Audits save money in end
Barely more than two years ago, a comfortable 56 percent of Washington voters approved Initiative 900, giving the state auditor authority to conduct performance audits of state and local agencies.
The measure’s success at the polls repudiated a relatively feeble alternative offered by the Legislature. The legislative version would have limited the effect of the proposal to state agencies, whereas I-900 covered state and local governments.
The legislative plan provided only $2.8 million to cover the auditor’s costs. The initiative dedicated 0.16 percent of the state’s share of the sales tax, or more than $10 million a year.
The inclusion of a clear, reliable source of funding was a significant part of the case that proponents made for I-900.
Now, after nine audits have been completed under the measure, and with eight in progress, an effort is under way in the Legislature to siphon off part of that dedicated funding stream. Auditor Brian Sonntag strongly opposes that idea, and lawmakers should take his arguments to heart.
Senate Bill 6450 is intended to let school districts and educational service districts be reimbursed out of the auditor’s funds for their costs of gathering materials needed by the auditors. At a time when local schools are already protesting the mandates put upon them by the state, without accompanying funds, it’s easy to see the appeal of SB 6450.
Except, as Sonntag pointed out during legislative testimony last week, the information sought is information the agencies already have and would be expected to produce for anyone making a public records request.
But more than that, the record Sonntag’s office has compiled in the short time it’s had performance audit authority suggests it pays for itself in most cases. Performance audits go beyond mere financial audits. They measure agencies’ efficiency and effectiveness.
Since I-900 took effect, Sonntag’s office has made more than 400 recommendations that, if implemented by the affected agencies, would save an estimated $3.2 billion over the next five years. That’s an impressive return on the $10 million or so a year in dedicated sales tax revenues.
One early audit was of the state’s nine educational service districts. That audit produced 215 recommendations and identified $23.5 million in potential savings over five years. That would be more than enough to cover the districts’ expenses. Besides, a special task force is making a comprehensive study of the state’s basic-education funding formula. The cost of participating in a performance audit would be more logically treated as a district’s overhead expense than taken out of the funds needed by the auditor to do the job right.
And, as Sonntag testified, if the schools are entitled to recoup their expenses, what about the rest of the 2,700 state and local agencies covered by the initiative? The dedicated funding stream that helped persuade voters to pass the measure in 2005 could be quickly and seriously eroded. This is no time to renege on a promise.