State Parks faces legislative audit


— During a legislative hearing Monday about the over-budget and behind-schedule Colorado State Parks campground west of Hayden, one official admitted he had learned "expensive lessons."

The Office of the State Auditor made several recommendations to State Parks officials Monday in Denver at the organization's first audit since 1996.

Impetus for the audit came from financial and construction complications at the Yampa headquarters and campground center west of Hayden. Those recommendations included that the state improve its accountability for its use of capital construction funds.

Costs for the headquarters have increased by more than 225 percent in three years, from about $1 million in 1996 to more than $3.28 in fiscal year 1999.

"This is a classic example of unaccountability and total mismanagement," state Rep. Jack Taylor, R-Steamboat Springs, told the Division of Parks and Outdoor Recreation Board Monday. "There is no control. Right now it's at three-and-a-half times the original cost, it's still not finished, and the dollars are still going up. I want an explanation of how this happened, and what you're really going to do about it."

Taylor said that when the Yampa headquarters project was first brought before him for approval in 1997, there were no projected dollars or budget plans.

"And it was sketchy budget when it did come in," he said.

Division Deputy Director Tom Kenyon said he agreed with Taylor.

"We've been moving so fast, doing so much so quickly with GOCo, and that leads to mistakes," he said. "Our original estimate of $1 million was a mistake. We've learned a lot of expensive lessons from this."

"It's a good template of how not do things," said Ron Cattay, deputy director at the Department of Natural Resources, said of the Yampa headquarters.

The state auditor also identified problems with the Division of Parks and Outdoor Recreation moving funds between projects.

"What is your policy about shifting funds," Taylor asked. "We were at the headquarters about a year ago, talking about cost overruns, and a local man on the scene was almost braggadociosly saying that they'd taken $1 million from the Elkhead Reservoir Project. Is this division policy?"

Taylor wondered how an auditor is supposed to keep track of a project when funds are being moved from one project to another, and also said he had received phone calls from people involved with the Elkhead project, wondering what had happened to its $1 million.

State Parks director Laurie Matthews said that Elkhead is part of the Yampa River Legacy Project, and that the division has made sure it is fully funded.

"We've requested the last million from GOCo for Elkhead," she said. "I was just there, and the place looks terrific."

Although Division officials said that nature of their business requires a reasonable level of flexibility, the state auditor said that excessive fund movement further diminishes the division's accountability, and that it presents problems in terms of tracking and monitoring funds.

"The regular transfer of funds among and between projects compromises achievement of Division plans, goals and objectives," state auditors wrote in their report. "In addition, presenting capital construction plans and budgets to the General Assembly that are subsequently and radically changed negates the purpose of legislative scrutiny."

Part of the auditors' recommendations was that the Division adopt standard, consistent categories or expenditure lines within all construction projects, and adhere to approved plans and budgets.

Division officials agreed.

"Sticking to an agreed-to plan/budget makes good sense, and may require fine tuning our existing process," the Division wrote in a response to state auditors' recommendation. "The current system enables us to be responsive to changing priorities and to take advantage of new opportunities that may arise. We understand, however, that reporting this information to the Legislature only once a year has created confusion."

Taylor also was disappointed with the way the division dealt with Beavers Construction, the company responsible for constructing the headquarters water wastewater treatment systems.

In an exchange of letters between the State Parks office and Art Beavers, owner of the construction firm, project manager Paul Barker wrote that the majority of chambers in the one of two evapotranspiration fields an underground wastewater filtration and evaporation system had been damaged by the construction operation, and that the liner had been destroyed.

"The north ET field is not functional and we reject the work. You are responsible for the replacement of the field," he wrote.

Beavers wrote in reply that he and his co-workers "wholeheartedly disagree with the State Parks' conclusions."

"At one point, Beavers was owed $150,000 it couldn't get," Taylor said at the audit hearing. "This is not the way to treat the private sector."

"We have little explanation for the conflict between Beavers and the state," Kenyon said, "but we are trying to make amends. We've apologized to Mr. Beavers."

Beavers Construction is being paid for finishing up the headquarters project, "because there is no way to lay blame on anyone," Cattany said.

"There was an enormous number of fingers in this pie," he added. "It's taken a lot to unravel and get it all going again during this construction season."

There are about four more weeks of work to be done at the Yampa headquarters, Kenyon said.

By the end of the audit Monday, state auditors and legislators had made 10 recommendations to the division, five of which dealt expressly with park construction.

The division agreed with all recommendations made, and officials said they would hold themselves accountable by, for example, developing and implementing budget reports, adhering to the approved plans and budgets, determining whether or not they have the qualified staff to efficiently manage construction projects, limiting the use of the miscellaneous category, and implementing systems for managing construction projects.

The reason there are no consequences for the division's lack of accountability and unforeseen funding requests is that it is exempt from the standard capital construction budgeting requirements that most other state agencies are subject to.

Because of this exemption, the division is not required to conform to a strict budget, approved by the Capital Development Committee.

The division does voluntarily undergo legislative review by the CDC and the Office of the State Auditor said. But the review is meaningless, partly because the division does not follow the construction and budget plans presented during the review.

The division asked that it be given the chance to improve its accountability before legislative action is taken.

To reach Bonnie Nadzam call 871-4205 or e-mail


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