It’s no secret that Oregon’s government sometimes wastes public funds. See: Cover Oregon ($248 million), the U.S. Highway 20 replacement ($220 million), faulty Medicaid enrollment technology ($166 million).
That’s part of the reason the state runs a waste, fraud and abuse hotline — as required by law.
Problem is, the hotline wastes money.
It costs nearly $200,000 a year to operate and, for at least three years, has failed to identify any significant wasteful state spending, according to reports documenting hotline tips.
Managing the hotline takes a lot of time. Auditors in the Secretary of State’s office required 1,700 hours to analyze tips last year, records show.
Told of those figures, Sen. Lee Beyer, D-Springfield, said it shouldn’t take that long.
“That seems like baloney. Come on,” he said. “That seems to be an inefficiency.”
The hotline is staffed 24 hours a day by operators who work for an outside firm. Complaints pour in by the dozen via phone and also come in through an online form, fax line and by U.S. mail. State auditors check hotline submissions daily to monitor for emergencies, and a full team of eight auditors review tips in detail every other week.
Although the number of hotline calls has grown in recent years, tips are often untrue or identify problems outside the state’s purview, officials say. Ninety-six percent of last year’s tips were unsubstantiated, irrelevant or better handled somewhere else, auditors concluded.
“We get a lot of calls that could be better addressed by another agency,” said Dale Bond, the auditor who’s managed the hotline program for 11 years.
Some tips are forwarded to other state agencies or the ethics commission. Tips can also spark a formal audit of a state government program.
Often, auditors consider the reported waste insignificant, Bond said. As an example, she told of one call to the hotline reporting a $5,000 expense for four office chairs.
“It was spendy,” Bond said, “but not exorbitant.”
Auditors say that in its lifetime, the hotline has netted tips that identified $16 million in questionable spending. Tipsters helped officials identify $1.4 million in wasteful spending by the Oregon Commission for the Blind in 2010, $1.2 million by the Sisters school district in 2006 and $2.3 million by the Department of Human Services in 2003.
It’s the past few years that have been lackluster.
Annual reports used to state the dollar figure of waste found each year. That’s been kept off the reports since 2013.
The program started under then-Secretary of State Phil Keisling in the early 1990s. Legislators codified the hotline into law in 1995.
Senate President Peter Courtney, a Salem Democrat who’s served in the Legislature for decades, credited the hotline for saving $16 million. But he said it may be time to review of whether it still makes financial sense.
“I’ll bet most people don’t know about it,” Courtney said. “I bet most legislators don’t know about it.”
When told about the hotline’s recent lack of effectiveness, Keisling expressed mixed feelings.
“There’s always risk when you do something like this,” he said.
When his administration started the program, he said, staff thought the hotline might eventually outlive its usefulness. But there’s still value in having a way for the public and state employees to report waste, said Keisling, who now runs Portland State University’s Center for Public Service.
“You always have the possibility of that one out of 100 that could be very material,” he said. “I actually feel good that $16 million in questionable expenditures have been identified.”
Others point out that the hotline was never intended to save money.
“You really can’t put a price tag on accountability,” said Deb Royal, chief of staff to Dennis Richardson, the current secretary of state.
Richardson didn’t return a voicemail seeking comment. Jeanne Atkins, who preceded Richardson and now heads the Democratic Party of Oregon, declined to comment.
Keisling and Beyer offered the same suggestion when asked how the program might be updated to improve its efficiency: Advertise the hotline more effectively to state employees.
“At some point in the future, it might be time to hang up its cleats,” Keisling said. “But in the near term — particularly with people still skeptical about how well government is spending their dollars — I think it’s important to continue it.”
“At a minimum, it sends a signal.”
— Gordon R. Friedman