Its called fleecing.

Audit Questions Constitutionality of IRRRB

IRRRB

Updated: 03/18/2016 5:43 PM
Created: 03/18/2016 9:50 AM
The Iron Range Resources and Rehabilitation Board was the focus of an almost year long review. The report’s findings that were released at a hearing announcing the findings proved the agency’s management of finances was a problem.
The report says the agency has not adequately overseen the use and impacts of it’s loans and grants and that the structure of the board may even be unconstitutional.
“The governor approves some of the board’s decisions but not all and in some cases the board of legislators has the final word,” said Elizabeth Stawicki, Director of Legal Research with the Office of Legislative Auditor at the hearing.
The report done by the Office of Legislative Auditor points out that the agency did not adequately specify objectives in loan contracts such as job growth and did not require most companies to report job creation IRRRB subsidies. The audit also recommended the agency to take a look at whether they should continue annually subsidizing Giants Ridge.
“Giants Ridge had this large operating loss because expenses grew faster than revenues. It’s not a difficult thing to understand but it’s important to know that happened in each of it’s key operations; golf, ski and food and beverage,” said Jody Hauer with the Office of Legislative Auditor.
Commissioner Mark Phillips says they have already began making changes.
“The agency has already undertaken the process of creating a new grants management software as a tool that will improve our grants management capabilities. Further, we will budget for and develop for a new loan database,”said Phillips.
A joint statement from board members said “There is no ‘magic wand’ to achieve the complex goals of economic development and diversification. The agency staff work very hard and are extremely dedicated to this challenging work.” They also say, “We will review the OLA’s findings and hope the IRRRB, and if necessary, the legislature can take action on the recommendations to ensure that the IRRRB is operating at the highest standards we expect of all our state agencies.”
Both agencies say with this they are hoping for a good outcome from the public dollars that are spent.
The entire report can be found at http://www.auditor.leg.state.mn.us/ped/2016/irrrb.htm.

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