Legislative auditor: more funds needed to fulfill oversight mission

An office that audits state financial statements hopes to add more funds to its bottom line.

Two months ago, the Legislative Audit Commission unanimously adopted two funding recommendations for the Office of the Legislative Auditor: a $500,000 annual increase in base-level funding and that the Legislature should make a direct line-item appropriation for the office, rather than including it in an appropriation for the Legislative Coordinating Commission.

Legislative Auditor Jim Nobles describes the functions of his office Jan. 15 to the House State Government Finance Committee. Photo by Paul Battaglia

Legislative Auditor Jim Nobles told the House State Government Finance Committee Thursday that bumping the office’s annual base budget from $6.31 million to $6.81 million would provide for two additional hires to address several new audit opportunities, including MNsure, legacy funds and information technology security audits.

This is the first request for additional staff since office staffing dropped from 80 to 60 during the state’s budget crisis in 2003-04. Numbers have remained fairly consistent since then.

The committee took no action.

The increase would also help the office address high staff turnover — including highly sought after IT security and financial auditors — by providing an annual pool equal to 4 percent of office payroll to fund merit-based salary increases.

Nobles said the office’s goal is to help ensure integrity of the state’s financial operations.

“We are to provide you, legislators, but also agency officials, and the public with accurate, objective, timely, and useful examinations of state agencies and state-funded programs,” Nobles said.

But staffing and funding situations have forced the office in recent years to focus efforts on core state agencies and functions, while reducing or eliminating coverage in some areas, including the state’s public higher education entities, the Metropolitan Airports Commission, Minnesota Housing Finance Agency and the state fair.

Nobles said the office’s audit authority includes all of the state’s executive and judicial branches “from the governor’s office to the Board of Nursing,” University of Minnesota, Minnesota State Colleges and Universities system, the Minnesota Sports Facilities Authority, several other metropolitan organizations and private organization’s use of public money. Cooperation is required of entities being audited, including access to all data and documents. The office has subpoena power.

Examination examples include addressing the state’s use of federal funds, financial controls and compliance and state agencies’ computer security. The goal is to highlight weaknesses and make improvement recommendations that are not required to be implemented, but usually are.