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Tuesday, May 26, 2015

Ind. Gov't. - "Did patronage lead to BMV overcharges?"

Great reporting this weekend from Tony Cook and Tim Evans of the Indianapolis Star. Some quotes:

The Indiana Bureau of Motor Vehicles' chief financial officer, a man who oversees a $110 million budget, lacks one of the most basic qualifications typical of CFOs.

Harold Day has no college degree.

Day does have something else valued in state government — political connections. He is a longtime GOP ward boss whose wife was an Indianapolis councilwoman. He got his job with a recommendation from former Republican Perry Township Trustee Jack Sandlin. * * *

Despite repeated hints, Day, for example, was unable to say what branch of government he worked for: judicial, legislative or executive.

He also testified that he neglected to collect interest on a BMV account that routinely contains $5 million to $20 million.

"That's a sign that this is not somebody who is well-equipped to do their position," said Trevor Brown, director of the John Glenn School of Public Affairs at The Ohio State University. "The transgression is not that you have a political appointee, it's that you have appointed a political appointee that doesn't have requisite skills required to perform the task."

And Day's credentials were not the only ones called into question.

Ron Hendrickson, who until recently was the BMV's deputy commissioner in charge of driver's licenses, was a former snowplow driver and pizza shop manager without a college degree. But he was a former Republican precinct committeeman from the city's Eastside.

Even Scott Waddell, the former BMV commissioner who ignored warnings that the agency was gouging motorists with excessive and illegal fees, had no experience in government, despite having a college degree. He got his job through Jim Kittle, a prominent political fundraiser and former Indiana Republican Party chairman. * * *

While license fees no longer go directly to the parties, political appointments of top officials are still common at the BMV, and all across government. Experts say that can cause problems when appointments are made with too little consideration for professional expertise. * * *

More clear is that a lack of expertise among top BMV officials likely cost the state money.

In discussing the BMV's primary bank account during a deposition in the ongoing lawsuit, Day explained that it had $5 million to $20 million in it on any given day. When asked if he ever sought interest on those funds, he said: "No."

"Have you ever even thought about the possibility that a bank might be willing to pay interest on somebody whose deposits average between $5 (million) and $20 million every day?" Irwin Levin, the Indianapolis attorney representing plaintiffs, asked.

"No, I have not," Day said.

"Can you think of any reason not to ask the bank to pay the Bureau of Motor Vehicles interest on the $5 (million) to $20 million that it has parked in the bank on any given day?" Levin asked.

"No," Day said.

In another exchange, Day expressed confusion about which branch of government the state budget office falls under. Levin then asked, "Do you know what branch of government the BMV is in?"

"No, I do not," Day said.

There is much more in the lengthy, must-read story. It concludes:
Gov. Mike Pence has said his administration is working to clean up the agency, and lawmakers plan to study potential reforms before next year's legislative session begins.

In the meantime, no one from the BMV has been publicly disciplined or fired, despite the massive financial blunders.

Waddell returned to the private sector in November 2013 as the state was settling the first lawsuit. Hendrickson moved to another state agency, the Family and Social Services Administration, where he receives $80,750 a year. Day is still the BMV's chief financial officer, with an annual salary of $74,000.

The story has sidebars about some of the players, including:
Harold Day: A longtime Republican ward boss, he landed a job at the BMV as a budget analyst in 2007. Before that, he worked in the finance departments of some construction companies. Later, he was a deputy for Republican Perry Township Trustee Jack Sandlin, who recommended him for a job at the BMV when he left office. In less than a year, Day was promoted to chief financial officer, a position he still holds today at an annual salary of $74,000. [ILB: From the main story - "he neglected to collect interest on a BMV account that routinely contains $5 million to $20 million."]

Ron Hendrickson: The former Republican precinct committeeman did stints as a snowplow driver for the state, a pizza store manager and a salesman for a charter airplane company before getting a job as a regional manager at the BMV, overseeing about 20 license branches. He was later promoted to deputy commissioner of policy and programs. He still works for the state, but not at the BMV. He left his job as deputy BMV commissioner of policy and programs in September 2013 and is now an information technology project manager for the Family and Social Services Administration. He receives a salary of $80,750. [ILB: Really.]

ILB: In my experience, "The governor's office wants you to find a place for this guy" is a message decades of state agency heads have received and followed.

Posted by Marcia Oddi on May 26, 2015 09:08 AM
Posted to Indiana Government