Oklahoma Corrections Director Justin Jones is in trouble with the governor.
The governor is demanding an explanation as to why Jones' agency had been urgently requesting a $6.4 million supplemental appropriation at a time when it had about $22 million stashed in three agency revolving accounts.
Clark Jolley, chairman of the state Senate Appropriations Committee, also is demanding an explanation.
Jones abruptly withdrew the agency's supplemental appropriation request April 15 after Steve Burrage, chairman of the Department of Corrections' budget committee, questioned why the agency was asking for more funds when it had such a large amount in the three accounts.
Now Gov. Mary Fallin, Burrage, and legislative leaders want to know why they weren't told earlier about the funds.
“Director Jones has repeatedly painted the picture of a Corrections Department in desperate need of immediate supplemental funding,” Fallin said in a terse letter received Monday by Burrage. “However, the discovery of an undisclosed $22 million held in revolving fund accounts and the subsequent retraction of the request for supplemental funding casts a shadow of uncertainty over the financial status of the agency. Besides making it unclear what financial resources the agency requires, it also begs the question about the agency's accounting practices and management of its finances.”
“It gives us great pause that the Oklahoma Department of Corrections requested supplemental funds from the Legislature despite sufficient monies in DOC revolving accounts to cover their budget deficit,” Fallin stated.
“With the agency's ever-changing financial landscape, executive and legislative officials are uncomfortable with the information being conveyed by DOC officials regarding the agency's financial status.”
Plans for money
Jones told The Oklahoman on Tuesday that his agency never tried to hide the revolving funds.
He said his agency had encumbered much of that money for needed projects like replacing cell doors and roofs before officials began asking questions.
When questions were raised, Jones said he postponed most of those projects, unencumbered millions of dollars that were not yet obligated by contracts, and withdrew his supplemental appropriations request.
The money now will be used to pay the costs of incarcerating an increased number of offenders and other purposes identified in the supplemental appropriations request that has now been withdrawn, he said.
This is not an issue of malfeasance, Jones insisted.
“It's a change in philosophy about how we budget those accounts,” he said.
Jones said money in the Corrections Department's main revolving fund account traditionally has been used to fill gaps in budgets, cover deficits and pay for repairs and improvements that the Legislature declined to fund.
The fund was tapped to reduce the need for department furloughs a few years ago during the state budget crisis, he said.
“During the height of recession, it was almost zeroed out to reduce the amount of furlough days we were taking,” he said.
In recent years, after funds built back up, a majority of the money has been used to expand prison bed space in the private sector and to fund construction at minimum security prisons to expand bed space, he said. It also has been used for medical payments and for projects needed to protect the lives and safety of employees and inmates, Jones said.
“We haven't had any capital outlay money for infrastructure in more than two decades,” he said.
Jones said a $460,000 study in 2009 identified “$344 million in immediate life and safety issues.” Corrections officials have been using the revolving fund to gradually try to resolve some of those issues, he said.
Burrage, a former state auditor, said he understands how the department has been using the revolving funds, but believes the money should be budgeted up front, just like other state funds.
“I know what these agency heads are doing,” Burrage said. “They're hiding these funds in case they come up with a dry spell or something.
“But that still doesn't make it right to build these funds up,” he said.
Jones said the Corrections Department can budget revolving funds up front if that's what the Legislature wants, but he cautioned such a move would reduce the department's flexibility in dealing with unexpected problems and would likely require the agency to go back to the Legislature for supplemental appropriations more frequently.
Burrage said the three revolving fund accounts are expected to be discussed at the next Board of Corrections meeting, which will begin at 1 p.m. Thursday at the Hillside Community Corrections Center, 3300 N Martin Luther King Ave.