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Reform and Renewal, Part 9,688

Thursday, May 29, 2008

* Keep in mind when reading these first couple of excerpts that these are the same people who want us to trust them with a $16 billion pension obligation bond, a $31 billion capital spending plan, a Lottery lease, etc…

An audit of Gov. Rod Blagojevich’s Office of Management and Budget found that the state’s top fiscal office did not competitively bid some services and failed to maintain even the most basic records of major financial activities.

* And

Gov. Rod Blagojevich’s Office of Management and Budget improperly awarded state contracts and had difficulty monitoring others, a state audit said Wednesday.

The review by Auditor General William Holland found that the budget office did not issue contracts based on required competitive bidding procedures. It also wrongly paid employees for travel expenses and failed to document workers’ pay raises.

“As the management agency of state government, they’re setting a poor example,” Holland said.

* From the auditor general’s summary

The Office did not exercise adequate controls over contractual agreements.

The Office did not exercise adequate control over its interagency agreements and related travel expenditures.

The Office did not exercise adequate control over its travel functions. […]

The Office did not fully comply with annual financial reporting requirements set forth by continuing disclosure undertakings.

The Office did not comply with provisions of the Accountability for the Investment of Public Funds Act…

* Aaron Chambers discusses another audit of CMS and Health and Family Services

…CMS and HFS — the agency responsible for managing the state’s health care programs — forged an agreement under which CMS raided nearly $20 million set aside for state worker health insurance to pay costs associated with worker’s comp. This is the “health care governor,” after all.

CMS also had trouble keeping its fiscal years straight, Holland’s audit found.

Go read Chambers’ post for the full effect. Horrid.

* Meanwhile

The largest state government employee union is upset with the Blagojevich administration’s contract offer that the union says will result in a pay cut for its members.

The offer doesn’t meet the American Federation of State, County and Municipal Employees’ idea of a contract that gives state employees “decent wages, health care they can afford and secure retirement,” AFSCME spokesman Anders Lindall said.

“The administration is seeking to shift significant new health-care increases on state employees and new pension costs and pay (increases) that wouldn’t keep pace,” Lindall said Wednesday. “The end result would be a pay cut for state employees who in recent years have seen their ranks reduced sharply and their workloads increased at the same time.”

Labor unrest is just what this administration needs.


* Related…

* Lawmaker laments ’session of nothing’

* A lot has to happen in three days

* Lawmakers racing the clock on budget

* Lawmakers hustle to craft spending plan

* House Democrats: little chance of passing capital plan

* Governor optimistic on big plan

* Editorial: Prospects for Illinois Works are dim

* Pension reform bill advances to full House

* Comptroller says Illinois needs to find other higher education funding

- Posted by Rich Miller        

  1. - Macbeth - Thursday, May 29, 08 @ 9:59 am:

    The “health care governor” I suspect is griping about how he’s doing his job (governing the state for the good people) but these agencies are not doing *their* jobs.

    It’s all very compartmentalized with Blagojevich, I suspect. It’s also a way to keep above the fray.

    These audit issues, I would assume, are the “fray.” A governor can’t effectively govern if he or she is always keeping tabs on the fray. We voted for Blagojevich (and, yes, most of us did — so nip that one right there in the bud) to govern, not to trifle about with the fray.

  2. - Stinky... - Thursday, May 29, 08 @ 10:01 am:

    Remember everyone, a fish stinks from the head down! Just another example of why RB needs to be removed from office. 2 more years of this and Illinois will be worse off then a 3rd world country!

  3. - wordslinger - Thursday, May 29, 08 @ 10:10 am:

    It’s sad, bad and makes you mad. The professionals in state government must wake up with a stomach ache every morning having to face another day of this stuff.

  4. - Hearing Voices - Thursday, May 29, 08 @ 10:24 am:

    No wonder Filan is no longer with OMB

  5. - Bluefish - Thursday, May 29, 08 @ 10:24 am:

    Unfortunately, the latest Holland audits will fail to garner major attention in the media. After all, the R Kelly trial is heating up.

  6. - Amuzing Myself - Thursday, May 29, 08 @ 10:25 am:

    And to top it all off, the Governor’s Office is the agency with the worst completion rate for state employee ethics training. Go figure!

  7. - Cassandra - Thursday, May 29, 08 @ 10:25 am:

    The Illinois middle class, most of whose members
    work in the private sector, should sit up and pay attention as AFSCME demands higher salaries and continued low-cost health and pension benefits for its members. Because we’ll be paying for it, along with higher gas, higher health insurance costs (8f we can get health insurance), higher food costs, higher utility costs and so on. Not to mention trying to squeeze out a few savings
    for our own retirements, which are unlikely to be as lavish as those of government employees. How much do our political masters think we can afford.

    And it’s not like Illinois state government is a meritocracy, with only the best and the brightest hired. The examples of bad office practices above are emblematic of a Democratic administration which sees state government as a vast respository of jobs and contracts for the politically useful and politically faithful and, most important, for “campaign contributors.” The fact that so many state agencies are evolving into total train wrecks is a matter of great indifference to Blago and his Democratic crew, including a great many
    purported liberal Democratic reformers (Carol Ronen comes to mind) who continue to support him.

  8. - Anonymous - Thursday, May 29, 08 @ 10:34 am:


    Is the capital plan in bill form yet? If so what number?


  9. - Anonymous - Thursday, May 29, 08 @ 10:35 am:

    Many state employees are NOT unionized, and many of them have gone without cost of living raises for years. Yet, whatever changes in the health insurance and pension plan are worked out with the union will also apply to them. They will end up having to pay for “lavish” union benefits they themselves never received! Oh well, I suppose the way to true economic equality is to make everyone equally miserable.

  10. - Rich Miller - Thursday, May 29, 08 @ 10:36 am:

    Anon 10:34, I’m not sure at this very moment. It wasn’t yesterday. At least, not in final bill form.

  11. - Anonymous - Thursday, May 29, 08 @ 10:45 am:

    Thanks Rich

  12. - North of I-80 - Thursday, May 29, 08 @ 10:47 am:

    No one should be surprised… those who work/worked under this group know what has been going on since Jan 2003. Will the media finally scream non-stop about this - making every public appearance of Gov B a public accounting for the mess he created? Will the public be utterly disgusted and keep this up front until answers are given?

  13. - Anon - Thursday, May 29, 08 @ 11:03 am:

    Unrest and AFSCME are synonymous.

  14. - jj - Thursday, May 29, 08 @ 11:28 am:

    Isn’t this the reason we have audits?

    I think its good to know that there are already mechanisms in place to catch things like this.

    I wouldn’t go far as to call this corruption, though. I mean, these things seem generally minor.

  15. - jj - Thursday, May 29, 08 @ 11:29 am:

    Let me clarify - minor on the political front.

    Not that I think improper handling of contracts and bureaucratic functions is not important.

  16. - Mr. Ethics - Thursday, May 29, 08 @ 11:35 am:

    So Blago wants almost free health care for all Illinois citizens but wants to stick it to state employees. Doesn’t make sense.

  17. - steve schnorf - Thursday, May 29, 08 @ 11:51 am:

    This is the type of year financially that makes it difficult for both sides to negotiate a contract. A little perspective is needed on the issue of health care for employees and retirees. It wasn’t that long ago that any employee with eight years of service got free health care for life. The concept of retirees with fewer than 20 years of service paying anything for health care is only about 15 years old. In negotiations, things have to be accomplished incrementally.

    I personally believe that all retirees should pay some part of their health coverage costs: I think they need skin in the game regarding increasing costs of health care. Unfortunately, in the contracts I worked on, we were only able to achieve that for employees with 19 or fewer years of service.

    The state probably pays more than it’s fair share of employee coverage (I’m guessing it’s still in excess of 90%), but the unions disagree, and believe that state pays far too little toward dependent coverage. I’ve always thought that 80-20 might be a fair compromise for both employees and dependents (that would save the state money, believe me) but that’s just my opinion. AFSCME prefers a flat dollar amount per member and dependent so the amount doesn’t increase automatically as health care costs increase, but has to be negotiated each contract.

  18. - Anonymous - Thursday, May 29, 08 @ 12:03 pm:

    Steve, when you say the state probably pays more than 90 percent of employee health coverage, does that refer to the Quality Care Health Plan, to the various managed care/HMO plans, or both?

  19. - steve schnorf - Thursday, May 29, 08 @ 12:06 pm:

    I’m guessing both. If I’m wrong, Hank or someone will quickly correct me.

  20. - Team Sleep - Thursday, May 29, 08 @ 12:06 pm:

    First, a capital bill, the new pension bond, the 10th casino license and any other major initiatives should not be completed until the ethics bill is signed into law and vetted by the SCOIL (the supremes). Can we trust anything at the top to do anything meritoriously?

    I keep thinking this: is it really ethical for Poshard to be pushing a capital plan? After all, he’s the currently president - and a handsomely paid one at that - of a major state university system. Why is he being allowed to basically lobby on behalf an elected official? I find this to be somewhat unethical. I like Congressman Poshard and think he’s doing a good job with SIU, but this smells rotten.

  21. - Princeville - Thursday, May 29, 08 @ 12:36 pm:

    not Hank, but it’s more like 20% now. The actual employee cost is scaled to wage, the family is set.

    Cassandra, no matter what you think of state employees, the generalize is what you like to drone on about. Take the 25,000 a year peon who pays out for one of the HMO. Person pays premium, then copays. Most hospitals now demand copay immediately. Copay for ER is now $200, Blago wants a drastic increase. But Gov Health Care For All wanted only –get this–$0 copay for his expanded healh care for ER for families making much more than this $25,000 a year.

    Majority of retires take the Quaulity Care, not HMO, like 70 %. This is the most costly to the state. The HMO take on most the liability, but with QC the state does.

    Unrest in employees? Doing ‘more with less’ seems to mean broken down equipment, less manpower, and total stressful conditions. Easy for you to judge though, uh?

    I’ve been quiet more or less for weeks while I’ve watched commenters bash and kick. But this attitude that tax payers pay and support state workers is silly. Yeah, your dollars pay the wage, but it is for a job performed. You have a plumber over, you pay for the services, you go for a hair cut and you pay for the services. The idea that state workers are leeches on society is is getting old.

  22. - Anonymous - Thursday, May 29, 08 @ 1:01 pm:

    Anyone know what percentage of current state employees take HMO coverage? Everyone in my office does. I wouldn’t touch QCHP with a ten-foot pole because the monthly premium (especially with dependent coverage) is almost twice as high as the premium for even the most expensive HMO, from what I could see. Hasn’t moving to HMO coverage with co-pays, etc. saved the state any money?

  23. - steve schnorf - Thursday, May 29, 08 @ 1:01 pm:

    Princeville, I’m 5 years from knowing the exact numbers, but 20% would have to be around $75/ month (or more) premium per employee for managed care, and likely $100 or more for quality care. Are the employee premiums that high now?

  24. - Princeville - Thursday, May 29, 08 @ 1:20 pm:

    Steve —QC is $60 to $72.50 depending on wage. HMO is $35 to $47.50 depending on wage. This is Period #1 prices, Period #2 is still pending.

    That is for employee only. Getting into ‘and dependents’ is by program (HMO or QC) and HMO selected and type of dependents. Worker and dependents must choose the same program.

  25. - Just Because - Thursday, May 29, 08 @ 1:40 pm:

    the sad part of the audit is nobody will do anything about it.

  26. - Crafty Girl - Thursday, May 29, 08 @ 1:57 pm:

    Cassandra, you seriously misunderstand the retirment benefits, health benefits, and salaries of the average, frontline State employee. While the health benefits may be somewhat better than those offered in the private sector, it’s a huge trade off with much lower public sector salaries. The average State employee retires with pension benefits that are barely above the poverty level.

    As for incompetence, well you see plenty of that in the private sector too. Every large company will have employees that work hard and produce and some that are barely confident. That’s human nature.

  27. - Reality Check - Thursday, May 29, 08 @ 2:21 pm:

    Better said, Cassandra willfully misunderstands the retiree benefits - right along with the rest of public-employee compensation, and the jobs performed by public-service workers. She’s content spouting her shallow anti-government, anti-worker ideology; please don’t confuse her with the facts.

  28. - Truthful James - Thursday, May 29, 08 @ 2:26 pm:

    Team Sleep –

    First before the Ethics Bill, before anything else let us have a truly balanced budget. And iron clad categories. This shape shifting movement to current demand from one sloppy agency to another ain’t good. What does the lender get out of it but an IOU.

    Normally the annual budget for a department or agency are the sum of the monthly budgets, each of which will vary. Or have the State employees merely used SWAG budgeting. Whatever, they do not seem tight.

    I have worked with smaller cities and villages throughout the Midwest and the State of Ilinois methodology appears to me the worst of all.

  29. - VanillaMan - Thursday, May 29, 08 @ 2:44 pm:

    Obviously there is a blogger among us without a clue as to the realities of public servant salaries and health care provisions.

    That is the blogger that makes blanket statements as to the inferiority of those who keep her government operating under today’s detestable conditions.

    Public servants in Illinois are not immuned to the skyrocketing costs of health care. They are paying an ever increasing amount, just like everyone else.

    Quit the finger pointing, the claims of unworthiness for honest compensation, and the justification of seeing your neighbor suffer because of a misguided belief.

    The only people getting themselves benefits at other’s expenses are the legislators who do nothing for their salaries and Former Senator Carol Ronen for the unethical scam she pulled recently, which grabbed her over a million dollars.

  30. - Macbeth - Thursday, May 29, 08 @ 2:46 pm:

    Weird. I was a state employee and wouldn’t touch the HMO with a 10 foot pole. Much preferred QC — and the few times I used it, I had zero problems.

    I put eleven years in and you bet I’m taking that pension. 11 years of state work, and I plan to extract every possible dollar. I did my part — and the parts of about five others in my office.

    I agree — the state worker-as-leech thing is getting old.

  31. - Kazelbtr - Thursday, May 29, 08 @ 3:21 pm:

    Hi webmaster!

  32. - Sir Reel - Thursday, May 29, 08 @ 3:32 pm:

    Cassandra likes stereotypes. They make life much simpler for her. State employees do get health insurance, but in some cases, it’s far from a great deal, what with deductibles, co-pays, non-covered items and services, etc. State employees are well compensated, but as Crafty Girl notes, so are many in the private sector. Plus, many MC employees have gotten the salary shaft for years. At this time, being a State employee in Illinois isn’t always a great job as State employees are often the focus of the frustrations of the public, unpaid vendors, constituents seeing their favorite programs/agencies decimated, etc. Most State employees are just as upset with their colleagues that don’t pull their weight and give all State employees a bad rep as everyone else. But these realities are too difficult to accept for those who get off on dumping on all State employees and lumping them all in with this current Administration.

  33. - Princeville - Thursday, May 29, 08 @ 3:34 pm:

    Actually Macbeth, some of the HMOs are not bad at all. But then again, over the years I had a couple that were terrible and should have never been contracted with. I’ve been lucky that my area has a number to pick from, but the areas that only have one maybe two to pick from had best do their homework on them–they are not all the same.

  34. - steve schnorf - Thursday, May 29, 08 @ 4:22 pm:

    I’ve had Personal Care for years and years, and have always been very satisfied with it.

  35. - sweinberg - Thursday, May 29, 08 @ 4:26 pm:

    The Institute for Truth in Accounting applauds Auditor General Holland’s audit report. We are working hard to bring such information to the public and are also saddened by the lack of attention paid to this report.

    The Illinois constitution requires a balanced budget. We are concerned that the Office of Management and Budget are also in charge of calculating whether the State budget is balanced. After studying the State’s financial reports, we believe that current and past governors and legislatures are not following the intent of the balanced budget clause. If they were following the intent of the balanced budget requirement, then why does the State find itself more than $44 billion in the hole.

    The current State legislators that we spoke to last month all mentioned that they have no idea how the budget numbers were calculated. The Institute is working to determine how a balanced budget is calculated. Some of the accounting gimmicks used are outlined in our booklet titled, Illinois’ Grande Illusion, which can be found at:

    Please contact us at: if you are interested in assisting us in trying to figure out where in the heck we can get the numbers to show how the Office of Management and Budget are meeting the balanced budget requirement.

  36. - steve schnorf - Thursday, May 29, 08 @ 5:09 pm:

    sweinberg, in one of your organizations documents you refer to the state as “bankrupt” but it doesn’t appear to me you are using the same definition of bankrupt that you would use with a for-profit company. ???

  37. - Six Degrees of Separation - Thursday, May 29, 08 @ 5:18 pm:

    To you state employees-

    Cassandra exists to tweak your chain, not to espouse any noble cause. I have often suspected “she” IS a state employee, maybe with DCFS, who isn’t particularly fond of her surroundings, and resorts to a sort of self-loathing attitude to get a reaction here. “She” does come up with some good commentary from time to time when not in knee-jerk mode.

  38. - anon - Thursday, May 29, 08 @ 5:18 pm:

    Though Personal Care and other HMOs may have decent coverage, if you have children attending college out of area or are a retiree who lives out of area, the only real choice is Quality Care. That would be the reason most retirees don’t accept the HMO option.

  39. - Bookworm - Thursday, May 29, 08 @ 6:49 pm:

    If the rumors are true, doubling the employee share of the premium and doubling copays, etc., in one fell swoop is a bit much and is bound to cause severe hardship to many state employees.
    I’m not union and not in the executive branch, so this may not directly affect me immediately. But if I suddenly had to cough up $200 extra per MONTH, right now, for health insurance for my family, that would put us in a world of hurt. I do not blame the union workers for being upset if that is indeed what’s been offered. I know it could be a harbinger of things to come for the rest of us as well.
    Yes, I realize private sector employees get their insurance premiums raised all the time, but there the adjustments are usually on an annual basis. An increase of 10 or 20 percent every year is bad enough, but not as bad as a 100 percent increase dropped like a bomb at the end of a four-year contract period.

  40. - Cassandra - Thursday, May 29, 08 @ 6:58 pm:

    Well, I am trying to combat the stereotype of the inattentive citizen who suddenly wonders why his taxes are so high or why he’s reading about a massive shortfall in some government agency or other. When any government employee union starts negotiating a big contract, it’s we who’ll end up paying, not the state’s negotiators. So we better pay attention and weigh in if we think it’s getting too pricey, especially in today’s economy.

    As to the quality of state government work, read the audit information cited in Rich’s summary of Holland’s audit. These errors were not committed by gremlins. They were committed by state employees, who work for us. And the notion that the state agencies have deteriorated under Blagojevich is hardly a new one. Other bloggers here talk about it every day. Blago isn’t interested in the craft of government. We hired a campaigner…twice! Not to mention the massive
    (Democratic) patronage.

    Six Degrees’ portrait of me as a state (DCFS) employee has caused a great deal of merriment at the family dinner table.

  41. - Truthful James - Friday, May 30, 08 @ 6:43 am:

    steverino –

    If that is the extent of your comments on Sheila Weinbergs excellent summary:

    then you are an apologist of the first water for this mess in Illinois.

  42. - Princeville - Friday, May 30, 08 @ 6:56 am:

    Oh, I see another nice try by the Cassandra. Really, Cassandra, do you actually believe that ‘massive shortfalls’ in state agencies are due to worker wages at the AFSCME level?

    Who are you going to blame the state’s ills on as more and more families in ‘today’s economy’ slip into needing assistance from the different state programs? And as more and more citizens need assistance it puts even more additional demands on the already understaffed agencies.

    “So we better pay attention and weigh in”—Cassandra, you’re not paying attention now, why in the world would the citizens need you to be their spokesperson and crusader?

    You are free now to tell us all what it is that you and/or your family do for a living. I’d like to now judge your worthiness. Oh course I’ll generalize and sterotype and blow truth out of proportion in my decision, but it might bring a bit of merriment to my dining table also.

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