State Technology Office broke law, audit finds

© St. Petersburg Times
published May 14, 2002

TALLAHASSEE -- The state agency responsible for spending $763-million on new information technology illegally solicited money from businesses with state contracts, failed to adequately account for expenditures and may have paid for services that were not received, an audit has found.

The findings will be referred to the State Ethics Commission, Attorney General Bob Butterworth and investigators for Comptroller Bob Milligan, who released the audit Monday.

Gov. Jeb Bush created the State Technology Office in 2000 to modernize the state's computer technology. It has been acting under interim management since August 2001 when its director, Roy Cales, resigned after he was charged with forging a letter of credit to get a $35,000 bank loan in 1996, prior to starting his state job. Bush hand-picked Cales for the job.

The office handles contracts for computer hardware and software, and consulting contracts for all state agencies.

The audit found:

The Technology Office frequently operated without sufficient written contracts and signed up for duplicate services from more than one provider.

The office operated for a time as the Information Technology Development Task Force without the necessary charter to do business in Florida. Employees solicited money, sponsors, hotel rooms and other items from vendors, though Florida law prohibits such solicitations.

The office solicited funds from vendors and paid Ronald L. Polito to produce a technology address delivered by the governor at a technology convention in November 2000, the audit found. Polito was paid $191,764 for work between Oct. 4 and Nov. 16, 2000. The entire technology event cost the state almost $250,000.

A state settlement with Polito included "false and misleading statements" used to pay $81,764 to Polito. He also was paid $110,000 by Enterprise Florida Inc. after the development agency collected checks from vendors who were solicited by state technology employees.

Milligan also found the "appearance of a conflict of interest" in a $399,000 contract with KPMG Consulting to do a feasibility study for the Department of Business and Professional Regulation. He also raised questions about a $16.5-million contract with the State Division of Retirement.

Bush declined to comment until he reads the audit.

A report in November by the state auditor general criticized the office for not having plans for consolidating state computer operations and developing service agreements with state agencies that were insufficient and not executed.

Kim Bahrami is the acting director of the office, a division of the Department of Management Services run by Cynthia Henderson.

Kathleen Anders, spokeswoman for Henderson, said the agency has "briefly gone over" the audit and believes many of Milligan's recommendations already have been implemented and others are "still in progress."

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