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State Auditor briefs House Commerce & Economic Development Committee on performance audits, staffing and oversight limits
Summary
The State Auditor described the office’s performance audit role, staffing constraints, peer-review standards and focus areas — including health care costs and tax-increment financing audits — during the committee’s Jan. 30 meeting.
The Vermont House Committee on Commerce and Economic Development received a briefing on Jan. 30 from State Auditor Doug on the office’s role, resources and audit priorities, including health-care cost oversight, tax-increment financing (TIF) work and municipal scope limits.
State Auditor Doug said the auditor’s office is a constitutional office that emphasizes performance auditing under the Generally Accepted Government Auditing Standards (GAGAS). “The point is we know where the money is, we can track it, we know about compliance, but the remaining question is, are the administrators ... administering the programs that you have created and funded in the way that you intended?” he said.
Doug told the committee the office is small relative to the state budget, with roughly 11 professional auditors plus one investigator, and that most of the office’s budget is funded through an internal service fund charged to state agencies for financial and compliance audits. He described market-based pay adjustments the office uses to retain qualified auditors and said the work is time-consuming because GAGAS standards require strict documentation and quality controls.
Health-care costs were cited as a high-priority area. The auditor said state-employee health-care expenses were about $200 million for the employer component in 2023 and that broader public-sector health-care costs (including teachers and school staff) approach a larger figure. He argued cost containment in health care is a necessary part of broader budget conversations.
The auditor described topic selection for performance audits as driven by program size, prior problems or risk, and public interest. He said performance audit results lead to recommendations and that his office follows up about a year after a report to verify implementation. Peer reviews by external auditors occur roughly every three years to confirm compliance with auditing standards.
On municipal work, the auditor said state statute limits his routine scope to state entities, but his office can follow federal and state funds into municipalities when relevant. He noted an exception: the office conducts audits of TIF districts and is required to audit each TIF district three times during its life cycle. The auditor said the legislature and joint fiscal office have produced reports on TIF and that further legislative attention may be needed before any expansion of the program.
Committee members asked whether the auditor’s office can examine town-level finances; the auditor said limited resources require prioritizing work with statewide value. He also discussed prior audits on reference-based pricing and other health-care topics that had stimulated public debate.
The auditor closed by inviting further committee engagement and suggested he would return to discuss TIF work and other topics the committee identifies as priorities.
