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Madigan points to Dixon as reason to block merger proposal

Thursday, May 3, 2012

* Years ago, Illinois had one person who acted as both state comptroller and treasurer. That person got busted embezzling funds, and so the Constitution was changed to split the office into two entities. Speaker Madigan has always pointed to that history as his reason to block a constitutional amendment to combine the two offices, which supporters say would save $12 million a year. Madigan now has a new reason

Illinois House Speaker Michael Madigan’s spokesman [yesterday] defended his opposition to a plan that would merge the Illinois comptroller and treasurer’s offices, by pointing at Dixon—the small northern Illinois town where the single fiscal officer now stands accused of embezzling some $53 million.

“If that doesn’t give them pause, I don’t know what will,” spokesman Steve Brown said of proponents who want to merge the two state offices. […]

Such a change would require a state constitutional amendment. But the Madigan-controlled committee process has kept the measure bottled up, against fervent Republican pressure to let it out for a vote.

“It’s simply tyranny,” the sponsor, Rep. Dennis Reboletti, R-Addison, said in angry floor debate [yesterday].

Madigan and other opponents say there’s no proof the merger would save money. More than that, they say, having separate offices for collecting, investing and dispersing state money ensures checks and balances, reducing the likelihood of fiscal shenanigans by any one office or officeholder.

Discuss.

* Meanwhile, from Illinois Statehouse News

A bill requiring local governments to post financial information could help to expose and prevent fraud, supporters of the measure say.

The Illinois Policy Institute, state Sen. Dan Duffy, R-Lake Barrington, and other lawmakers are pushing Senate Bill 3392, which would require local governments to post their budgets, audits and expenditures. The institute is a nonpartisan, nonprofit think tank that supports free markets.

The proposal comes after federal charges were filed against Dixon comptroller Rita Crundwell, who is accused of taking $53 million from taxpayers.

The Illinois Policy Institute looked at 130 local governments, and measured them based on transparency.

“After seeing how little public information is available on Dixon’s website, it’s no surprise that the alleged theft went under the radar for so long,” said Brian Costin, director of government reform for the institute.

Crundwell became comptroller of Dixon, a town of about 16,000 people, in 1983. Some seven years later, court documents said, Dixon began funneling city funds into personal bank accounts, using the money to buy a horse farm, several cars and a $2.1 million motor home.

- Posted by Rich Miller        

21 Comments
  1. - Oswego Willy - Thursday, May 3, 12 @ 10:02 am:

    Madigan found his “cover” to keep both offices … at the expense of the horrible situation in Dixon.

    This Dixon fiasco will derail the merger for a long time.


  2. - Cincinnatus - Thursday, May 3, 12 @ 10:14 am:

    Is not AG Madigan already tasked with making sure that fraud is prosecuted, in Dixon and in a combined Comptroller/Treasurer office, and are there not Inspectors General who, along with the legislature providing oversight?


  3. - Pot calling kettle - Thursday, May 3, 12 @ 10:15 am:

    While posting the financials on-line sounds like a great idea, it would cost time and money to do it. At a time when the financial situation of many local governments is tenuous, it seems like this extra expense would need some strong indication that it would accomplish the desired goals.

    The more you put on a web site, the most the host charges, and they would likely charge more if they know the user has no choice. In addition, it takes time to format and maintain this information. And, for it to be useful in the way envisioned, there would need to be enough information put up for a citizen to audit the transactions; that would be pretty much everything.

    Then, you have to wonder, would any citizens take it upon themselves to actually do such an audit? It seems unlikely unless there was some political antipathy or a very clear indication that something wrong was happening. If the former, is that what we really want? If the latter, someone in government would probably take a look.

    On the whole, I think posting detailed financials would be a cost not justified by the potential benefit.


  4. - Bigtwich - Thursday, May 3, 12 @ 10:15 am:

    Orville Hodge is reason enough to derail the merger.


  5. - TCB - Thursday, May 3, 12 @ 10:18 am:

    I don’t understand this $12M number either….are they saying that one (or both) of these GOP controlled offices are bloated & could be downsized?

    If not, what the heck makes up this $12M? Assuming both offices are running efficiently, the only savings created by the elimination of 1 office is the salary/travel/expenses of one of those officers, which better not be $12M!

    Im in agreement with Madigan, even if the number is $12M (which it probably isn’t) its worth that amount to avoid another major scandal in Illinois.


  6. - Freeman - Thursday, May 3, 12 @ 10:34 am:

    Does Dixon have an auditor general? Or an Attorney General? Or Comprehensive Annual Financial Reports completed by independent auditors?

    Dixon was one woman from a small staff with no checks or balances on her for many, many years.

    Plus, I thought we were supposed to be in “painful cuts” mode in our state???

    It’s difficult to justify prioritizing this ahead of facility closures, Medicaid cuts, etc. Especially when the Treasurer and Comptroller are both on board with saving the state $12 million and we won’t do it.


  7. - mark walker - Thursday, May 3, 12 @ 10:36 am:

    Madigan’s right: this is one defense against financial corruption, used in most large corporations. But there are ways to keep the functions operating separately even when they’re under the same constitutional elected office.


  8. - Ahoy - Thursday, May 3, 12 @ 10:36 am:

    “It’s simply tyranny,” said Rep. Reboletti.

    What? Let’s tone down the hyper-bowl language buddy. Maybe instead of being bitter about who controls the Chamber you should work at winning elections and instead of acting like a child on the House floor.


  9. - Hickory - Thursday, May 3, 12 @ 10:45 am:

    Internal controls should prevent corruption. Combine the two offices ASAP.


  10. - Oswego Willy - Thursday, May 3, 12 @ 10:47 am:

    ===Madigan’s right: this is one defense against financial corruption, used in most large corporations. But there are ways to keep the functions operating separately even when they’re under the same constitutional elected office.===

    This will be the response to that …

    “With two offices, and two seperate ELECTED officals, being held accountable, and having to answer for spending and investing, the people of the state of Illinois will be best served KNOWING who is responsible, as opposed to faceless buerocrats in ONE office watchiing over the entire treasury.

    Illinois deserves better than beurocrats that they don’t know, in one combined office.”


  11. - Dirty Red - Thursday, May 3, 12 @ 10:49 am:

    = Years ago, Illinois had one person who acted as both state comptroller and treasurer. =

    and

    = Orville Hodge is reason enough to derail the merger. =

    This drives me CRAZY! Hodge did not have the responsibilities of the State Treasurer. Hodge was able to steal from the state because he could write himself checks (issuing warrants is now the Comptroller’s primary function), cover his tracks during audits (enter the Auditor General in the post-Hodge Constitution), and cash the checks at banks his office was in charge of regulating (a duty shifted to what we now know as DFPR).

    Madigan is using all the time that has passed since Hodge was busted to throw mud in our eyes. Having these two offices as one WAS NOT what allowed Orville Hodge to be Orville Hodge. There has not, to my knowledge, ever been an indictment involving abuse of powers in the Treasurer’s office (Bill Scott was busted for using campaign funds on personal expenses when he was Attorney General, but that’s it).

    The Constitution even says that the Treasurer must move funds as the Comptroller orders. That means not much would change except less bureaucracy and one less elected official. Both of which lead to the cost savings.


  12. - Oswego Willy - Thursday, May 3, 12 @ 10:55 am:

    I am waiting for this one next;

    “If looting millions and millions can be done in a town of 16,000 residents and ONE treasurer, imagine what ONE office for 13 million people could do with billions running through the treasury. A Two-Office, $12 million cost to prevent that, is worth every penny.”

    It ain’t about the cost, money, checks and balances …it about politics and Madigan wanted it stopped well before Dixon, and Dixon is going to be used as the hammer to pound the Merger Bill to its demise.


  13. - Colossus - Thursday, May 3, 12 @ 10:59 am:

    I can sympathize with wanting to put the financials online, but how many of you have looked at county clerk sites throughout Illinois? There are counties that have literally no web presence, that still mail out info requests instead of email because they don’t keep them electronically.

    Did I half hear an NPR blurb about Elections wanting to help upgrade online election results reporting for the counties? I think that if you can improve the web infrastructure of the counties and cities it would go a long way towards helping these two ideas happen.

    It’s the 21st century, folks. There are no excuses for not utilizing this wonderful, free information dissemination device called the Internet. At least, no excuses that don’t boil down to “I’m old and don’t understand computers.”


  14. - Jake From Elwood - Thursday, May 3, 12 @ 11:01 am:

    If we follow Madigan’s logic, then I guess we should get rid of the State Auditor because as I understand it, the City of Dixon’s long time auditors did not identify the Crundwellian machinations.


  15. - GA Watcher - Thursday, May 3, 12 @ 11:21 am:

    Ahoy:
    Let’s cut Rep. Reboletti and Rep Bost, for that matter, some slack. they are just getting into their new roles as floor rabble rousers. It makes for good entertainment if anything.


  16. - Cal Skinner - Thursday, May 3, 12 @ 11:26 am:

    State law should require that outside auditing firms look for fraud.

    The CPA’s are not charged with that task now, at least that’s what I heard listening to Huntley School District 158 auditors.


  17. - Bigtwich - Thursday, May 3, 12 @ 1:01 pm:

    Dirty Red, can not say what let Orville be Orville, but I do know, “The Comptroller’s Office was created by the Constitutional Convention of 1970 as an expanded replacement for the Office of the Auditor of Public Accounts.” At least JBTs website says that. I believe they had Orville in mind.

    As far as indictments and the Treasures Office, see
    http://www.justice.gov/usao/ilc/press/2009/02February/02Kirby.html

    “Springfield, Ill. - A former senior accountant for the Illinois State Treasurer’s Office was ordered to serve 30 months in federal prison for embezzling approximately $750,000 in state funds prior to her retirement from the agency. During today’s hearing, U.S. District Judge Jeanne E. Scott ordered Debra Kay Kirby, 54, of Taylorville, Illinois, to report to the federal Bureau of Prisons on April 1, 2009, to begin serving her prison term. Judge Scott further ordered Kirby to pay $263,408 in restitution, the amount Kirby pocketed as a result of the offense, to the Treasurer’s Office.”


  18. - foster brooks - Thursday, May 3, 12 @ 1:15 pm:

    People forget that the state treasurers’ office signed off on the city of dixons audits.


  19. - The Captain - Thursday, May 3, 12 @ 2:17 pm:

    This whole discussion is ridiculous, $12 million is a preposterous number. Let me explain:

    The comptroller’s office pays bills and oversees some cemetery business (you may have read something about that). The treasurer’s office does all the same accounting that the comptroller’s office does but it also has to invest all the state’s money, manage the state’s unclaimed property, Bright Start, a venture capital fund, a local government investment pool, etc. So there are some things where consolidating the two offices could save on duplication (legal, press, HR, administrative, accounting, etc) but there are also a number of things that are unique that consolidation won’t affect.

    Now go look here at the budget book and scroll down to 11-23. The total GRF payroll for the entire Treasurer’s office in FY was $5.7 million. So if you fired every GRF employee, every single one of them, you’d only save $5.7 million. The Treas office has some non-GRF employees but none of them would overlap with anything the Comptroller’s office does so none of them would be affected.

    It’s hard to take any of this discussion seriously when it starts with a projected saving that is so ludicrous it hurts your mind.


  20. - reformer - Thursday, May 3, 12 @ 3:35 pm:

    There is something to be said for checks and balances. Not that many exist in the General Assembly.

    As I remember Orville, he was a Republican.


  21. - Oswego Willy - Thursday, May 3, 12 @ 3:56 pm:

    ===People forget that the state treasurers’ office signed off on the city of dixons audits.===

    Let’s leave ‘Alexi’, ‘Banks’, and ‘Audits’ out of the discussion please … there is nothing in commin between those things.


Sorry, comments for this post are now closed.


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