Cities, Auditors, Unions Kill Fraud Accountability Bill

A bill intended to protect whistleblowers reporting fraud, waste and abuse in state and local government while outing those committing it was overwhelmingly rejected by a State Senate committee Monday after heavy opposition by the League of California Cities, the city auditors of Berkeley and Oakland and two notable campaign funders for the majority Democrats, the California Professional Firefighters and the California Labor Federation.

SB 1336 by Senator Leland Yee (D-San Francisco) was introduced to continue anonymity for those reporting improper governmental activity of the kind investigated through whistleblower programs operated by the State Auditor, the California State University and city and county auditors, but also to remove the secrecy now giving the same anonymity to the public employees found blameworthy for such abuses.

The bill passed the Senate Committee on Governance and Finance on a 6-1 vote on April 26, but the seven-member Senate Appropriations Committee today gave the bill three No votes (Christine Kehoe, D-San Diego; Mimi Walters, R-Laguna Hills; and Bob Dutton (R-Rancho Cucamonga), with four others not voting (Senate President pro Tempore Darrell Steinberg, D-Sacramento; Elaine Alquist, D-San Jose; Ted Lieu, D-Redondo Beach; and Curren Price, D-Los Angeles). This outcome contrasted with the committee’s professional staff analysis, noting estimates of only minor costs resulting from the bill’s implementation.

The bill’s defeat leaves in place a system protecting and to that extent encouraging what in other contexts would be treated as white collar crime—typically in the form of defrauding the taxpayer of thousands or even hundreds of thousands of dollars in unearned pay or reimbursement for expenses not incurred on government business, the use of government resources for private occupations, or either ignoring or covering up for such larcenous exploitation by subordinates.

A summary from the most recent (August 2011) report of the State Auditor provides a flavor of the activity whose perpetrators the whistleblower programs do not identify, and how vigorously the responsible agencies pursue correction: Continue reading