California Receives an “F” in Annual Report on Transparency of Government Spending

CALPIRG Education Fund

SACRAMENTO — California received an F when it comes to government spending transparency, according to “Following the Money 2014: How the 50 States Rate in Providing Online Access to Government Spending Data,” the fifth annual report of its kind by the California Public Interest Research Group Education Fund.

“State governments across the country have become more transparent about where public money goes, providing citizens with the information they need to hold elected officials and recipients of public subsidies accountable,” said Garo Manjikian, Policy Advocate with the California Public Interest Research Group Education Fund. “But California has a long way to go.”

“This report shows that many states are getting impressive results from making contracts and subsidies more transparent. California’s continued failure to make state spending more transparent is disappointing and unaccepable,” said Manjikian.

Officials from 45 states provided the researchers with feedback on their initial evaluation of state transparency websites. Unfortunately, California was one of only five states that didn’t respond to the researchers with any feedback. The leading states with the most comprehensive transparency websites are Indiana, Florida, Oregon, Florida, Texas, Massachusetts, Iowa, Vermont, and Wisconsin.  

Based on an inventory of the content and ease-of-use of states’ transparency websites, the “Following the Money 2014” report assigns each state a grade of “A” to “F.” Described in the report as a “Failing state,” California fails to follow many of the standards of online spending transparency.

This is the second consecutive year that California’s transparency website earned an “F” grade. Grading standards rise each year, so states need to improve transparency each year to maintain high scores.

While many states continue to improve, the states that most distinguished themselves as leaders in spending transparency are those that provide access to otherwise unscrutinized areas of expenditure. Six states provide public access to checkbook-level data on the subsidy recipients for each of the state’s most important economic development programs, allowing citizens and public officials to hold subsidy recipients accountable by listing the public benefits that specific companies were expected to provide and showing the benefits they actually delivered. The most transparent states similarly provide detailed information on subsidies spent through the tax code, on economic development subsidies, and “off-budget” quasi-public agencies.

California, on the other hand, still lacks a central transparency website that provides spending data in a searchable format. The one place where some state spending is available, Department of General Services, no expenditure data is available on any of California’s major subsidy programs.

The one place that California made some progress last year was with the passage of AB 93 to replace the long-critiqued Enterprise Zone program with more transparent, accountable subsidies. Once fully implemented, the reforms require a public database of companies that received the hiring credits and a report on new jobs created.

“Open information about the public purse is crucial for democratic and effective government,” said Manjikian. “It is not possible to ensure that government spending decisions are fair and efficient unless information is publicly accessible.”

While California has fallen far behind at the state level, California cities are taking the lead in making government spending transparent and easily accessible to the public. In a 2013 CALPIRG report “Transparency in City Spending,” that graded the country’s largest 50 cities on spending transparency, San Francisco received an “A-” one of the top ranked cities in the country. In October 2013 Los Angeles unveiled their new transparency portal, “Control Panel LA”  which includes checkbook level data that is easily searchable and downloadable.

At least eight states have launched brand new transparency websites since last year’s report, and most made improvements that are documented in the report.

States that have created or improved their online transparency have typically done so with little upfront cost. For example, Oklahoma (B-) did it for only $8,000 and Texas (A-) did it for $310,000. In fact, top-flight transparency websites can save money for taxpayers, while also restoring public confidence in government and preventing misspending and pay-to-play contracts. For example, Massachusetts reported that they by posting information on opportunities through the state’s checkbook-level procurement website, Comm-Pass, bids for transportation projects funded by Recovery Act funds came in 15-20 percent below the state’s initial estimates.

State spending transparency is a non-partisan issue. The report compared transparency scores with a variety of measures of which party rules the state legislative, or sits in the Governor’s office, or how public opinion tilts in the states. Neither Republican nor Democratic states tended to have higher levels of spending disclosure.

To read the California Public Interest Research Group Education Fund report, click here:

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California Public Interest Research Group Education Fund works to protect consumers and promote good government. We investigate problems, craft solutions, educate the public, and offer meaningful opportunities for civic participation.



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