Government Waste

Recent independent reports suggest that state government agencies and departments routinely spend on programs and projects with little accountability to taxpayers, failing to consider what is the most efficient and effective way to stretch tax dollars to the fullest.

Eliminating waste, fraud and abuse in state government is essential to our efforts to solve California's long-term budget problems once and for all.

Below are a few examples of government waste highlighted by nonpartisan government watchdogs and independent state auditors.  These examples only scratch the surface of the billions of dollars in ongoing wasteful and fraudulent state spending.

Examples of fraud and abuse


California is suffering from a devastating drought that has dried up large parts of the state, yet the state will spend $2.7 million to build and fill a new swimming pool in Calexico, a small city on the Mexican border. Wouldn’t that money be better spent on providing reliable water supplies for farmers or drinking water for families?
 
The Governor doesn’t live in the old Governor’s Mansion, yet the state will spend $2.5 million to renovate the building. The Governor currently uses the mansion to meet with legislators and hold other events, purposes that can easily be handled by the State Capitol or the Leland Stanford Mansion nearby. Why does the Governor need another elegant setting to hold events?
 
California’s high-speed rail project is plagued with numerous problems, such as lawsuits and the lack of private investment, but the state is going full-speed nevertheless. Moving forward, the state will use 25 percent of Cap-and-Trade revenues – taxes that many companies pay to address global warming – to fund high-speed rail each year. Cap-and-Trade was never intended to fund high-speed rail and would only cover a small amount of funding needed to pay for the $68 billion (and rising) high-speed rail project.
 
That’s $500 million that would be unavailable for actual improvements of a system that has the nation’s worst congestion and its second worst pavement conditions. The overstaffing amounts to a third of Caltrans’ project support employees, the LAO says in a highly critical report released as legislators were making detailed decisions on the 2014-15 budget.”
 
“The maneuver is one state departments have used to pad their budgets with millions of tax dollars earmarked for employee salaries. By law, they are supposed to lose the money when a position goes unfilled for six months. Instead, they have simply altered the identifying numbers to make it appear that a job was filled with a transferred employee, thus avoiding a cut to their budgets.”
 
“California's deficit-plagued unemployment insurance program missed out on more than half a billion dollars in federal money in recent years when state officials failed to take advantage of a new federal program.”
 
Audit: State Controller’s Office accounting riddled with errors
“State Controller John Chiang’s office has understated liabilities, miscalculated debt payments and, in one instance, made a data-entry error that added three additional zeros to a revenue figure, changing the figure from millions of dollars to billions of dollars.”
 
“With repair bills mounting, the state Legislature is now considering how to resolve the long-festering problem and get the employees into a healthier office environment. State taxpayers so far have shelled out about $60 million for building repairs and $2.3 million to pay workers' compensation claims and settle lawsuits from fed-up workers.”
 
California spends $1.37 million on ObamaCare web stream featuring Richard Simmons
“Facing a $78 million budget shortfall, California’s ObamaCare exchange has spent $1.37 million to fund an outreach video featuring exercise guru Richard Simmons gyrating on the floor and hugging a contortionist who is kneeling with his buttocks in the air.”
 
State is warned about new fiscal computer system's costs and timeline
“A computer project to modernize the way the state of California manages its finances will take 12 months longer to complete and cost $55.8 million more than originally budgeted, the state auditor warned Wednesday.”
 
“Just about everyone agrees that the new eastern span of the Bay Bridge is a case study in how politics can turn even the most urgent task into a drawn-out, overly expensive nightmare. ...Still, with every change and every delay, the cost went up - and up and up, from $1.3 billion, to $3 billion, to more than $6 billion.”
 
“In fact, from the get-go, the governor and state transportation officials decided that the biggest Caltrans mess-up in modern times was not to be covered by the 100-plus-page report.”
 
Caltrans will be spending a whopping $10 million this year to keep an eye on those questionable bolts holding together the new $6.4 billion eastern span of the Bay Bridge. And transportation insiders tell us that $10 million could just be the start.”
 
Computer system dropped after $500 million spent
“The plug has been pulled on one of the biggest boondoggles in California history - the effort to build a $2 billion computer system linking the state's 58 county courts. It never worked, and some say it was doomed from the start. The program had run so amok, according to the state auditor, that one of the subcontracts had 102 change orders, pushing that one bill alone from $33 million to $310 million.”
 
“…officials scuttled a massive overhaul of the state’s payroll system known as the 21st Century Project. The job was $250 million over budget and four years behind schedule. A test run in the California State Controller’s Office revealed glaring flaws in software designed by SAP Public Services, the Washington, D.C.-based firm chosen for the work.”
 
“California is spending nearly $15 million to build 10 hydrogen fueling stations, even though just 227 hydrogen-powered vehicles exist in the state today. It's a hefty bet on the future, given that government officials have been trying for nine years, with little success, to get automakers to build more hydrogen cars.”
 
Cal Fire Hid Millions of Taxpayer Dollars in Secret Account
Following the discovery of nearly $54 million in hidden funds by the Parks Department, the Los Angeles Times reported another abuse of taxpayer money by the Department of Forestry and Fire Protection (Cal Fire).   The Department set up an account with the California District Attorneys Association instead of depositing it into the General Fund. Since 2005, Cal Fire officials have hidden nearly $3.6 million, even while the Legislature and Governor Brown implemented the $150 fire tax to cover the Department’s budget gaps.