CA - Feds To State: $2.9 Million Owed For Elections (Shmelleygate)

There's a final resolution to federal election assistance money given to California and, according to authorities, misspent by the office of former Secretary of State Kevin Shelley.

This morning, the U.S. Election Assistance Commission closed the books on the investigation into how Shelley spent some $3.8 million in funds allocated through the federal Help America Vote Act (HAVA). The spending was part of the scandal allegations that drove Shelley from office in 2004. It included payments for activities not related to HAVA, including payments to consultants who appeared to be doing pro-Shelley political work on the federal government's dime.

Secretary of State Bruce McPherson had asked for the EAC to scale down the amount of money the state was ordered to pay back. Today, EAC Chairman Paul DeGregorio agreed, but not to the extent McPherson wanted.

More from Flash Report:

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Among other things, Secretary of State McPherson has outlined some examples of Shelley's abuses of power revealed in the BSA audit findings. They include:

- The Kevin Shelley Administration “failed to document the time spent by its staff members on HAVA activities, as required when salaries and wages are charged to a federal fund source.” A review of supporting documentation and interviews with employees showed that HAVA funds were inappropriately used to compensate employees for attending events that were “partisan in nature” and “unrelated to HAVA.” As the BSA Audit report noted, “both federal and state law generally prohibit the use of public funds for partisan political activities for the purpose of affecting the outcome of a campaign.”
- The Kevin Shelley Adminstration failed to properly and adequately account for the activities of some of its consultants who were being paid with HAVA funds. For example, some consultants attended events such as candidate fundraisers and a state delegation meeting for the Democratic National Convention, where they were representing then Secretary of State, Kevin Shelley.
- The Kevin Shelley Administration’s insufficient planning and poor management practices hampered its efforts to promptly implement HAVA.
- The Kevin Shelley Administration’s disregard for proper controls and its poor oversight of staff and consultants led to questionable uses of HAVA funds.
- The Kevin Shelley Administration avoided competitive bidding for many contracts paid with HAVA funds by improperly using an alleged exemption from competitive bidding requirements and by not following the State’s procurement policies.
- The Kevin Shelley Administration bypassed the Legislature’s spending authority and improperly charged consultant contract costs to its HAVA administration account.
- The Kevin Shelley Administration overrode and, in many cases, lacked controls in its administration of the HAVA funds. For example, the office failed to document time spent by employees on HAVA related activities, as required by federal cost principles, and as needed to appropriately charge and pay the costs with HAVA funds.
- The Kevin Shelley Administration split purchase orders to avoid CMAS procurement limits and competitive bidding requirements.

Today, McPherson requested Lockyer take immediate legal action on behalf of California taxpayers to recover the funds misused by Shelley. Along with his request, McPherson said, "This flagrant abuse of public trust and public money demands personal accountability of the official who committed the abuse. When public officials are not held to account for their actions and the taxpayers’ hard earned dollars are not protected, we are neglecting our responsibility as leaders, entrusted by the people to stand up for what is right and to conduct business in an ethical and non-partisan way."

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