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Stashes of cash are tucked away in Oklahoma state agency accounts

While Oklahoma lawmakers have been wringing the budget to scrape together money for a small income tax cut, millions of dollars in cash has been accumulating in some of the obscure corners of about 2,700 state agency accounts.
by Randy Ellis Published: May 6, 2013
/articleid/3806399/1/pictures/2040774">Photo - Gary Jones, State auditor and  inspector
Gary Jones, State auditor and inspector

Federal funds often come with strings attached. One of the strings attached to federal forfeiture funds is they must be used to enhance law enforcement activities but can't be used to replace funds that previously had come from other sources, officials said.

There is more flexibility in how state forfeiture funds can be spent, but it is impossible to predict how much money the agency will receive from asset seizures each year, so it is considered unwise to lock in those revenues for salaries, which would be a recurring expense each year, Thompson said.

Thompson said it costs about $133,000 to train, equip and pay a cadet for a year.

County road fund

Within the Oklahoma Department of Transportation is a fund called the County Road Improvement Fund.

The agency started out the last fiscal year with $3,952,035.87 in that fund, and 12 months later that same $3,952,035.87 was still sitting there.

It's not because there aren't county roads that need improving, said Mike Patterson, director and chief financial officer of the transportation department.

The $3.9 million was designated for specific counties as part of a program the Legislature abolished about eight years ago, Patterson said.

Even after the program was terminated, however, it took years to complete contracts, make all the necessary disbursements and complete the agency's auditing process, he said.

Patterson said he believes all that is now done.

“We need to return it to the counties for their use,” he said of the money. “All the projects are closed out. So now we're able to do that.”

Patterson said the account is one of three similar accounts related to county roads and bridges that his agency has been working to close out over a period of years.

“We've had numerous discussions about getting those funds closed out,” he said.

“I really do want to get it back in the hands of the counties.”

Roads revisited

After the Legislature terminated the old county road program, it created a new one, and a new fund was created called the County Improvement for Roads and Bridges Fund.

Records show cash rapidly has been accumulating in that account. It recently had a cash balance of about $227.8 million.

“This is one of those deals where essentially we started a complete new program,” Patterson said.

Little money was spent during the program's first couple of years because time was spent identifying projects and on relatively low-cost things such as engineering and right-of-way purchases, he said.

As more construction projects actually begin, Patterson said, he expects money will be spent at a faster clip and predicted the account eventually will carry an average cash balance of about $60 million.

Ho Ho Ho

Some state funds have unexpected names, such as the Santa Claus Commission Revolving Fund administered by the Office of Juvenile Affairs.

That fund is to provide gifts at Christmas time to underprivileged youths housed in Office of Juvenile Affairs' facilities and group homes, said Paula Christiansen, spokeswoman for the agency.

The commission only spent $2,568 out of the fund last fiscal year and carried over more than $87,000, which might raise questions about whether the state version of Santa is a bit of a Scrooge.

Christiansen said the fund relies solely on contributions from private donors.

“We put a cap on the spending because donations are not always a guarantee from year to year,” she said.

The agency operated several other funds that ended last fiscal year with cash balances that far exceeded the amounts spent from them over the entire year, including the agency's main revolving fund. That fund ended the fiscal year with a cash balance of more than $1.29 million after a year's worth of expenditures totaling about $292,500.

“General revolving funds are OJA emergency funds,” Christiansen said. “There is nowhere for an agency to go if there is a shortage of funding during the year. We can request a supplemental appropriation, but these are rarely funded and cannot be obtained timely. Without these reserve funds, many of our programs would be at risk toward the end of our budget year.”

Orphaned funds

Sometimes funds get abandoned and all but forgotten.

Such is the case for a series of five funds ranging from about $2,337 to more than $3.2 million maintained by the Oklahoma Office of Management and Enterprise Services.

The old computer system used for processing payroll withholding used to require the creation of a new fund every year, said Lynne Bajema, state comptroller.

The state has switched to a PeopleSoft system that now uses just one payroll withholding account and rolls over the money from year to year. But when the switch was made, money was left stranded in five old accounts.

“Those funds should be consolidated,” Bajema said.

by Randy Ellis
Investigative Reporter
For the past 30 years, staff writer Randy Ellis has exposed public corruption and government mismanagement in news articles. Ellis has investigated problems in Oklahoma's higher education institutions and wrote stories that ultimately led to two...
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