A Watchdog Comes to the End of Its Leash

Desks are being emptied and unemployment insurance applications completed as the Office of the Auditor General prepares to abandon the business of protecting taxpayers against waste in government.

As of Friday, the remaining 80 investigators and 15 support staff members of the low-profile watchdog agency are scheduled to leave the state payroll--a development that may bring relief to some state bureaucrats.

So how is it that a politically independent office that has been widely credited with saving taxpayers many millions of dollars over the years is folding up?

Basically, the answer is that the Legislature gambled and lost Nov. 3 when the voters crushed Proposition 159. The measure would have excluded costs of the auditor general’s office from spending limits imposed on the Legislature’s budget two years ago by voters.

The Legislature didn’t prepare an alternative plan to save the $7-million-a-year agency, which has no money to pay salaries or other expenses beyond Friday.

Now, top Democratic and Republican legislative leaders and Gov. Pete Wilson say they want to find a way to resuscitate the agency, but no plan is in place to do so quickly. None is expected soon.

“I’ve heard that everybody wants to find a solution,” says Kurt Sjoberg, the acting auditor general, who will turn out the lights and lock the door. “I haven’t seen one yet.”

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The auditor general’s investigators, including skilled certified public accountants, comb through government operations to assure that taxpayer funds are properly spent and programs are efficiently managed. Typically, the pull-no-punches audit reports severely shake up offending bureaucrats.

At the polls earlier this month, Californians also defeated a companion measure, Proposition 158. It would have extended the same budget protections to the nonpartisan legislative analyst’s office.

The analyst’s agency, headed by Elizabeth G. Hill, the first woman director in its 50-year history, also has saved taxpayers millions of dollars. She is the Legislature’s chief adviser on fiscal issues and the counterbalance to the governor’s director of finance.

Unlike the auditor general, Hill’s highly regarded office does not face imminent closure. The Legislature had set aside enough money to keep her already scaled-down operation functioning for the next seven months if Proposition 158 was rejected.

Democratic Assembly Speaker Willie Brown and state Senate Republican leader Ken Maddy, among others, have voiced support for retaining the auditor general as an agency.

But Wilson appears to take a more narrow view. He says he believes the state needs the “function” of an auditor general but adds, “We haven’t devised a means of achieving it.”

For his part, Brown says Wilson could easily save the Office of the Auditor General merely by contracting with it on a permanent basis to perform audits that still will be required by state law and federal regulations.

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Former Los Angeles County Supervisor Pete Schabarum and other opponents of Propositions 158 and 159 had dismissed assertions that both legislative watchdog agencies would go out of business if the two proposals were defeated.

They claimed that the Legislature would have plenty of money to keep the two offices fully operational if the lawmakers laid off more “political” staffers in line with Proposition 140, the term limits initiative that voters approved in 1990.

In addition to limiting terms of legislators and most other state-level officeholders, Proposition 140 ordered a 38% cut in the Legislature’s budget and imposed restrictions on future spending. The Legislature complied with the budget cut, largely through payroll reductions.

Having done so, the Legislature--political creature that it is--seems unlikely to make further deep cuts in its shrunken staff in order to restore the auditor general.

Maddy, who built a reputation for both candor and political pragmatism, has been a champion of the auditor general for years. But he says he fears that if it comes down to a choice between retaining the auditor general at the expense of laying off more “political” staffers, the auditor general will lose.

In an interview, Maddy said he personally would have no difficulty choosing the auditor general, but in the “face of the cutbacks that we have already experienced, it would be very difficult to sell others.”

“Unfortunately, we tend to keep the political operatives and lose people who deal with substance when cutbacks occur.” Maddy said. “Why? Because we are all politicians.”