Posts Tagged ‘double-dipping’

State Employee Contracting Controversy Addressed With Administrative Changes

By Sean Whaley | 3:37 pm October 13th, 2011

CARSON CITY – Ten months after a legislative audit first raised serious questions about current and former state employees working as contractors for state agencies, the Board of Examiners earlier this week approved administrative changes to prevent future abuses.

The changes approved Tuesday bring closure to the issue of “double dipping”, but not before it spawned legislation and a serious examination of the state employee contracting process.

The audit, released in December 2010, identified numerous potential concerns, including a case of one worker seeking payment for 25 hours of work in one 24-hour day and another where a current state employee earned $62,590 as a contractor in fiscal years 2008 and 2009 while earning a state salary as well.

The audit identified 250 current and former employees providing services to the state. These employees were paid a total of $11.6 million during fiscal years 2008 and 2009, the years covered by the review.

The Board of Examiners is composed of Gov. Brian Sandoval, Attorney General Catherine Cortez Masto and Secretary of State Ross Miller.

In addition to the administrative changes, Masto’s office was asked by the Legislative Commission’s Audit Subcommittee to review the information for potential criminal violations.

Jennifer Lopez, a spokeswoman for the Attorney General’s Office, said today the requested review was completed on June 10 but no action was taken against any current or former employees referenced in the audit.

“The case was declined due to insufficient evidence primarily related to the fact, as pointed out in the legislative audit, that no positive controls were in effect to document or record the time state contractors were actually engaged in their state duties,” she said.

The new rules added to the State Administrative Manual implement the changes mandated by Assembly Bill 240, sponsored by Ways and Means Committee Chairwoman Debbie Smith, D-Sparks.

The new rules prohibit a current state employee from being hired under contract by a state agency unless approved by the Board of Examiners. The same approval is required of a former state employee who has not been out of state employment for at least two years.

Such contracts can only be approved if certain circumstances are found to exist, including situations where a short-term or unusual economic circumstance exists for an agency requiring such employment.

Smith said she is pleased with the voted by the board.

“I think we’ll see a lot better accountability and reporting on the use of consultants because of this,” she said. “I’m glad. It may be the type of thing that we need to keep sort of tweaking each session until we have it where we need it to be, but so far, so good.”

“I think we demonstrated it was the right thing to do,” Smith said.

State Sen. Sheila Leslie, D-Reno, who serves as chairwoman of the Audit Subcommittee, said she was pleased that the Sandoval administration took the audit recommendations seriously. They are overdue, she said.

“There were a few instances that either were very sloppy record keeping or might have been more suitable for prosecution, so I hope somebody is following up on those,” Leslie said.

Sen. Sheila Leslie, D-Reno. / Nevada News Bureau file photo.

“If citizens are going to have confidence in government, they need to be assured that everyone is playing by the same rules,” she said. “The audit raised a lot of red flags about whether there were state employees who were getting sweetheart contracts.”

The administrative changes approved Tuesday will go a long way to correcting any such abuses, Leslie said.

The administrative changes come as yet another state employee contracting controversy involving a new member of Sandoval’s cabinet was recently reported in the Las Vegas Sun. The newspaper reported Sept. 29 that Frank Woodbeck, the newly appointed director of the Nevada Department of Employment, Training and Rehabilitation, held down two state jobs last fiscal year, earning almost as much as the governor.

Woodbeck told the newspaper he worked 60- to 70-hour weeks to fulfill the demands of the two jobs.

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Audio clips:

Assemblywoman Debbie Smith says the law may need tweaking, but she is pleased with the changes:

101311Smith :10 far, so good.”

State Sen. Sheila Leslie says she is pleased the Sandoval administration took the audit recommendations seriously:

101311Leslie1 :20 the same rules.”

Leslie says the audit raised red flags about whether there were state employees getting sweetheart contracts:

101311Leslie2 :26 the Audit Subcommittee.”

Leslie says there were a few instances that may have risen to the level of prosecution:

101311Leslie3 :11 up on those.”

Audit Revealing “Double Dipping” Employees Spurs Legislation

By Andrew Doughman | 6:19 pm March 8th, 2011

CARSON CITY – Speaker Pro Tempore Debbie Smith, D-Sparks, wants better reporting on state contracts with consultants.

She said an audit last December proved that lax reporting requirements had allowed many consultants to profit from taxpayers as they escaped legislative scrutiny.

She asked the auditing staff how she could improve oversight of consultants. They recommended removing references to consultants in favor of defining “contract” broadly. So that is what Smith wrote into her bill.

“People figure out loopholes and somebody abuses them, and that’s bad for everybody,” Smith said.

Salaries earned by current and former state employees working as contractors for state agencies, a practice called “double dipping,” was the subject of a critical Legislative Counsel Bureau audit released late last year. The audit identified 51 current and former state employees working at 14 different agencies as contractors doing work similar to their duties as state employees during the audit period of fiscal years 2008 and 2009.

A Nevada News Bureau inquiry probed into allegations that one of those employees was earning $350 per hour.

Smith’s bill would cover most contracts with state agencies.

The bill, however, exempts contracts related to school districts, Medicaid and the Public Employees Benefits Program from her bill.

Smith said that the Medicaid and Public Employees Benefits Program contracts pass through other oversight that the Legislature need not take up.

“It will involve every contract that needs to be considered,” she said.

A Board of Examiners comprising some of the state’s constitutional officers vet those larger contracts.

Smith highlighted her bill at a press conference earlier this afternoon. She joined several other Democratic legislators who also paraded bills they are championing before members of the press this afternoon.

The bill has bipartisanship sponsorship.

Audio Clip

Assemblywoman Debbie Smith talking about how her bill increases accountability:

030811Smith:15 our state well

Colorado River Commission Pays Big Bucks To ‘Double-Dippers,’ But No $350 Hourly Rate

By Sean Whaley | 10:30 am January 14th, 2011

CARSON CITY – Nevada’s Colorado River Commission is one of the state agencies cited in a recent legislative audit as paying some of the highest salaries to former state employees working as contractors, the Nevada News Bureau has learned.

Information obtained as a result of a public records request shows two former state employees, James Davenport and Sara Price, both attorneys, have collectively earned over half a million dollars in salaries as contractors for the agency over the past three and a half years.

Davenport, who was a manager for the CRC when he ended his state employment, has earned $411,708 in that time and Price, who was a deputy attorney general within the Nevada Attorney General’s Office when she ended  her state employment,  has earned $105,431.

Officials with the agency, which is not funded with taxpayer dollars, defend Davenport’s contract as necessary for the state to protect itself in complex negotiations with other states and the U.S. over the use of Colorado River water in the midst of a lengthy drought. He started his work as a contractor after retiring from the state in the fall of 2006.

Despite a section of his contract indicating he could be paid $350 an hour for his work, Davenport never earned such a rate, agency officials said.

Price’s work as a special consultant to the commission on matters concerning the Lower Colorado River Multi-Species Conservation Program is also essential for complying with the Endangered Species Act, the officials said.

The Colorado River Commission is a small state agency employing only about 35 people. Its budget is derived from water and power sales to various entities and is not funded with taxpayer funds of any type.

Colorado River Commission Executive Director George Caan said because of its size, the agency relies on contractors to provide specialized expertise when necessary.

Salaries earned by current and former state employees working as contractors for state agencies, a practice called “double dipping,” was the subject of a critical Legislative Counsel Bureau audit released late last year. The audit identified 51 current and former state employees working at 14 different agencies as contractors doing work similar to their duties as state employees during the audit period of fiscal years 2008 and 2009.

Two such employees were identified as working for the Colorado River Commission.

Davenport’s initial contract shows that he was paid up to $10,000 a month plus expenses. It also says that if the monthly payment was deemed “disproportionately large or small,” that the contractor “shall invoice the commission in the amount of $350 per hour for worked performed in lieu of the monthly payment.”

The Davenport contract appears to be one highlighted in the Legislative audit issued late last year: “For example, one agency contracted with a former employee at a rate of $350 per hour vs. $65 per hour cost to the state as an employee.”

But Caan said Davenport was never paid $350 an hour despite the contract language authorizing such a rate. Instead, Davenport was paid up to $120,000 a year, he said.

The agency was not contacted by legislative auditors to discuss the contracts ahead of the release of the audit, said CRC Deputy Executive Director Jim Salo.

An analysis by the agency of the hours Davenport worked in fiscal years 2007, 2008 and 2009 shows he earned on average about $185 an hour, more than his hourly rate as a state employee but well below the $350 rate cited in the audit.

The contract was modified in May 2009 and the $350 an hour component was eliminated. The revised contract, which reduced the monthly maximum pay to $5,000, was approved by the state Board of Examiners, made up of the governor, secretary of state and attorney general.

Caan said Nevada was in the midst of negotiations with the federal government and the six other states in the Colorado River Compact regarding water usage during the current drought when Davenport retired. His experience in the negotiations made it critical for the commission to continue to use his services, he said.

“So the reason to keep Jim working at the same kind of responsibility he had in this position was to ensure the continuity of those important discussions among the seven states and the federal government,” Caan said. “That was the criteria that we used in order to substantiate Jim’s continued work on behalf of the commission at a pay that was equivalent to what he would have earned had he kept up his state employment.”

Davenport is also representing Nevada and the commission as a special deputy attorney general in a Colorado River water rights case involving the Navajo Reservation in Arizona.

Davenport’s contract is anticipated to expire completely on June 30 of this year, Caan said. The lower monthly rate of pay in the renegotiated contract is because his work is coming to an end, he said.

Price’s contract shows she was hired initially at $175 an hour up to $125,000 starting in April 2005. The contract was also approved by the Board of Examiners. The contract was revised in April 2007 and the hourly rate increased to $190 up to $125,000 a year. It was amended again in April 2009 to $210 an hour through April 2011.

She had worked in the Attorney General’s office as an attorney assigned to provide legal advice to the Colorado River Commission.

“We have lots of lawyers who work . . . for the seven basin states who work for different agencies,” Caan said. “What Sara is earning is probably at the low end of what they earn and is certainly reasonable for someone with her expertise.”

Davenport could not be reached for comment.

Price said her contract with the commission has been managed conservatively and the maximum limit has never been exceeded.

Audio:

Colorado River Commission Executive Director George Caan says the agency only hires contractors when specialized expertise is required:

011211Caan3 :20 a full-time person.”

Caan says Davenport’s continued employment was critical for important Colorado River negotiations:

011212Caan1 :12 the federal government.”

Caan says Davenport was paid at a level similar to what he earned as a state employee:

011211Caan2 :16 his state employment.”

Caan says Price is being paid a reasonable salary for her work:

011211Caan4 :14 with her expertise.”