Klarides: “We are not spending the state’s money; we are spending the taxpayers’ money.”

State Representative Themis Klarides of Woodbridge, Orange and Derby testified before the Planning and Development Committee today at the Legislative Office Building in favor of a bill that, if enacted, would require audits on all municipalities with populations over 30,000 and receiving state aid in excess of 35 percent of their operating budgets. The audits are designed to find savings, efficiencies, financial improvements and reforms. Rep. Klarides is a Deputy House Republican Leader and a cosponsor of Senate Bill 501, “An Act Concerning the Audit of Certain Municipalities,” proposed jointly by the Republican legislative caucuses.

The Auditors of Public Accounts currently audits all state agencies. Klarides argued, “It’s common sense: if we are going to audit a state agency with a $10 million budget, we should audit cities that received $200 million in state taxpayer money.”

Current state audits of Connecticut municipalities do not include cost savings analyses or efficiency recommendations. Klarides testified the bill would promote responsible governance and improve transparency.

“It is important that we constantly remind ourselves that we are not spending the state’s money; we are spending the taxpayers’ money,” Klarides said.

Below is Klarides’s  official testimony, delivered on Feb. 14.

Good morning Chairs Cassano and Gentile, and Ranking Members Fasano and Aman, and members of the Planning and Development Committee.  I am here on behalf of the House Republican Caucus to express our support for Legislative Republicans’ proposed Senate Bill 501 An Act Concerning The Audit of Certain Municipalities.

The current economic crisis has been one of the most challenging times for the legislature in recent memory. A $3.5 Billion annual state deficit, thousands of our citizens unemployed and scores of business closures have caused us all many sleepless nights.  If there is one positive aspect of this dire economic situation, it is the renewed focus on scrutinizing every tax dollar the state spends and ensuring it is being used as prudently as possible.  That is exactly the purpose of SB 501

The bill authorizes the Auditors of Public Accounts to review the budget and financial condition of municipalities whose populations are thirty thousand or more and receive state aid in excess of 35 percent of their operating budgets. The Auditors of Public Accounts would also be required to report back to the Governor, Planning and Development, Appropriations, and Finance, Revenue and Bonding Committees regarding any programmatic savings, efficiencies, financial improvements and reforms that could be implemented in the municipalities. 

It is important that we constantly remind ourselves that we are not spending the state’s money; we are spending the taxpayers’ money. Currently, the Auditors of Public Accounts conducts audits of every state agency. The majority of agencies receive much less in state taxpayer money than some of our larger cities. It’s common sense: if we are going to audit a state agency with a $10 million budget, we should audit cities that receive $200 million in state taxpayer money.

The state currently spends over $2.8 billion in municipal aid with very little oversight.  We constantly hear from our municipalities that they are in need of more funding for education, road repair, and capital improvements, but rarely do we closely examine how the money is used.  Our municipalities are very deserving of this state assistance as long as the money is being spent in the most effective and transparent way.  An audit into municipal finances will provide us with valuable information that will enable us to make better, more informed decisions for our state, our municipalities and most important, our customers—the taxpayers.

Before closing, I want to acknowledge that cities and towns currently are required to undergo independent audits each year. However, those audits are narrow in scope and do not look at cities from the perspective of the state and how taxpayer money is being used, which is the goal of this bill.