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Minnesota State Auditor Rebecca Otto says hurried new bill would leave counties without an auditor

(This story has been updated.) 

State Auditor Rebecca Otto, whose office audits 59 of 87 Minnesota counties among other responsibilities, said a technical glitch in the state government finance bill that passed in the final hours of the legislative session could leave those counties without any auditing.  

The intent of one section of the bill, which runs to more than 90 pages, was to allow counties to hire private auditing firms to complete the required review of their accounting and finances. By doing so, they would opt out of the current system wherein they pay the state auditor to complete their audit. 

The section of the bill that allows for private audits says it takes effect August 1, 2016. Meanwhile, Otto said she's been advised by her counsel that the bill would repeal a current section of law that gives Otto her auditing authority, but would do so immediately. Otto said this would prevent her office from conducting any audits beginning July 1. 

In other words, there would be a one-year gap wherein counties could not use Otto or a private company to audit their books. This would be especially problematic for counties her office has already begun to audit for a Sept. 30 deadline whose programs could lose federal funding without proper auditor sign-off. 

"It's a total mess," she said. 

The crafters of the measure to allow counties to seek a private auditor say counties can save money by using private auditors, as is currently the case with 28 counties, including Hennepin County. A partial privatization measure was adopted in 2003. 

Otto, who is engaged in a furious lobbying effort to get Gov. Mark Dayton to veto the bill, said her office can better protect taxpayers and taxpayer dollars than private firms without proper oversight. 

Dayton has thus far declined to commit to signing or vetoing the bill. 

Rep. Sarah Anderson, R-Plymouth, who was a chief author of the bill, said she would consult with nonpartisan legislative staff about Otto's charge. She said any drafting error like that could be easily fixed in the upcoming special session. 

Anderson said Otto is "missing the whole point of this legislation." She said counties could save $30,000 to $40,000 by using a private auditor instead of Otto's office. 

Dayton OKs 4 budget bills including higher ed, health and human services

Gov. Mark Dayton signed four bills Friday that together lay out nearly $25 billion in state spending over the next two years, even as he began a public relations pitch aimed at convincing state lawmakers to go along with a higher spending increase on schools than the one he vetoed a day earlier. 

The DFL governor gave final approval to four major spending bills: health and human services, higher education, transportation, and public safety and courts. A short while later he was at an Apple Valley elementary school, mixing with four-year-olds, their teachers and school administrators as he tries to build support for more state spending on early learning programs than House Republicans have so far been willing to grant. 

“I’d like to get that on video and make all 202 of us watch it,” Dayton said, referring to himself and 201 legislators, after about 45 minutes in a prekindergarten classroom. Dayton’s inability to convince lawmakers to back an education spending increase to a level he considers acceptable left the legislative session ending on an unresolved note, and headed for a special session that the governor said Friday he hopes can be held by June 15. 

In fact, several House Republican lawmakers from the area joined Dayton at Westview Elementary. Reps. Tara Mack and Anna Wills, both of Apple Valley, mingled with the kids alongside Dayton, and joined him after for a short discussion with local administrators and teachers. Dayton has tried to put pressure on House Republicans in the current standoff, arguing they prefer to leave state money unspent this year instead of sending it to schools in order to have more available next year for some type of tax cut. 

Wills and Mack argued they are also committed to public schools. Mack said her own young children would be attending Westview in a couple of years. 

“We’re looking at a way we can provide a preschool solution that will work across the state,” Wills said. “There’s some disagreements on how we should get there, but let’s see if we can find a way to bridge that gap and reach these kids.

Of the four bills Dayton signed Friday, the $12 billion health and human services budget was the second largest budget bill after the vetoed, $17 billion education bill. The HHS bill includes about $138 million more meant to bolster pay for nursing home workers, a major priority of House Republicans.

The public safety and judiciary bill included an additional $111 million in spending for courts and public safety, and a measure legalizing firearm suppressors — more commonly known as “silencers.” That provision had earned an earlier veto warning from Dayton, but the final version included a system of law enforcement oversight for the devices. 

The public safety deal includes pay raises for judges, more staffing for the Minnesota Bureau of Criminal Apprehension, and funding to combat sex trafficking and prevent recruitment of Minnesotans to terror organizations like ISIL and Al-Shabab.

A push to restore voting rights to felons after they are released from incarceration did not make it in the final bill. The House and Senate toughened drunken driving laws. They compromised on Automatic License Plate Readers, allowing law enforcement to store data gleaned from the devices for 60 days. 

The higher education budget includes $166 million in new spending, with $53 million for the University of Minnesota. Of that, $30 million will go toward the U’s Medical School. The Minnesota State Colleges and Universities System received $100 million in the budget the Legislature approved.

The bare-bones transportation measure maintains spending on roads and bridges at current levels, but makes few new investments. Legislators said they plan to pick up debate on a more robust budget next year. 

That leaves just three measures for Dayton’s approval or rejection: budget bills for state agencies, agricultural and environmental programs, and a jobs and energy bill that was rammed through in the Legislature’s closing minutes. Dayton is expected to decide on those final bills on Saturday. 

Staff writer J. Patrick Coolican contributed to this report.

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