Thread by @CathJSweeney

Thread: I ended up going through the state department of health report pretty late last night and figured I’d save the tweets til the morning. I’ll be posting pictures of the report with highlights, etc but I’ll tweet essentially what they say and why those points matter.

This is probably most important. The 200 layoffs and $30 million bailout were never necessary. Here is why:

The department had a practice of using strange tactics to trick their COMMAND PROMPT budget program into releasing money. They ended up essentially creating fake debt. (Imagine moving money from your savings to checking account and saying you’re $50 in debt to yourself.)

In the same way, the department said it was about $30 million in debt to itself. There was a revolving door of chief financial officers (CFOs) for years, and the newest one — and the new Chief Operating Officer — didn’t know this $30 million debt didn’t technically exist.

CFO was Mike Romero, and COO was Cynthia Nichols. Those are the people who were testifying in the #okleg investigative hearings. They and others pushed for the bailout, which was $30 million. Romero pushed for the layoffs. Let’s get to those.

Neither Romero nor Nichols knew that officials were putting money in the slush fund. I got very confused about this yesterday, but the report clarified it. There are some services where federal money essentially covers a little more than the cost of service ...

... or in other ways transfers from federal accounts to state ones. Federal funds tend to be restricted and can go to only one kind of expense. But at the end of the year, if there is extra (definitely oversimplifying this) the money is unlocked and can go into state funds.

Lawmakers have been raiding agency’s reserve accounts, even those that are holding money that they expect to spend in the next few years. (@JRsarahtc covered this extensively in 2016, how it affected road projects, health programs etc. I’ll link that later.)

OSDH officials wanted to hide any leftover money from lawmakers. Federal money is put into funds with a “400” prefix, and lawmakers can’t touch federal money. So the slush fund was labeled with a 400 prefix to make lawmakers think they couldn’t touch it, but it was state money

The report indicates the new CFO and COO didn’t realize this 400 fund was a fake federal fund filled with state money. There was enough in there to prevent layoffs. But there is more on the layoffs.

A lot of these people were paid with federal funds, not state funds. The CFO overlooked that (Purposefully? Accidentally? We don’t know). So he pitched total savings, leading everyone to think that was state savings.

Of 171 classified employees laid off, 100 weren’t paid with state money. In other words, their layoffs saved little to not state money. In some cases, laying off employees end up costing more than it saved because the state also lost federal funds.

Auditors said the savings projections were overstated by $2-$5 million. Also, implementing the layoff cost $3 million. Keep in mind: The agency was not bankrupt. It had slush money to cover all of this.

So yeah, fake debt created the call for the bailout. Slush fund could have prevented layoffs, and the layoffs didn’t even save as much as they were supposed to.

Need to reiterate that this whole time, they’re using command prompt software. People my age have proabably never used this. This is what it looks like:

The rest of the report went more into detail about how executive team employees and the board let all of this happen, which is still very nuts but not exactly new.

That's all I got for now, I think. Unless any curious followers want to ask a question knowing there's a 75% chance I won't have an answer.