"Governor may soon hold agency purse strings; Low-profile board to get say in borrowing" by Casey Ross, Globe Staff | August 5, 2008
The Patrick administration is about to gain unprecedented control over state borrowing after the Legislature last week gave an obscure advisory panel oversight of previously independent agencies such as the Massachusetts Turnpike Authority.
Also see: The Massachusetts Dictatorship
The legislation, expected to be signed by Governor Deval L. Patrick within days, gives the little-known Finance Advisory Board the authority to set rules on how state agencies borrow and manage their money. It also requires that all agencies fully disclose the details of their loan transactions and taxpayers' financial exposure.
Four of the advisory board's five members are appointed by the governor's office, giving the administration substantial control over its actions. The consolidation of power at the board has created some unease on Beacon Hill, but aides to the governor said it will provide financial oversight that is sorely lacking.
Now if he can do that...!
In the case of the turnpike, state officials said the authority's managers entered into a series of interest rate swaps whose risks were not fully understood, and ultimately exposed the state to millions of dollars in unanticipated interest costs. Those costs are on pace to grow to $2 million in January, but the turnpike will now be able to use the higher credit rating of the state to refinance and lower borrowing costs.
Some lawmakers involved in negotiations over the bill said it does not go far enough to protect taxpayers. State Senator Mark Montigny, a New Bedford Democrat, wanted to require managers at state agencies to fully disclose taxpayers' exposure to their financial deals under "the pains and penalties of perjury." He said that language, which was struck from the bill, would have forced agency heads to eliminate the dysfunction and secrecy that he said has plagued projects like the $14.8 billion Big Dig.
"There's been a lot of corruption and ineptitude, and no one is going to be accountable unless they're sworn to it," he said. "I don't know how else you restore trust in the public's eyes."
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That's what we want!!!!
