With hundreds of thousands of dollars provided to employees with insufficient or no justification and millions of dollars awarded questionably for sole-source contracts, the Office of the State Auditor noted several areas of lax protocols in the judicial branch’s administrative office.

“The current State Court Administrator fully understands and accepts the fiduciary responsibility associated with administering the Office,” the State Court Administrator’s Office wrote in response to the critical audit report. “To this end, and with the support of the Supreme Court, the Office is operating within a set of core values to demonstrate integrity and ethical administration and use of public funds.”

The SCAO provides administrative, procurement, human resources and Internet technology services to the Judicial Department. It has 260 full-time equivalent positions, compared to 3,500 staff and 300 judges across the court system statewide. The chief justice, who heads the entire Judicial Branch, appoints an administrator to oversee the office.

In the fall of 2019, a new administrator took over following allegations of non-work involving at least two employees and scrutiny of a $2.5 million contract to a former employee who was previously subject to discipline. The former administrator, Christopher Ryan, resigned in July 2019.

From March through November this year, auditors interviewed SCAO staff, reviewed contracts and paid leave, examined purchases and scrutinized family and medical leave documentation. 

Regarding voluntary separation agreements, also known as buyouts, nine employees with contracts received either three or four months’ compensation, but none of which received all of the required approvals.

“In all instances, the [voluntary separation] contracts had been approved by only the former State Court Administrator and were not signed by the other three parties required by the contract terms (the employee’s Division Director, the Director of the Division of Human Resources, and the Chief Financial Officer),” auditors wrote.

Further, there was no targeting involved for the buyouts, meaning SCAO had no plan for what happened if more employees left the office during a reorganization. Benefits paid out were also in excess of what executive branch employees would have received under similar conditions, including further paid leave.

Despite the reorganization, three staff positions involved in the buyouts were eliminated entirely, but the remaining openings were re-filled or slated to be.

“The SCAO’s [voluntary separation] contracts amounted to costs of more than $518,000 paid to employees, which is more than 50 percent higher than the maximum costs allowed ($343,000) for executive branch agencies,” the report noted.

Other problems with the office included 3,600 of discretionary administrative leave – for purposes that are “for the good of the state,” like volunteer service – that had no record of why personnel received the time off. An additional 10,000 hours had recorded instances of “family reunion” and “pre-operative appointment,” which did not obviously accrue to the state’s benefit.

Some employees also received discretionary leave above the normal range for staff.

“It would be reasonable and expected that some employees may warrant receiving additional leave awards above the normal range for reasons that the SCAO indicated,” auditors acknowledged. “However, the SCAO could not articulate what amounts of leave would be appropriate for these types of reasons and reasonably meet the Department’s requirement that discretionary leave awards must be for the good of the State.”

In nine instances, SCAO awarded nearly 3,100 hours of paid leave during disciplinary investigations, with an average of 43 days off per investigation. The auditor’s office faulted vague guidelines and a lack of monitoring or caps for administrative leave. Altogether, the loosely-documented leave time and leave for investigations cost more than $300,000.

For 10 cases of leave granted under the Family and Medical Leave Act, SCAO could not prove the employees were eligible for the amount of leave they received, or even if they were eligible, period.

“The SCAO confirmed that it did not know what became of these required documents,” auditors wrote. This leave cost approximately $40,500. Unlike the executive branch, SCAO employees earned regular compensatory time while they were taking their administrative leave.

“Employees are being paid for not working while still accruing the leave they receive as an employment benefit,” the report concluded bluntly.

Finally, the auditor’s office discovered issues with six sole-source contracts between fiscal years 2017 and 2020 that totaled $3.87 million. The problems ranged from lack of justification for the noncompetitive contract to the award of a contract to an employee who had just ended their work at SCAO when the office indicated it would move forward with the contract involving the employee’s company.

“Our system historically has a lack of structure and informality that should not be with a department of more than 200 employees and a $600 million budget,” SCAO administrator Steven Vasconcellos conceded to a legislative committee, according to The Denver Post.