to properly manage public 
money and assets entrusted to it.

2000: An audit report issued by the Joint Legislative Audit Committee 
found that agency expenditures were questionable and that the 
commission exercised virtually no fiscal oversight.

2001: An audit report issued by the Audits Division noted a lack of 
controls over personal service contracts and invoice payments.

2009: An audit report by the Audits Division disclosed problems 
similar to those reported in previous audits of the agency. Areas of 
concern included the use of public funds for nonclients, management 
oversight to ensure that funds are spent according to applicable 
regulations, ensuring that competitive pricing is obtained, planning 
business ventures to ensure client success, ensuring that 
expenditures are necessary and reasonable, and protecting assets. As 
a result, the audit questioned whether $1.46 million of public funds 
were spent prudently or lawfully.

End of sidebar.

The Portland Tribune is also working on an article, looking to dig 
into the BE program now that it's becoming clear that the piece they 
did some months ago, while certainly extensive, was anything but 
complete.

I know about the Portland Tribune's article because they contacted ME 
for a statement.  I told their reporter that if he wanted to know 
what was going on first-hand, he should talk to the vendors and the 
BECC, since they have documentation of what's going on.

If they're serious about it, that one's gonna get ugly.

Joseph