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State auditor warns of rising deficiency requests, recommends modernizing budgetary controls
Summary
The state auditor presented a transparency report finding growing deficiency appropriations and recommended statutory clarifications, increased allotment frequency, and greater DFA authority to enforce budget controls.
The state auditor told the Senate Finance Committee Feb. 4 that deficiency appropriations — one‑time requests to cover agencies’ prior overspending or unexpected shortfalls — have increased and that statutory language and budgetary controls have not kept pace with modern accounting systems.
The auditor’s office said it analyzed deficiency requests and related statutes and found that the state’s legal framework for fiscal control contains vague phrases such as "funds at the agency's disposal" and statutes that predate the state’s current SAP/SHARE accounting environment. The report recommended clarifying how receivables and accruals should figure into decisions about whether an agency has the funds to pay obligations, increasing allotment frequency or standardizing allotment rules, and revising or modernizing statutes that assign roles for warrant issuance and penalties.
David Craig and staff from the auditor’s Governmental Accountability Office told senators the review showed a 137.5 million increase in deficiency requests between 2014 and 2024 and that justifications for many deficiency requests were incomplete or inconsistent in public records. The auditor recommended enhanced transparency — including more public hearings and making supporting documents available — and suggested the legislature and executive consider whether some deficiency requests should be denied or subjected to a more rigorous review.
Committee members discussed how modernizing statutes and clarifying DFA’s oversight role could reduce the frequency of late‑year and prior‑year funding shortfalls. The auditor’s office said it would expand audit work on agencies that seek deficiencies and offered to help draft statutory changes or participate in a legislative work group to resolve conflicts and bring statutes in line with the SHARE accounting system.
The committee did not take action on the auditor’s recommendations but called for follow‑up and said some proposals may be suitable for memorials or statutory updates in the session.
