Colorado state lawmakers reviewing an audit of how the Department of Revenue ran its medical marijuana enforcement program half-jokingly called for oxygen Wednesday when they learned of what one senator called a “shopping spree” for expensive furniture, unnecessary electronics and a fleet of cars that went largely unused.
On Tuesday, members of the Legislative Audit Committee were stunned at details of how the Revenue Department’s Medical Marijuana Enforcement Division could barely do its most basic job functions — licensing businesses and monitoring marijuana.
On Wednesday, some were barely able to suppress outrage at how the division, which has been nearly broke for the past two years and overwhelmed with work, spent more than $1,000 on individual office chairs, paid $16,000 for three office cubicles, purchased 50 Blackberry cell phones for a staff that never exceeded 37 employees (and which is now down to 15), and ordered a fleet of 33 vehicles — mostly SUVs, which are pricier to lease than sedans — for a staff that included 13 administrative employees who rarely used a vehicle.
“It is unbelievably disappointing,” state Sen. Steve King said of the division’s extravagant spending. “I’m sure that every member of the audit committee is biting their tongue.”
He said the expenditures defied common sense and that people “are laughing at us when you pay $1,000 for a chair.”
The audit also uncovered evidence of improper tax-exempt status for both the former and the current director of the marijuana division, both of whom had been authorized to use state vehicles to commute between home and work. Such a perk is considered to be a taxable fringe benefit under federal law, unless the employee is a law enforcement officer.
The directors claimed to be exempted, since marijuana investigators have duties that qualify them as peace officers. But the auditors pointed out that state law specifies that division directors cannot claim the exemption.
“If these employees do not meet the definition of a law enforcement officer,” the audit reads, “we estimate that they would each need to reimburse the division about $60 per month, or $720 per year, or claim this amount as taxable income.”
But it was the equipment and furniture purchases that left some lawmakers speechless. The division spent about $250,000 on furniture in 2011, including paying $28,000 for seven desk extenders. The division didn’t use a competitive bidding process for the furniture and instead bought most of it from Colorado Correctional Industries. Auditors found far cheaper alternatives online.
In addition to the unnecessary cell phones — whose service plans are estimated to have wasted $10,000 per year — the division also spent $31,000 on 21 computer tablets. The audit didn’t identify the brand of tablet, but they cost an average of $1,476 each, or nearly three times the price of a brand new iPad. At the time of the purchase, the division only had 19 investigators who would use the tablets; today, there are only 10 and the unused tablets are being held in inventory.
Other questionable purchases pointed out in the audit include a five-day car rental for a conference that only lasted two days, and $1,800 spent on three sets of patio furniture “without a clear business need for them.”
“I’m speechless,” said Sen. Lucia Guzman. “It appears that there was a shopping spree.”
Sen. Lois Tochtrop said she was “appalled” by the revelations.
“Revenue would be the agency you would look to to have very good controls on spending,” she said.
“I’m probably going to have to get my medication changed,” King said. “Apparently, we haven’t learned anything from $400 federal hammers.”
Department of Revenue representatives didn’t attempt to justify the expenses and Executive Director Barbara Brohl said she agreed with Tochtrop that many of the purchases — such as the patio furniture, used in employee break rooms — were “pretty unreasonable.”
“I agree with all these comments,” Brohl said, adding that she wasn’t going to lay blame on individuals, but the department as a whole.
“It’s our responsibility,” she said.
She and her administrators also agreed with all of the auditor’s numerous recommendations for reigning in spending, promising to do better in the future.
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