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In 25 plus year of writing about state and local government, we are often stunned by how much time and attention goes to creating policies and processes and how little time and attention goes to policy implementation. There’s no better evidence of the chasm between policy vision and policy implementation than the photos on this page, which were pulled from a January legislative audit of community-based living arrangements for the mentally ill in Nevada. We’re not talking about a few bad actors here. The performance audit of the Division of Public and Behavioral Health looked at 37 provider homes. “We observed serious, deficient conditions in all 37 homes inspected,” the audit reported. “Although the Division developed policies and procedures to inspect provider homes, staff implementation of procedures is inadequate.” This isn’t the first time that Nevada officials have learned about community living problems for the mentally ill. Newspapers reports about deplorable conditions in the last few years resulted in a slew of new policies, including standards established in 2014 for certifying providers, and clear requirements to inspect homes regularly. Two Nevada agencies, which are part of the behavioral health division, oversee providers. One operates in the southern part of the state. The other in the north. The policy for Southern Nevada Adult Mental Health Services, effective April 2016, says its home placements for the mentally ill provide “independent living with the security of monitoring, continued support and behavioral skills training in a scattered site community Center.” A similar policy exists in the north. More legislation was passed in 2017 providing for certification and regulation of community-based homes. Currently, providers get an average of $1450 a month from the state for each resident and may also receive funding from the federal government via Social Security Administration disability checks. An average of four residents are housed in each home. The audit alludes to the temptation that some providers may have to skimp on services, care and basic home maintenance. “Providers operate a business that inherently is driven by a profit motive. In the absence of adequate inspection and certification activities, providers may limit their level of care to maximize profits at the detriment of client services.” On Friday, The Nevada Independent reported that the Nevada Department of Health and Human Services had immediately responded to the situation and would re-inspect 105 “community-based living arrangement” homes. The department’s director, Richard Whitley,  was also clearly stunned by the audit and the photos that accompanied it, and baffled that agency inspectors had missed the problems witnessed by auditors.  “If you read the audit, you see that they were in facilities that we were in days before, so . . . how did they see something that we missed or didn’t report?” Whitley told reporter Megan Messerly. “To see that we’ve been out there and didn’t act on seeing what the auditors saw, I have to know why that is and fix it now.”

Why don’t state and local governments keep better records on contractor performance? We’ve puzzled over the answer to this question in Governing, where we observed in a January 2016 Smart Management column that many states and local governments “fail to consider a company’s past performance when contracting with them.” The fact that contractor performance isn’t reported – even when required – was shockingly displayed in a Minnesota legislative audit of professional/technical contract spending that was released yesterday. The audit looked at contracting in the Pollution Control Agency and the Departments of Corrections, Education, Human Services and Transportation. While many of the audit’s conclusions were positive, it did find a big flaw in department inattention to reporting requirements. In Minnesota, departments and agencies are required by statute to file a report with the Department of Administration on contractor performance when contract awards are greater than $25,000. Based on contracts tested, the audit found that the Pollution Control Agency failed to submit the required contractor performance reports 100 percent of the time; the Department of Transportation failed 86 percent of the time and education had an 83 percent miss in submitting the required reports. The omission rate for both corrections and human services was 75 percent. Such high rates of non-compliance suggests not only that departments are lax in following the law, but that the Department of Administration doesn’t much care. “Our testing indicated that none of the agencies had sufficient internal controls to ensure compliance with the statutory reporting requirements,” the audit says. “However, given the widespread noncompliance, we also question whether the Department of Administration is taking a strong enough leadership role as the state’s central procurement agency.”

We’ve been thinking a lot about the challenges faced by government auditors, as we prepare to give a talk to the 2017 Mid-America Intergovernmental Audit Forum later this week. One of the issues we’ll be discussing is the lack of cooperation government auditors sometimes get from the departments they’re auditing.  The obstacles they confront include delays in getting necessary documents, the refusal by departments to share information, and controls placed on auditors’ access to departmental employees. As we wrote in a Governing column in September, California’s auditor Elaine Howle believes this kind of audit interference is becoming more common. “We’ve had to fight these battles more and more,” she told us. In general, these are the kinds of problems that are not picked up by reporters, so we were somewhat startled to see a number of recent examples in our Google searches this week. In New Jersey, for example, an audit that was scheduled for release in the summer is still in progress. The reason? According to a November 30th article in Route 40, which supplies South Jersey news and information, the holdup stems from delays in getting requested documents from the Casino Reinvestment Development Authority. We saw another example in Louisiana, where the auditor’s office has asked for records from the medical examiner’s office, which is seeking the opinion of a Baton Rouge judge as to whether it should refuse to comply based on doctor-patient confidentiality laws . The auditor there told The Advocate in Baton Rouge,  “They feel like they can’t give us the records. We feel like the law is on our side.” Then there’s the situation in Montgomery County, Tennessee, where the county audit committee issued a letter of reprimand last week against a county trustee for refusing to comply with the auditor’s request for public records. Coming back to California, in mid-November the UC Board of Regents published its investigation of alleged university obstruction of an audit that was released in April.  The investigation found that top aides to UC president Janet Napolitano had examined audit responses submitted from high-level officials in the university system and had moved to have answers modified. An editorial in the L.A. Times on Saturday said the aides, who have since resigned,  “engaged in egregious interference, telling campuses to omit or temper their criticisms of the president’s office.”

Just a handful of days ago, the Volcker Alliance released its latest in a series of ground-breaking reports, titled “Truth and Integrity in State Budgeting: What is the Reality?”  at a gathering in the Roosevelt House in New York City. This report, which covers all fifty states over the fiscal years of 2015 through 2017, focuses on five critical areas that explain methods used to achieve budgetary balance, as well as how budgets and other financial information are disclosed to the public. States were given grades of A to D-minus for their procedures in: Estimating revenues and expenditures; Using one-time actions to balance budgets; Adequately funding their public worker retirement and other postemployment benefits; Overseeing and using rainy day funds and other fiscal reserves; Disclosing budget and related financial information. As William Glasgall, director of the Volcker Alliance’s state and local program said, “With state revenue growth estimates being revised downward in 2017 and 2018 despite more than eight straight years of economic recovery, the pressure is great to balance budgets using one-time maneuvers or underfunding long term obligations for such areas as infrastructure, education and public employee retirement. The press conference also featured commentary from Paul Volcker, the Alliance’s Chairman and former Federal Reserve Board Chairman, Richard Ravitch, an Alliance director and former Lieutenant Governor of New York and Thomas W. Ross, president of the Volcker Alliance. The top graded states in Budget Forecasting included Connecticut, Florida, Hawaii, Maryland, New York and four others. In the budget maneuvers category, the list of states least dependent on using resources from other years to pay the bills due this year was led by California, Delaware, Georgia, Hawaii, Idaho and sixteen others. Legacy costs, like pensions and post retirement health care were given the highest marks in Idaho, Iowa, Nebraska, Oklahoma, Oregon and three others. The evaluation of Reserve Funds found that Alaska, Arizona, California, Hawaii, Idaho and ten others did better than the remainder. Finally, the category that covered transparency only had two states with the highest scores; Alaska and California. This was largely due to the fact that both of those states are making an effort to disclose deferred maintenance figures for their infrastructure. The remainder of the core Volcker Team, working under the auspices of Glasgall, include Melissa Austin and Noah Winn-Ritzenberg. Consultants to the report include Matt Fabian and Lisa Washburn of Municipal Market Analytics and Katherine Barrett and Richard Greene (us!) principals of Barrett and Greene, Inc. For a film of the Roosevelt House event, click here.

With the unprecedented horrific hurricanes hitting Florida, Texas and Puerto Rico in just the last weeks, we’re reminded of a conversation we had some time ago with one-time Iowa Governor Tom Vilsack. It seemed to be particularly timely in the wake of these devastating hurricanes, and so we thought we’d share it. When Former Iowa Governor Tom Vilsack was about to take office in 1999, he went to the National Governors Association’s “New Governor’s School,” and sat next to then-Governor Zell Miller of Georgia. Vilsack had one big question to ask his seatmate: “What are the one or two things I should focus on? Should it be health care? Should it be jobs? Should it be education?” As Vilsack recalled in his conversation with us, “Governor Miller said, ‘Son, emergency management. I guarantee you that within six months something is going to happen in your state and if you don’t handle it well it won’t make any damn difference what you do in health care or jobs or education.” Vilsack took Miller’s advice, and when the state was hit with a huge tornado three months later, its leaders handled the situation in a coordinated, capable way that saved lives and property damage. This isn’t the kind of story that people need to hear today. But when this onslaught of horrific hurricanes, and other natural disasters, has passed, and there’s the potential for months to pass without another, it’s entirely too easy to forget. That’s a bad idea.

We often misplace our keys, and last year we left a Kindle in the seat pocket of an airplane. So, we understand that it can be tricky to keep track of possessions. Even so, we are repeatedly struck by the huge difficulty state and local governments have with maintaining an accurate inventory and solid knowledge of the whereabouts of their various assets. The latest example comes from Philadelphia. This month, Controller Alan Butkovitz took a look at the city’s inventory of personal property, delving specifically into how effective city departments were in tracking computer and high-tech equipment. As it turned out, less than half of the 350 items sampled by the controller’s office could be located in the city department that was specified in the citywide inventory. Missing items included a $16,600 GPS system from the Office of Innovation and Technology, two thermal imaging cameras from the fire department (with a combined value of about $15,000) and a $12,300 generator from fleet management. The list of missing items also included 48 desktop computers, and 11 portable computers. According to the audit, “The Water Department was missing a pneumatic jackhammer, a hand-held meter, two water pumps, and a paving breaker. The Police Department could only locate one of thirteen portable radios, the Health Department was missing an x-ray film processor, the Streets Department could not locate a paving breaker . . . the Parks and Recreation Department could not find a pool vacuum or a commercial lawn mower.” While there are detailed processes in Philadelphia for tracking equipment, many departments have been lax about following them. The result? “Departments’ ability to determine the need to acquire computer and other high-tech equipment may be impaired, departments cannot provide assurance that equipment is protected from loss or being used only as authorized, and valuable equipment could be easily misappropriated.” As noted above, Philadelphia is far from alone in having problems with maintaining accurate inventories or locating missing assets. We wrote a column about this topic in a Governing column three years ago, called “How Does a City Lose a Backhoe?” [Note: We also did a Q&A column with City Controller Butkovitz in Governing in January, 2016.]

What computer weaknesses open the door to a local government data breach? Missouri’s state auditor, Nicole Galloway, has summed up the results of multiple local audits to pinpoint the most common data security shortcomings. The list is designed to provide insight to Missouri locals, but any local government could benefit by taking a look. Here are the five data breach trouble areas for local governments in Missouri: 1. Too wide access. We see this over and over again in government audits. Employees are able to get into multiple systems that are not actually needed and too often they retain access after leaving a job. 2. Employees are sloppy about passwords with many local entities failing to put in place rules about changing passwords or making them more secure. 3. Security software is not in place and inactive computers stay on rather than closing down after a period in which no one is working on them. 4. Data isn’t backed up. 5. Edits are too widely permitted, enabling employees to potentially alter or even destroy data. For each security issue, the report lists the entities that were cited for the issue during an audit between July 2016 and June 2017. The most common problem involved passwords that were left in place too long without alteration.

In Fiscal Year 2018, the City of Atlanta employee health premiums are going down by 1.87 percent. That’s a big change from the days when 12 percent increases were routine. “My percentage increases have kept going down because our employee behavior has changed,” says Atlanta Commissioner of Human Resources Yvonne Yancy, citing the city’s full throttle effort to emphasize employee wellness, whether it’s physical, mental or financial. In our most recent Governing column, which came out on Friday, Atlanta was one of several cities we highlighted to show the kinds of new benefits that governments are using to engage employees while also lowering absenteeism, controlling health costs, boosting recruitment and reducing turnover. The opening of Atlanta’s new wellness center, with its gym, free health clinic, juice bar, sparkling showers and sleep pods, is shown in the one-minute video below. It’s one more addition to the city’s already robust benefits, including health education programs, flexible work schedules, paid family leave and robust employee assistance program.

We try to keep an eye out for university research that could potentially have an impact on public policy. A great source of information is “Academic Minute”, which highlights studies that help solve “the world’s toughest problems” and serve “the public good.” It is hosted by Dr. Lynn Pasquerella, president of the Association of American Colleges and Universities. As its name suggests, the “Academic Minute” podcast provides a short pithy oral description of a research project, generally by the lead researcher. Listeners also can also find a handy written transcript for each entry as well as descriptive information about the researcher. Each weekday, the podcast covers a wide variety of fascinating research – like the future of shopping malls or common misconceptions about hand-washing.  We’ve sifted through the summer’s entries to provide a selection of episodes that we consider particularly relevant to managers, policy-makers and researchers in state and local government. “Bad Bosses and the Defensive Environment” – Christian Kiewitz, a professor of management at the University of Dayton, discusses the harm to any organization of bosses who manipulate, ridicule and intimidate. He looks at why employees sometimes stay silent out of fear and notes that workers who react with “fear-based silence” are “more likely to say they experienced abusive supervision a year later.” Not surprisingly, bad bosses may lead employees to quit, sabotage their bosses and lose emotional attachment to the organization. “Play and Public Spaces” – Teresa Gonzales, assistant professor of sociology at Knox College, talks about the importance of play for adults, looking at ways Chicagoans in high-crime neighborhoods are “reimagining public streets, sidewalks, parks and abandoned lots as spaces for music, dancing, eating, skateboarding, basketball and just having fun.” “States and Gun Laws” – Aaron Kivisto, assistant professor in the College of Applied Behavioral Sciences at the University of Indianapolis, shares research findings that show strengthening state-level gun laws offer promise “for reducing rates of fatal police shootings in the United States.” “The Importance of the Census” – Jay Zagorsky, economist and research scientist at The Ohio State University, explains the differences in outcome of a “quick and cheap” census and one that picks up harder to find individuals, such as the homeless or non-English speakers. “Fighting Rust Belt Blight” – Richard Sadler, assistant professor in the Department of Family Medicine at Michigan State University, describes a recent study that showed a decline in crime rates when citizens were engaged with the “beautification of their neighborhoods.”

We’re taking the second half of August off from posting. We’ll be back after Labor Day. We hope everyone has a wonderful end of the summer.

We’ve been toting up a list of problems in state and local purchasing and contracting. Whether the entity is large or small, in the middle of the country, the south, east or west, the same issues pop up repeatedly. Here are some procurement problems we’ve been tracking lately. Fuzzy contract language A Cincinnati audit in May looked at a contract with the nonprofit, Closing the Health Gap, and found that the language in the contract was broad in scope and lacked precise definitions of allowable costs. Weak oversight The internal audit office in Cincinnati also cited a lack of training to help contract administrators exercise adequate oversight. The lack of training leaves staff unsure of how to verify adherence to contract terms. A similar complaint about weak oversight appeared in a King County audit that focused on the contract with a non-profit that works on restoring licenses for people who can’t drive because of license suspensions. Contract database flaws In June, the City of Phoenix auditor reviewed the vendor validation process there and noted the problem of duplication of vendors in the procurement database. As we wrote in a blog post about California several weeks ago, the contract database there “contained numerous errors, essentially rendering it ineffective for its intended purpose.” Decentralization headaches Last year, the Kansas City Auditor found difficulties in the ability to access contracts, largely because agencies sometimes fail to use the centralized database to record information and provide contract documents. In an abstract that summed up the audit, the auditor’s office wrote “City contracts are not centralized, although the city’s regulations require centralization.” On occasion, when Kansas City contracts have been involved in legal disputes, the city simply could not locate the document and had to rely on copies of the contract obtained from the other party. Questionable performance measures In an audit of paratransit providers, the Office of the City Council Auditor in Jacksonville found that contract staff had altered pick up times, in an apparent effort to avoid rides being counted as late. Since late pickups are supposed to lead to penalties, the auditor was unable to determine if the contractor was paid accurately because the data had been changed. A lack of policies or consistent processes A Dallas audit in June noted inconsistencies among buyers in the way they conducted sole source and single bid procurements and how they documented their need. This lack of formal written approved and dated policies and processes is familiar to us from audits generally, as is a lack of documentation to support agency actions. Cybersecurity concerns Our upcoming Thursday column in Governing looks at the ways in which government workers compromise website security. One of the issues is inappropriate access and that also commonly appears in contract audits. For example, the Jacksonville paratransit audit chided the contractor for allowing inappropriate system access rights, and “lingering terminated user accounts.”

We’ve been fans of the Center for American Women and Politics for a long time. One of their most interesting ongoing projects is a website where they share the exact number of women currently serving in elective office. With this website as a resource, we thought it might be interesting to compare the number of women serving in elective office now with the number serving 30 years ago in 1987. In comparing these percentages, we were simultaneously struck by how far we’ve come as a country and how far we still have to go. We’ve assembled our comparisons in the form of a few animated GIFs. The number of women serving in U.S. Congress has steadily increased over time. From 5% in 1987 to 11% in 1997 to 16.1% in 2007 to 19.6% in 2017. Interestingly, from 1999-2001, 27.6 % of statewide elective executive offices were held by women so the number has come down slightly since then. As we examine these numbers we’re reminded of the words of Michelle Bachelet, the head of UN Women. “For me,” said Bachelet, “A better democracy is a democracy where women do not only have the right to vote and to elect but to be elected.”