AUGUSTA, Maine — A review by the Legislature’s watchdog agency,
the Office of Program Evaluation and Government Accountability, has found no indication of fraud or wrongdoing at the Maine State Housing Authority, but has turned up a number of expenditures that had no clear connection to the authority’s mission.
The OPEGA review presented to the Legislature’s Government Oversight Committee on Friday examined a sample of MaineHousing expenditures over a five-year period totaling $4.3 million.
While the analysis called a number of expenditures into question, “we judged substantially all of the $4.3 million sampled by us to be generally consistent with MaineHousing’s mission and primary activities,” OPEGA Director Beth Ashcroft told lawmakers.
“We found no indications of fraud,” she said.
The review focused on authority spending on sponsorships, travel and meals, organization memberships and contributions to outside groups from 2007 through 2011. It also included an examination of all expense reimbursements paid to Dale McCormick, the authority’s executive director who resigned in March, and statements from the agency’s two corporate credit cards.
MaineHousing’s current annual operating budget is about $14 million, which is funded through investment revenue, interest fees on mortgages and fees the authority collects for administering federal programs.
The OPEGA review called on MaineHousing to examine the amount of money it spends on out-of-state conferences, organizational memberships, business meals for authority employees when they’re not traveling and food and refreshment purchases for staff members at meetings and events.
“They go and get a sandwich or they go down to a restaurant and they have their lunch and business discussion there,” Ashcroft said of the nontravel meal spending. “Do you have to have the meeting over lunch? We’re questioning it because state agencies don’t typically pay for it.”
The Government Oversight Committee requested OPEGA’s “rapid response” review of MaineHousing expenditures in January amid a firestorm of criticism directed at the quasi-public agency by State Treasurer Bruce Poliquin, authority board members and the Maine Heritage Policy Center alleging inappropriate and wasteful spending.
The authority’s expenditures came into question following the release of documents obtained by the Maine Heritage Policy Center showing authority expenditures at high-end hotels for conferences and contributions to outside advocacy organizations.
While its review doesn’t point to a pattern of lavish spending, OPEGA did say that the housing authority should require more detail from employees seeking expense reimbursements, cut back on employees using personal credit cards for business expenses and better document all expenses and make sure they directly relate to its mission.
The OPEGA review found at least four instances, totaling almost $2,800, in which MaineHousing unintentionally reimbursed McCormick for the same expense twice.
In the two largest instances of duplicate reimbursements, totaling more than $2,600, according to OPEGA, McCormick noticed and repaid MaineHousing.
Lawmakers on the Government Oversight Committee said they were relieved to hear no evidence of wrongdoing, though Democrats and Republicans disagreed on the extent to which MaineHousing should change its spending practices.
“I don’t see anything here that alarms me. There’s a few housekeeping issues,” said Rep. Donald Pilon, D-Saco. “I feel confident everything will be taken care of. We can move on here.”
Rep. David Burns, R-Whiting, said the OPEGA review pointed to a “laissez-faire attitude” on spending “somebody else’s money.”
“Things really needed to be brought to light and some procedures needed to be changed,” he said.
MaineHousing staff and board members say the agency is already working to rein in its spending and travel practices and implement OPEGA’s recommendations, partially in response to newly passed legislation that more closely regulates the practices of quasi-public agencies like the housing authority.
“They’re easy to do,” said MaineHousing’s interim executive director, Peter Merrill. “They’re appropriate.”
While MaineHousing’s spending practices didn’t amount to wrongdoing, Merrill said the housing authority’s staff and managers got into certain spending habits, and the OPEGA review helped to bring them to light.
McCormick couldn’t be reached for comment Friday afternoon.
The presentation of OPEGA’s findings on Friday came less than a day after Maine’s Majority, a Portland-based nonprofit organization, published several emails among Poliquin, MaineHousing Board Chairman Peter Anastos, Maine Heritage Policy Center staff and others that the group said pointed to collusion among government officials and the conservative center to force out McCormick for political reasons.
In the emails, Poliquin and a Department of Economic and Community Development staffer discuss publicizing MaineHousing in the national media in order to “help boot Dale out,” and Maine Heritage Policy Center staff members discuss vendor records and other MaineHousing documents they’ve obtained with Poliquin and Anastos.
McCormick was the last appointee of Gov. John Baldacci serving as the head of a state agency.
Hmmmmmmmmm no fraud or wrong doing eh? Imagine that. So let me get this straight Poliquin lies, the Grand Wizard and his “news” wire at MHPC swear to it and all of the tea party faithful go around posting it on all the websites they can find and declare it to be fact. So you start with a lie and somehow are able with the help of the “I will believe anything as long as it fits my ideology” crowd turn it into truth. Well at least what the far right calls truth. The rest of us just call it what it is, another right wing lie.
“………several expenditures that had no clear connection to the authority’s mission.” oh well no big deal…..
full report……http://www.maine.gov/legis/opega/GOC/GOC_meetings/Current_handouts/5-25-12/MSHA%20Report%20RR.pdf
You’ve hit the nail on the head here, not much more to say. Well, let us not forget that Mr. Poliquin took the lead roll in telling all these lies. He has an office now that he doesn’t deserve to hold and like many others from the far right who are supported by groups that exist upon fabricated lies such as “Maine’s Majority” or the “Maine Heritage Policy Center” want Mainer’s to run out and vote for them in November. Good golly! Who would possibly be that dumb?
The Legislature’s watchdog agency “found no indication of fraud or wrongdoing” at the agency “but” …..”turned up several expenditures that had no clear connection to the authority’s mission”…..this is exactly, IMHO what is wrong with today’s gov’t and it’s agencies…..like little to no accountability and putting the fox in charge of the hen-house…..speaking of hen-houses, the same by-product results in both houses at the end of the day and it smells pretty bad……
That statement is not accurate. Every department budget is approved and signed by the governor’s office. Now, if he chooses to audit miscellany expenditures or question line items in a budget he certainly has the authority to do that.
In looking at the report from the link posted above one would/should agree that someone in this agency should be held accountable for the “unconnected” expenditures listed…..seems like several dept. personnel benefited from these monies…..
I recall one of the “charges” levied against the MSHA was lavish non mission critical spending. I noticed the lack of numbers shown in this article about just that question. $59K for employee gift cards from Hannaford; $1,000 bonuses to all MSHA
staff while a state employee wage freeze was in place; $16K grant to a prison
theater group. Couple that with disastrously failed housing inspections in the Norway area. It would seem that under director McCormick MSHA not only didn’t have its eye on the ball, they forgot what their mission was for the state.
The KJ has the full report linked from their version of this article. Maybe you’ll find what you’re looking for in there or maybe not.
Edit: Here, I’ll save you the effort:
http://www.maine.gov/legis/opega/GOC/GOC_meetings/Current_handouts/5-25-12/MSHA%20Report%20RR.pdf
Thanks–I gleaned some of my figures from a short report published else where. I was surprised the BDN went lite on some of the figure that were readily available to them.
None of what you mention is fraud or wrongdoing. What you are attempting is witch hunting. There isn’t a bureaucracy anywhere that you couldn’t find the type of waste you cite somewhere in the chain. All spending is justified in their approved budgets signed by the governor. He could have line itemed out everything you mention and he didn’t. Wasteful? Probably in a time of austerity but hardly fraudulent or wrong.
I reviewed my posting and neither fraud or wrongdoing were mentioned. My concern remains with efficient effective state run programs. Some of the comments from Democratic legislators during the “fight” over balancing the budget seems to be directed towards more efficiency and fighting fraud (especially with the DHHS budget). My only comment here would be where have they (the Democrats) been the last two decades.
Not properly documenting expenses is wrongdoing. That’s why it’s called “accounting” in both the private and public sector.
“All spending is justified in their approved budgets”
An approved budget sets a parameter for expenses in various categories. It’s not blanket permission to spend money for expenses unrelated to the stated purpose once the check’s cleared. If it were, there would be no such thing as an audit.
Nearly all of MSHA funding comes from the federal government and the feds have audited them repeatedly and found absolutely NOTHING wrong with their finances. Nothing
If the agencies funding them approve of how they spend the money then they are using it as intended.
btw: The financial disclosures that have been published seem to
indicate that OPEGA’s director has spent similar amounts on her junkets
in years past.
All of their expenditures were accounted for in the audit. There is no evidence of improper documentation. The question becomes are some of the expenses justifiied. That is all.
Well stated….
David Ha
Explain how this is fraud please
Dale should sue them for slander and libel.
When did the
Maine Heritage Policy Center become a full member of government such that Poliquin et al have to seek the groups advice on how to behave and what to object to?
The Grand Wizard and his clan of highly paid political operatives at the Maine Heritage Policy Center runs Maine Government. Their former Grand Wizard Terren Bragdon hand picked LePage’s cabinet. A very large part of the special interest legislation we have seen in the past two sessions of the legislature came directly from MHPC. Not bad eh? They control who gets appointed. And then they control the appointees. Not bad for a bunch of people that exist in a Post Office Box in Portland. Rumor has it that when the current Grand Wizard moves his hand just right LePage can be seen dancing.
About the same time the Koch brothers bought the State of Maine for the republicans.
Thank you Maine Majority! Now let the real investigation begin into the real wrong doers: the LePage administration, the Maine Heritage Policy Center, and their lap dog Peter Anastos. Hypocrits all. It would also be nice to see the republican lock steppers who have used this forum to attack Dale McCormick and the MSHA with political fodder before the results were in apologize for their misrepresentations of the facts.
Dale needed to go.. anything that still has the scent of Baldacci on it needs to go. Even a good boiling would not work.. I don’t much care for professional politicans. I like them a little rough around the edges.
What a load of manure. I think you should not be allowed to comment. Anything that comes from a right-winger as yourself stinks of hypocritcal rhetoric and self-serving and arrogant delusions of grandeur.
I would turn manure into fertilizer.. Lemons into lemonade… By no means am I selfserving.. She went outside her scope of employement to try to tie MSHA into a global Algorian district. I don’t need the UN telling me how to build houses.
OMG! You’re right, you’re not self-serving just completely paraniod! “Algorian district…UN telling me how to build houses” , Please! You don’t even know what the words “scope of employment” mean, much less how to spell them. Better watchout, there may be a liberal under your bed. BOO!
Let’s play a little game of “what if” here.
Imagine you’re operating a private sector business and then imagine you’re undergoing an audit by the IRS.
Now imagine the IRS giving you a pass in a similar situation:
“OPEGA did say that the housing authority should require more detail from employees seeking expense reimbursements, cut back on employees using personal credit cards for business expenses and better document all expenses and make sure they directly relate to its mission…. ”
IRS auditor: “Say, Tax-Paying Business Owner, we see that you’ve written off expense reimbursements to your employees with no documentation. You can’t provide the documentation? No problem, we’ll take your word for it.”
Are you kidding? The entire crux of the complaint against the Housing Authority was the charging off of undocumented expenses and OPEGA treats it as if it was it was just a marginal issue. Welcome to Through the Looking Glass.
No, the claim from Poliquin and his apologists was that fraud was being committed, not that a subjective judgement of whether some expenses totaling less than 3% of spending were perfectly aligned with the mission.
It is almost all federal funds and the federal auditors approved MSHA finances.
No, the issue was, after much stonewalling, the housing authority released a list of vendors only without detailing payments to them. This raised a red flag, as it should have. And this OPEGA review was not a comprehensive one, as they state in their own report.
There was some pretty sloppy bookkeeping involved even in the limited areas OPEGA addressed.
The famous “list of vendors” that the Maine Heritage Policy Center (aka one of the conspirators in a secret plot to smear an honest woman for political purposes) released was mostly from years before McCormick was even at MSHA.
The feds audit MSHA multiple times every year and they have always approved MSHA fiances. They supply the funding and they have approved of how it is spent.
Your spin is dizzying.
So it really was a witch hunt…. nice..
OOOPS! No Fraud here. (Except for Poliquin and Anastos, of course)
The only person who comes out of this with reputation intact is Dale McCormick. Thank you for your service to the state and your respect for MSHA’s mission by stepping down to end the rancor. You appear to be the only adult in Augusta.
What ever happened it worked, cause SHE’s GONE!! Thank you.