Day Late and a Dollar Short

The saying “better late than never” doesn’t apply here.

I received the following Commonwealth News Center Updates via email on June 23.

Media advisory
URL : http://kentucky.gov/Newsroom/finance/etransparency.htm
Date : Tuesday, June 17, 2008
Issued By : Finance and Administration Cabinet
Summary : The Kentucky eTransparency Task Force to hold its first meeting

Governor Beshear Issues Call for Special Legislative Session to Address Pension Reform
URL : http://kentucky.gov/Newsroom/governor/20080617special.htm
Date : Tuesday, June 17, 2008
Issued By : Governor Steve Beshear's Communications Office
Summary : Governor Steve Beshear today issued the call for a special session of the General Assembly to convene on Monday, June 23, 2008, to act on the state's public pension crisis.

Chief of Staff Jim Cauley Announces Decision to Leave Post in Beshear Administration
URL : http://kentucky.gov/Newsroom/governor/20080618cos.htm
Date : Wednesday, June 18, 2008
Issued By : Governor Steve Beshear's Communications Office
Summary : Governor Steve Beshear today announced the decision of Chief of Staff James Cauley to resign in order to pursue his own political consulting business.

And this one on June 24th:

eTransparency Task Force holds inaugural meeting
URL : http://kentucky.gov/Newsroom/finance/etransparency.htm
Date : Thursday, June 19, 2008
Issued By : Finance and Administration Cabinet
Summary : Gov. Beshear's vision for making public information more available, accessible discussed

Now I know email is not perfect, but a 5 or 6 day lag?

I don’t know if this time lag is intentional or just blazing incompetence but it is another example of how this administration appears to be clueless when dealing with the public appearance of doing the right thing.

I do know that all four of the items were things that I have commented on in this blog.

THIS ISN’T GETTYSBURG

The following is an email written by University of Kentucky Professor of Finance Joe Peek. His words speak much better than mine to this topic.

DISCLAIMER: The views stated herein are those of the author, and do not necessarily reflect the views of members of the UK Board of Trustees or Administration.

CLAIMER: Usually, but not always, when someone says “I told you so,” they do so with some degree of self-satisfaction and a minimal degree of enjoyment. This is one of the usual cases.

ACKNOWLEDGEMENT OF THANKS: I would like to thank the Herald-Leader and the UK Administration for the timing of the front page articles on Wednesday (Todd bonus) and Thursday (Boone-doggle Center). I have been out of the country for the past 3 ½ weeks and am leaving again tomorrow for another week. Thus, these two days of headlines appeared on the only two days during a five-week period in which I was in town to read them. Makes me appreciate just how much I miss this place.

NOTE: Unlike the UK Administration, I try to be responsive to faculty comments and views. In response to numerous requests, I am attempting to be a bit more subtle. However, it is a learning process, since I am severely subtlety-impaired (I am also subtitle impaired, since foreign languages are among my many areas of in-expertise).

FEELINGS

After having a few days to contemplate their decision about the President’s bonus, do you think that any of the members of the Board of Trustees are feeling a bit sheepish? (Please note the lack of bold font in an effort to be more subtle.) Note that many have attributed the awarding of the bonus by the trustees, and the acceptance of most of the bonus by President Todd, to an ID-ten-T error. (Hint: subtlety at work; write it out using numbers.)

THIS ISN’T GETTYSBURG

President Lincoln’s famous reference to “government of the people, by the people, for the people” has been changed at UK to “governance of the administration, by the administration, for the administration.”

Self-serving decisions are the norm at UK, at the expense of faculty, staff, and students. At least in President Todd’s acceptance speech for his bonus, he touted the self-sacrifice shown by the faculty and staff accepting zero percent salary increments in these difficult financial times.

However, such behavior and attitudes are present not only at the top of the UK administration; they are pervasive throughout the administration structure. As an example, I give you my own Gatton College. After six months of repeated efforts to obtain information on the awarding of the January merit increments to Gatton faculty, I have finally received an accounting. In addition, to a set of “compression and inversion” adjustments, 11 adjustments were awarded to “top performers” among the faculty. Of these 11 adjustments, five went to non-administration faculty (that is, 5 out of about 80 such faculty) and six went to faculty that were also college administrators (that is, 6 out of 6). Any wonder why we have such a lack of transparency at UK?

SEE BLUE? SEE BLURRED!

In such dire financial times, surely there must be a better use for the $95,500 bonus accepted by President Todd. Perhaps the funds could have been used for student aid to offset the tuition increase for some students; or to lessen the impact of layoffs; or to fund faculty research efforts.

Alternatively, think of how much beer could be purchased at Pazzo’s next Friday night for faculty. Then, perhaps many of the faculty could have the same blurred vision as our administrators.

GRADE INFLATION

Grade inflation is a well-known problem at universities. However, usually the worst occurrences are associated with student grades. At UK, we are breaking new ground. Here, our Board of Trustees has inflated President Todd’s grade to a near perfect score of 96.8. Unsurprisingly, his lowest score was for the category of “improving communications with students, faculty, staff and trustees.” Apparently, it is still not well understood that communication is bidirectional. Weak communication problems are not solved by sending out more memos, but by actually listening to the stakeholders in the university.


HOUSTON, WE HAVE A PROBLEM

At least one of the three of us (you, me, President Todd) do not have a firm grasp of reality; but I am not sure just who. The UK Administration emphasizes form over substance. Thus, it would seem that accepting most of a $145,000 bonus at a time of soaring tuition, layoffs, and zero raises for faculty and staff would be a public relations disaster. However, we are reminded by the UK publicity staff that President Todd’s salary trailed nine of his peer’s salaries at 19 benchmark universities. Still, this is just the public funds part of his salary, and, I am sure inadvertently, they forgot to provide the ranking of UK faculty salaries relative to those same 19 benchmark universities. So why am I not sure just who is out of touch?

Simply because the reality is that decisions are made over and over by the UK Administration that are not in the interests of university stakeholders, yet the UK Administration is allowed to get away with it, although in some instances they first must weather a brief and ineffective protest (e.g., renovation of the Boone-doggle Center); but perhaps I am being too cynical here.

A REPRESENTATIVE VIEW

The Herald-Leader reports that faculty trustee Ernie Yanarella thinks that there will be “some diffuse irritation among faculty about Todd’s salary and bonus.” He continues, stating that, “The faculty who are cynically minded will be crabby about it.” First, why would UK faculty become cynical? OK, maybe a few. Well, I suggest that all three of us (among the 1,900 UK faculty) who have become cynical and crabby send President Todd an email suggesting that he did not make an intelligent decision when he accepted most of the bonus. The Herald-Leader reports that President Todd appears to receive few complaints about his policies, quoting President Todd as stating, “I don’t think I’ve had an email yet—maybe one or two—about not giving a raise.” And in your letter, you should pledge your entire 2008 faculty raise to a fund intended to make up the shortfall of President Todd’s $150,000 bonus.

A FINAL THOUGHT

While the UK Administration may not appreciate the faculty or entertain their views, at least they do entertain with their statements and actions.


Joe Peek
Professor of FinanceGatton Endowed Chair in International Banking and Financial Economics School of Management

Transparency - Sort Of

Here is a Kentucky government web site that offers a glimpse, sort of a looking through the glass darkly view, where your tax dollars are going.

While not as transparent as we would like, the Legislative Research Commission offers some transparency to state government spending. The Government Contract Review Committee shows us who gets some of our tax dollars.

All of the information is on contracts and amendments that have been reviewed and approved by the committee for payment. So we get to see where the money went, not where it’s going.

Here are the bigger ticket items from May 2008:

MEDICAID SERVICES, DEPARTMENT FOR

16. 0800007172

Health Care Excel Incorporated
2629 Waterfront Parkway
Indianapolis, IN 46214

Auditing - $2,694,084.00

Provide for compliance with the Deficit Reduction Act of 2005 including, but not limited to, three year general audits by Centers for Medicare and Medicaid (CMS), as well as CMS focused reviews, provide technical and educational support to identify fraud, rule out potential erroneous/fraudulent billing through clinical reviews and audits, and identify opportunities for system payment edits and audits.

TRANSPORTATION CABINET

21. 0800007385

JL Lee Engineering LLC
100 North Main Street, Suite 218
Lawrenceburg, KY 40342

Engineering - $2,000,000.00

Provide Resource Conservation and Recovery Act (RCRA) and Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) based site assessments, evaluations, characterizations and remediation plans and control compliance reviews including sampling, reporting, remediation and other environmental concerns.

22. 0800007413

Corradino Group First Trust Center
200 South Fifth Street, Suite 300N
Louisville, KY 40202

Engineering - $2,000,000.00

Provide Resource Conservation and Recovery Act (RCRA) and Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) based site assessments, evaluations, characterizations and remediation plans and control compliance reviews for Kentucky Underground Storage Tank regulations and the Clean Water Act including sampling, reporting, remediation and other environmental concerns.

23. 0800007414

Linebach Funkhouser Incorporated
114 Fairfax Avenue
Louisville, KY 40207

Engineering - $2,000,000.00

Provide Resource Conservation and Recovery Act (RCRA) and Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) based site assessments, evaluations, characterizations and remediation plans and control compliance reviews for Kentucky Underground Storage Tank regulations and the Clean Water Act including sampling, reporting, remediation and other environmental concerns.

Now, true transparency in government would let us see these contracts before they get the legislative rubber stamp.

Also here’s an idea:

Could we cross reference the Contributor Information from the Registry of Election Finance, the Corporate Information from the Secretary of State with the database containing the above information?

Now that would be a fun site.

Free the Documents

Here is an example of what currently goes on in Frankfort. The Commonwealth Office of Technology maintains an online document system called GotSource.

The public can search GotSource as a Guest user. The words I searched for and some of the results are listed below. The searches were limited to 100 responses sorted by date.

“Expenditures”

20070914_PMIS_Governance_Board_Agenda.doc
Copy of att6.8_payroll.xls
Financial Report
YTD Expenditure 1-31-01
Section III - 09b - GOT IT Overview- Expenditure Comparison Chart
Revenue Expenditure Summary

“Contract”

Copier CONTRACT.doc
Alabama contract
Section III - 10 - GOT IT Overview - Major Enterprise Contracts
RE: Panasonic Toughbooks on contract

“Contractor”

Time Tracking Business Rules.xls
IT Contractor Report (january06).xls
Training for Purchasing Professionals ITN#3-908-660-B Revised 8-14-2006.doc
NIC Contract Final 2-21-03.doc

“Telephone”

Kentucky Revenue Cabinet Locations and Telephone Numbers.doc
Kentucky State Telephone Directory Tutorial
2003 NASCIO Nomination NoCall.doc

If you click on any of the links above you get this:

Not Authorized

You are currently listed as Guest, which means you are not logged in. Guests are allowed to freely browse the publicly-readable portions of this server, but do not have permission to add content, make revisions or view restricted information.

I’m sure there is some Home Land Defense security reason for restricting the access to the Kentucky State Telephone Directory Tutorial and the 20070914_PMIS_Governance_Board_Agenda.doc. I’m just confused at what the reason might be.

Now here is the real problem. The Governor has created a Task Force that is charged with finding ways to create more transparency in State Government. He has put Jonathan Miller in charge and appointed Steve Dooley to the Task Force.

The problem?

Steve Dooley is the Commissioner of Commonwealth Office of Technology and Jonathan Miller is his boss. Either one could remove a lot of the secrecy built into GotSource with one direct order to their staff.

Opening up GotSource doesn’t take a Task Force recommendation, an order from the Governor or Legislative approval.

All it takes is for either Dooley or Miller to make a management decision. So guys, it’s time to walk the walk.

Electronic Transparency

Another thought on putting a little electronic transparency in state government. How about this as a start?

Let the public see the purchases made on state Procurement Cards.

Procurement Cards, or ProCards are government issued credit cards. I for one would like to see what is being bought with these little pieces of plastic.

Now the cards will be rejected if someone tries to buy any of the following.

Airlines
Automobile/Vehicle Rental
Hotels and Motels
Eating Places, Restaurants
Bars, Cocktail Lounges, Discotheques, Nightclubs, and Taverns – Drinking Places (Alcoholic Beverages)
Quick Payment Service – Fast-Food Restaurants
Package Stores, Beer, Wine, Liquor
Financial Institutions
Security Brokers/Dealers
Insurance Sales and Underwriting
Insurance Premiums
Insurance (Not elsewhere classified)
Lodging

So I couldn’t pay for a trip to Europe with this card, but I bet I could buy jewelry, furniture, clothes, a big screen TV (I wonder if David Williams has one of these?)

The rules say I can’t rent a car, but could I buy one?

I think the public would probably get a little bent out of shape if they found a state office furnished with solid cherry furniture or antiques.

I would love to trip through these records.