CT Green Bank Audit Further Emphasizes Need for Better Control of State’s Quasi-Publics

Audit Finds “Questionable” Severance Agreements, Inadequate Procedures and Inspection Reports, Untimely Reporting

Senate Republican Leader Len Fasano (R-North Haven) today emphasized the need for increased transparency and oversight of the state’s quasi-public agencies in light of a State Auditors’ Report on the Connecticut Green Bank released today.

“The state auditors’ report raises questions about yet another quasi-public in our state that has a responsibility to taxpayers,” said Sen. Fasano. “Republicans have long fought for reforms to increase transparency and oversight of the state’s quasi-publics. This audit emphasizes the extent of these problems, which I hope the new administration is fully focused on addressing.”

The audit raised questions about severance payments related to the elimination of three positions that equaled 26 weeks of salary for all three employees, totaling $148,526. The severance agreements were not approved by the board of directors. The audit also questioned a transition agreement to one of these employees which allowed the employee to maintain employment until vesting for retirement benefits.

“We have seen questionable severance payments before in the state’s quasi-publics. We all remember the debacle surrounding the departure of Anne Noble from the Connecticut Lottery Corporation, the $250,000 severance payment made to the former president and executive director of the Connecticut Housing Finance Authority, and the severance payments totaling over $376,000 for four senior level managers at Access Health CT, with some of these agreements including questionable nondisclosure language. These arrangements are what led Republicans to propose legislation requiring more oversight of such contracts. While these bills were repeatedly rejected by the majority, we will continue to push for reforms,” said Fasano.

The Green Bank audit report also found untimely reporting in conflict with state statute governing quasi-publics, raised concerns about the Green Bank’s lack of a formal application process in place for certain programs which could lead to financing being awarded to unqualified recipients, and found that the Green Bank did not keep proper records of inspections and could not determine if and when adequate inspections took place.

Sen. Fasano also commended Governor Lamont for taking the first steps to investigate two other quasi-publics earlier this week, and his openness to reviewing the actions of all state quasi-public agencies.

“I think an extensive review by the executive branch is a positive and long overdue first step,” said Sen. Fasano. “Past administrations never made a serious effort to address the problems associated with our quasi-public agencies. Year after year, Republicans have proposed reforms to increase transparency and oversight of quasi-publics, only to be rejected by the majority. Gov. Lamont’s focus on this issue indicates that the new administration is taking our concerns seriously. I am hopeful that Gov. Lamont wants to be different from the last administration and take real action to get control of the organizations I have found to be out of control.”

Senator Fasano said the state should reconsider multiple reforms proposed by Republicans in recent years to increase oversight and transparency of the state’s quasi-public agencies, including the following:

• In 2019, Republicans proposed legislation (Amendment LCO No. 8814) to require specifically that no quasi-public employee be paid a salary of greater than $150,000 without first receiving a vote of approval from the appropriate General Assembly committee that oversees the quasi-public employer.  (All Republicans voted in favor of this proposal, but all Democrats in the Senate voted against the amendment.)
• In 2017, 2018 and 2019 Republicans proposed legislation that would have brought more transparency to the state’s quasi-public agencies (in 2019 Senate Bill #604; in 2018 Senate Bill #180; in 2017 Senate Bill #356). These bills would have required that all quasi-public agency employment contracts, consulting contracts and separation agreements be reviewed in great detail and be in the best interest of the state of Connecticut. They also would have required that any of these contracts or agreements with an annual cost of over $100,000 also be submitted to the appropriate General Assembly committee or Attorney General for review. These bills were not advanced by the majority.

• In 2018, Republicans also proposed Senate Bill 503 An Act Requiring Legislative Approval of Certain Payments Made to State Employees Pursuant to a Nondisclosure or Separation Agreement, which specifically sought to address the laws which allowed a costly separation agreement to be developed behind closed doors involving the former Lottery CEO Anne Noble. This bill was not advanced by the majority party.

• In 2015 Republicans proposed creating the Office of the Inspector General that would be able to investigate government waste and abuses. (House Bill 6669). This bill was not advanced by the majority party.