By Deena Winter | Nebraska Watchdog

LINCOLN – Sen. Bill Avery set out to construct a bill to help State Auditor Mike Foley get the records he needs from government agencies without delay, but by the end of the public hearing on his bill today, Avery was accusing Foley of implying he’s stupid and wanting to “rummage around” in unrelated government records in a hunt for embarrassing, titillating information.

HAMSTRUNG: State Auditor Mike Foley says Avery’s bill would allow government entities to decide if they want to be audited.

And Foley said Avery’s bill would be a “terrible public policy blunder” that would allow state agencies to dictate when he conducts audits of them.

In December, Foley testified in Avery’s committee about the challenges he faces in trying to get information from public entities on a timely basis, saying he sometimes waits weeks to months to get records for audits. So the Lincoln senator introduced a bill requiring government agencies to ante up documents to the state auditor and legislative auditors for free within seven days or to explain why they need more time. If more time is needed, they can have up to three weeks unless auditors agree to wait longer.

His bill is similar to the state open records law, which requires government agencies to provide public documents or an explanation to people within four business days.

Sen. Bill Avery tried to address Foley’s problems getting documents for audits, but ended up clashing with the state auditor.

But Avery said he also got complaints from government agencies that Foley often asks for information above and beyond what’s needed for a financial audit, but more akin to a performance audit, which he must get permission from legislative auditors to do.

However, Avery also bowed to college officials’ concerns about Foley doing federal audits of them and added a provision that only allows Foley to audit federal funds if they agree to it. Avery also proposed an amendment that would allow the attorney general to resolve disputes over access to records.

Avery said his bill attempts to reduce the tension between “two very strongly opposed forces.”

“At this point, I can’t tell if anybody is happy,” he said during the public hearing on his bill Wednesday. “I might be the most unpopular person in state government at this time.”

Stan Carpenter, chancellor of the Nebraska State College System, testified in favor of the bill, saying while the auditor has the right to look at all records, he shouldn’t be allowed to do a single federal audit if the government agency has already contracted with a private certified public accounting firm to do one.

Carpenter accused Foley of holding up their federal audit, which could have risked financial aid for students. Foley dismissed that assertion, saying the audit was done with a month to spare.

Foley testified against the bill, saying he had “two long, very spirited conversations” with Avery about the bill, which he believes cedes his authority to conduct audits to state agencies.

He said his office decides when to audit agencies, not vice versa, and most of the roughly 600 audits his office has done have been without controversy. Since almost every government agency receives federal funds, the bill could prohibit him from auditing them without their agreement, Foley said. Most would prefer to “hand-pick their CPA firm” to do audits and prevent him from doing his job, he said.

While there are many outstanding certified public accountants, “unfortunately many of them see government as an easy paycheck” and “kind of overlook things,” Foley said.

“I think that’s a very, very dangerous public policy,” he said. “If you hire a CPA firm, you control that firm.”

He also pointed out that while a man on the street must get an answer to open records requests within four days, the state auditor could wait seven days to three weeks for records, under the legislation. Going to the attorney general with disputes could mean a year-long wait, he said.

“I challenge my critics, show me the audit that was not the public interest,” Foley said. “Show me the audit that shouldn’t have been performed.”

Foley pointed to an audit last month that found the state health department failed to seek $1.8 million in federal reimbursements.

“Would you prefer not to know about that? I don’t think so. I think you want to know about those kind of problems.”

He said his office often does audits after government entities have hired firms to do audits that found nothing, while his auditors find plenty of problems.

“I’m very proud of my auditors, they’re very thorough they do a great job,” Foley said.

The University of Nebraska was neutral on the bill, with attorney Joel Pedersen saying the university respects legislative auditors and the state auditor. He said legal concerns have arisen when Foley’s auditors seek private health information and other sensitive and non-public records.

Pedersen said the university supports the bill’s provision allowing them to select their own auditor of federal funds.

But Foley’s testimony seemed to irritate Avery, who during his closing statement said Foley spent considerable time in his office during their two meetings and “never showed much interest in working out a compromise on the bill.” Avery said he hoped to get Foley’s suggestions but Foley “made it clear perhaps I was not smart enough to get it.”

While he agrees government agencies shouldn’t be able to decide when they’re audited, Avery said his bill requires them to cooperate by replying within seven days. He said perhaps he should have required the auditor to conduct his audits more quickly, since the university said Foley was responsible for some of their delays.

He said people shouldn’t act as though they have all the answers and suggested Foley didn’t like him “restricting him from rummaging around in matters that have nothing to do” with his financial audits to look for “embarrassing titillating information.”

“It’s not been fun,” Avery said as the hearing ended.

Contact Deena Winter at deena@nebraskawatchdog.org. Follow Deena on Twitter at @DeenaNEWatchdog

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