State cellphone audit uncovers waste

State agencies are unplugging telephone landlines in favor of more versatile cellphone plans. But in 2012, taxpayers paid for more than 5 million minutes of cellphone voice minutes that never got used, according to the latest performance report published by Vermont State Auditor Doug Hoffer.

State Auditor Doug Hoffer. Courtesy photo

State Auditor Doug Hoffer. Courtesy photo

In 2012, charges for 3,080 state-issued cellphones totaled $1,646,995, according to the report. Hoffer’s office set out in January to gauge underutilization of the devices, and whether Vermont could save money by managing mobile plans better.

“Without consistent cellphone management practices and continuous monitoring of cellphone use, the State risks paying for cellphones that are not needed,” according to the auditor’s office report.

Hoffer estimates the state could save nearly $300,000 per year by trimming cellphone and smartphone plans for employees who don’t appear to use their mobile devices very much. Aside from millions of voice minutes paid for but never used (more than 85,000 hours worth), the audit found that almost no data — or very little — was accessed on nearly half of the bundled voice-and-data service plans.

Better protocols guiding cellphone management could also help save money going forward, Hoffer recommended. He found little to no consistency in how management decides which employees should be issued a cellphone, when the devices should be upgraded or how to monitor related costs.

Some statewide policies regarding cellphones do exist, but they touch on different aspects of the technology: The Department of Information and Innovation policy relates primarily to security, while the Department of Human Resources policy governs personal conduct on state-issued devices.

“In the absence of an overall policy framework, departments have developed their own policies which led to an inconsistent approach,” Hoffer said in the report.

Centralizing some policies could help with cost-benefit analyses, he suggested, especially as agencies and departments consider replacing landlines with cellphones.

For example, the audit uncovered an error in the Agency of Natural Resource’s fiscal analysis of its landline costs, prior to the agency’s canceling most of those lines to save money. They had used an average cost-per-minute of 15 cents for landline telephones, which DII determined to be overstated by no less than 13 cents. The actual cost was 2 cents per minute.

DII is authorized by statute to manage the state’s telecommunications infrastructure, but ANR did not contact the department for input into its landline study. Nor did ANR work through the Agency of Administration, which is “responsible for coordination of telecommunications initiatives among executive branch agencies, departments and offices,” according to the audit.

ANR is one of four agencies whose cellphone usage comprised more than 60 percent of the state’s total cellphone accounts included in the audit. The Agency of Transportation, the Department for Children and Families and the Department of Public Safety also dominated cellphone use.

Hoffer said the Agency of Administration’s response to the audit was exactly what he had hoped.

“Our intentions are to finalize, issue and implement the statewide telephony (landline and cellular device) policies by March 1, 2014,” Secretary of Administration Jeb Spaulding said in a letter responding to the audit.

The full audit report, along with Spaulding’s response and detailed plans for related action, can be found on the state auditor’s website.

Hoffer said before he took office in January, he got the idea for a review of state-issued cellphones from his review of successful audits from other states.

“It seemed interesting and might be of value,” Hoffer said. “And it was, and it is.”

Hilary Niles

Comments

  1. Patrick Cashman :

    While nice, I have to ask who requested conduct of this audit? The Governor, a citizen complaint, or a requirement of law? Only stating that Mr. Hoffer “got the idea” while running for office implies the auditor is choosing audit targets based on his personal whim, political bent, or to pander to his base from the campaign. Perhaps Mr. Hoffer could provide the Risk Assessment Matrix used to determine this audit was appropriate and required by his office’s professional standards

    • Doug Spaulding :

      Who cares who may have requested a “conduct of this audit” and what does that even mean? And just what is a “Risk Assessment Matrix?” That Mr. Hoffer uncovered a way to eliminate waste should be all that really matters Mr Cashman or are there party politics in play here and maybe in your book Mr Hoffer will never do anything right?

  2. Patrick Cashman :

    Hi Doug, thanks for asking.
    The auditor in many ways plays the role of a referee for state government, which calls for an impartial approach (because I think most everyone prefers a fair ref to a biased one). This kind of points out the illogic of holding partisan elections to select someone to be impartial, but that’s just the way it’s set up.
    In order to achieve that impartiality you’ll notice, or at least I did, that nowhere can you find express license to the auditor to choose whatever audit targets he wants. This is a good thing because remember, the auditor is elected and is going to be seeking re-election frequently. That means keeping those who elected him (in this case a Progressive/Democrat mix) happy. The danger is in an auditor using the power of his office to target those specific agencies or programs that his base doesn’t like while allowing those programs his base “likes” to operate without oversight.
    In order to reinforce this requirement for partiality, you’ll note in the auditor’s own professional standards such politically driven bias is called out as a “Bias threat: – the threat that an auditor will, as a result of political, ideological, social, or other convictions, take a position that is not objective.” One tool for avoiding that threat is the Risk Assessment Tool to provide a still subjective, but at least reasoned, assessment of the proposed audit. It’s required by section 6.3.2 of the Auditor’s own professional standards for non-discretionary audits and it would seem to have been a simple matter for the auditor to include such a document in the report if it existed.
    It is true that I find Mr. Hoffer problematic, in my opinion he is a hyper-partisan extremist filling what is supposed to be an impartial and fact driven mission. But even with my own bias, I really don’t think it too much to ask that he demonstrate he is fulfilling his office with at least a simple nod to the professional standards of that office.
    One final note, let’s not act as if the auditor found $300K in cash under a couch cushion. He’s made some recommendations that may save a sum of money he estimates to be significant, though other agencies have not yet had a chance to weigh in with at what cost in effective delivery of services to Vermonters.

    • Doug Hoffer :

      You said, “nowhere can you find express license to the auditor to choose whatever audit targets he wants.”

      Actually, I can. Although you couldn’t find it, the authority is granted in statute.

      32 VSA §163(1)
      “Annually perform or contract for the audit of the basic financial statements of the State of Vermont and, at his or her discretion, conduct governmental audits as defined by governmental auditing standards…”

  3. Fred Woogmaster :

    If Mr. Hoffer identifies even one more costly situation that can be exposed by audit and remedied by administration to cut down on waste – wow!

    His work, thus far, has been very impressive to me.

  4. Patrick Cashman :

    Fred,
    Yet imagine how much is lost by not basing targeting on objective criteria. One of the criteria in the Risk Assessment Tool is “significance” or scale of potential savings. Perhaps such an assessment was conducted, perhaps not. It would be a simple matter to include it in the report if it were.

    • Fred Woogmaster :

      Risk Assessment Tool – I plead ignorance.

      Mr. Hoffer: What does this mean? Is there validity to Mr. Cashman’s point?

  5. Doug Spaulding :

    Thank you Pat for that clarification. I’m still digesting but, by your inference, what Mr. Hoffer has done here is a lot like what Obama did with the IRS…. by having them target those who might be considered a political threat to him. Would that be correct?

  6. Patrick Cashman :

    Hi Doug,
    I would have to say I haven’t followed that story as close as I should have, though I have my doubts that the President personally directed some form of persecution of particular groups. However, personally I am all for 501(c)4 groups such as VPIRG being subject to greater scrutiny to prevent their using their incredibly large checking account to influence elections. As long as such scrutiny is universal and not based on political bent.

  7. Doug Spaulding :

    I tend to agree with you regarding all non profits but I am surprised, with your knowledge of the IRS and all the underpinnings thereof, that you didn’t follow the situation that arose when it was uncovered that the IRS had targeted many of Obama’s nemesis’s for further tax scrutiny and auditing when it was front page news! You sure have more faith in the president than I do. Do you also take him on his word regarding Obamacare and how he was duped right along with the rest of the nation?

  8. Patrick Cashman :

    Doug,
    I get the feeling you’re fishing for something but I don’t know what to tell you. ACA is law, we need to figure out how to make it work.

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