Review of state and federal audits find O’Malley-Brown Administration failed to act on $1.75 billion in cost-saving measures.
Shoddy record keeping, widespread mismanagement and lack of fraud controls sapped critical funding for child protection, environment, public safety and education.
Annapolis, MD – May 1 -- According to an investigation by the Hogan-Rutherford campaign, over the past seven years the O’Malley-Brown Administration failed to act on dozens of official audits detailing more than $1.75 billion in improper spending and even outright fraud in the Executive Branch. Additionally, audits of the nearly $13 billion Maryland receives annually from the federal government also found widespread accounting failures.
Hogan said, “This isn’t wishful thinking about magically increasing government efficiency; these audits comprise hundreds of pages actual instances of waste and mismanagement and the simple steps required to prevent further losses. Clearly, Martin O’Malley and Anthony Brown decided it would be easier to hike taxes, fees and tolls, loot $100 million from retiree pension funds and millions more from environmental, highway and arts funding than to act on the simple guidelines presented in the audits.
The audits, which do not include the estimated $300 million spent on the failed Health Exchange include:
Jan. 2009 - $38.9 million in unlawful budget transactions. These are improper payments and transactions by Executive Branch agencies that have to be cut from the next year’s budget or require tax increases to cover.
May 2010 - $936 thousand in rental payments the Maryland Stadium Authority never recovered.
Sept 2010 – Up to $22.5 million paid to a contractor without verifying that workers showed up to do their jobs.
Dec. 2010 – $1.8 million in fraud at Kidney Disease Program due to fictitious claims.
Feb. 2011 – $2.3 million that the office of Public defender failed to collect in fees in 40,000 cases
April 2011 - $71,000 spent by one employee making fraudulent purchases on a Department of Natural Resources credit card.
Of his campaign’s analysis, Larry Hogan said, “This is just a partial accounting of the O’Malley-Brown Administration’s rampant mismanagement of our hard-earned tax dollars, these audits make clear that critical funding for the disabled, education, child protection, the environment, public safety and other priorities was wasted through sheer incompetence or outright fraud.”
In many cases, the General Assembly’s Office of Legislative Audits determined that O’Malley-Brown officials ignored previous warnings that nearly every state agency lacked basic controls to prevent personal use of petty cash, government credit cards and state-owned vehicles. In fact, according to a review of the audits, most state agencies lacked basic controls on spending cash, use of government purchase cards and personal use of tax-payer owned vehicles. In recent months, there have been several highly publicized cases of state workers spending tens of thousands of tax-dollars on personal items and luxury travel.
The audits also reveal an alarming pattern of state officials ignoring rules governing safety and security. In one case, the O’Malley-Brown Education Department officials failed to follow up on criminal background screenings for child care workers. In a separate instance, while failing to report about $38 million in unspent funds, the Development Disabilities Administration left thousands of developmentally disabled Marylanders languishing on a wait list while advocates successfully lobbied for a 150% increase in the alcohol tax to fund such services. The DDA’s Chief Financial Officer was fired shortly after bringing this to the attention of the O’Malley Administration.
“Addressing the cost-savings recommendations of these audits and prosecuting any theft of tax dollars should be the top priority in the final months of the O’Malley-Brown administration.
