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Over the course of years, we’ve written extensively about the problems with state tax systems, and proposed a number of “solutions.” At or near the top of the list of approaches we’ve recommended has been to expand on the number of services that should be taxed. After all, the logic goes, many of the states’ economies have shifted from those based on manufacturing to those based on the provision of services. And yet a whole host of business activities — like funeral services, home repair and personal care — have tended to escape the taxman’s net in many places. And yet, actions to extend sales taxes to many new services have been stifled in state after state according to an excellent article in the Pew Charitable Trusts’ Stateline, by Elaine Povitch. (Thanks to Kil Huh, of Pew, for pointing out this piece via Twitter). Povitch points, for example, to an effort in Oklahoma to tax more services, writing that the proposal “immediately ran into trouble both from anti-tax legislators who predominate in the conservative state, and service industries that could have been affected. The funeral home industry called the proposal a ‘death tax’ and argued that families already burdened with thousands of dollars of funeral expenses didn’t need a sales tax bill on top. “‘Should I smoke? I am going to pay a price. They’re going to tax me more. But I still have a choice of not smoking,’ funeral home owner Jerry Dillon told a Tulsa, Oklahoma, ABC affiliate in February. ‘But death is gonna happen. Let’s not take advantage of a grieving family at the worst times of their family’s life.'” Povitch’s article goes on to demonstrate that problems continue to exist even in states that have been able to get expanded service-based sales taxes. She writes, “Since North Carolina began implementing a tax on some services this year, which was enacted in 2016, the Department of Revenue has been flooded with questions about what is taxable and what is not. There have also been inquiries about how to collect and remit taxes from businesses that have never had to worry about it before, according to Schorr Johnson, public affairs director for the department. ‘People are looking for guidance, especially in clarifying the definitions … about what is and what is not taxable,’ he said.” We strongly recommend you read the full piece, which you can find by clicking here.

A couple of decades ago, like many observers of government, we were wildly exuberant about the potential for state and local governments using  websites to improve transparency, involve the citizenry, provide fast, efficient services and cultivate a one-on-one relationship with taxpayers. Back in 1999, we wrote in Governing magazine that “the siren call of the Internet intrigues [the states]. Many states now have detailed websites where citizens can call up all sorts of information about jobs and tourism and often find a lovely full-color photograph of the governor, available to be printed out.” We went on to write about the wonderful opportunities in advanced states to do amazing things like sign up for fishing licenses or pay tax bills. My, how time has passed. Many of the futuristic opportunities we mentioned have long since become a reality. Sadly, reality is a two edged sword, and even as the capacity of the Internet to improve state and local government services to the public has grown, there’s much more to complain about as well. Here are a handful of our gripes. Some may seem minor, but they all get under our skin: 1) Missing dates. When we find documents on websites, particularly those that consist largely of text, they’re often missing any kind of date. As a result, it’s difficult to tell whether the information is current or thoroughly out of date. 2) Missing phone numbers. It’s almost as though cities and states have forgotten that some folks might want to reach their representatives with a telephone. Often, but not always, you can find e-mail addresses, but phone numbers are often missing. The phrase “contact us,” is overrated. 3) Queries. Many state and local websites give users the opportunities to ask questions by filling out a form, which is deposited in a “general mailbox,” of some kind. This might seem like an efficient way to triage the questions that flow in. But in our experience, most of our questions fall into the hangnail, not the heart attack stack – and so we never hear back at all. This can’t do any good for citizens’ faith that government cares. 4) Un-English English. Acronyms are epidemic online, and they can stand as a giant stumbling block between alleged transparency and real understanding of an issue being featured on line. 5) Search tools. Many state and local websites have some kind of search mechanism. We repeatedly blunder into the error of believing that we can actually find what we want on the site through this fill-in-the-blank service. But it’s not always clear exactly what’s being searched – the website itself, or the entire Internet. And we find ourselves frustrated by the search findings more often than not.

Multiple tensions afflict state-local relationships. States often balance budgets on the backs of locals. They mandate services without funding and increasingly pre-empt local action. So, it wasn’t a surprise to us to see the 2017 Michigan Public Policy Survey reveal that nearly half of local officials surveyed rated their relationship with the state as either poor (13 percent) or fair (36 percent). But we did wonder why the dreariest assessment of state-local relations came from counties. When researchers at the Center for Local, State and Urban Policy at the University of Michigan, disaggregated the survey results, it found 19 percent of county officials rated their relations with the state as poor and 41 percent said fair. We asked Steve Currie, executive director of the Michigan Association of Counties, why he thought counties appeared to have the worst relationship with state officials. His answer focused on money. Counties have more mandated services than other forms of local government. That means that when property taxes are capped (as they have been in Michigan) or when tax exemptions reduce local revenue (as they do in Michigan), the pain is greater. Currie believes some of the problem boils down to structural issues. Cities and townships get constitutional revenue sharing from the state, whereas counties don’t have that protection. At the same time, he says counties have more limited revenue raising capability for themselves. Was he surprised by the results of the survey? “I talk to county commissioners every day. The angst wasn’t surprising to me, but I was a little surprised to see that other levels of government weren’t quite as frustrated as our county folks,” he told us. County frustration, which we hear about all the time, comes partly from being poorly understood.  The Michigan Association of Counties has produced a web page to fix that problem, but it still grates. We hear about the plight of misunderstood counties all the time. “Everyone knows what a downtown area of a city is and what services are provided,” says Currie. “Counties deal with the services that people don’t want to think about until they have to – local public health, community mental health, court systems and jails. “These are all very expensive to provide. You don’t think about them until you need them.”

The sentence that we’ve heard most frequently about states in our 25 plus years of researching them has been “they vary.” They sure do. We entertained ourselves this morning by skimming through an excellent ranking of state performance that was published this week by the Missouri Auditor’s Office. We’ve seen “how do we compare” documents from a variety of other state auditor-evaluator offices, but thought this one was particularly good. Of course, it draws attention to Missouri specifically, but the rankings for the other 49 states are there, too. The comparisons cover the economy, education, civic involvement, health, crime and transportation and include 28 separate rankings. It was put together by the Harry S. Truman School of Public Affairs’ Institute of Public Policy at the University  of Missouri – Columbia. Some of the rankings surprised us. (The fact that they did, probably shows some admitted prejudices about how we think states are likely to perform.) Our home state, New York, had the second to lowest property crime rate per capita and Hawaii had the highest. Vermont had the lowest property crime rate per capita. (2015 data) Nevada had the lowest percentage of roads in poor or mediocre condition. Hawaii, again, had the highest. (2013 data) Minnesota, where the I-35 West St. Anthony Falls Bridge famously collapsed in 2007, has the lowest number of deficient or obsolete bridges. (2014 data) Montana has the highest percentage of the population with a high school diploma (93.5 percent) and California (where our son and daughter-in-law live) has the lowest (82.2 percent) (2015 data) Kentucky is among the states with the highest 4th grade reading scores. (2015 data) Idaho and South Carolina (where our daughter lives) had the highest job growth rate in 2014-2015. Maine and Wisconsin had the highest voter turnout rates for the last mid-term elections in 2014 (58.7 and 56.9 percent ). New York and Indiana had the lowest.(29 and 28.7 percent). By the way, Missouri is found at the middle of the pack for most of the rankings. But it does rise to the top and bottom of some lists.  Its state and local tax revenue is among the lowest as a percentage of personal income (2013 data), and its 17-cent cigarette tax is the lowest. (2016 data) Its percentage of adult smokers – 22.3 percent of the population – is among the highest. (2015 data)

We’ve written a good deal about auditor independence lately. The issue comes up all the time in our interviews, whether it involves retaliatory budget actions, departmental resistance to document requests or rejection of audit topics.  We’re not alone in sensing rising tensions. The Institute of Internal Auditors recently published an article about public sector auditors, entitled “Under Siege”. Some attacks on auditors threaten their very existence. Last week, we wrote about Lawrence, Kansas, where City Manager Tom Markus has asked for the one-person City Auditor office to be abolished. He made the same request of the Lawrence City Commission in 2016, but it failed. No decision has been made yet by the commission this year. The Lawrence Journal-World ran an editorial supporting the auditor on June 14th, a day after the issue was discussed in a budget working session. “Perhaps the city of Lawrence should elevate — instead of eliminate — the role of city auditor,” it said. In a letter to the editor on Monday, Rob Chestnut, a former mayor of Lawrence, wrote: “The city auditor has highlighted persistent issues with collections in Lawrence, and it is disappointing to see the reaction of our city manager. It is clear that the audit function is not well understood by leadership within the city.” The status of the City Auditor’s office in Lawrence will be discussed again in a July 11 City Commission meeting.  For more details on the situation, see our June 13, 2017 blog post, Lawrence, Kansas: A city auditor under attack. We should also note that auditor struggles are far from new. Kansas City Auditor Douglas Jones recently reminded us of  the excellent May 31, 2008 Governing article, “Focusing on Accountability”, written by our friend Jonathan Walters.

Given the tensions that face auditors, we thought this was a good time to talk with Tina Adams, the new president of the Association of Local Government Auditors (ALGA) about auditor independence.  ALGA has 340 member organizations in the United States and Canada and focuses largely on performance auditing, as opposed to financial auditing. Adams took over the one-year presidency term in May. She is the deputy city auditor in the internal audit office of Charlotte, N.C., and has been in the profession for two decades. B&G: Why can’t performance auditing be handled on a contract basis rather than having an internal office? What are the reasons that you believe an internal office is preferable? Adams: Internal auditing is a basic cornerstone for good public governance. Internal auditors meet with department heads on a regular basis, understand their concerns and what they see as risks and help them address or mitigate those risks. That’s something that an internal auditor brings to the table that an external auditor may not. As internal auditors, we develop an annual audit plan partly based on areas where we see opportunities for improvement. Management and council may review and make suggestions for our audit plan, but in the end, we decide what to audit. Contractors may be steered to certain topics and away from other ones that could reflect negatively on management. B&G: What do you see as the goal of internal audit offices? Adams: When establishing an audit shop, one goal should be to maximize transparency and accountability to the public. Depending upon what the local organization does, whether it’s a city or county government or a school district or an authority, you want to give some assurance to the public that the organization is achieving its mission effectively and efficiently and ethically. B&G: What are the major issues that cause local auditors to lose sleep? Adams: For me, it’s threats to independence. That causes me to lose sleep. That’s the core and then all of the issues that come along with that threat – am I going to be able to report what I find honestly without fear of retribution. Will I be able to exercise my professional judgment? B&G: Why is auditor independence so important? Adams: I think it’s important because of public perception. Auditors have to be independent, both in appearance and in fact. If the public does not perceive that an auditor has integrity and is objective or if they think the auditor has been compromised in some way, it can erode the confidence they have in the organization. Having an independent auditor in-house helps with the public perception that the organization is trustworthy accountable and transparent. B&G: What are the key elements that build auditor independence? Adams: For a lot of our members it’s who the auditor reports to – the placement of the internal shop within the organization.  You don’t want an internal auditor placed within an operating department of a city or county. It should be reporting to those charged with governance. A lot of people indicate that the best way to provide independence is to have it legislatively mandated, whether in a city charter or through some other authoritative law. B&G: In Lawrence, Kansas, it’s been suggested that setting up an audit committee will help protect the city auditor’s office. What do you see as the advantage of having an audit committee? Adams: Having an audit committee provides more time to hear the details of an audit. Otherwise, you may end up with five minutes at the end of a four-hour council meeting. An audit committee can also help to make sure that recommendations are implemented. Audit committees can ensure the quality of audits and help to resolve problems caused by a lack of resources. B&G: Are there disadvantages? Adams: Sometimes the members of the committee have a conflict between supporting internal audit and management. Those conflicts could be a challenge for an audit committee member.

Inspections often fall short of goals and requirements. A fire department inspection audit from the City Controller’s office in Houston, released last week, was particularly alarming. It focused on the Life Safety Bureau of the Houston Fire Department, laying out 28 problems considered to be high risk. While fire department management assured the auditor that it is addressing the issues mentioned, the scope and quantity of issues must have been alarming to residents. One example: As the Houston Chronicle pointed out in its June 15 article about the audit, just 526 of Houston’s 5,000 plus apartment buildings were inspected in the last two years. This falls far short of the goal of 470 of these inspections each month. One clear problem is that the Life Safety Bureau is “highly understaffed” in relation to the number of buildings. Houston is the fourth largest city in the U.S. The number of high risk issues in Houston may be extreme, but inspections in many places and for many different areas of city, county and state oversight fall way short of requirements and goals. We wrote about this problem in Governing last February: “From Food to Buildings, Safety Inspections are Lagging.” Since we researched that column, we have noticed the issue continuing to crop up for different areas of government oversight, such as dam inspections, which have fallen behind schedule in California, or nursing home inspections, which have been lagging in Ohio. Here are some of the highlights of the Houston report: Occupancy permits were often issued without inspections Many policies and procures had not been updated in years Department teams and units did not communicate with each other Record keeping was poor, with no document management system and some inspection records scattered in file cabinets and desk drawers Overtime costs were beyond estimates New high rise buildings were not reliably added to the bureau’s building master list Inspections were not consistently performed and inspection records did not clearly show what building components had been checked. Of the 5,000 plus apartment locations, 4,818 had no inspection date recorded. The inspection rate for “apartment locations” was just 5 percent in Fiscal Years 2015 and 2016. There were no inspection reports found of the three major airports The bureau’s database was not updated to reflect changes to the fire code that were made in 2012. Due to “resource constraints” copies of the fire code amendments have not been provided to inspectors. There were no established inspection cycles for “apartments, hotels/motels, airports & heliports, mid-rise atriums, general occupancy buildings and hazmat/high-piled storage facilities.” Like so many issues that are focused on prevention, inspection shortcomings are rarely a high priority until something terrible happens like the Oakland Warehouse fire last year or the tragic high-rise fire in London last week.

About a month ago, we put up our “which states are the best” video, which features the many superlatives that governors use when talking about their states. We followed that up with a text blog post of “Governor Superlatives”  that included more governors bragging about how their states were the best. It’s a lot less common to see governors bring up the areas in which their states are at — or close to — the bottom of 50-state rankings.  It’s braver, too. We have to give credit to governors who use annual speeches in bully pulpit fashion to raise public concern and to try to push for fixes. So, today, here’s a short list of quotes from governors speeches about ways in which their states are the worst (or among the worst). We’ve linked to the addresses themselves, so you can see that they also had good things to say. The following come from state of the state or annual budget addresses and in one case, an inaugural address. Illinois Governor Bruce Rauner, January 25, 2017 “For years Illinois has provided the lowest percentage of education financial support from any state in the country. And we have the largest gap between funding for high income schools and low income schools in the country, both across the state and within the city of Chicago.” . . . “We haven’t had a full year budget of some kind in a year-and-a-half– and we haven’t had a state budget that is truly balanced in decades. We have more than $11 billion in unpaid bills, a $130 billion unfunded pension liability, and the worst credit rating in the nation. We have the 5th highest overall tax burden and one of the lowest rates of job creation of any state.” Montana Gov. Steve Bullock, January 24, 2017 “And while I’m so pleased that Montana leads the nation in many economic indicators, I cannot tolerate that Montana leads the nation in youth suicide. I am haunted by this statistic, and I imagine you are as well. I am proposing $1 million to fund evidence-based pilot programs. We will take what we learn from these efforts to bring it to scale, to better keep our kids safe. New Hampshire Gov. Chris Sununu, Feb. 9, 2017 “We all know that our energy rates are among the highest in the nation. It’s an economic development issue and an affordability issue for our citizens. “We need to work on energy rates for everyone, but the people struggling the most are on fixed incomes, often low-income rate payers, and are struggling to afford their energy bill. “I propose to dedicate 20% of the renewable energy fund to supplement our current electricity relief programs for low-income families. “Fixing energy is a long-term problem, but some people can’t wait. And we simply have to provide them resources today.” Oklahoma Gov. Mary Fallin, February 6, 2017 “It’s no secret our prison population is in a crisis with over 61,000 people under the jurisdiction of corrections. Our prisons are way over capacity, and our prison population is expected to grow by 25 percent in the next 10 years. “Oklahoma’s overall incarceration rate is the second-highest in the country. We lead the nation in female incarceration – incarcerating women at two and a half times the national average. Oregon Gov. Kate Brown inaugural address, January 9, 2017 “Our schools continue to be among the nation’s leaders in all the wrong categories–the largest class size, the shortest school year, and the highest dropout rate.” Tennessee Governor Bill Haslam, January 30, 2017 “While we take great pride in paying the lowest amount of tax as a percentage of income in the country as individuals, unfortunately that’s not true for our business taxes. We are the third highest in the country in business taxes as a percentage of income and as a percentage of our budget.” Texas Governor Greg Abbott, January 31, 2017 “Texas schools are filled with some of the best teachers in America who are called to their profession. Unfortunately, a small number of teachers have given Texas an unwanted ranking. Texas reportedly leads the nation in teacher-student sexual assaults. Some of those teachers are not prosecuted. And worse, some are shuffled off to other schools.We are the ones with the duty to do something about it.”

The generally bleak biannual Fiscal Survey of the States report was released today by the National Association of State Budget Officers (NASBO). It contained quite a bit of dismal, though not unexpected, news. In 33 states, general fund revenues are coming in below estimates this year. Pension and health care costs continue to rise faster than inflation. Twenty-three states had to make mid-year budget cuts, the highest number since FY2010. While general fund growth for the current year is 2.4 percent, expected spending growth is 4.1 percent (That’s excluding Illinois which throws off the figures because of its unique budget situation). General fund ending balances and rainy day funds dropped from $81.1 billion at the end of Fiscal Year 2016 to an estimated $69.4 billion this fiscal year. For 46 states, Fiscal Year 2016 ended June 30, 2016 and Fiscal Year 2017 ends June 30, 2017. (The most recent financial information in the report is from April.) A hint of better news comes in the projections for next year’s budget, which are a bit more optimistic. One reason is that oil and gas prices have been rising – good news for natural resource states, if not for drivers. General fund revenues are projected to grow 3.1 percent in Fy2018. A bit of that expected growth comes from tax and fee changes, which are slated to bring in $3.7 billion more overall. Fifteen states are raising taxes or fees and twelve are reducing them. Most notable hikes are in Oklahoma, Pennsylvania and Washington. Two powerful recessions in this century have generally heightened state caution. Although revenue is expected to grow 3.1 percent next budget year, spending is only going up 1 percent. States plan to add about $4 billion to rainy day funds in their upcoming budgets, with only seven states foreseeing declines in their rainy day fund balances. (Rainy day funds in 2017 held $49.6 billion, very close to the 2016 figure.) The area in which the largest number of states plan budget cuts in Fiscal 2018 is higher education (19 states). K-12 education is the area that will see cuts from the least number of states (11).  Six states plan some cuts to employee benefits next year. They are Alaska, Connecticut, Illinois, Massachusetts, New Mexico and West Virginia. We should point out that NASBO’s Fiscal Survey of the States focuses just on General Fund spending, which is about 40.4 percent of the total. Federal fund spending for states make up 31.2 percent, other state funds are 26.3 percent and bonds represent 2.1 percent. Mosts and leasts: State with the largest rainy day fund balance projected for FY2017: Texas with $10.2 billion States with no rainy day fund balances in FY2017: Arkansas, Illinois, Kansas, Montana, New Jersey, North Dakota and Pennsylvania State with the biggest spending increase planned for FY2018: Nevada at 7.3 percent State with the biggest drop in spending for FY2018: North Dakota at -23.4 percent State with the biggest mid-year budget cut: New York with $2.1 billion. (This was a decline in the transfer of General Fund revenues to General Reserves.)

We’ve been conducting interviews for an alarmingly long time and the last 25 years of have been largely devoted to talking with state, county and city officials. Based exclusively on personal experience, we’ve developed a solid sense of the things that our interviewees can do that will optimize their chances of communicating their message well. Important note: We’re not talking about a lot of the things you might hear in media training; like how to pivot from the question asked to the one you want to answer. Speaking for ourselves, when someone is pivoting away from our questions, we’ll just ask the question again and again and again, and finally we’ll just go to another source. That’s not what the original  source really wants, because  he or she loses all control over the information being communicated. We’re not saying that pivoting is never  effective in interviews — particularly on television or radio, where there’s a limited amount of time to probe. We’re just saying that it can alienate well-trained reporters. Some of the following may seem manipulative. That’s because some of the following is manipulative. But much of it is really obvious — though frequently ignored. Take five or ten minutes, before the interview, to find out a little about the interviewer and the publication for which he or she is writing. This can be crucial if it turns out that you’re talking to someone with a strong political bias. Be very careful about the meaning of “off the record,” or “on background,” or “not for attribution.” People bandy these phrases around as though they are universally understood. But they’re not. If you want to make ground rules for the conversation, be explicit, like “I do not want to see my name attached to any of the quotes, but you can feel free to attribute them to a ‘California budget analyst,” or whatever. A corollary to number 2: Make any ground rules explicit at the beginning of interviews. Journalists will assume they have the right to attribute any quotes directly to you, unless they’re told otherwise. The reporter should probably clarify this from the beginning. But if that’s not the case, you should make sure it happens. At least once in the conversation compliment the press representative as in, “That was a terrific question.” People like to be praised. Just don’t shower the reporter with kind words, or it will seem less genuine. Don’t make any assumptions about the knowledge-level of the reporter, and assume you can put something over on him because he seems to know nothing. Smart interviewers don’t show how much they already know, preferring to draw out the interviewee to provide more details. Use stories in interviews. Real, live stories. Most articles are going to call out for anecdotes, and if you provide them yourself, it’ll help to get your points into the final article. If you don’t know something, say you don’t know it. And if you use numbers or dates that are really just guesses, tell the journalist to double check on them. Or double check yourself and get back by phone or e-mail. It makes us crazy when we fact-check a piece we’ve written and discover that the source has given us some data that turns out to be just distant memories of data. It makes us wonder if anything we’ve gotten from that particular source is reliable. We hope this helps. And we’d really like it if those of you who are reading this would make any additions to the list as a comment on this website.

As we’ve written many times before, local government auditors often face major obstacles in doing their work. Threats to their existence are common, which is not surprising since audits often result in a steady stream of criticism of people who are in power. The criticism may be constructive, but it is often annoying. No one likes to be criticized. Last week, we wrote about the significant victory experienced by the Portland auditor’s office in a May ballot measure that protected the office from resistance by city administrators and bolstered the office’s independence. Today, we have a potentially sadder story to tell. This evening, the Lawrence, KS, City Commission will have a working session to talk about next year’s budget. One of the most controversial items on the agenda is the city manager’s proposal to eliminate the city auditor’s office. The city manager proposed the same cut last year and it failed.  In an article in yesterday’s edition of the  Lawrence Journal-World, City Manager Tom Markus explained his position that an auditor’s office was not necessary to evaluate the city’s performance and that there were other ways to do this. He also made it clear that cutting the audit office would not jeopardize the annual financial audit, which is contracted out to a financial audit firm. The city auditor, who reports to the City Commission and not to the city manager or mayor, focuses on performance audits. Presumably, the city manager’s idea is that matters of performance could be assessed through individual contracts, as well. So, what’s wrong with cutting out the city audit office and relying on contractors instead? We’ve been writing about performance auditing for 25 years. Here’s our take: Contractors deal with individual problems on a one-time basis. They do not have the knowledge or sense of history that is present in an established auditor’s office. There is also the important question of independence. An independent city auditor has more ability to choose the topics to be audited, often in conjunction with a council or commission. A contractor is more likely to be given a specific topic to be covered – one likely chosen by the administration. Of great importance, a contractor would generally sign a contract with the executive branch and report to the administration. An independent auditor does not report directly to the executive branch officials it is responsible for auditing. If the city audit office survives, one proposal that is being floated in Lawrence is to create an audit committee that would help to bolster the office’s independence and make recommendations to the governing body. It could help ensure quality work from the auditor, consider budgetary questions and have input into the topics chosen for review. In May, David Givans, the president of the Association of Local Government Auditors (ALGA), sent a letter of support for the Lawrence auditor to the Mayor and City Commission and also supported the idea of an audit committee. It emphasized the importance of local auditor independence and the important role an auditor plays in improving government operations and strengthening public accountability. In a similar letter last year, ALGA went into more detail about the Lawrence auditor’s work. “From ALGA’s perspective, Lawrence’s Office of City Auditor is a high quality performance audit office headed by an experienced government auditor. We note that the Lawrence City Auditor successfully passed two rigorous external quality control reviews conducted by ALGA in 2011 and 2015 that demonstrated his office’s compliance with the demanding U.S. Comptroller General’s Government Auditing Standards. The office has also won ALGA’s Knighton Award for the high quality of its report on financial indicators. These accomplishments are notable, particularly because Lawrence has an audit office staffed by only one person.” The Lawrence auditor, Michael Eglinksi has been in his position since the auditor’s office was established in 2008. City manager Markus took on his role with the city in March of 2016.  Eglinski reports that the explanation he received from the city manager for the proposed cut was that there were tough decisions that had to be made. The city manager’s budget eliminates 11 positions in city government. Ten are already vacant. The auditor’s position is the only one of the 11 that’s filled, according to a Journal-World article in early May. “I went through the stress and hassle of this situation last year,” Eglinski wrote us. “Last year, the Council put the position back in the budget and added a very small property tax increase to cover it. When this was going on last year, I had several other local governments that contacted me and asked if I’d be interested in working for them. Last year, I said, “I’m committed to Lawrence and I really want to stay here and I think I’m doing good work for the organization…but, if things fall apart, I’ll be back in contact.”  This year, I’m saying, “I really want the situation to work out in Lawrence, but tell me more about the job.’” NOTE: See editorial from Lawrence Newspaper on June 14.

Last week, Southern Oregon University put out word that it was duped out of $1.9 million by an email payment scam involving a campus construction contract. This unfortunate story has become eerily familiar. An email comes to a public entity with an address that appears to be the same as a contractor on a construction project. It tells the entity about a new bank account in which to deposit the amount due. In this case, the university wired the money to the account, then discovered several days later that the actual contractor received nothing. The FBI is investigating. We’ve read about similar scams in The City of Albuquerque, New Mexico,  which lost about $400,000 in early spring and a Socorro, New Mexico, school, which lost $200,000. Tim Keller, the New Mexico auditor put out a warning to government agencies in early April.  Auditors in Ohio and Utah have issued similar alerts. The FBI started publishing warnings about the scam several years ago and has said that it is spreading. Its Portland office put out a press release in late May providing guidance on how to avoid being fooled. Scammers also target businesses, but public entities may be particularly vulnerable because of the easy availability of contracting information and the frequency of construction projects. News articles within the last year have chronicled  construction payment scams affecting Appalachian State University, El Paso, Texas, the community college system in New Hampshire, an Ohio school district and a couple of counties in Utah. Daniel Salazar, a reporter for The Wichita Eagle, nicely summed up the similarities in some of these cases in early January, following up on the loss of about $500,000 to Sedgwick County, Kansas in late 2016.