SACRAMENTO — A state commission chaired by Hollywood entertainer Rob Reiner violated no laws but failed to properly award millions of dollars in contracts and did not adequately justify many payments, a state audit released Tuesday shows.
The nonpartisan California Bureau of State Audits said the commission had "clear legal authority" to spend public money on television commercials last winter touting the benefits of preschool, at the same time Reiner opened a campaign to place an initiative on the state ballot to create universal preschool. Voters rejected that initiative, Proposition 82, in June.
The Sacramento County district attorney's office continues to investigate the matter, a spokeswoman for Dist. Atty. Jan Scully said Tuesday. State law bars the use of public money for political endeavors.
Auditors found numerous management and oversight problems at the California Children and Families Commission, also known as the California First 5 Commission. The panel was created after voters approved Proposition 10 in 1998, raising tobacco taxes to fund child health and education programs.
In some instances, the commission overpaid for services. In others, it paid for costs that were not part of its obligations. And the commission failed to follow state rules when awarding some contracts. First 5's recordkeeping was wanting; it could not produce some documents auditors sought.
"We found a number of problems with the way it awards and manages these contracts," the auditors' report said, referring to the $230 million in advertising and public relations contracts awarded by the commission.
The audit reviewed some expenses dating from 2000. Among their findings, the auditors said the commission:
* Did not follow state policy when it used a competitive process to award three of the contracts valued at more than $47.7 million, and failed to provide sufficient justification for awarding one $3-million contract and six amendments totaling $27.6 million using the noncompetitive process.
* Paid $1.2 million more than it should have for administrative overhead because it did not follow state policy that limits such payments.
* Paid markups of $129,000 over the actual cost of material, printing and shipping. The markups were as much as 87%, according to the audit, which noted that the commission's contract did not authorize such increases.
