Audit: Pa. gaming board secretly hired contractors
HARRISBURG, Pa. (AP) — State Auditor General Jack Wagner on Wednesday accused the Pennsylvania Gaming Control Board of violating state law by allowing millions of dollars in contracts to be executed without approving them at public meetings, although the board contended it was not required to do so.
"We think the law is pretty darn clear," Wagner told reporters in a news conference to release an audit of the six-year-old agency responsible for licensing and regulating the state's casino industry.
Wagner said his office's audit uncovered 19 service contracts worth about $7 million that should have been approved by the seven-member gaming board at a public meeting, rather than by delegating that authority to agency employees.
He said he believes the gaming board violated the state's Sunshine Act, which governs public access to government meetings, and is forwarding his findings to the state attorney general's office.
Gaming board spokesman said Doug Harbach said officials there have consulted with executive-branch lawyers about the agency's contracting practices, and board officials believe they are complying with the law.
"There's a difference of opinions on how we're conducting our contracting and how the auditor general believes it should be done," Harbach said.
However, Harbach said officials at the agency take the findings very seriously and, when practical, will approve contracts with a public vote. The gaming board's budget is paid by the casinos it regulates.
He also said that Wagner's auditors did not find that the gaming board used contracts inappropriately or wastefully.
However, Wagner said his office's review of the staff's written justifications for emergency or sole-source contracts found the information to be sorely lacking. For instance, the gaming board awarded a $120,000 contract for a human resources contract without competitive bidding by saying that it simply was "clearly not feasible," the audit said.
Auditors found no evidence in the contract paperwork to support that contention, it said.
A check of two other board-run public agencies in Harrisburg, the Public Utility Commission and the Liquor Control Board, found that each has a policy for when the board votes on contracts.
For instance, the liquor board votes at public meetings on all contracts worth at least $10,000 or more and all changes to contracts that adjust their value by at least that much, board spokeswoman Stacey Witalec said.
The three-year period studied by auditors began July 1, 2006, and ended June 30, 2009.
The audit also criticized what it called excessive spending on travel, including a $33,000 trip in 2008 by five gaming board officials to a conference in Rome. The trip became public knowledge and prompted an uproar among agency critics in the Legislature after a Pittsburgh television station reported on it.
It said the gaming board paid for the hotel accommodations of two guests who accompanied board officials, while two gaming board members were reimbursed for seven nights in a hotel room to attend a five-day conference.
Harbach said the board has substantially limited its travel since then.
Auditors also found a number of what they deemed questionable expenses, including $8,800 for meals, gifts, candy and flowers that should have been paid for with personal money or were allegedly misrepresented in board records.
It also mentioned a nearly $700 dinner in 2006 at an unnamed Harrisburg restaurant that was listed as an "office supply" expense, did not list attendees and occurred on the same day two board members sought meal reimbursements of $67 and $98.
"We think the law is pretty darn clear," Wagner told reporters in a news conference to release an audit of the six-year-old agency responsible for licensing and regulating the state's casino industry.
Wagner said his office's audit uncovered 19 service contracts worth about $7 million that should have been approved by the seven-member gaming board at a public meeting, rather than by delegating that authority to agency employees.
He said he believes the gaming board violated the state's Sunshine Act, which governs public access to government meetings, and is forwarding his findings to the state attorney general's office.
Gaming board spokesman said Doug Harbach said officials there have consulted with executive-branch lawyers about the agency's contracting practices, and board officials believe they are complying with the law.
"There's a difference of opinions on how we're conducting our contracting and how the auditor general believes it should be done," Harbach said.
However, Harbach said officials at the agency take the findings very seriously and, when practical, will approve contracts with a public vote. The gaming board's budget is paid by the casinos it regulates.
He also said that Wagner's auditors did not find that the gaming board used contracts inappropriately or wastefully.
However, Wagner said his office's review of the staff's written justifications for emergency or sole-source contracts found the information to be sorely lacking. For instance, the gaming board awarded a $120,000 contract for a human resources contract without competitive bidding by saying that it simply was "clearly not feasible," the audit said.
Auditors found no evidence in the contract paperwork to support that contention, it said.
A check of two other board-run public agencies in Harrisburg, the Public Utility Commission and the Liquor Control Board, found that each has a policy for when the board votes on contracts.
For instance, the liquor board votes at public meetings on all contracts worth at least $10,000 or more and all changes to contracts that adjust their value by at least that much, board spokeswoman Stacey Witalec said.
The three-year period studied by auditors began July 1, 2006, and ended June 30, 2009.
The audit also criticized what it called excessive spending on travel, including a $33,000 trip in 2008 by five gaming board officials to a conference in Rome. The trip became public knowledge and prompted an uproar among agency critics in the Legislature after a Pittsburgh television station reported on it.
It said the gaming board paid for the hotel accommodations of two guests who accompanied board officials, while two gaming board members were reimbursed for seven nights in a hotel room to attend a five-day conference.
Harbach said the board has substantially limited its travel since then.
Auditors also found a number of what they deemed questionable expenses, including $8,800 for meals, gifts, candy and flowers that should have been paid for with personal money or were allegedly misrepresented in board records.
It also mentioned a nearly $700 dinner in 2006 at an unnamed Harrisburg restaurant that was listed as an "office supply" expense, did not list attendees and occurred on the same day two board members sought meal reimbursements of $67 and $98.
