Despite Targeted Funding, California Prisons Didn’t Fix Disciplinary Process
February 12, 2024
Topline: California’s prison system received $34 million to institute reforms related to staff misconduct allegations. Although new rules were put forward, the process never changed because prison staffers continued to operate under the old rules.
Key facts: Inmates can file reports with the California Department of Corrections and Rehabilitation (CDCR) if they believe they have been mistreated. If the mistreatment stems from a prison employee, the issue is addressed by a team from another prison to avoid bias.
In 2021, the state inspector general found that prison staffers were the ones determining if a misconduct allegation against themselves or their colleagues was worth flagging for investigation, presenting an obvious conflict of interest.
The department requested $34 million from the state in its 2022 budget to “restructure its staff misconduct allegation screening.” The rule changes were made on paper, but prison staffers kept following the old system anyway, leading the state inspector general to criticize the $34 million in “wasted resources" in a Jan. 29 report.
As a result, 595 allegations of misconduct against prison staff were classified as “routine grievances” and investigated by the same prisons where the misconduct may have occurred.
The process “resulted in a wasteful duplication of efforts and misallocation of resources” because investigative work had already begun on some of the 595 cases before they were reclassified, according to the IG.
The drawn-out process also caused the statute of limitations to expire on 127 cases, 22 of which could have caused a prison employee to be fired had the case been investigated.
Background: While it’s impossible to quantify the dollar cost of the misallocated resources on top of the wasted $34 million, CDCR's budget doesn't have excess funds to spare. The department spent almost $2.5 billion just to pay outside vendors in 2022, according to OpentheBooks.com.
The 2023-24 budget allocates $14.5 billion for the department, more than any other state prison system.
Supporting quote: “This reassignment complied with regulations and was shared with the Office of the Inspector General in advance,” CDCR Secretary Jeffrey Macomber wrote in his response to the IG report. “Of note, the reassigned grievances amounted to less than one-third of one percent of all grievances reviewed by the Department in calendar year 2023.”
Critical quote: “The department’s attempt to downplay the impact of its decision by pointing out that it only affected a small percentage of grievances ignores the impact its decision had on the incarcerated people whose allegations of staff misconduct were not reviewed in compliance with the department’s current regulations,” the IG wrote in the report.
Summary: $34 million is a lot of money just to rewrite the rules of a bureaucratic process, especially if the process is never actually changed.
Pentagon Spent $53.2 Million In Covid-19 Funds On Paint, Wi-Fi, Gym Equipment
February 13, 2024
Topline: The Department of Defense spent $53.2 million on items including exercise machines and acrylic paint and then categorized them as expenses caused by the pandemic, according to a recent DoD Inspector General report.
Key facts: From March 2020 to January 2022, DoD staffers were allowed to make Government Purchase Card orders of up to $35,000 to “support the DoD’s response to the Covid-19 pandemic.” This resulted in 110,525 purchases, totaling $242.6 million.
But auditors estimated that $53.2 million of those purchases were not even related to the pandemic.
Additionally, 52% of the purchases were not properly documented.
An estimated 45% of the erroneous purchases came from the Air Force and 36% came from the Army.
For example, one Army member spent almost $3,000 on plumbing repairs and marked the transaction in the “Covid-19” category. The official who reviewed the notes did not correct the error.
Other orders included $76 of paint for a middle school art course and 10 cybersecurity training courses costing $23,400.
The Air Force bought over $4,000 of gym equipment, including four NordicTrack skiing machines, and spent $540 on Wi-Fi services.
The Air Force was also responsible for 56% of the documentation errors, such as losing receipts and failing to ensure that purchased items were actually delivered.
The report says that the mistakes created an “increased risk that fraudulent, improper and other abusive activity could occur without detection.”
Background: Previous reporting already revealed that the Pentagon spent most of its $1 billion in Covid-19 relief funds on military equipment instead of medical items.
The Pentagon is often in the headlines for wasteful spending and inefficient internal controls that result in documentation errors. The DoD began conducting internal audits in 2018 and has failed every single one.
The Pentagon owns $3.8 trillion in assets — more than 10% of the country’s GDP — but can’t even account for half of them in financial records.
Critical quote: “Without proper oversight, the DoD faces the challenge of ensuring that [Government Purchase Card] purchases align with contingency operations, are adequately documented, and adhere to established policies,” said Inspector General Robert P. Storch. “Addressing these issues is crucial to maintaining accountability, transparency, and the effective use of taxpayer resources in the response to Covid-19 and any future pandemics.”
Summary: Poor internal controls at the Pentagon have jeopardized taxpayer money for years, and it’s now apparent that the deficiency spilled over into the DoD’s Covid-19 response.
Expanded EV Charger Tax Credit Will Now Cost $900 Billion
February 14, 2024
Topline: A $7,500 federal tax credit meant to help those in poor or rural areas buy electric vehicle chargers is now applicable to parts of huge cities like New York and Los Angeles, according to updated rules from the Treasury and a Wall Street Journal report.
Key facts: President Joe Biden’s Inflation Reduction Act in 2022 created a tax break that covers 30% of the cost of an EV charger for “low-income and non-urban” drivers.
This month, the Treasury changed its definition of “low-income” to include neighborhoods where the median income is less than 80% of the surrounding area’s median income.
That definition fits relatively poor areas of prosperous cities such as Manhattan's Times Square, where income is high but still lower than most of New York, according to the Wall Street Journal.
The updated meaning of “non-urban” includes any neighborhood where less than 90% of blocks are designated as urban. So, a town that is 89% bustling metro could claim the tax credit as a rural area.
Now, “low-income and non-urban” applies to two-thirds of America, according to the White House’s press release.
Background: The credit expansion will contribute to the rising cost of Inflation Reduction Act climate subsidies. Democrats said that the subsidies would cost $391 billion when the bill first became law, but The Brookings Institution estimates the real cost at closer to $900 billion.
The Treasury has already issued guidance that expanded tax credits for “energy property” such as solar panels.
Critical quote: “The Administration just will not stop ignoring the law in pursuit of its radical climate agenda — no matter the cost,” Sen. Joe Manchin (D-WV) said in a written statement. “This proposed guidance ensures that rural Americans will remain stuck at the end of the investment line, the exact problem this tax credit was supposed to address, choosing to give hand-outs to those that don’t need it while ignoring its responsibility to provide a hand up to rural communities at risk of being left behind.”
Summary: The Inflation Reduction Act’s investments in clean energy are important for the country’s future, but sending $7,500 tax breaks to individuals who can afford new technology themselves is a way to waste taxpayer dollars.
Throwback Thursday: In 2008, DOJ Pays Teens To Jar Salsa, Salad Dressing
February 15, 2024
Throwback Thursday!
Topline: In 2008, the Department of Justice earmarked $517,000 — $754,000 in today’s money — for the Cleveland Botanical Garden’s “Green Corps,” a summer program that teaches high schoolers how to make and sell salsa and salad dressing.
That’s according to the “Wastebook” reporting published by the late U.S. Senator Dr. Tom Coburn. For years, these reports shined a white-hot spotlight on federal frauds and taxpayer abuses.
Coburn, the late U.S. Senator from Oklahoma, earned the nickname "Dr. No" by stopping thousands of pork-barrel projects using the Senate rules. Projects that he couldn't stop, Coburn included in his oversight reports.
Coburn's Wastebook 2008 included 65 examples of outrageous spending worth more than $1.3 billion, including the $517,000 wasted in Cleveland.
Key facts: Teenagers participating in the Green Corps worked together to produce 6,000 jars of “Ripe From Downtown” salsa, which were then sold for $5 per jar, according to news reports from the time.
Other program objectives included learning the difference between rice and quinoa and deciding which spices taste best on vegetables.
The program had 55 participants, meaning the DOJ spent over $9,400 on each Cleveland student. Adjusted for inflation, that’s almost $14,000 per student — which would have been enough to pay for a semester of tuition at Cleveland State University last year.
Background: 2008 was not the only time the Cleveland Botanical Garden received tranches of questionable taxpayer funding.
In 2023, the state spent $23.2 million on Ohio Arts Economic Relief grants. The second largest of 139 grants went to the Cleveland Botanical Garden: $671,000, with top priorities including funding field trips for third-graders.
The botanical garden charges visitors for parking, which some have called a violation of the use of the garden’s public land; it uses 10 acres of space donated to the city in 1882 to be “open to all.” The debate went all the way to the Ohio Supreme Court, where the botanical garden won its case.
Summary: There’s certainly nothing wrong with the DOJ supporting juvenile justice programs, but perhaps there’s a more efficient way to keep kids off the streets than paying $517,000 for high-end salsa production.
Almost Bankrupt New York Hospital Paid Four Retired Doctors $8.9 Million
February 16, 2024
Topline: Nassau University Medical Center on Long Island, New York is in danger of going bankrupt, but that didn’t stop it from doling out pensions that rank among the highest in New York state.
Four retired doctors each earned over $2 million in pensions since 2017, according to OpenTheBooks.com.
Key facts: Four of the top 10 pension earners among New York state employees worked at the public NUMC last year, according to a Newsday report using data from SeeThroughNY.
Auditors at OpenTheBooks analyzed NUMC’s spending records and found that the pensions are indicative of a much larger payroll spree for those four employees.
The four doctors took home a total of $8.9 million of taxpayer money in the last seven years. Only $2.4 million of that money came from actual salaries; the rest came from pensions after the doctors retired. The four doctors collectively put in just five years of work since 2017.
Surgeon Richard Batista took home a $340,000 pension last year, more than anyone else at the hospital and second-highest in New York, per SeeThroughNY. While he was employed, Batista’s salary maxed out at $531,000 in 2017. He began collecting his pension in 2021, raising his total earnings to just over $2.4 million in a seven-year span, OpenTheBooks found.
Paul E. Scott, a wound care specialist, retired in 2017 while making a salary of $570,000. With his annual pension, he also earned $2.3 million in seven years.
The remaining two employees — surgeon Leonard Barrett and OB-GYN Elsie Santana-Fox — took home $2.1 million and $1.9 million in the last seven years, respectively. Barrett’s earnings came entirely from a pension that reached up to $321,000 annually.
Background: NUMC is in danger of closing because of financial struggles. But OpenTheBooks found that NUMC still had 99 employees making more than New York Gov. Kathy Hochul’s salary of $250,000 in 2022. Five employees made more than $400,000, contributing to the hospital’s $216 million payroll.
NUMC operated at a deficit of $180 million last year, per Newsday.
Critical quote: “We are now in the window of time in which experts have warned that the Corporation may become insolvent and cease to operate,” Nassau County Legislator Siela Bynoe wrote in an open letter to the hospital’s chairman. “Yet, the Legislature and the public remain in the dark as to whether NUMC’s doors will remain open into this New Year. Outside auditors have warned for five consecutive years that the collapse of the Nassau Health Care Corporation … is a real possibility.”
Summary: If NUMC wants to avoid shutting its doors, perhaps reducing its $8.9 million payouts to four retired doctors is a good place to start.
The #WasteOfTheDay is presented by the forensic auditors at OpenTheBooks.com.