Audit: Disturbing Lack of Sunshine on State Contracts

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October 19, 2011

Who sells to the government and for how much is information that should be available to the public. But recently members of the Legislature’s Joint Audit Committee heard different.

In describing the difficult audit process Interim State Auditor James Chrisman said, “We encountered questions at every step. Who was to report; what was to be reported; when was it to be reported; how was the reporting mechanism working or not working.”

The ‘Contract Sunshine’ law requires most state purchases of $10,000 or more to be reported within 24 hours to the Government Accountability Board (GAB). In turn, contracts are posted on a website to allow the public to see who is buying what and for how much.

But the Legislature created the 2006 law without an adequate budget or staff; without a requirement the vendor name be made public and without a clear penalty for enforcement.

Many agencies simply ignored the law.

Auditors found that after more than a year of operation less than a third of agencies reported any information about state contracts on the Contract Sunshine website. Only one of the agencies the auditors spoke with had a written plan for reporting contracts. Despite the 24-hour reporting requirement, two-thirds of the agencies reporting contract information were more than ten days late.

When auditors began to collect information on compliance, agencies began to send in missing data. More than sixty percent of all contracts in the state’s Contract Sunshine website (http://sunshine.wi.gov/) were submitted after the audit began. Several large agencies started reporting for the first time after auditors began their work.

Last session, as the Senate Chair of the Joint Audit Committee, I and my co-chair Representative Barca supervised approval of this audit. I was concerned that an increasingly larger amount of the state’s budget was work being done by out-side contractors. With such large sums of taxpayer money at stake, it was most important contract information be made public. But I continued to hear stories about problems with the Contract Sunshine website.

The portal into state contracts was, for the most part, a shuttered window.

The work of state auditors verified my concerns. The website was not easily searchable, included duplicate and inaccurate information, lacked vendor names and was missing significant contracts. For example, auditors found no information related to highway construction projects.

Through my questioning I learned that even now we don’t know how many contracts are missing from the Contract Sunshine website. This is most disturbing.

A major problem in getting contract information to the public was getting it from the Department of Administration (DOA). This is a large agency that does purchasing for twelve other agencies. During the hearing a GAB lead attorney testified DOA was ‘able but unwilling’ to report contract information because staff had to log-in and log-out of account for each of the 12 agencies.  This problem was not solved until 2010 – four years after state law required reporting.

In the last state budget, Republican leaders moved the responsibility for Contract Sunshine from GAB to DOA. This might not seem like a big improvement, but testimony at the hearing suggested it might be. Wisconsin has centralized many state purchasing tasks in DOA. Using the state system that buys things to also post contract information may increase efficiencies. State officials testified the new system would be completely automated decreasing staff time and errors.

But questions remain about the independence of the information if the entity that negotiated the contract, writes the check and posts the information to the public is all one-in-the-same. It’s a bit like the coyote guarding the hen house.

Setting up checks and balances in the spending of state money has not received a great deal of attention in Wisconsin. Who gets state contracts and for how much is not easy information to find despite requirements in state law. With potentially billions of state dollars at stake and new contracts signed every week, this aspect of state government deserves greater scrutiny. Our state auditors have begun the process. It is up to elected officials to keep asking questions and make sure the sunshine really does shed light on state government.


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