Following the Money 2013

7/28/2019 Following the Money 2013

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Following the Money 2013How the 50 States Rate in Providing OnlineAccess to Government Spending Data


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Written by:

Benjamin Davis, Frontier Group

Phineas Baxandall and Ryan Pierannunzi,

U.S. PIRG Education Fund

March 2013

Following theMoney 2013

How the 50 States Rate in ProvidingOnline Access to Government

Spending Data


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The authors would like to thank Philip Mattera, Research Director o Good Jobs First,or providing analysis, editorial assistance, and review or this report. We wish to ad-ditionally thank the public ocials rom the 48 states who took the time to answer oursurvey questions and provide eedback on our evaluation o the transparency websitesthey manage. Previous years versions o this report beneted rom comments providedby: Gavin Baker, Open Government Policy Analyst o OMB Watch (now Center or E-ective Government); Melissa Duscha, Ph.D. student o Public Policy at the Universityo North Carolina, Charlotte; Suzanne Leland, Associate Proessor in the Department oPolitical Science and Public Administration at the University o North Carolina, Char-lotte; and Francisca Rojas, Research Director or the Transparency Policy Project at theAsh Center or Democratic Governance and Innovation at Harvards Kennedy School

o Government. Thanks also to Tony Dutzik and Travis Madsen at Frontier Group ortheir editorial assistance.

This report is made possible through the generous support o the Ford Foundation.

The authors bear any responsibility or actual errors. The recommendations are those oCALPIRG Education Fund. The views expressed in this report are those o the authorsand do not necessarily refect the views o our unders or those who provided review.

2013 CALPIRG Education Fund. Some Rights Reserved. This work is licensed under aCreative Commons Attribution Non-Commercial No Derivatives 3.0 Unported License.To view the terms o this license, visit creativecommons.org/licenses/by-nc-nd/3.0.

With public debate around important issues oten dominated by special interests pursu-ing their own narrow agendas, CALPIRG Education Fund oers an independent voicethat works on behal o the public interest. CALPIRG Education Fund, a 501(c)(3) or-ganization, works to protect consumers and promote good government. We investigateproblems, crat solutions, educate the public, and oer meaningul opportunities or civicparticipation. For more inormation, please visit our website at www.calpirgedund.org.

Frontier Group conducts research and policy analysis to support a cleaner, healthier andmore democratic society. Our mission is to inject accurate inormation and compellingideas into public policy debates at the local, state and ederal levels. For more inormationabout Frontier Group, please visit our website at www.rontiergroup.org.

Cover Photos: Alex Nikada Photography

Layout: To The Point Publications, www.tothepointpublications.com

Acknowledgments


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Table o Contents

Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Transparency 2.0 Websites Empower Citizens to Track Government Spending . . . . . . . . . . . 10

New Transparency Websites Open the Books on Spending . . . . . . . . . . . . . . . . . . . . . . . . . 18

Making the Grade: Scoring States Progress toward Transparency 2.0 . . . . . . . . . . . . . . . . . 25

States Innovate with Cutting-Edge Features . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

State Ofcials Face Obstacles and Challenges in Operating Transparency 2.0 Websites . . . . 36

Continuing the Momentum Toward Greater Transparency: How States Can Improve

their Transparency 2.0 Websites . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40

Appendix A: Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43

Appendix B: Transparency Scorecard . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52

Appendix C: Understanding States Scores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .56

Appendix D: List o Questions Posed to Transparency Website Ofcials . . . . . . . . . . . . . . . . 70

Appendix E: Agencies or Departments Responsible or Administering Transparency

Websites by State . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71

Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74


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4 Following the Money 2013

Executive Summary

E

very year, state governments spend

tens o billions o dollars throughcontracts with private entities orgoods and services, subsidies to encour-age economic development, grants, andother orms o spending. Accountabilityand public scrutiny are necessary to en-sure that state unds are well spent.

In recent years, state governmentsacross the country have created trans-parency websites that provide check-book-level inormation on governmentspending meaning that users can

view the payments made to individualcompanies and details about the goodsor services purchased. These websitesallow residents and watchdog groups toensure that taxpayers get their moneysworth rom deals the state makes withcompanies.

In 2013, or the frst time, all 50

states provide some checkbook-levelinormation on state spending via theInternet. In 48 states all except Cali-ornia and Vermont this inormationis now searchable. Just our years ago,only 32 states provided checkbook-levelinormation on state spending online, andonly 29 states provided that inormationin searchable orm.

This report, U.S. PIRG EducationFunds ourth annual evaluation o statetransparency websites, nds that states

are closer than ever beore to meetingthe standards o Transparency 2.0 encompassing, one-stop, one-clickcheckbook transparency and account-ability. Over the past year, new states haveopened the books on public spending andseveral states have pioneered new tools


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Executive Summary 5

Grade

FDCBA

Figure ES-1: How the 50 States Rate in Providing Online Access to GovernmentSpending Data

to urther expand citizens access to criti-

cal spending inormation. Many states,however, still have a long way to go toprovide taxpayers with the inormationthey need to ensure that government isspending their money eectively.

Since the beginning o 2012, at leastsix states have created new transpar-ency websites. For example:

In January 2013, Maine launched itswebsite, opening the books on $7billion o expenditures in scal year2012. The checkbook is searchableby 103 state agencies and oces, 43spending categories, 33 purchasingunds and more than 58,000 vendors.

In January 2013, Idaho launched anew website that enables users to

view and download recipient-specic

state expenditure inormation. Thewebsite also contains inormationon the states tax expenditures, aswell as nancial inormation on localgovernments.

States have made varying levelso progress toward improved onlinespending transparency. (See FigureES-1 and Table ES-1.)

Leading States (A range): Seven

states are leading in online spend-ing transparency and have createduser-riendly websites that providevisitors with an array o checkbook-level inormation about expendi-tures. In each o these states, userscan monitor the payments made to


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vendors through contracts, grants,tax credits and other discretionary

spending. All spending in these states with the exception o subsidiesin Texas is accessible in a search-able database. All Leading States except Florida also provide userswith copies o contracts, allowingresidents to uncover details about the

Confrmation o Findings with State OfcialsTo ensure that the inormation presented here is accurate and up-to-date, U.S. PIRG

Education Fund researchers sent initial assessments and a list o questions to transparencywebsite ocials in all 50 states and received eedback rom such ocials in 48 states.

Website ocials were given the opportunity to alert us to possible errors, clariy theironline eatures, discuss the benets o transparency best practices in their states, andidentiy obstacles and challenges that they ace. For a list o the questions posed to stateocials, please see Appendix D.

Transparency 2.0 Is Encompassing, One-Stop,

One-Click Budget Accountability and Accessibility

Transparency 1.0 Transparency 2.0Incomplete: Residents only have accessto limited inormation about public

expenditures. Inormation about contracts,

subsidies or tax expenditures is not disclosed

online and oten not collected at all.

Encompassing: A user-riendly web portal

provides residents the ability to search

detailed inormation about government

contracts, spending, subsidies and tax

expenditures or all government entities.

Scattered: Determined residents who visit

numerous agency websites or make public

records requests may be able to gather

inormation on government expenditures.

One-Stop: Residents can search all

government expenditures on a single

website.

Tool or Inormed Insiders: Researchers

who already know what they are looking orand understand the bureaucratic structure

o government programs can dig through

reports or data buried beneath layers o

subcategories and jurisdictions.

One-Click Searchable and Downloadable:

Residents can search data with a singlequery or browse common-sense categories.

Residents can sort data on government

spending by recipient, amount, legislative

district, granting agency, purpose or

keyword. Residents can also download data

to conduct detailed o-line analyses.

goods or services the governmentpays companies to provide.

Advancing States (B range):Nine states are advancing in onlinespending transparency, with check-books that are easy to access andcover many o each states expendi-tures. With the exception o spend-ing on economic development tax


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Executive Summary 7

State GradePointTotal

Texas A 96

Massachusetts A- 93

Florida A- 92

Illinois A- 92

Kentucky A- 92

Michigan A- 91

Oklahoma A- 91

Oregon B+ 89

Utah B+ 88.5

Nebraska B+ 88

Arizona B 86

Iowa B 85

Pennsylvania B 85

Washington B- 81

New Hampshire B- 80.5

Virginia B- 80.5

Georgia C+ 77

Vermont C+ 77

Connecticut C+ 76

Indiana C+ 75

Missouri C 74.5

West Virginia C 74

Maryland C 73

Mississippi C 73

New Mexico C 73

Table ES-1: How the 50 States Rate in Providing Online Access to GovernmentSpending Data

credits, all expenditures availableonline are searchable, allowing

residents to easily locate specicspending data. All Advancing Statesprovide checkbook-level inormationon grants, which are oten awardedthrough processes separate romcontract awards. Also, all Advanc-ing States, with the exception o

Washington, provide spending inor-mation rom quasi-public agencies.

Emerging States (C range):Twenty-two states are emerging inonline spending transparency andhave launched transparency websiteswith checkbook-level inormationon contracts and some other expen-ditures. However, Emerging States

State GradePointTotal

New York C 73

South Carolina C 73

Tennessee C 73

Idaho C 72

Louisiana C 71

Minnesota C 71

New Jersey C 71

South Dakota C 70

Arkansas C- 69

Delaware C- 69

Kansas C- 68

Maine C- 68

Alabama C- 66

Alaska D+ 64.5

Nevada D+ 62

Ohio D+ 61

Colorado D+ 60

North Carolina D 58

Montana D 57

Rhode Island D- 54

Wyoming F 48

Wisconsin F 47

Hawaii F 39

Caliornia F 37

North Dakota F 31


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provide minimal inormation onexpenditures outside states usualaccounting systems.

Lagging States (D range): SevenLagging States maintain trans-

parency websites but are missingimportant pieces o their checkbooksand ail to provide other spend-ing data that are available on mostother websites. While these LaggingStates provide checkbook-level detailon the payments made to vendorsthrough contracts and grants, onlyone state Ohio provides inorma-tion on economic development taxcredits.

Failing States (F range): Fivestates are ailing in online spendingtransparency, and maintain websitesthat are checkbook-level, but arelimited and hard to use. Not a singleFailing State provides inormationon the public benets o economicdevelopment subsidies broken downby recipient or makes its tax expendi-ture report available. Only one state Wyoming provides spendinginormation on o-budget agencies.

Some states have gone above and be-yond standard Transparency 2.0 eatures.They have developed new tools andposted new sets o inormation on gov-ernment expenditures, giving residentsunprecedented ability to monitor andinfuence how their government allocatesresources.

Shining a Light on Pay-to-PlayPractices: Illinois has launcheda tool called Open Book thatempowers the public and watchdoggroups to explore contracts awardedto corporations side-by-side with

electoral contributions those corpo-rations have made.

Integration o Local GovernmentData into Checkbook Tool: Utahscheckbook allows users to view

expenditures by city, and Arizonascheckbook allows users to viewexpenditures made by two countygovernments.

Mapping Tools: Oregon providesinteractive maps that allow usersto view where taxpayer dollars arespent. For example, the WatershedEnhancement Board map pinpointsproject locations and provides thesame checkbook-level detail aspayments in Oregons main spendingdatabase.

All states, including Leading States,have many opportunities to improve theirtransparency.

Thirty states do not post checkbook-level inormation on economic devel-opment tax credits.

Only eight states provide inorma-tion on both the projected number o

jobs to be created and actual numbero jobs (or other public benets)created by economic developmentsubsidies.

Eleven states checkbooks oncontracts cannot be searched byall assessed categories vendor,keyword and purchasing agency.

Sixteen states do not provide anyinormation about the expendituresor revenues collected rom quasi-

public agencies or public-privatepartnerships, prohibiting citizensrom monitoring such o budgetstate expenditures.


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Introduction 9

Introduction

U

p until a ew years ago, most citi-

zens were completely in the darkabout the details o how their stategovernment spent taxpayer dollars. Jour-nalists, watchdog groups and the mostpersistent citizens could nd expendituredata through ocial inormation requestsor by exploring the nooks and crannieso certain government websites, but orthe most part, Americans knowledge ogovernment spending was limited to whatthey heard in the news.

Recently, however, the spending data

disclosed by states online has multipliedand improved. Hundreds o billions odollars in checkbook-level detail are nowaccessible at the click o the mouse. Thescope ranging rom contracts and grantsto tax credits and reunds and accessibil-ity o the data have ollowed an emerg-

ing set o best practices. Citizens have

greater opportunity than ever beore tomonitor government spending, evalu-ate budgetary decisions, and ensurethat contracts to private companies aresmart choices or the state.

Even though states have all begunto adopt these standards, there remainmajor discrepancies in the comprehen-siveness and user-riendliness o gov-ernment spending data available online.

This report is U.S. PIRG EducationFunds ourth annual assessment o each

states online spending transparency.In the ollowing pages, we highlightstates excelling in opening their booksand call attention to ways states canimprove. In doing so, we hope to en-courage states to make all spendingdata available.


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Transparency 2.0 Websites EmpowerCitizens to Track Government Spending

Practically speaking, public inorma-tion is not truly accessible unless itis online. Government spending

transparency websites that meet the stan-dards o Transparency 2.0 give citizensand government ocials the ability tomonitor many aspects o state spending saving money, preventing corruption,reducing potential waste and abuse otaxpayer dollars, and encouraging theachievement o a wide variety o publicpolicy goals.

Transparency 2.0 MakesGovernment More Eectiveand Accountable

States with good transparency websiteshave experienced a wide variety o ben-ets or state residents and the govern-ment. Transparency websites have helped

governments nd ways to save moneyand meet other public policy goals.

Transparency Websites SaveMoney

Transparency 2.0 states oten realizesignicant nancial returns on theirinvestment. The savings come romsources big and small more ecientgovernment administration, morecompetitive bidding or public projectsand less sta time spent on inormationrequests, to name just a ew and canadd up to millions o dollars. Harder

to measure is the potential abuse orwaste that is avoided because govern-ment ocials, contractors and subsidyrecipients know that the public will belooking over their shoulders.

Transparency websites can savemoney in a variety o ways, including:


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Transparency 2.0 Websites Track Government Spending 11

Highlighting opportunities orstates to negotiate low-costcontracts.Texas was able torenegotiate its copier machinelease to save $33 million over threeyears. The state was also able to

negotiate prison ood contracts tosave $15.2 million.1

Increasing competition orcontracts. In 2011, Massachusettsreported that by posting inorma-tion on state contracts and biddingopportunities through the statescheckbook-level procurementwebsite, Comm-Pass, bids ortransportation projects unded byRecovery Act unds came in 15-20

percent below the states initialestimate.2

Identiying and eliminatinginefcient spending.

In Texas, the comptrollers oceused its transparency websiteover the rst two years it wasavailable to save $4.8 millionrom more ecient administra-tion.3 For example, the ocesaved $328,000 by setting up

separate post oce boxes insteado buying a new mail sorter.4

Once South Dakotas new trans-parency website was launched,an emboldened reporter re-quested additional inormationon subsidies that led legislatorsto save about $19 million peryear by eliminating redundanciesin their economic developmentprogram.5

Once Utahs transparencywebsite revealed that the stategovernment was spending$294,000 on bottled water everyyear, the state reduced its annualbottled water expenditure to ap-proximately $85,000.6

Reducing costly inormationrequests.

Massachusetts procurementwebsite has saved the state $3million by eliminating paper,

postage and printing costs associ-ated with inormation requestsby state agencies and paperworkrom vendors. Massachusetts hassaved money by reducing statime or public records man-agement, retention, provision,archiving and destruction.7

In Utah, the State Oce oEducation and the Utah TaxCommission save about $15,000a year rom reduced inormationrequests.8

South Carolina open recordsrequests initially dropped bytwo-thirds ater the creation o itstransparency website, reducingsta time and saving an estimatedtens o thousands o dollars.9

Mississippi estimates that everyinormation request ullled byits transparency website rather

than by a state employee saves thestate approximately $750 in statime.10

Kentuckys website eliminates anestimated 40 percent o the ad-ministrative costs o procurementassistance requests, and couldreduce the costs associated withopen records requests by as muchas 10 percent.11

Since the launch o Delawares

transparency website, the Depart-ment o Finance has reported asignicant reduction in Free-dom o Inormation Act (FOIA)requests, saving valuable statime.12


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Online Transparency ProvidesSupport or a Range o PolicyGoals

Transparency websites provide statestools to assess their progress toward com-

munity investment, armative actionand other public policy goals. Govern-ments oten stumble when trying to meetpublic policy goals because managersstruggle to benchmark agencies, spreadbest practices, or identiy contractorswho advance these goals. Online trans-parency portals allow states to bettermeasure and manage the progress osuch programs.

For example, when government bodiesin Ohio including cabinet agencies, the

General Assembly, counties, townships,boards, public corporations, universities,school districts and more purchasegoods and services, they are obligatedto use vendors who employ persons withdisabilities.13 The goal o this practiceis to provide gainul employment andtraining to residents with work-limitingdisabilities.14 The transparency websiteenables government oces to nd thesevendors by providing a list o certiedcompanies already conducting businesswith the state along with details on thegoods or services provided.15

Online Transparency CostsLittle

The benets o transparency websiteshave come with a surprisingly low pricetag, both or creating and maintainingthe websites. Several states includingDelaware, Georgia, Ohio and Oregon

created and update their websites withunds rom their existing budgets. Forwebsites that required a special appropri-ation or earmark, the cost is usually lessthan $300,000 to create the website andeven less to keep it updated. (See Table1.) For states that are concerned about

the costs o contracting out to expensiveinormation technology programmers,New York City this spring will also pro-vide its top-notch code or ree in an opensource ormat.

Transparency 2.0 WebsitesGive Users DetailedInormation on GovernmentExpenditures

Websites that meet Transparency 2.0standards oer inormation on govern-ment expenditures that is encompassing,one-stop and one-click.

EncompassingTransparency websites in states that

ollow Transparency 2.0 standards oerspending inormation that is both broadand detailed. States that ollow Trans-parency 2.0 standards provide inorma-tion that helps citizens answer three keyquestions: how much is the governmentspending on particular expenditures,which companies is the government pay-

ing, and what is the public getting orits money? These states also empowercitizens to answer those questions orevery major category o state spending,including:

Contracted payments to privatecompanies and nonprofts: Somegovernment agencies spend wellover hal o their budgets on outsidecontractors.22 These contractors aregenerally subject to ewer public

accountability rules, such as sunshinelaws, civil service reporting require-ments or reedom o inormationlaws.

Non-contracted expenditures:States governments also spendmoney outside o ormal bidding and


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State Start-Up Costs Annual OperatingCosts

Alabama $125,000 Less than $12,000

Alaska $5,000 Nominal

Arizona $72,000, plus existing statime

Approximately$83,000

Arkansas $558,000 $175,000

Colorado $200,000 rom existing

budget, plus existing sta time

$169,400 rom

existing budget

Connecticut Existing budget Existing budget

Delaware Existing budget Existing budget

Florida Existing budget

Georgia Existing budget Existing budget

Hawaii Existing budget Existing budget

Idaho Approximately $28,000 romexisting budget

Existing budget

Illinois Approximately $100,000 Approximately

$10,000

Iowa Less than $75,000 $6,000

Kansas $150,000 rom existing budget Existing budget

Kentucky $150,000 $10,000-$15,000

Louisiana $325,000 Minimal

Maine $30,000

Maryland $65,000 $5,000

Massachusetts $540,00017

$431,000Michigan Existing budget Existing budget

Minnesota Existing budget

Mississippi $2,200,00018 $400,00019

Missouri $293,140 rom existing budget Less than $5,000

Montana Existing budget Existing budget

Nebraska $30,000-$60,000 Approximately

$10,000

Nevada $78,000 $30,000

New Hampshire Existing budget Existing budget

New Jersey Existing budgetNew Mexico $230,000 $125,000

New York Existing budget

North Carolina $624,00020 $80,600

North Dakota $231,000 $30,000

Table 1: Cost to Create and Maintain a Transparency Website16


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State Start-Up Costs Annual OperatingCosts

Ohio Existing budget Existing budget

Oklahoma $8,000, plus existing sta time Approximately

$3,600Oregon Existing budget Existing budget

Pennsylvania Approximately $300,000 Primarily existing

sta time

Rhode Island Existing budget

South Carolina $30,000 in existing sta time Existing sta time

South Dakota Not tracked (nominal) Existing budget

Tennessee Existing budget

Texas $310,000 Existing budget

Utah $192,800, plus existing sta

time ($100,000)

$63,400, plus

existing sta time($133,400)

Vermont Existing budget Existing budget21

Virginia $500,000 rom existing budget $400,000 rom

existing budget

Washington $300,000 Existing budget

West Virginia Existing budget

Wisconsin $30,000 $11,300

Wyoming $1,600

Note: Some costs are approximations; many Annual Operating Costs are blank

because states have not tracked these costs or responses were not provided; unds or

many websites or which states provided specic costs (as opposed to existing budget)

came rom the existing budget as opposed to a separate appropriation; to see a list o

agencies or departments responsible or administering the transparency website in each

state, see Appendix E.

Table 1: Cost to Create and Maintain a Transparency Website (continued)


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disclosure. States that ollow Trans-parency 2.0 standards provide trans-parency and accountability or taxexpenditures, usually by linking theirtransparency portal to a tax expendi-ture report, which details a states tax

credits, deductions and exemptionswith the resulting revenue loss romeach program.

Spending through quasi-publicagencies: Quasi-public agencies areindependent government corpo-rations that are created throughenabling legislation to perorm aparticular service or a set o publicunctions. Over time, quasi-publicagencies have delivered a growing

share o public unctions.26

Theyoperate on the ederal, state and locallevels, providing services such aswaste management, toll roads, watertreatment, community developmentprograms and pension manage-ment. Because quasi-public agenciestypically collect ees or some otherorm o their own revenue, they donot rely solely, or oten even signi-cantly, on an annual appropriationrom the legislature. As a result,

their expenditures oten all outsidethe ocial state budget and aredicult or the public to scrutinizewithout strong transparency.

Leases and concessions to privatecompanies: States sometimes sellor lease to private companies theright to construct or operate apublic asset or service in return orthe right to collect and retain userees rom the public or to receive

contracted payments rom thegovernment. These arrangementsare most common or toll roads,garages, parking meters and watersystems. They have also becomemore common at state parks andin the operation o ee-collecting

contract processes, including capitalacquisitions, small purchases, rentals,debt service, insurance, salaries andbenets.

Grants: States administer grants,

similar to contracts, to private ornonprot entities in exchange oradvancing public aims.

Subsidies such as tax credits oreconomic development: Stateand local governments allocate anestimated $50 billion each yearto private entities in the orm oeconomic development subsidies.23These incentives which can takethe orm o grants, loans, tax creditsand tax exemptions are awardedwith the intent to create jobs andspur growth, yet most governmentsstill do not disclose ull inorma-tion on these expenditures andtheir outcomes.24 The degree towhich private entities deliver on theeconomic growth promised in thesubsidy agreements is rarely report-ed, prohibiting the public and stateocials rom holding the compa-nies accountable. States that ollow

Transparency 2.0 standards allowcitizens to hold companies account-able by listing the descriptions othe public benets companies wereexpected to provide and what theyactually delivered, such as the speci-ic number o jobs.25

Other tax expenditures: Taxexpenditures are subsidies bestowedthrough the tax code in the orm ospecial tax exemptions, credits, deer-

ments and preerences. Once creat-ed, tax expenditures oten escapeoversight because they do not appearas state budget line items and rarelyrequire legislative approval to renew.For these reasons, spending throughthe tax code is in particular need o


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services such as motor vehiclelicensing. Reporting on spend-ing and user ees collected at thesepublic-private partnerships isoten lacking, which is a problemsince these arrangements are oten

not governed by standard publicprotections such as civil service,confict-o-interest, and reedom oinormation rules.27

For each o these orms o spending,taxpayers deserve to know exactly whichbusinesses and organizations are receiv-ing state money, and they should also beprovided with enough inormation todetermine whether they are receiving areasonable return on their investment.For some types o spending such as di-rect contracts or goods and services thisinormation is usually readily availablein clear dollar amounts. In other cases,such as economic development subsidiesor other tax expenditures, the cost to thestate may be more open to interpretation.In any case, states should strive to pro-vide the public with all the inormationit needs to evaluate how public resourcesare allocated to contractors and recipients

o state subsidies.

One-StopTransparency websites in leading states

oer a single portal rom which citizenscan search all government expenditures.With one-stop transparency, residents aswell as local and state ocials can accesscomprehensive inormation on directspending, contracts, tax expenditures andother subsidies in a single location. While

expert users searching or amiliar dataare unlikely to be stymied by the need tovisit many dierent websites, scattereddata impedes more typical citizens romlocating important inormation on spend-ing, bureaucratic entities and programsthey do not already know about.

One-stop transparency is particularlyimportant or public oversight o subsi-dies. Subsidies come in a dizzying varietyo orms including direct cash transers,loans, equity investments, contributionso property or inrastructure, reductions

or deerrals o taxes or ees, guaranteeso loans or leases, and preerential use ogovernment acilities and are adminis-tered by a variety o government agencies.

Placing all data about governmentsubsidies on a single website can uncoverpotential waste and highlight opportu-nities or savings. For example, whenMinnesota began to require agencies tosubmit reports on the perormance osubsidized projects, the reports revealedthat numerous projects were receivingassistance rom two or more undingsources that is, Minnesota taxpayerswere sometimes double- and triple-paying or the creation o the same jobs.Ater the centralized publication o thosereports, the double-dipping stopped.28

One-Click Searchable andDownloadable

Transparent inormation is only as

useul as it is accessible, which meanseasily searchable. Transparency websitesin leading states oer a range o searchand sort unctions that allow residents tonavigate complex expenditure data with asingle click o the mouse. Transparency2.0 states allow residents to browse inor-mation by recipient or category, and tomake directed keyword and eld searches.

Citizens who want to dig deeper intogovernment spending patterns typicallyneed to download and analyze the data

in a spreadsheet or database program.Downloading datasets can also giveresidents the ability to aggregate ex-penditures or a particular company,agency or date, or instance to see trendsor understand total spending amountsthat might otherwise be lost in a sea o


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unrelated data. Leading states enablecitizens to download much or all o the

Transparency 2.0 Is Encompassing,One-Stop, One-Click Budget

Accountability and AccessibilityTransparency 1.0 Transparency 2.0

Incomplete: Residents only have

access to limited inormation about

public expenditures. Inormation

about contracts, subsidies or tax

expenditures is not disclosed online

and oten not collected at all.

Encompassing:A user-riendly web portal

provides residents the ability to search detailed

inormation about government contracts,

spending, subsidies and tax expenditures or all

government entities.

Scattered: Determined residents

who visit numerous agency websites

or make public record requests may

be able to gather inormation on

government expenditures.

One-Stop: Residents can search all government

expenditures on a single website.

Tool or Inormed Insiders:

Researchers who already know what

they are looking or and understand

the bureaucratic structure o

government programs can digthrough reports or data buried

beneath layers o subcategories and

jurisdictions.

One-Click Searchable and Downloadable:

Residents can search data with a single query

or browse common-sense categories. Residents

can sort data on government spending by

recipient, amount, legislative district, grantingagency, purpose or keyword. Residents can

also download data to conduct detailed o-line

analyses.

most important inormation rom theirtransparency websites.


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New Transparency WebsitesOpen the Books on Spending

Over the past year, at least six

states created new transparencywebsites. These websites post

new data online, consolidate importantspending inormation or make existingtransparency tools more user-riendly.Below are highlights rom new websites.

ArkansasIn our 2010, 2011 and 2012 score-

cards, Arkansas received a ailing grade,ranking among the lowest-perormingstates or spending transparency.29 Thestate lacked a transparency website thatcentralized spending data and providedany inormation about grants or eco-nomic development subsidies makingit dicult or Arkansas residents to know

how the state government was spending

its money.In July 2012, Arkansas launched a new

checkbook-level transparency websitethat is one-stop, easy to use, and updateddaily.30 The checkbook tool providespublic access to $1.9 billion in state con-tract spending and $7 billion in otherspending rom scal year 2013.31 (SeeFigure 1.)Users can search expendituresby agency, recipient and spending cat-egory, giving the public multiple ways toinvestigate spending o interest. Arkansasshould continue to improve this databaseby making expenditures rom past yearsavailable at the checkbook level. Althoughcontracts are currently available startingas early as 2001, other orms o spendingsuch grants are only available rom 2013.


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New Transparency Websites Open the Books on Spending 19

Arkansas also improved its account-ability to the public by including a linkto tax expenditure inormation. Sales andincome tax expenditures are now avail-able in a report linked directly rom the

Arkansas website, allowing the public tomonitor the budgetary eect o spendingthrough the tax code.32 Arkansas shouldcontinue on this path toward greaterpublic accountability by including thepublic benets both projected and ac-tual created by recipients o economicdevelopment tax credits.

Idaho

In our past reports, Idaho never scoredhigher than six out o 100 points, and in2012 it ranked at the very bottom o ourreports scorecard.33 Through 2012, thestate did not have a website dedicatedto transparency, and checkbook-levelgovernment expenditure inormation was

not available online.34

In January 2013, the state controllerand governor announced the launch oTransparent Idaho, a new transparencyportal that ollows some standards o

Transparency 2.0.35 This new websiteincludes a Vendor Checkbook, giving Idahoresidents the ability to view and down-load recipient-specic state expenditureinormation. (See Figure 2.) The websitealso contains a link to inormation on thestates tax expenditures and links to coun-ty and municipal nancial inormation.

In the next year, Idaho should improveits website by adding data rom all statedepartments and agencies to the VendorCheckbook. The current website onlycontains inormation rom the oces othe secretary o state and the controller.Additionally, Idaho should update thewebsite to provide detailed checkbook-level inormation on all economic devel-opment subsidy programs.

Figure 1: Arkansas New Transparency Website Contains Checkbook-Level Detail onContracts, Grants and Other Payments


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Figure 2: Idaho Launches a New Transparency Website, Transparent Idaho

Figure 3: Maine Launches a New Transparency Website, Open Checkbook


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MaineMaines online spending transparency

has come a long way in recent years. Twoyears ago Maine ranked dead last in ourassessment o states transparency web-

sites because spending inormation wasonly available to registered vendors, notthe general public.36 In an eort in early2012 to provide inormation on statespending, the controllers oce madesome spending data available online, al-though it was outdated and unsearchable.Then in February 2013, the controllersoce launchedMaine Open Checkbook atlast adding Maine to the ranks o statesthat provide spending inormation in auser-riendly database. (See Figure 3.)

Maines checkbook is both compre-hensive and intuitive to users. For scalyear 2012, it contains data on more than$7 billion o expenditures, and is search-able by 103 state agencies and oces,43 spending categories, 33 purchasingunds and more than 58,000 vendors.37Users can search through the expendi-tures using multiple criteria at the sametime to break the inormation down intounderstandable pieces. For example,users can search or payments made by

the Department o Education (agency)on equipment (category) through theGeneral Fund (und source). This bringsan unprecedented level o state spendingtransparency to Maine residents.

Even with Maines new website, thestate has room or improvement. Whilethe values o payments made throughindividual grants are listed, all recipi-ent names are marked as NOT PRO-VIDED. This lack o transparencyprevents the public rom discoveringwhich vendors received more than $660million o state grants in scal year 2012.Payments made by quasi-public agen-cies such as the Maine State HousingAuthority are also not available throughthe checkbook.38 The values o credits

awarded through economic developmentprograms such as the $1.4 million SeedCapital Investment Tax Credit program are not available either.39

In the uture, the controllers oceplans to publish recipient-specic expen-

ditures on grants, quasi-public agenciesand tax credits, and Maines high qualitycheckbook website platorm was designedto easily accommodate these changes.40

MontanaIn our 2010, 2011 and 2012 reports,

Montana ranked in the bottom ve statesbecause it lacked a website containingcheckbook-level inormation on govern-

ment expenditures.41

The contract inor-mation available located on MontanasGeneral Services Division website wasnot checkbook-level and was designedor vendors seeking business with thestate, not or citizens looking to holdgovernment contractors accountable orproviding quality goods or services atreasonable prices.

Montana took a step in the right direc-tion in early 2013 by creating a websitededicated to transparency. Although the

website is still being improved, it oers aneasy-to-use interace that includes a linkto a new checkbook-level spending data-base, as well as inormation on the statesassets, liabilities and employee com-pensation.42 Clicking on the MontanaCheckbook brings visitors to a searchabledatabase o more than $1 billion in stateexpenditures by 35 government depart-ments during iscal year 2013.43 (SeeFigure 4.) Montana residents can use thistool to view and download the details owhen, or what and to whom governmentpayments are being made.

Montana should continue to help thepublic hold recipients o governmentunds accountable by expanding the con-tent and improving the accessibility o the


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inormation on the website. In the nextyear, Montana ocials should upgradethe website to include spending inorma-tion rom prior years, recipient-specicinormation on tax credits, and a linkto the states tax expenditure report atool or the public to monitor spendingthrough the tax code.

PennsylvaniaPennsylvania perormed just above

average on our reports in 2011 and 2012 providing checkbook level inorma-tion about state contracts on its treasurywebsite.44 However, the state had ailed inprevious years to make all o its spending

inormation clear and accessible to thepublic at a one-stop portal.In June 2011, Governor Tom Corbett

signed the Pennsylvania Web Account-ability and Transparency Act, whichdirected the Oce o Administrationto create a searchable budget database-

driven Internet website detailing certaininormation concerning taxpayer expen-ditures and investments.45 Following thelaw, in December 2012, the governorsoce launched the website PennWatch anew, comprehensive, one-stop portal thatPennsylvania residents can use to monitorstate spending.

This new website is a success orgovernment transparency and spend-ing accountability in Pennsylvania. Thecheckbook eature provides users witheasy access to spending inormation orall three branches o state governmentand quasi-public agencies. This toolis searchable, intuitive, thorough, andmakes investigating government spend-

ing a straightorward process.The website includes many eaturesthat serve as examples or other states,such as the Department o Community& Economic Developments InvestmentTracker, which allows users to searchthrough economic development subsidies

Figure 4: Montana Creates a Searchable Database o the States Expenditures


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received by companies and view the num-ber o jobs they pledged to create.46 (SeeFigure 5.) While the Investment Trackerwas available online in previous years,never beore had it been connected to acentral transparency portal.

To improve the website in the nextyear, the Oce o Administration shouldmake its checkbook search results down-loadable, so Pennsylvania residents canobtain and analyze government spend-ing inormation ofine. The site shouldexpand the scope o inormation availableby including city and county spending,and all expenditures or the past iveyears.

yVermontIn January 2013, Governor PeterShumlin announced that the Departmento Finance & Management had developeda new website called Spotlight Vermont.The website creates a one-stop sourceor Vermonts expenditure and nancial

Figure 5: Pennsylvanias Department o Community & Economic DevelopmentInvestment TrackerShines a Light on Subsidy Spending

inormation and provides the data incharts, graphs, reports and downloadablespreadsheets.47

Spotlight Vermontis easy to use and al-lows visitors to access recipient-specicgovernment spending inormation romclearly marked links. Vermont residentssearching through spending inormationcan access a set o data and charts romwhich they can view checkbook-leveldetail on a range o expenditures. Forexample, data on economic developmenttax credits are available as a download intoa spreadsheet.48

Wh il e some o thi s in o rmationwas available online in previous years,never beore has it been compiled into a

central website. This one-stop tool is amajor improvement, bringing Vermontstransparency grade rom a D to an above-average C+ and demonstrating the stategovernments commitment to spendingtransparency.

In the next year, the Department o


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Finance & Management should increasetransparency by providing inormationon the public beneits such as jobscreated or skills trainings held thatcompanies plan to produce using gov-ernment subsidies. Vermont currently

provides some public benet inormationon government subsidies. For example, adownloadable report provides net newjobs created by the states Economic

Advancement Tax Incentive programas a whole. However, inormation onwhich subsidy recipients are producingthe benets is not available.49 Providingsubsidy-specic inormation on the ben-ets would empower Vermont residentsto more easily use the website as a tool inholding companies accountable or theiruse o taxpayer dollars.


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Making the Grade: Scoring States Progress toward Transparency 2.0 25

Making the Grade: Scoring StatesProgress toward Transparency 2.0

Every year, state governments spendtens o billions o dollars throughcontracts with private entities or

goods and services, subsidies to encourageeconomic development, grants and otherorms o spending. Accountability andpublic scrutiny are necessary to ensurethat state unds are well spent.

In recent years, state governmentsacross the country have created trans-parency websites that provide check-

book-level inormation on governmentspending meaning users can view thepayments made to individual companiesand details on the goods or services pur-chased. These websites allow residentsand watchdog groups to ensure that tax-payers get their moneys worth rom deals

the state makes with companies.Our analysis shows that or the rst

time, every state now hosts a transpar-ency website with some checkbook-level spending inormation. While thebreadth and user-riendliness o thesewebsites vary, this represents a milestoneor transparency. Forty-eight states allexcept Caliornia and Vermont providespending inormation in a searchable da-tabase, allowing residents to easily ollow

the money rom government coers toprivate bank accounts. In 2010 the rstyear we assessed states online spendingdata only 32 states provided checkbook-level websites and only 29 were search-able. Likewise, rom 2010 to 2013, thenumber o states providing inormation


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on the public benets expected to becreated by individual recipients o eco-nomic development subsidies increasedrom two to 18, the number o statesproviding data on o-budget agenciesincreased rom 21 to 34 and the numbero states providing data on local govern-ment spending increased rom eight to28. (See Figure 6.)

Each states transparency website wasanalyzed and assigned a grade based

on its searchability and the breadth oinormation provided. (See AppendixB or the complete scorecard, andAppendix A or a ull explanation othe methodology and explanations ohow the scoring system was applied to

each states specic website.) An initialinventory o each states website and aset o questions were rst sent to theadministrative oces believed to beresponsible or operating each stateswebsite. (For a list o questions sent tostate ocials, see Appendix D.) Followup e-mails, and i necessary phonecalls were made to these oces. O-cials rom 48 states responded withsubstantive inormation, clariying or

conrming inormation about theirwebsites. In some cases, our researchteam adjusted scores based on thisclariying eedback. Only New Mexicoand Minnesota did not respond to ourinquiries.

Note: Data on the number o states that oered each eature in 2010 came rom U.S. PIRG

Education Funds 2010Following the Money report. For the methodology used to compare criteria

between the 2010 report and this years, see Comparing Features in 2013 to Features in 2010inAppendix A.

Figure 6: States Have Rapidly Made Spending Inormation Available Online50

8

21

8

2

28

29

32

28

34

39

18

49

48

50

0 10 20 30 40 50

City & County

Spending

Off-Budget

Agencies

Tax Expenditure

Report

Proj. Benefits

of Subsidies

Grants or

Tax Credits

Searchable

Checkbook

Number of States that Provided Feature in 2010

Number of States that Provide Feature in 2013


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Democrats and Republicans Support Government TransparencyGovernment transparency is not a partisan issue. As was the case in 2010, 2011,

and 2012, higher levels o transparency are not a characteristic o either Demo-cratic- or Republican-leaning states. The average score or a Democratic-leaningstate (determined by the political party o the current governor) was 72.6, whilethat o a Republican-leaning state was 72.8, a dierence o less than hal a point.51Among the seven states that scored an A (pluses and minuses included) threehave Democratic governors and our have Republican governors.52

Figure 7: How the 50 States Rate in Providing Online Access to Government Spending Data

Grade

FDCBA

Based on the grades assigned to eachwebsite, states can be divided into vecategories: Leading States, AdvancingStates, Emerging States, Lagging Statesand Failing States. (See Figure 7.)

The ollowing sections summarizecommon traits shared by the states ineach o these categories to highlight theirstrengths and weaknesses.


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Changes to the Grading Criteria rom 2012Refecting rising standards or government transparency, the grading criteria changed

slightly rom the 2012Following the Money report.53 Changes in the criteria were:

The scope o the checkbook criterion was expanded. Last year, states received ullcredit or providing checkbook-level detail when this inormation was supplied orany orm o spending. This year states that receive ull credit must have checkbook-level detail on both contracts andnon-contracted spending. Similarly, whereaslast year, states could receive ull credit or checkbook-level detail on expendituresthrough grants oreconomic development tax credits, this year, states that receiveull credit or these eatures must have checkbook-level detail on both grants andeconomic development tax credits.

More ne-tuned criteria were introduced or evaluating how checkbook-level dataare provided on grants and economic development tax credits. States were allocatedpoints separately based on whether their checkbooks or grants and economic devel-

opment tax credits are detailed, downloadable, and searchable.The point values assigned to the criteria were rearranged to refect the importance

o criteria that were once at the cutting edge o Transparency 2.0, but that havenow become standard practice. For example, the points assigned to checkbook-levelcontract expenditures decreased rom 30 to 20.

The ARRA Funding criterion, which awarded points or the transparency websitelinking to the states American Recovery and Reinvestment Act website, wasremoved because such unding has mostly already been spent. While maintainingdata rom prior years is a standard o Transparency 2.0 and allows visitors to trackawards to a specic company or industry over time, the criterion was removed socredit could be awarded to more current expenditures.

The tightened criteria have lowered grades or some states that ailed to add eaturesnewly assessed or weighted more heavily this year. A lowered grade does not necessarilymean that unctionality was stripped rom the transparency website. For example:

In Arizona which dropped our points rom last year the Commerce Authorityailed to make checkbook-level inormation available on the recipients o economicdevelopment tax credits. Quasi-public agencies that administer a states economicdevelopment unds such as the Commerce Authority require heightened trans-parency, and while the Commerce Authority has made available checkbook-levelinormation on grants, this transparency has not been extended to tax credits.

New York which dropped 16 points rom last year ailed to make checkbook-

level inormation available on the payments made to vendors through mechanismsother than contracts. Without checkbook-level detail on these payments, residentscan only view a portion o the companies that receive taxpayer dollars.

In a ew cases, it is possible that the grades o states that made no improvements totheir websites increased because the sites already included the criteria weighted moreheavily this year.


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Leading A States

Table 2: Leading A States

The seven states leading in online spend-

ing transparency have created user-riendly websites that provide users withinormation on an array o checkbook-level expenditures. In all states, users canmonitor the payments made to vendorsthrough contacts, grants, tax credits andother discretionary spending. All spend-ing in these states with the exceptiono subsidies in Texas is accessible in asearchable database. All Leading States except Florida - also provide users with

copies o contracts, allowing residents toexamine details about the public goodsor services the government pays compa-nies to provide.

These Leading States also providevisitors with spending details rom

public entities outside the states usualbudget and accounting system. All statesprovide details on expenditures romquasi-public agencies, whose spendingis oten let o the state governmentsbooks. All states except Illinois alsoprovide details on municipal expendi-tures, helping citizens view spendingdecisions across dierent levels o gov-ernment.

Leading States still have opportu-nities to improve transparency. Forexample, not a single Leading Stateprovides completely comprehensive anduser-riendly access to checkbook-leveldata on economic development tax cred-its. Most states data on these tax creditscannot be downloaded or analysis, andOklahoma does not provide any inor-mation on the public benets projectedor achieved created by economic de-velopment incentives.

State Grade PointTotal

Texas A 96

Massachusetts A- 93

Florida A- 92

Illinois A- 92

Kentucky A- 92

Michigan A- 91

Oklahoma A- 91

Controversy Besets Floridas Progress toward Greater Transparency

While Floridas website, Transparency Florida, made the greatest improvements inthe past year to move into the A range, urther attempts to open the states bookson government spending have been beset by controversy. The checkbook-level in-ormation in the newFlorida Accountability Contract Tracking System (FACTS), whichis integrated with Transparency Florida, provides users with contract deliverables andaudit reports enabling the public to hold corporations accountable or deliveringon promised public goods or services in contract agreements. However the tool allsshort in opening all books on state spending. Transactions contracted by the Legisla-

ture, or example, are not available. To x these shortcomings, Floridas State Senatecontracted to create another transparency website called Transparency 2.0, but pulledthe plug shortly ater its completion citing long-term licensing costs o updating thesite.54 At the time o this reports research, civic organizations were calling or stateocials to rectiy Floridas path toward greater transparency, while legislators wereproposing transparency reorms.55


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Figure 8: Top 10 Most Improved Transparency Websitesrom 2012 to 201356

Several states dramatically improved their online spending transparencyin the past year. The states with the largest gains either created new trans-

parency portals or made major improvements to their existing ones. Iowaand Idaho both saw the largest improvements with 66 points. In order, thestates with the highest increase in score rom last year are as ollows:

Note: In some cases, the changes in grade refect changes in the grading criteria.

54

49

51

51

48

59

7

8

19

6

68

64.5

73

77

80.5

92

57

69

85

72

0 20 40 60 80 100

Maine

Alaska

Tennessee

Vermont

NewHampshireFloridaMontana

Arkansas

Iowa

Idaho

Scorein2012FollowingtheMoneyReport Improvementfrom2012


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Advancing B States

Table 3: Advancing B States


Oregon B+ 89

Utah B+ 88.5

Nebraska B+ 88

Arizona B 86

Iowa B 85

Pennsylvania B 85

Washington B- 81

New

Hampshire

B- 80.5

Virginia B- 80.5

Nine states are advancing in onlinespending transparency, with checkbooksthat are easy to access and cover manyo each states expenditures. With theexception o spending on economic de-velopment tax credits, all expendituresavailable online are searchable, allow-ing residents to locate specic spendingdata easily. All Advancing States providecheckbook-level inormation on grants,which are oten awarded through pro-cesses separate rom contract awards.Also, all Advancing States, with the ex-ception o Washington, provide spendinginormation rom quasi-public agencies.

In the next year, Advancing Statesshould improve to join the ranks o theLeading States. Only our out o the nineAdvancing States provide copies o con-tracts online. Also, not a single AdvancingState provides completely comprehensiveand user-riendly access to checkbook-

level data on economic development taxcredits.

Emerging C States

Table 4: Emerging C States

State Grade Point

Total

Georgia C+ 77

Vermont C+ 77

Connecticut C+ 76

Indiana C+ 75

Missouri C 74.5

West Virginia C 74

Maryland C 73

Mississippi C 73

New Mexico C 73

New York C 73South

Carolina

C 73

Tennessee C 73

Idaho C 72

Louisiana C 71

Minnesota C 71

New Jersey C 71

South

Dakota

C 70

Arkansas C- 69

Delaware C- 69

Kansas C- 68

Maine C- 68

Alabama C- 66

Twenty-two states are emergingin online spending transparency andhave launched transparency websiteswith checkbook-level inormation oncontracts and some other expenditures.

However, Emerging States provideminimal inormation on expendituresoutside states usual accounting systems.

Contract expenditures in all EmergingStates, with the exception o Vermont,are searchable by at least one o the three


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search criteria in the scorecard vendor,keyword or purchasing agency. All statesalso provide data on contract expendi-tures or at least one prior year.

Emerging States all behind Lead-ing States and Advancing States in how

they provide inormation on economicdevelopment subsidies. Only our othe 22 Emerging States provide bothcheckbook-level detail on the recipientso economic development tax credits andinormation on the benets created romthe subsidies.

Lagging D States

Table 5: Lagging D States


Alaska D+ 64.5

Nevada D+ 62

Ohio D+ 61

Colorado D+ 60

North

Carolina

D 58

Montana D 57

Rhode Island D- 54

Seven Lagging States maintain trans-parency websites but are missing im-portant pieces o their checkbooks andother spending data that are availableon most other websites. While all thesestates provide checkbook-level detailon the payments made to vendorsthrough contracts and grants, only onestate Ohio provides inormation oneconomic development tax credits. Theinormation on contracts and grants is notas comprehensive or as easy-to-access asthe inormation in higher-rated states.For example, many states do not make

details available about the speciicgoods or services purchased or provideinormation about past expenditures.

Lagging States lack other inorma-tion commonplace on many otherstates transparency websites. Only

two states post inormation on city andcounty spending, and only three statesmake available tax expenditure reportsthat detail the total unds lost throughexemptions, abatements, credits andother tax break programs.

Failing F States

Table 6: Failing F States


Wyoming F 48

Wisconsin F 47

Hawaii F 39

Caliornia F 37

North

Dakota

F 31

Five states are ailing in online

spending transparency. While thesestates maintain websites that arecheckbook-level, the sites are limitedand hard to use. Not a single FailingState provides inormation on the pub-lic benets o economic developmentsubsidies broken down by recipientor makes its tax expenditure reportavailable. Only one state Wyoming provides spending inormation ono-budget agencies. In addition, whilevisitors can download Caliornias

checkbook inormation, the data arenot available in a user interace mak-ing it one o two states in the countrywithout searchable vendor-speciicspending inormation.


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States Innovate with Cutting-Edge Features 33

States Innovate withCutting-Edge Features

Some states are innovating by intro-ducing new spending transparencyeatures along with checkbook-level

expenditure inormation. They have de-veloped new tools and posted new setso inormation on government expendi-tures, giving residents new ability to view,analyze, monitor and infuence how theirgovernment allocates resources.

Shining a Light on Pay-to-PlayPractices: In many states, corpo-rations or individuals will makecontributions to electoral campaignsto curry avor with decision-makersin the hopes o winning protablecontracts down the road. Such payto play systems result in contractsbeing awarded to the best-connected

vendors, potentially excluding thosethat oer the best value or thepublic. Illinois has launched a tool called Open Book that empowersthe public and watchdog groups toexplore contracts awarded to corpo-rations side-by-side with electoralcontributions those corporationshave made. (See Figure 9.) The toolalso tracks the unds contributed byemployees o the companies. Withthis tool, Illinois residents can easily

discover when government agenciesmay be awarding contracts based onpolitical connections.

Integration o Local Govern-ment Data into Checkbook Tools:Many states provide data on city


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and county spending by linking tomunicipalities websites. However,on these sites, the inormationavailable is oten limited to budgetdocuments, which can be dicult oreveryday users to read and are not

checkbook-level records o spending.Some states have opened the books onmunicipal spending by incorporatingcheckbook-level data on local govern-ment spending into their checkbooksearch tools. Utahs checkbook, or

Figure 9: Illinois Open BookEmpowers Citizens and Watchdog Groups to UncoverPay-to-Play Practices

Figure 10: Utahs Checkbook Tracks Payments Made by Cities and Towns


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States Innovate with Cutting-Edge Features 35

example, allows users to view expen-ditures by city and town. (See Figure10.) Arizonas checkbook allows usersto view expenditures made by twocounty governments.

Mapping Tools: Oregon providesinteractive maps that allow usersto view where taxpayer dollars arespent. One such map allows usersto pinpoint the location o Oregons

Figure 11: Oregon Watershed Enhancement Boards Interactive Map

Watershed Enhancement Boards(OWEB) investment projects.The map provides the same levelo checkbook detail about OWEBgrants as payments in the centraltransparency websites check-

book search tool. (See Figure 11.)Another map shows the locationand cost or all Oregon Depart-ment o Transportation projects.


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State Ofcials Face Obstacles andChallenges in Operating Transparency

2.0 Websites

O

cials in each o the 50 states wereasked to describe the challengesand obstacles they ace in enhanc-

ing their states online transparency. Stateocials identied a number o actorsthat impede increased transparency, in-cluding a lack o centralized or standard-ized systems o record-keeping, outdatedinormation systems, limited resources,legal limitations and concerns regardingcondentiality.

Lack o StandardizedRecord-Keeping andDecentralized Structure oState Government

Twenty states cited the decentralizedstructures o state government and a

lack o standardized record-keeping asobstacles in developing and improvingonline spending transparency.57 When

launching transparency websites, stateocials must oten assemble data romthe dierent accounting and technolog-ical systems used by varying agencies,departments and local governments.

For example, states reporting theseproblems include:

Vermont, where reporting ongrants is hindered because the statecurrently has no centralized grants

and contract system58

;Arizona, where detailed inor-

mation can sometimes only bemaintained on the agencys propri-etary system and not readily avail-able or display on the transparency


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State Ofcials Face Obstacles and Challenges in Operating Transparency 2.0 Websites 37

website because agencies use dier-ent accounting systems59; and

North Carolina, where the websitemust assemble data rom themultiple procurement, account-

ing, budgeting, and grant reportingsystems used throughout the stategovernment.60

Some state ocials have overcomethese problems by improving cooperationamong dierent departments and localbodies:

To update their transparency websiteor 2013, Oregon state ocialsworked with 19 Education Service

Districts,36 Counties, severalState Agencies (or Tax Expenditureinormation), and over 80 Agenciesincluded in reports or Contracts,Salary, and Expenditures.61 Accord-ing to Philip Harpster in the OregonDepartment o AdministrativeServices, many o the logistics odata collection [were] improvedconsiderably by the State partneringwith local associations (e.g., OregonAssociation o Counties, TheOregon Association o EducationService Districts, [and the] League oOregon Cities).62

Prior to the launch o Pennsylvaniastransparency website, the Oce oAdministration reached out to everyagency aected by the law to makethem aware o their responsibili-ties, answer questions and designatea point o contact to work with us.In addition to requent updates via

email, there were numerous individ-ual agency and group meetings anddiscussions, as well as guided andhands-on demonstrations.63

Indiana has established a workinggroup made up o state agencies that

supply data to the states transpar-ency website.64

Limited Resources

Ocials in 10 states cited issues relatedto state budget constraints and the limita-tions o available resources as obstaclesto improving and expanding state trans-parency.65 However, some o these stateshave developed innovative ways to launchand improve their websites with limitedresources.In Idaho, or example, wheredeveloping a transparency site was hin-dered by a lack o legislative unding, theOce o the State Controller negotiatedinormation technology contracts such

that they could leverage the technologyto construct a transparency website.66 InArizona, the General Accounting Ocewas able to save costs by adapting anotherstates online transparency platorm orits own use.67

Outdated InormationSystems

Numerous states reported antiquatedtechnological systems as impedimentsto greater transparency.68 For example,Virginias outdated accounting and pro-curement systems prevent the state romposting electronic copies o contractsonline.69 The accounting system still usedin Idaho is more than 30 years old.70

Some states are currently working toovercome these problems by improvingor replacing outdated inormation sys-tems. For example, according to Hawaiis

Department o Budget and Finance, thestate has initiated an ambitious technol-ogy transormation program, in orderto upgrade and modernize the Statesinormation technology inrastructure.71Michigan is beginning the process o re-placing its current accounting systems.72


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Alaska is adopting a new accountingsystem with a Vendor Sel-Serve portalthat will allow interested vendors and thegeneral public to view State procurementactivity.73

Protecting ConfdentialInormation

Ocials in 10 states cited the protec-tion o condential inormation as anobstacle to improved transparency.74A Tennessee state oicial explained,inormation about payments that arecondential by law must be manually re-moved rom payment les beore loadingthe website. This manual intervention is

costly and time-consuming.

75

In orderto protect sensitive inormation withoutwithholding useul data, states shoulddevelop data systems that keep privateinormation in specic elds that will

not be disclosed to the public, whileproviding all other expenditure detailswithout manual intervention.

Legal LimitationsSome state ocials cited state laws

that hinder greater transparency. EricWard in the South Carolina Comp-troller Generals oce explained thatstate law shields rom disclosurecertain inormation related to stateeconomic development eorts, in-cluding dollar amounts o economicdevelopment tax credits.76 Expendi-tures to companies whether through

contracts, economic developmentsubsidies or other means shouldbe public inormation, and state leg-islators should strike down laws thatprohibit this transparency.


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State Ofcials Face Obstacles and Challenges in Operating Transparency 2.0 Websites 39

0

10

20

30

40

50

60

70

80

90

100

$1 $10 $100 $1,000

FollowingtheMoneyScore

2011 State Budget (billions)

Figure 12: State Budget Size Does Not Determine the Level oTransparency77

The size o states direct expenditures (here reerred to as budgets) in no way de-termines the ability o a state to deliver transparency. Some states with small budgetsearned high scores, while some states with large budgets received low scores. (See gurebelow.) Utah, with a budget totaling $13.6 billion in 2011, scored an 88.5. Meanwhile,Ohio, with a budget totaling $60.7 billion, scored a 61. Vermont, with the ourth-smallestbudget in the country, scored a 77; meanwhile, Caliornia, with a budget 43 times largerthan Vermonts, scored a 37.

The data show that small states with small budgets have the ability to create andmaintain comprehensive and user-riendly transparency websites. Also, states with largebudgets will not automatically be leaders in Transparency 2.0.


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Continuing the Momentum TowardGreater Transparency: How States

Can Improve their Transparency 2.0Websites

While all states now providecheckbook-level inormationon some government expendi-

tures, state ocials should move theirocus toward expanding the scope anduser-riendliness o the data. In act,every states transparency website stillhas room or improvement.

Thirty states do not post

checkbook-level inormation oneconomic development tax credits.Without this inormation, residentscannot begin to assess i the taxrevenue orgone is worth the socialbenet created by the credit.

Only eight states provide inorma-tion on both the projected numbero jobs to be created and actualnumber o jobs (or other publicbenets) created by economicdevelopment subsidies. While 10states provide inormation on theprojected number o jobs createdand our states provide the actualnumber o jobs created these statesprovide only hal o the inormationnecessary to hold companies ullyaccountable and reclaim unds ipromises are not kept. The other 28states provide no data on the societalbenets o subsidies, leaving taxpay-ers completely in the dark.


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How States Can Improve their Transparency 2.0 Websites 41

Eleven states checkbooks oncontracts cannot be searched byall assessed categories vendor,keyword and purchasing agency.Making checkbook data searchableallows users to easily nd specic

spending inormation.

Sixteen states do not provide anyinormation about the expendituresmade or revenues collected by quasi-

public agencies or public-privatepartnerships, prohibiting citizensrom monitoring such o-budgetstate expenditures.

With cont inued progress toward

online transparency, citizens will havegreater opportunity to monitor govern-ment spending, evaluate budgetary deci-sions and ensure that contracts to privatecompanies are smart choices or the state.


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Appendices


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Appendices 43

Appendix A: Methodology

Grades or the scorecard were deter-mined by assigning points or in-ormation included on (or in some

cases, linked to by) a states transparencywebsite or another government websitethat provides inormation on governmentspending. (See Tables A-3, A-4, A-5 andA-6 or a detailed description o the grad-ing system.)

What We GradedOnly one website was graded or each

state. I states had a designated trans-parency website, that site was graded.

I a state had more than one transpar-ency website, we graded the transparencywebsite that earned the highest score. Istates lacked a designated transparencywebsite, we graded the state website thatearned the highest possible score.

The grades in this report refect thestatus o state transparency websites aso January 2013, with the exception o

cases in which state ocials alerted us tooversights in our evaluation o the web-sites or inormed us o changes that hadbeen made to the websites prior to mid-February 2013. In these cases, FrontierGroup and U.S. PIRG Education Fundresearchers conrmed the presence o


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the inormation pointed out by the stateocials and gave appropriate credit orthat inormation on our scorecard.

How We Inventoried andAssessed the Websites

The researchers reviewed websitesand corresponded with state ocials asollows:

During January 2013, U.S. PIRGEducation Fund researchers evalu-ated every accessible state transpar-ency website based on the criterialaid orth in Tables A-3, A-4, A-5 andA-6.

In mid-January, state agenciesadministering transparency websiteswere sent e-mails with our evalua-tion and were asked to review it oraccuracy by February 8, 2013. For aew states that requested extensions,the deadline was extended.

In early February 2013, U.S.PIRG Education Fund research-ers reviewed the state ocialscomments, ollowed up on potential

discrepancies, and made adjustmentsto the scorecard as warranted. Inmany cases, our researchers contin-ued to correspond with state ocialsinto February, clariying the criteriaand discussing websites eatures.

Calculating the GradesStates could receive a total o 100

points. Based on the points each state

received, grades were assigned as listedin Table A-1.

Table A-1: Grading Scale

Score Grade

95 to 100 points A

90 to 94 points A-

87 to 89 points B+

83 to 86 points B

80 to 82 points B-

75 to 79 points C+

70 to 74 points C

65 to 69 points C-

60 to 64 points D+

55 to 59 points D

50 to 54 points D-

1 to 49 points F

States were given ull credit or mak-ing particular categories o inormationavailable on their websites, regardless owhether we could ascertain i the dataevaluated were complete. For example, ia states contract checkbook only containsa portion o the payments the state madeto vendors through contracts, ull creditis awarded. Likewise, i a website listsa non-government entity that receivedan economic development tax credit(and the value o the award), the statereceives points or that category even ipayments made through other tax creditsubsidy programs are missing rom thewebsite.78 While it is obviously criticalthat states post all o the inormation theypurport to make available through theironline transparency tools, measuring thecompleteness o each state website is wellbeyond the scope o this report and wouldhave required a separate objective datasource on what inormation should be

included that does not currently exist. Welook orward to uture eorts to ascertainthe degree to which states are providingull and complete spending inormationto the public.


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Appendices 45

For the O-Budget Agencies crite-rion, states were awarded points i theyullled one o the ollowing conditions:

The state received points or theO-Budget Agencies criterion in

U.S. PIRG Education FundsFollow-ing the Money 2012 report (or whiche-mails were sent to website admin-istrators, inquiring whether quasi-public agencies were included);

The website administrator respond-ed in February 2013 that the siteincluded expenditure or revenueinormation or quasi-public agenciesor public-private partnerships;

The researchers ound expendi-

ture inormation rom quasi-public

Table A-2: Criteria or Evaluating Progress rom 2010 to 2013

Feature Criteria in this years (2013)Following the MoneyReport

Criteria (called Variables) inthe 2010 Following the MoneyReport

Checkbook Checkbook criterion or

Contracts or Expenditures

Checkbook-Level Web Site

Searchable Checkbook is searchable by

recipient, keyword, und, agency

or department or Contracts orExpenditures

Search by Contractor or Search by

Activity

Grants or Tax Credits Checkbook criterion or

Economic Development Tax

Credits or Grants

Economic Development Incentives

Inormation

Proj. Benefts o Subsidies Projected Public Benets

or Economic Development

Subsidies

Received 10 points or Economic

Development Incentives Inormation

(10 points were awarded i a detailed

description o the incentive was

provided, including estimates or the

number o jobs created)

Tax Expenditure Report Tax Expenditure Reports Tax Subsidy Inormation Provided inthe Database or Linked

O-Budget Agencies O-Budget Agencies Quasi-Public Agencies

City & County Spending City and County Spending Local/County Budgets

agencies on the transparencywebsite.

The website explicitly stated that itsonline checkbook contained data ono-budget agencies.79

Comparing Features in 2013to Features in 2010

To show nationwide improvements instate spending transparency rom 2010,we compared states perormance on thisyears scorecard to states perormance onthe scorecard in our 2010 Following theMoney report according to the criteria

listed in Table A-2.80


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Checkbook-Level Spending

Criteria Description Partial Credit

Checkbook A list or database o individual

expenditures made to

individual recipients. Payments

made through the American

Recovery and Reinvestment Act

are not eligible or credit.

No partial credit.

Searchable Ability to search checkbook-

level expenditures by certainparameters. Search eatures

must be part o the checkbook

tool.

Partial credit is additive across the subcategories below.

Searchable by Recipient - Ability to search expenditures

by recipient (e.g. contractor or vendor) name.

Searchable by Keyword or Fund - Ability to search

expenditures by type o service, item purchased, or the

paying government und. For economic development

tax credits, the ability to search by name o the

program receives credit.

For Contracts, Expenditures and Grants: Searchable by

Agency or Department - Ability to search expenditures

by the purchasing branch o the government.

For Economic Development Tax Credits: checkbook tooldisplays multiple credits when users enter search terms.

Historical

Expenditures

Expenditure data rom previous

scal years. For states to

receive credit or contracts

rom prior years, the contracts

must be inactive.

1 point (up to 3) or every scal year o expenditure

data, excluding the most recent year. Partial (as

opposed to ull) credit is awarded on a state-by-state

basis i historical expenditure data are removed rom

the website ater a set period o time.79

Expenditure

Summary

Inormation

A detailed description o what

the state receives or each

expenditure.

For Expenditures, Economic Development Tax Credits,

and Grant spending, states either receive ull or no

credit. For contract spending, in order or states to

receive ull credit (2 points), they must make copies o

contracts available. States that provide summaries othe goods or services purchased instead o the contract

copies receive 1 point.

Downloadable Inormation can be

downloaded or data analysis

(as le type .xlsx, .csv, .xml,

etc.).

No partial credit.

Table A-3: Point Allocation or Checkbook-Level Spending Inormation (Continued on page 47)

Description o Point Allocation or the ScorecardTables A-3, A-4, A-5 and A-6 describe the criteria we used to evaluate state transparency websites and

the amount o points we awarded or each category. Note: For denitions o Contracts, Expenditures,Economic Development Tax Credits, and Grants, see the section titled Transparency 2.0 WebsitesGive Users Detailed Inormation on Government Expenditures on page 12.


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Appendices 47

Points for Checkbook-Level Spending

Contracts ExpendituresEconomicDevelopment TaxCredits

Grants

20 12 4 4

1 1 1 1

1 1 1 1

1 1 1 1

3 3 3 3

2 1 1 1

2 1 1 1

Point Allocation or Checkbook-Level Spending Inormationcontinued rom page 46.


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Economic Development SubsidiesCriteria Description Partial Credit Points

Projected

PublicBenefts

The public benets, such as

the number o jobs, intendedto be produced by specic

private recipients o economic

development subsidies (in the

orm o tax credits, grants or

other types o programs) are

included.

No partial

credit.

4

Actual

Public

Benefts

The public benets, such as

the number o jobs, actually

produced by the specic

private recipients o economic

development subsidies (in the

orm o tax credits, grants or

other types o programs) are

included.

No partial

credit.4

Table A-4: Point Allocation or Economic Development Subsidy Inormation


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Appendices 49

Table A-5: Point Allocation or Tax Expenditure Reports

Tax Expenditure Reports (TERs)Criteria Description Partial Credit Points

Accessibility Tax Expenditure

Reports are easilyaccessible.

3 points i the TER is downloadable rom the

transparency website or a link is providedthat directs users to another webpage rom

which they can directly download the TER. 1

point i links direct users to the central portal

o a government department, and then to a

another webpage, to downloaded the TER.

3

Tax Expenditures

rom Multiple Years

Tax expenditures rom

multiple scal years.

1 point (up to 3) or every year detailed in

the tax expenditure reports linked, excluding

the most recent year. Tax expenditure

inormation rom beore 2009, regardless o

the number o years, is only eligible or one

point o credit.

3

Comprehensiveness Tax Expenditure

Reports cover

expenditures rom all

the states major taxes.

Partial credit is additive across the

subcategories below. Credit is only awarded

i the report includes at least one-third o

expenditures rom the tax type. I a state

does not collect one or more o these taxes,

or collects less than 2 percent o its revenue

rom property tax, the other taxes are

Following the Money 2013

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