Legislative Joint Auditing

Thank you all for being here. And we'll get started. The. Members you want to talk outside you will come to talk outside we're getting really good started here. And we are called order. His adoption minutes of the art over thirteenth tool twenty three meeting. In representative all market. I'm sorry I apologize. The. This. A lost track of world wars folks do I have a motion for the adoption of the minutes of the october thirteenth meeting I have emotioned I have a second half a second thank you all in favor anybody opposed and in his arm then accepted. Moving on to items see the option of reports of the executive and standing committee and we will have the executive committee first representatives of all maximum thank you mister chair the executive committee met wednesday november eighth two thousand twenty three in new business staff discussed the law applicable to the developing procedures for reporting matters discovered during staff's review of all matters limited to expenditures involving the governor of the governor's office made confidential by section four a of x seven of the first extraordinary session of two thousand twenty three in compliance with the existing law and section five of the act. Staff recommended that these reporting procedures be developed and submitted to the committee for review and approval after staff has started this review the committee approved the staff's recommendation. In other business the committee approved suspending the rules and adopted two motions first staff will conduct an examination of procurements and related processes that the organs all educational television commission from july first two thousand twenty one through president and provide a special report concerning that review to the follow legislative joint auditing committee and second the staff will conduct a review of cyber security procedures for rural hospitals receiving or performing this request was referred to this committee by organization legislative council at its october meeting. With no additional business to discuss the meeting was adjourned. The next meeting of the comedian schedule for thursday december seventh two thousand twenty three and mister chair and move for an option of this report thank you sir I have a motion I have a second. All approved say I in the opposed it is passed moving on to the city are there can him to start representative right. Thank you thank you the committee adopted the minutes of the meeting here on october twelfth two thousand twenty three the commercial considered request from the towns of jerko and as to replace to repay less than ten percent of general revenues for amounts o to the straightforward is required bar so code energy irritated twenty seven seventy two seven. The commercial deferred these requests and directors staff to invite town personal to present their request at the meeting to be here on december sellers two thousand twenty three the commercial reviewed five deferred reports and one hundred and thirty current reports officials from five energies were president to address repeat findings one of the previous deferred reports was filed and forward for to a second term so that officials can address repeat findings of the hundred and dirty current reports reviewed one was certified to the governmental bond board and favor referred to proscuiting attorneys and attorney general the committee filed a hundred and twenty six car reports and deferred forward so their officials can provide adequate responses to findings already in the december meeting. To address unresolved findings. Pursuant to a motion pay us at october twelfth meeting the box at mayors and city council members attended the waiting to explain the lack of terminally audience by private accounting firm. The committee voted to ask the mayor in city council members to attend the mediano january the levis two thousand twenty four to follow up on progress record regarding completion of the hours misses for adoption of this report. Thank you sir members I have a motion do I have a second I have a second. All in favor say I in the opposed. The. In his improved. Moving onto the standing committee on educational institution. The sentence elements are. Thank you mister chair the committee met on november eighth twenty twenty three and reviewed two school districts audit reports for the fiscal year ending uh june thirtieth twenty twenty two. The committee filed the two car audit reports that were brought before it mister chairman I moved for adoption of this report. And members I have a. Motion do we have a second on the floor. I have a second all in favor in the opposed. And it has been approved. Moving on to the. Standard committee on state agencies soon to bright thank you mister chair nine reports were on the committee's agenda yesterday through reports with findings were presented apartment of finance and administration overpaid a seasonal employee over a five month period the game and fish commission had several thefts of property as well as the cleave overpayment the department of better and affairs did not properly link all payments to appropriate contracts and could not provide competitive bid information or a contract related to a purchase various agency staff where were present to report on how the agencies attend to address these findings and answer committee questions during the meeting the committee filed all nine reports mister chairman moved a doctor's report. Members are have a motion do we have a second I have a second on favorite eye in the opposed. See none. It is proved in it. Yeah at this time ribs warlow you or recognize her thing is chair I have motion if that's okay sure go ahead make your motion and make a motion that leds they have joint audits in the letter somebody co chairs to the arksauta parliament an education and current it's a remain school districts of the statutory requirements that must be followed for construction projects falling on the public works laws in arkansas code twenty two dash nine does to one and following. Members just so everybody's aware of this this is about the tips program and then it does not allow construction projects under the tips program and I think it's important that we let our school districts know that continuing that practice is not a valid move going forward thank you mister. Members we have a motion I have a second all in favor say I any opposed. Investigator urban emotion has been approved i'm sorry may I be recognized yes go ahead I guess i'll have noticed we've met on wednesday and thursday this week because tomorrow as a holiday to recognize the veterans and so at this time i'm we would like to recognize all the the individuals in the room that are veterans and and have a moment to of appreciation for them if they could stay in appreciate it who are. Move out of paragraph daughter. Some of your interest college ethic review in expenses. Move to philadelphia come up please. Thank you sure if if you would announce yourself please nick following the sister commissioner financial division of higher education go ahead sir. All right before you is a yearly report on the interclude athletic revenues and expenditures that we present to you this report is for a fiscal year twenty twenty three the into june thirtieth. Within this report should the total amount of athletic expenditures reported by four year universities is two hundred and forty two million sixty four thousand eight hundred nine dollars in at the two year college campuses it was four million two hundred ninety thousand seven hundred ninety five dollars this representative twelve percent increase over twenty fiscal year twenty twenty two. Then in comparing the actual expenditures to the reported budgets that were presented at the beginning of fiscal twenty three. The institutions were above the proposed budget amount by seven point nine percent this future weights anywhere from arrange of twelve percent below their budget to sixty eight percent above the initial budget for the athletic department for each each institution i'll say the larger increases percentage increases they come from the two year institutions with the dollar amounts or lower so a change generates a bigger percentage of of an increase on that. One of the how I didn't want to point out each year institutions are allowed to transfer an amount from their educational and general revenues to support athletics are code six sixty two eight of three allows up to two percent of an institution's education on general budget allowed to be transferred or an amount established by the division of higher education each year which we increase normally by the consumer price index each year this past year the limit from dhe was set at one point five oh nine million dollars. Or the two percent of an institution's budget for on the four year campuses and for the two institutions it was set at one hundred and seventy dollars per full time equivalent student. And all all institutions did either. Use that two percent amount or less no one transferred additional amounts over that and i'm available for any questions you might have in regard to the expenses. In central johnson europe. The. You are recognized. Thank you mischairman was four I looked over the spreadsheet for a key word I didn't find it up. In ill that that is not expenses over the institution what and I understand that and i'm a more concerned obviously it's an issue that is correct. Here's upside the heart of the last couple years and i'm not against inal per se I think that that it may have jumped out the gate and golf it too far but that's a discussion for another day my real question is when we're charging student fees to other students that are struggling. And then this all this nil money is coming in and is is this is anything went down at the departmental level or any level really to sturdy that may be we shouldn't be in effect taxing the single mom with two kids who come back to college to try to better herself on the. Taxing her to turn ran and subsidize the athletic program when they do have this new source of revenue maybe a maybe tax the student athletes that are receiving some and I small percentage of that to offset the student fees is that been looked at or even studied there has not been anything looked at on there front as you know the the revenues for the inall go directly to those students so it's nice anything that the school can use to offset their their athletic expenditures that that the school still incurs where and then i'm also a little troubled when I turn my tv own and there's a student athlete talking about how wonderful are you a messages which I agree with him but i'm thinking he's getting paid by you and we asked to say this and course that's part of the university system and i'm just thanking gosh was a lot of money flying around here that with very little accountabilities but just is any of that factored into the budget so this but I don't get an ums has an athletic but you know so they do not know maybe some of them that we are you are may want to look at moving forward but it's not something the department has any oversight gives us it's always something new hitting airplay yet thank you very much for you. Suitable and sir you are recognized thank you mister chair i'm just looking at the expenditures the back side of the of the hand out on the transfer to other funds and accounts just notice that there are flagship campuses is not like the others what specifically do the transfer to other funds. The the fate they'll campus does transfer money from their athletics back to the at the academic side and that's why that that large amount is there on there's where there's not on the other institutions so they generate enough to not need the transfer to athletics from the end educational general phones they don't have no revenue that they do transfer some back to the academic side. The. And suit your patent you're a recognizer. Yeah. Thank you mister chair and i'm not real familiar with your budgeting process but i'm just curious when it says that they spent seven point nine percent above the budgeted amount. What. And what is the framework that they operate in if you have a budget how do they get authority to spend more than what's in the budget is now they do have an overall budget for the campus that you are set the limits on but the the budget for the athletics is under that that they said in the initial budget on their each of their campuses. That they said so it is possible to exceed that on the campus level but there's not exceeding the authority that that's given within their cash appropriations so that authority to exceed the budget is within the college board and authority yes sir okay thank you thank you mister chair thank you. Yeah. Members are there any other questions. Just know thank you for being here today sir. Member seeing non do I have a motion to accept this report. I have some mood do I have a second I have a second all in favor say I in the opposed. It has been approved thank you. Members next we have a special report on saver security. Mister david cole or you hear sir. Watch as skipped over we're doing the annual financial report. The division of elementary second education mrperiod tombulton will be making that report thank you miss chair thank you tom but this presentation covers the annual financial audit of the arts or education television commission also known as arks or pbs for the unit june thirty two thousand twenty two. This report contains two fannings and was originally presented to the standing committee on state agencies and oggs of this year after being deferred by the standing committee to a subsequent meeting in both the august n september meetings the report was filed at the october meeting however at the full committee meeting in october a request was adopted to refer report for discussion at today's meeting. The. This report contains tooth oh i'm sorry that the first finding relates to parsing contracts are so code defined small procurements has procurements not exceeding twenty thousand dollars which may be obtained without getting bids however competition should be used to the maximum extent practical. Additionally using repeated small quantity procurements to circumvent competitive bid limits or failing to obtain compared to bid without justification constitutes of violation of arts or procurement law. And finally the state of arkansas financial major regard states that vendor should be selected before parts or is created and after the purchase order is approved it can be printed and sent to the vendor. We select the tin vendors used by the activity transactions both above and below the twenty thousand dollar threshold for obtaining bids. Our review revealed that the eighty entered two agreements to procure goods and services from two companies owned by the same person. It's a good service that had been obtained from the same company bidge would have been required. The. The action also regularly informed vendors how much they would pay for good and services. While this practice is not appeared to volley a specific purchasing law it raises a question of whether vendor would have charged less how the issue not provided this information. The ac also made numerous parts of just below the twenty thousand dollars threshold for obtaining bids. Additionally. The ac regularly paid for a portion of good the services before they were obtained and they often executed an interning generate scope of work agreement with vendors instead of a purchase order therefore goods and services may have been procured before purchasers were created. The second finding relates to time and effort sheets which are prepared separately from the regular time keeping function and these are used by certain eighteen point to track the number of hours worked on various projects. The acused inaccurate t and a cs to support payroll calls reimbursed from grants awarded by the arts all department of education. Of a hundred and fifty nine t and a sheets that were used as a support for the rise of shan two thousand twenty two grant from may through september two thousand twenty two we selected thirty sheets for thirty employees to review our review reveal that the hours eighty reimbursed for that grand exceeded the number of hours on the selected team issued by hundred nineteen hours told approximately twenty two hundred dollars. Additionally the total number of hours on the selected team issues exceeded the number of hours and asus for which employees were paid by eighty seven and a half hours telling about eighteen hundred dollars. The ac did not reconcile team issues to asus timely or ensure that number of hours for specific grant programs which would be reimbursed by the grant or work correct. Michael chair that concludes my presentation agency officers are present to answer committee questions. And if we have representative for a. They are organization television commission would you please come forward. The. Thank you all for being here today if you would identify yourself. The. Thank you courtney pleasure director of arkansas pbs aetnc this map. Good morning karen watkins cfo are considered good morning ma'am. Good morning a sergeant computer has director of education good morning ma'am. The. In who setting it seek twenty seven. Springer ribses frame or recognize me good morning thank you mister chair I was just trying to follow along with the presentation just given by. The gentleman and I think i've found it on peach six the findings the actual fine user which you were going over is that correct I was just trying to follow along with what you're findings were. Yes man that's great there are only thank you. Instead of selling your recognizer. Thank you mister chairman yell i'm over here in this thank you so are on the time and effort sheets were any the employees ever asked to amend with they entered. The. No worries they figured filled out the sheet beef to bomb what they thought to be factual and then administration or other staff asked and do a just those payments do that ever happen to your knowledge not my knowledge no I have never asked that. And you never had any employees can be in promote that comment. That someone has asked them to change it. Now there was one that had they had gone to the hr person and I hit hours the cfo to find out what that was and so we subsequently asked all the managers to ask if anyone had concerns and all the managers came back and said none of their employees had concerned okay and to your knowledge I understand that and the rising shine grants. The there those along with the money came restrictions are on how that money would be used you know as far as the production of a better series are in event. That there were fcc guidance on the standards that should be met is that correct so I heard that yesterday I don't understand I am not a part of fcc compliance nor does anyone in my department deal with fcc compliance so i'm not really sure what that's in regards to as far as I understand production has to include captions that's part of being on broadcast for okay every single one of our choice if if there is money that's given to the stay. That is then given to eet. You're not for me with any guidance that goes along with that production and you're in charge. None it's not part of my job to know fcc compliance I just will produce the final clear so we're getting money from the feds. And they have guidance. On what you have to do to receive that money and you're not the person who is responsible for making sure the money of spare in compliance worth FCC guidance. Yeah. Yep. If I may. The agency is divided into departments each department has a role d education division is responsible for managing the terms and conditions responsible for making sure we're comply with fcc guides when we did the rise and shine grant who's in charge of the. That would be the engineering division in conjunction with administration of the agency the cooo okay anybody come before any view sitting at the table any of the engineers with concerns about fcc compliance. Nobody brother not to me. Okay so you you there wasn't a meeting that was held regarding scc compliance. Not that i'm aware of are you aware of any violations of FCC complaint I am not. The. So again is clarify there was never a an agenda item on a meeting where fcc compliance was discussed we do discuss fc compliance and we work. Very diligently to remain comply we engage attorneys who specialize in fcc compliance okay so I live I can't have a little struggling here so if if you have meetings on fc compliance and you talk about whether we're not were compliant however you're not aware of any complaints that were made that you were not following FCC gains. I am not okay. This. That's all I have mr chair i'll get back in if I need to do thank you yes integral more sure you recognize that you have shares so just have I think maybe a couple of questions just looking through the audit here and a couple things stuck out in regards to the multiple twenty thousand dollar purchases o they are outlined several of these even twenty thousand dollar purchases with I guess the same vendor. And it says on multiple multiple occasions but one thing that really stuck out to me in this report it says the agency circumvented in violated certain aspects of morgan saw procurement law. Do in part to an indifference. I just like a response to that from anyone at the table. The fact that it mean did you intentionally circumvent procurement law and was there and difference to that law no sir there was not our goal is always compliance even while one with this article state that because I mean auditors work in fact. This. Yeah. For the record I was not with the agency at the time under review I my first month with the agency was february of twenty twenty. Two. Twenty three sorry earlier this year. We followed the advice and guidance of our former fiscal officer. Now that we are aware that it is received to be not good practice not solid practice we will not conduct business and that way in the future we. Felt we were acting. And always you know aimed to act within the law we will change those practices we have already begun one and one procurement trainings in terminally with all employees that touch procurement and we have initiated some training intensive training with osp with also all of our employees who touch procurement. So yes you're no question did you circumvent the law. No. Okay thank you. The. The. Simply cheshifield your recognizement. Thank you so much. I'm concerned about the. The staff that says it was deliberate. Could you explain to me because it seems rather subjective to some extent that you tell me why you arrived at that decision that it was deliberate to someone tell you that. Young me with their stay. Yeah. Yes in your trash for this was just we made their conclusion based on basically. In that day we noticed numerous purchases right at that twenty thousand dollars ratio. Dealing with companies owned by the same person. Mean all of those sains kind of laid into that conclusion you were just over it was an overall result of the things that we found during that audit. And because this happened none of which was illegal. Because we have a threshold is a correct. The. Yes there are threats of this correct the threshold was twenty thousand is a correct that's forbid and and what your concern was that there were just two mini. Based that were just under there. Is that the concern that that's one of the concerns yes but that is one of the concerns that i'm hearing over and over again. And so you decide as their there was a deliberate attempt to circumvent the law. This would say the question in male i'm sorry. Because the beards came in under twenty thousand. How much under twenty thousand they come here dollar was a two dollars to first while they didn't take me as a lot of we're in the nineteen thousand dollars is just under twenty thousand dollars at as well as the process where they were telling vendors ahead of time that we could pay you night up the nineteen thousand dollars or but in nineteen thousand five hundred dollars. Then that was communicated to vendors on the front and rather than the vendor telling them how much they could do the pork. So if i'm doing business with a vendor. And I tell they'd been I can't pay you more than this amount. Their constitution deliberate. I deliberate effort to undermine the statute is that what you're telling. Like I stated before the combination of all these factors let us legitimate it was they were intentionally trying to tell that line near that twenty thousand dollar more. When if they had until the lan would they be before audit today. If we had noticed the number that we noticed that we're near that line probably not. So it was the number tell me what they're thresholding is going forward for other agencies that may sign their fault if you get above twenty thousand we're going to have to do so insulate so if you stay at night till me how many constitutes deliberate. But that that's a judgment call me that's my concern. There I guess it's my concern because it seems to be a judgement car. And. For me objectivity is the most important thing we've got going it on. And I guess your objectivity let you to believe that there was a deliberate champ did you contact these faults and ask them if it were deliberate. We had numerous interviews with various individuals that were current employees and foreign employees at the agency that said it was a deliberate attempt. That was indicated to us. I see was that back more current employees are more former employees. Well since given the turnover that had for the most part that has been former employees employees or any of those folks fired. Are you have their saves you that I don't have that i'm just trying to get to the corporate because sometimes disgruntled people. Sasser. And I want to make sure that we as a body of being objective. I understand the rear flags go up when you see so many nineteen thousand dollars because I think that's something that they are cognized and up now but when we say is a body that it was deliberate then it has to be based on to me a more objective criteria and that's concerning to me because we're lying on folks who are better. It will take out of you. Am I making a sense to you yes maybe certainly our best but. Yeah. Representative war law so you are recognized things chair I think it's important and we're missing the fact here that one of these energies formed a new energy I believe it was eight days tom you're welcome to correct me where i'm wrong here eight days prior to the actual work because the work was going to be over twenty thousand dollars. Folks that's that's what's important here is date they advised they provide energy to form a new company so they could get more money without bid. To do the same work and in there's invoices and what what I wanted a question you guys on last month and you wouldn't hear was there's the invoices in you testified in on the thursday committee last month that one did equipment and one had specialized labor. Well when you look at the invoices in two different interests instances one did labor one day lights one did labor one did light so that that that test money's completely false it doesn't even match. So senator chest field I think you got to look at it in his holistic not it's not just the fact they be it under twenty and a told people to stay under twenty day told people to go for and a whole nother company to stay under twenty so it it's blatantly circumventing a law here and a certain testified that's not true I think you know at some point when we get down with the future audit we probably need sinister prosecute attorney but I think it's important to know all the facts here. The chair recognizes my culture thank you mister I think it would benefit the committee greatly if people test fine were under oath so I would like to make a motion that the committee. Oh agree with me and put these folks under oath as they test saturday I have a motion I have a second. All in favor say I in the opposed. Insure your motion has been approved. And if you are if you all would stand in marijuana around here. If you would please state your name employer and position. Courtney pledger a director atn or I can say pds. Karen watcons cfo are considered pbs. Sargeney compuris director of education thank you do you some of the square or a firm that's a testimony you're about to give will be the truth the whole truth and nothing but the truth. Oh thank you may have received. Yeah. The. The. Should he revenue recognized thank you just a follow up who follow up on the the invoices and on the specurum and issue specifically you know it's not it's never I think I just want to follow up on on the directors a statement that you were under the perception that you were not following or that you were following procurement law that where you testified to you were under the perception that you were following the picture of it law correct okay you just testified also that you do meet with attorneys when it comes to fcc compliance that's correct. We have attorneys that we can turn to with specific questions in fcc do you have specific attorneys that you can turn to to just to give you instead of perception fact about arkansas state law. We do we have the attorney general's office and are prior physical officer was crystal clear that we were within the law from his perspective and you know it was his job to check with the age if he had questions but he apparently didn't now if any question arises anything that is even remotely related. To procurement law I will go to osp or the attorney general's office from the individual that directed for these individuals to maybe it was more than one individual but was there somebody who did direct that they form a company i'm in order to meet these procurements goods and services. And who who was that person i'm sorry did somebody to do that could you just repeat the short getting a bit question just following up on representative laws information that he provided to this committee and review of the evidence that was put forward by legislative audits who at your organization then had those conversations to direct these individuals to form a company to perform the labor and the services and to provide the goods for ah that that that came under the scrutiny. To the best of my knowledge and I will also like our director of education and address it we did not instruct anyone to structure a company in any way. No instructions for that came from us okay we're were these individuals that you are talking about that did perform the services right underneath that twenty thousand old threshold the audit reports that on multiple occasions you entered in to agreements but that you had conversations with these people and told them what they were what you would pay. So who who are these individuals and who are the ones that would be procuring these services and these goods. From these people who are they. Because that that was the violation of obviously this is this is you informed the vendors how much you would pay for their goods and services so who who are those people within your agency that would be having those conversations the education departments outside can you. So there are many departments within atm at higher vendors for services we are one the education department and for that vendor that had two companies they had simply asked if we they could have two companies to do the work I had asked the cfo I am not the peculiar officer it was the pecurian coordinator in the cfo that was aspect question and they said it was fine and then a approximately three weeks prior to that we had done the same thing which was not my. Doing for four four. Companies within one owner so it wasn't an intent. We have thought that it was right we weren't the procurement officers we brought it to them asked the question that the vendor has and it was as simple as that there was not a long conversation none of that had been asked to the cfo nor asked for us to do something we are procurement officers in education can you describe for me just quickly what exactly at the services engage you're talking about is this equipment this is this company yes well it's multiple companies that were seem to be forumed by one person correct I believe they're talking about one that had to two companies yes okay one company did what the other company did for you. Sure this is a lighting company so when you do major broadcast you have lighting and film gear you know there's a lot of pieces there philadelphia equipment something called a dalley which takes the hammer i've worked in television yes so there is only really one company in this state that offers that I believe. You know when this happened with the audit we actually needed them for a new project and we did a bed and we went outside of arkansas because there are the only ones here and we found one in memphis and I think they came in the amount so we're starting to do bed since caron's been here we had never done competitor bids never been trained on procurement in my department we we've never had procrement we had to rely locate so so let me just stop you so what are the other company offers so one company was lighting same person owns two companies so one company was lighting what did the other company provide. So I don't remember like what was what's on each one there you see where this is very clear I like it it looks very. Umm it doesn't have smart passes smelled hers when you've got one percent that owns now two companies and this company is going to do this and this company does that and they both under the threshold of twenty thousand but collectively they would be over I don't know I haven't seen the invoices but that's what's going on in my mind which is absolutely circumventing you know the bid process while i'll just break this into several different company this is the way that it reads to me you know is that I can go will this company can go right at nineteen nine hundred this one can be at nineteen nine hundred this one can be at nineteen nine hundred this one can be at nineteen nine hundred. But we're not so that we don't have to bid it out but we can help our buddy here that owns multiple companies so I need you to explain that to me because. For me I would not make that decision if I were in your shoes. Could I add something to their destined for my understanding the two companies one provided the lighting equipment. The other was described as providing the services of the lighting specialist to operate that equipment well that didn't make any sense to me except for to circumvent law so II appreciate that but it ultimately falls to you you're the director and so you're the responsible party for it you may answer and i'll be finished i'd like to make a statement it's an observation since joining the agency I was very surprised by the amount of procurement taking place within the divisions people were not trained in procurement. And. In my opinion it's an unfair position to put employees in especially under substantial work load these are very busy people who have expertise in their area. And not only do they have to do their job they also have to do procurement the agency had won procurement person gs seven and a cfo the entire fiscal division of the agency consisted of a cfo a controller and accounting coordinator and accountant and a procurement coordinator and in fiscal year. Twenty two d agency err issued. Four hundred a total over five hundred and thirty four purchase orders to two hundred and sixty one vendors totalling just under ten million dollars and four hundred and eighty four those purchase orders were under twenty thousand and I did a comprehensive review of. Fiscal year twenty two purchase orders and I observed the same things that like observe. And it is unfair to hold division directors responsible for knowing procurement rules when they have to know lots of other rules they should have a resource within the agency to support them in that function and that did not exist thank you smile last comment thank you for the latter two minutes of chair but that is your director's responsibility if you're the director of an agency and you realize that you are ill equipped and that your employees are illocated you're making a big salary. And it is your job to be a steward of tax payer dollars it is your job to understand the state law it is your job to follow the state law and it is your job to make sure your employees are a quipped to be able to be trained or handle that so I hear you and I appreciate that statement but at files to the directors responsibility and that is where I see a failure may I add to that that in twenty and twenty one we had clean audits. During the health crisis this agency which is very lean at received their own close to thirteen million dollars for five extra super sized projects we were it was a capacity issue and something we didn't really have the the positions to be able to accommodate. So in retrospect yes we did need more more people working in procurement and more people in the fiscal division we simply at that time did not have any positions or any way based on one time funding. To make those editions. If if I may all of those projects landed in the education division which has about twenty five employees so they were managing multiple large projects with existing staff okay. Existing staff managed all these projects. Shouldn't get more sure you recognize that you miss chair. So just following along the same lines of questions as my colleagues and urban I would just like to hear from. Anyone to table what advice or what assistance in complying with procurement law was given to vendors. During the process of. Them you know seeking beds or or whatever. We had a manager of procurement and a chief fiscal officer who handled there even though I would like to be in every room at every minute you know I cannot be I put my trust in that department and and the procurement officer I will never do that again. I will ask every question that ever occurs to me and I will go to osp for additional advice as well as the attorney general's office. Two you're not aware of any advice or will I know they were giving the advice that what was that advice. You just said that you know that they were giving it so what was it well I know as per their job description they were doing that. I agree with carin that we should we have so many. Procurements for a very small agency we do a lot of small individual projects and and for that sort of volume especially when we are overwhelmed by five super large projects and one time funding. We definitely need more people working in that area. And without additional. A positions to do that now having. Gone through the storm of the health crisis and all of that opportunity to make kind of serve students and kids across the state. You know I would like to address the understaffing so did your agency follow procurement law. To the best of my knowledge yes. Okay so the outset of this I read a statement from the audit i'd like to read that again. Quote the agency circumvented and violated certain aspects of the arkansas procurement while do in part to an indifference. Do you agree with that statement. I do not did you circumvent procurement law we did not. Did anyone in your agency my knowledge there was no intent to circumvent or violate procurement did anyone your agency circumvent preterminate law. To the best of my knowledge. No one had any intent to circumvent procurement law thank you mister chair. Who sitting in share sixty one century love you or recognize her thank you miss cheer so i've been listened to it seems to be that there are some people that have more insight information than them we do so are out i'm my first thing is there it sounds like there is some sort of whistleblower within the agency so I would say that that was a blower is protected and they need to come forward if they have information that we need to we need to have because i'm here in a lot of accusations in so I won a first start with the with the question for staff. Ah are we saying that the in the the if the term is split purchasing. Right so are we saying that the agency is do a split purchase in. We noticed a lot approached that were write their effect threshold and then we have the two businesses too that have they were owned by the same person doing the same project they were right at that threshold as well okay but codes stipulates the using repeated small quantity for cure mister circumbiking a billion surface obtained compare bid without just the case in concentrates of violation of our child I didn't know what what i'm i'm just answering the several questions are we stating that the agency is doing a split purchasing. Is there is that what we're stating cos that now will help me that would help me better process what we're saying are we saying that they're doing a split purchasing. We we we have no proof to say that it's a split purchases however there were a lot of them that were right at that threshold. Okay so I heard from a heard from and i'm going to get to the direct during just a few minutes but I heard from the director that they also get gardens from the attorney general's office. Did we talk to anybody in the attorney general's office and regards to. To the gardens that they gave the ideas before for procurement we did not and nor did we see any documentation that they got any gardens from the attorney general. Okay so or I think that their house in in so in the multiple nineteenth car that i'm over the same nineteen thousand but. On the multiple. I guess purchases under the twenty thousand dollars russia number one I guess the twenty thousand on threshold if they keep it on the they're not violin the law technically but. And split purchasing you are about length so if we're not stating which is making a notation that they had a number of. Of purchases under the twenty thousand dollar threshold which could imply split purchasing is that when is that what we're saying i'm just trying to sir okay in the end let me get to the director of the end now or the cfo wanted to see but I guess the cfo wasn't there when this was going on the peer to the arty is that correct. For the peer to the eye of the cfo was not there but the but the director was that's correct okay. In a I think you answered this this question in regards to with senator gill more so to your knowledge there was no one giving additional god it's too the private entities to. To start other companies in. In the circumvent the process. Is that is that your testimony. Is that for me yesterday yes. To minorities. There was no communication of that kind and no intent on our part to instruct anyone to set their company up in a specific way. Okay companies miss kinnett now isn't also your test the money that you do get guidance from the attorney general's office and regards to procurement. In general we get guidance from the office of state procurement we we see guidance frequently from the attorney general's office I am not privy to specific conversations that are prior fiscal officer would have had at that time but I know that is our general practice is a person that was it is the person. That you receive our you are received guidance from from state procurement are they still in their position. The. When I was saying is that I don't know exactly the specific conversations that our prior internal. Chief fiscal officer had with procurement over these questions. I think there are we lost our prior. Cfo in september. Um of twenty twenty two. And we searched for a cfo for five months it took us five months to be without a cfo for five months I will mention here they are difficult. Positions to fill we did phil with with karen watkins but not until the very last day of january of of twenty twenty calendar twenty twenty three. Okay mr chair is there anybody here from state procurement. Said that one more time is there anyone here from state procurement. The. There is not sure. Okay all right I guess and to get to the bottom of this i'm i'm really curious to hear state procurement side of this because if they're giving gardens. In the garage in. The director saying that they received us from state procurement they operated in that. I will use me curious to hear their side as well as the attorney general and turning channels are but. I just addict health right now thank you. Since you are recognized. Thank you mr chair. The. Twenty thousand dollars worth a lot into a lot of lotting. I'll run a four million dollars company. And the four million dollars in sales a year and twenty thousand dollars is a big sale period. Um. I'd say to this committee. That. Here. I have warned in city county local center johnson point out to me while ago every time that the municipal league or county associate arts association counties comes to us and says less raise this minimum again. This is a huge mistake. Obviously twenty thousand dollars is too high the. Thirty over thirty purchases right under the twenty thousand dollars more I would say with our ought in defense of our auditors as a manager if I didn't see that and know there was a problem there's something wrong with me but this idea that it's unfair for people to purchase and their busy. Unbearing that my people make a whole lot less than your people. And i'm the headbar. We in talk on top of selling on top of merchandising on top of everything else with their buying every day. And there are doing a whole lot better job I think i'd be willing to come in and try I think I could train those people in two days and they'd be cracker jack bars but you know nineteen thousand five hundred dollar contract come in for a week two weeks. And if that didn't take out one be sure is two different contracts but if that in take your could harm you again for nineteen thousand five hundred dollars to come in and train your bars. And you wouldn't have to you wouldn't have to see have represented a woman could do it cheaper and you wouldn't have to say because it's loses hundred twenty thousand dollars we were just asking for problems. And the auditors caught it it may have been legal but it certainly wasn't within the spirit of the law and so you want to tell me again how it's unfair to ask well paid people. With responsibility and i'm a similar with college degrees because a lot of mine don't have college greece most of them don't. To be able to purchase assume they purchase in their private life and are correct. There are a lot of rules in la behind state procurement lawyers i'm sure you're aware. It a lot of procurements can be complex the majority or not right but I could simplify for. With this people are contact with the most for the least. There is press provide they want they want the most in the best for the least and those rules actually are around that they're they're they there may be lots of rules. But they're very it in the law in fact says that you don't have to take compared to bids if it's under twenty but it doesn't say you can't. Take competitor bids if it's until there's no role that says that is there. No sir it's a best practice and we have implemented that best practice let me ask you this. If you bought twenty thousand dollars for the lighting. Would you go to just one place. Eh i'm told that you personally for less over your home because that's what I specialize in is is decorating homes and selling flooring in lighting set where i've yet to see the person. Who goes to one company. I'll remind the committee that I was not at the agency for the audit under a question in me personally yes I do sharp around for myself and for the state and in in the regarding the southern light pictures it's not lighting like you're thinking of its lighting uh as a service for a film production so it's it's not the purchase of an item to hang on the wall or have installed its. Lighting related to film production my mistake are there multiple companies that do that. There's one in arkansas apparently and one in memphis and the one in memphis. Uh their bid was approximately three times greater than the company's bid that was used but up I think you did say earlier you agreed that although we didn't mention the number that there was over thirty that they're the fact that we had so many just under twenty thousand dollars seemed to be a problem. Agreed and then the lady write their pass to yell didn't see a problem. For rise and shine we had an start me by wrong about this number sergeantly three hundred and fifty one mall video projects that were individual projects and. It was a massive project and so therefore it is not unusual to see a number of under twenty. The. We're not talking under twenty we're talking just under twenty. Uh. The. The. I'm all stopped mister thank you thank you senator. Search the seller you recognized thank you mister chair you mentioned several time that you were over worked or over capacity did you ever communicate that to department of education and said we just can't do this we're doing more than we can do. No we did not wait we took it on in the interest of the opportunity to serve kids across the state with one time funding what but if you can't if you don't have the capacity to do it correct never mind i'll live that stand i'm sorry shingy I don't know your last name but were you ever specifically trained in the procurement. Nap no never i've been there for years in. Okay they'll stop and trade for my staff the overgrads and people say you are do you personally have your own production company. Or have you had at your own production company I had a freelance business I haven't done business with a since I believe twenty eighteen so before I had taken the job at pbs and I had also worked full time at prior to his name what i'm asking them yes I have a production company are you apartment at barbara ownership or have you had part of ownership in a production company. I had an llc it was mine I was the single employer yeah that's what i'm asking and. The. You don't mister chair i'll just make the comment I think there's i've received several messages that are inconsistent with from the testimony is so I think i'll save my questions if possible to have some of the people that have come to speak speaking out that my questions go thank you yes. Can I make one statement for the record go here it came to our attention that there were some rumours flying around about uh sergeantly having a production company and maybe that production company receives some business from arkansas pbs. It's a fault her she provided her llc tax id to me iran az warrant report going back to two thousand ten there's not been a single payment made by arkansas pbs two sarsness llc that per her she can tell you herself she has not used this company for. Five years plus so I don't know where these rumours are coming from I think they're intended to discredit sergeantly and it it needs to be quashed the rumour but we'll take you up first to have not heard those rooms but thank you. Rips in his spranger you recognize me thank you mister chair and thank you all for being here today I would just like to make the comment that I have participated in said and on a number of addict committee meetings for their been certain findings would respect to different mandicipalities than agencies across the state of arkansas and basically what i've heard is that once there's a fine in this let me just make sure I understand this is your first finding that has taken place with their use of the existence of your organization is that correct are you aware of any previous findings before this one that stand out like this understanding now have are you all aware anyone. I believe the two thousand eighteen aren't at report before was what was that finding about what were you up was this the same type of valuation that the speed addressed here today. There well what stood out when I read it was I think there were four or five findings the biggest finding was. Well I believe the agency had to pay back. Five hundred thousand dollars to the department of education for. The. For not abiding by the grant rules. Okay so as a result of that that anyone offer so what i've been here and in in the course of my participant is main meetings that the members of the added provides training or they will assist in referring you to different agencies to assist with these kind of problems has that taken place I guess this question can be directed to mister bullet right if that's the case that's a week we cannot participate in management or or give any sort of legal advance to the age on that asking about legal advice i'm less than about the kind of training that you that i've heard over the past few months about your suggestions and recommendations to these different agents steve to a sit receive assistance that's what i'm talking about that for you to come in and do the work but to give advice as to how they can get some type of consistence and me what we frequently tell access to to contact the for your contact state posting me as part of our audit cycle mean obviously they're the experts on those rules right we are so we we frequently do that with account so that I guess that's my question there did you do that with with this group would respect to your previous finders and this findings are now anytime we exit and actually when we're finished we have an exit conference with those people we discussed the findings and in the parts that discussion they asked for recommendations what they can do and we always in those situations recommend that they seek gardens with these situations well let me just ask you this then do you disagree with what they've testified who today that they're not willing to move forward to address the concerns that have been raised is a you questioning them that there's not gonna take place it's been our experience where they're working on audit now for twenty three and I think they're I think they're trying to move forward to do the right thing I that's the thing that we get unfortunately they've had a lot of if they said they stated here they've had a lot of influx of funds from the part of a one time money. And they just have not had the star but I think they're trying to move forward with that some of this is volume some of it may be not but I think they're trying to move forward and do the right thing so is there anything that you know of at this point in time that makes you think that they're not willing to move forward and try to correct anything that you found they've been very cooperated with us we thank you very much this is what I wanted to hear. This. Reps of borrower you recognize you mister I have a motion if it's okay with you. So I go him state your motion on motion is to deferred this report from filing until the audit that was agreed upon an executive committee yesterday is completed and then we can have the indiscussion of this altogether members we have a motion do I have a second. I have a second one in favor of the eye. In the opposed eyes have it. Members I do have a other members are asking questions. Who said he in chair thirty one. Represent the flowers you recognize me thank you so much is the chair. Um if I just clarify it would stay what are the official findings. That we were discussing this far and I don't because I don't have anything in front of me you should have a copy of the report that has got this counter off bike color. In their own pages five and six of that report thank you and and as I take a look at that. I've i've I heard earlier that. Representative love was asking about the split purchasing an and it was said that they're sort of buttressing right up to that but it was not found that they engaged and split purchasing as that correct well with it with all these they were rather at that ninety thousand they took the approach that they were individual projects so there's some grey area and parking all about what constitutes the project in our recently they've gotten some gods from state pursuing. On what can't sue to project specifically take for instance they do all the high school sports chamberships broadcast and they consider that in the past that football was a project basketball as a project so and so forth. And I think the guide is now correct me if i'm wrong at the I think the garage from osp now is that sports in general because they know what's coming they know what the venues are they know what production is going to be that that's considered one project of itself and I understand for twenty five that's going to be bit out so there's been some grey areas for what constitutes the project and I think that adds to this as well because from our perspective we're not technical production people in nature right so we have to use some judgement and why do they project in and of itself so for context. As it relates to what we're looking at now. Because it was great area. And there was a consistent definition and expectation. For our purposes here it wasn't defined as split purchasing and i'm just clarifying from the exchange you had with representative. Yes my week we can say unequivalent that person we can say that hold that land route that twenty thousand we could say that they did business with two businesses on the same project that are owned by the same person in our our finding speak for themselves as far as that goes right. And so basically. That wasn't a finding in this case because i've heard of conversations about the twenty thousand and then on the from from the agency that that's not what it was in reasons why. So for this conversation we didn't find that there was split purchasing even though there was a concern and it has been rectify moving forward. From our perspective from staff perspective from the agency's perspective that this will be how we define it and this is how you will be expected to move forward as at what i'm hearing as far as what we would found going for we don't know the option to finish me we get the impression that they're trying to they're trying to they've been seeking guides from osp for these things and they've been getting some got it from speaking specifically to the grey area that she will describe and how for twenty five I think I just heard you say the categorization of projects. Is now there's there's clarity so that that grey area some clarity I can't say as a relative sports their son is right to sport but it may as they've stated they have lots of lots of projects rate or productions and so it's unlike anything that we normally see at other agencies as far as procurement goes so there's so there's some there's some gardens that they need to seek from osp there and I think they're trying to do that at this point great. And then if I could get some clarification really quickly from staff about the creation of a new company as I mean that's something I heard a lot about in a lot of concern. And i'm and I want to ask the question. Understanding my prospective that. You know i've been a legislator for just about nine years now and have seen many instances. Where we have as a body awarded the offended and advocated for companies that. The. Were created. Just at the cars of. You know applying for a multi million dollars. You know project for the state whether it's broadband whether it's an education than obviously those are too very important areas for the state. And there was in any concern not only not concerned but like literal advocacy for an awarding of those contracts so i'm that's sort of the listening ear from where I am. Thinking about this and so i'm just would ask you what is the concern and if and if relevant any rules that we would need to look at as it relates to the creation of a company. Yeah as far as barred what rules you would until II don't really not an expert in that field by any means but but for in this case for this one yet we have here there was a an existing country that they don't bus with prior there was a new company that was set up literally eight days before the scope of work agreement was signed that essentially based on invoices the invoice is looked very similar to the description look very similar so it looks like that they set up another company so that they could get business stable at twenty thousand dollars result now we don't know. Well that was directed by the ach where there was a decision made by the binder that part we don't know but it just looked funny that it was that close together. And in the course of. Looking at that should have flowers if you could representative not starting I think you're starting some family stuff represent flowers yesterday I have several people in the queue and will allow one more question than I put in the back of the queue and will continue thank you so much. Um. So i'll wrap up the line of questioning with this last question on this particular issue having heard the agency director and her team in front of a state that there was no communication they were aware of on the part of the leadership of this agency as well as the staff. Numerous times i've heard that but I hear that the concern so I just would ask from a staff standpoint that i'm assuming has had communication with the vendor with you know the agency leadership. Was there a violation of the law or any rules as it relates to that particular company. And. And i'll just staff there with that question yet we did not we have not had communication with the vendor to my knowledge is just that time frame that we said we felt like that that valid the spirit of the law is for but nathan la if I did late at the spirit but i'm just want to ask specifically with a law or any rules violated as it relates to that company and their activities in those two contracts. I think that's a question of of fact I mean basically they. If you look at him too if there were two separate aviats they would be no but if you're dealing with one entity or one person and where you have situation where one. Vendor basically creates. Another corporation to that basically relates to the same contract is what it appears here then it has the appearance that the the reason that it was done was to valid the law the bidding last members are held other potential witnesses that I would like to get in front of the committee today i'm gonna ask and i've got two in the queue through the queue but i'm on them different those questions until we get to these other witnesses with that latest if you are would please have a seat you're not dismissed I may call you back up thank you. And with that do I have anybody in the audience that is here to speak. The. Yeah. If you would please come up. Sure we will get a chair for you all one more chair. Here shortly. While we are waiting here. I'm going to swear all four of you in. If you would please stand all for a please stand. The. I'm gonna ask you to state your name your employer. In your position. And i'm going to ask you to raise your right hand raise your right hand. Do you stolen its war or firm that to testimony are about to give would be the truth the whole truth and nothing but the truth. Alright if you would please state your names. Going from the lift. Turn on i'm sorry sir attorney might then you are welcome sit down thank you my name is andrew bigno presidently unemployed but I was the former chief technical officer and I can sort of previous. Stephanie lively palmer former hr director arkansas pds cale fletcher i'm currently employed by because the k headquarters that I was the former education power in coordinator at arkansas. Chuck delish and I am retired from arkansas pbs alright in if you would all you're welcome to. Speak sir i'll start with you they've been sworn as. The. Go hitter okay. For me personally I was involved with. Assisting legislative legislative audit and inspector general's office and it should do if he report you might just a little bit closer shop thank you I was assisting legislative ordered and inspected general's office because I had concerns about some of the questionable activities that those asked to be involved with and I can solve pbs. And I was assisting them prior to my termination as an employee with I can sort of pbs. I can test a five that. There is a culture within the organization too. Um by pass purchasing regulations and procurement loads. And that has its it's sort of common practice. And that uh the culture has been sporned and encouraged by the directorship of the organization. And it's it's why to reaching them then just. The investigations that are presently enveloped under white into the rise and shine issue. And also involved sports as well as vendors. The provide other services to the organization. The. The. Intent of negotiating purchases down below twenty thousand. Mainly is so that. We can deal direct with those windows and don't have to go out to bid so that that those with binders specific vendors can be selected for doing that project work. And that's certainly been the case that i'm aware of with rise and showing. Um as well as other issues. I'm prepared to answer any questions that you would like to to ask of me today specifically okay what i'm on a first move on to the. Lay on your right ma'am. Hello first I would like to address the time and effort sheets that was initially a reporting and that was from me when I was currently employed to address something that was said earlier in the meeting so some of this was reported during our current when we were currently employed in the parties but state your name again please stephanie lilly palmer thank you. In that in that reporting I had multiple employees come to me I transferred to pbs from the arkansas insurance department so I had sixteen and a half years of state experience. In that I had employees come to me and expressed their concerns to me about tom and effort sheets and saying that they were being asked to change them I also submitted multiple time effort sheets from the employees that had been asked to change showing one bit of documentation to another there is also a recording of this particular former employee asking about changing the time and effort sheets as well as another employee that is still currently there so I don't want to say her name right now there was a big concern about the employees because they expressed it multiple times that they were being asked every pay period to change their tom sheets. When you're processing payroll like that I get the simple logistics of it however it is not explainable how you don't know what your employees are doing for a week and a half to two weeks prior every pay period along with those grounds that are being utilized for these there was constant costs in her changes because we were having to shift funds around very quickly there is a percentage that you can use on those grants that you have for example arkansas you had ninety percent and ten percent that was utilized to heavily to say okay well we can do this here employees were being told to come back up and split that time the tom sheets that are a time and effort sheets were actually implemented in two thousand nineteen due to an audit where they were told we don't understand why you are still doing this we don't understand how you don't know what is happening there for internally time and effort sheets were there therefore implemented that's why those were there the other issue that we were trying to fix regarding that the controller the cfo did leave in september he transferred back to the department of agriculture he did try to help address the issues I took my concerns to him. The control or even send an email because one of the things that did not understand is why we were not getting copies to reconcile for pay periods for these grants for these customers we would be provided just a spreadsheet you need to make this ninety you need to make this ten twenty five percent there was no justification for that so I want that's what I have to say about the time and effort sheets I would like to address the training that I keep hearing that they did not receive that is untrue. We have procurement training that was put in place however when we tried to when I came on board in february way of twenty twenty two to article pbs we tried to implement a human resources routing and procedures that part of it involved accounting and reporting and how those would go so we would have approvals in a town we may we also implemented or attempted to let me say a new process for procurement training it was strugged off and in one case laughed at so we actually had a power point and we actually went new employees came on board we did have training for them however I will tech say to the fact employees were spread so then some of the training was very happezed not by us they couldn't get to it and time. When they say they didn't feel positions they didn't feel positions because they would keep them. Two utilized so they could have higher salaries elsewhere however extra help position positions were filled repeatedly in the education division therefore. That having no staff as not necessarily an issue and it was always said they have the grant. Okay. Have a lot of documentation but i'm not sure what all you're wanting me to tell you there are there's another recorded conversation where someone is being coerced to sign a document regarding the contract. Two get around expenditures. At this time I opened it up for questions there are multiple issues with arkansas pds sports there are things that we would get there was a division engineering division actually in f what twenty three or are you upset down on their budget through a five twenty three there was no money there because we were told to move it somewhere else when we come back to that while the sudden we have the money they're playing a shell to that regard there is also multiple employees that are stating that they're not getting to use their car tom well that's small in the whole scheme of things but wouldn't there be and pushed to these limits and they can't even utilize the carp time and being told to report different different things that is not acceptable when we challenged when I took these things to my supervisor asked why we were constantly changing cost centers without a documentation while we were using these grants like this with no documentation I was told there are things i'm just going to have to do without question I refused. Yeah in this end folks this is your time to tell your story well we have big stories we have big stories I have pages of stories how long have you got how to. At this time II mean i'll take any questions there's a whole lot of information that I have caller has a lot of information too many of you received an email in december from an employer for our employee that was actually exiting that day this would be the employee mr dollish can speak to cultural issues but i'm not sure where you want your focus to be today in with that ma'am i'll move on to you and would you please state your name and again state your position or formal sure my name's california I was the education program coordinator when I left i'm I worked for architect pds from june of twenty eighteen until december of twenty twenty two so I was actually a part of the audit but took place in twenty nineteen because I worked directly for the department of education's arkansas grant if you're familiar with that which is a massive form of some of the past audit that took place so I was actually questioned during that audit I had been there approximately a year and a lot of the questions that were asked in that audit are counter some of the same ones that are being asked now where your time and efforts going so I was not terminated I know that some can't speak to that I had the opportunity my direct supervisor at the time who was the project manager of arkansas had left in october of last year and I had a feeling my protection had just walked out the door so thankfully I was able to exit and as stephanie mentioned I did send an email before I left that last day I sent it to every single employee of arkansas pds and line copied them accident to suddenly comparisons courtney pledger and edly on who's not longer there and then I included several members the department of education and several legislators and essentially it just tried to kind of explain the surface of the issues that were taking place highlight the time and effort issues that things that were being asked it is very a cultural issue that's kind of been stated I was very much a part of conversations in the room sometimes of individuals who knew that what they were doing. Was against if maybe not against the law against the spirit of the law and and if they could bindle polls they were attempting to do that if you aren't a yes man you are going to be asked to leave the room and sell. Time and efforts I was a part I do have the recording um of this was approximately somewhere between october in december of last fall because it was after my supervisor had left but before I departed time and effort because a sergeant comparison became my direct supervisor after my supervisor left and so are entire team that now had new management we met kind of discussed time and effort because many of us. Myself included I had not had to do a time and effort sheet after two night two thousand nineteen because I was full time arkansas grant my time was not normally ever split to work on something like maybe it producers would have been you know the production what their time more frequently however when rising shine came in to be that is the first time I had been asked to split my time and there were multiple conversations from people who were like hey I didn't work on any of that this week or maybe hey I spent thirty hours on rising shine this week but you're wanting me to put all forty came from arkansas. But that wasn't true um and there were conversations and in that recording I directly ask. Are you wanting me to switch this like is this what you're saying and the question it was answered yes this is what has to be done because you know there was lots of things like all you know there's eighty hours in the week it's just easier for this easier for that I don't remember quite when I stepped into stephanie's office for the first time but I had a lot of documentation to provide and so i've had approximately fifteen current employees that are still employed there and I won't give their names but who have reached out prior to my departure who are still experiencing some of those things now things may be getting better but that was the culture the culture was very much said down and shut up or don't be there. So. And sir if you would identify yourself in your position or former position. Chuck delicious retired as I said from mark and saw pbs say. I was doing in the show exploring arkansas and was the produce certain host and. I was doing that since two thousand five this new management came on board. For a reason that still do this they do not know of the show was cancelled. And it exploring arkansas was one of the top rated shows on arkansas pbs. And viewers try to tell management that they wanted to show to continue that they loved it a pbs consultant that came to aetn and told management that in the state like arkansas which caused itself the natural state. Which you know outdoors is our thing here he said I show like exploring arkansas is a necessity to supply to meet the viewer demand well not only that you know they only courtney pledge or need leon. They didn't listen to the board viewers wanted in fact the reception has told me one day that they did they did not even take calls from viewers they could care less would be your thought and it goes against their mission statement you know we'd like we provide arkansas stories well if you've wanted to provide our consauce stories why that you cancel exploring arkansas. You know a lot of people that I run into said they relied on that show to to give them ideas of where to go and explore themselves but that with their own families of course it's still in an in reruns but they're you know that the point of the matter is uh why cancel one of the top rated shows and arkansas pbs when viewers demanded that it stay still the state on the air with new episodes. And like I said to this day II have had not been given a reason why that show us cancel. So that's my that that's my two cents worth and after the show was cancelled I went to and worked and operations as a studio camera man further for the most part and until I just had enough and say hey we know i'm retiring in. That's it thank you certain may I say one more thing in addition to what I had said before we open add up to questions one of the things that he spoke to about the culture i'll get to in a second one thing I would like to point out and do it myself actually have documentation there was a question earlier about the broadcasting standards we actually have documentation where he did email those standards and did put into question how things were being aired it was not addressed as a matter of fact i'm in turn I was asked to consider display action on him. I would not. The other the other thing that I would like to point out myself I have been working with. Buries the entities including the inspector general's office since last august in september. The other thing I would like to say so again I want to go to that point where current employee at the time there have been fab of us directors or division heads terminated within seven months upon the new cfo arriving. Two of us on february twenty seventh twenty twenty three one of them on march twenty fourth twenty twenty three. All of us had long standing state careers that on september thirteenth the cto and on october fifth the production director all of us had asked questions about procurement all of us had asked questions about expenditures all of us had asked questions about culture we had talked about the toxic environment the ballinging and feeding on charge the extreme lack of value the no communication and lack of leadership and employees were saying this is not the atm flash pbs that they had worked for all these years there were multiple complaints that came to my office as soon as I hit the door so I would like to put those on record as well I do have dates and times of certain instances for it where employees speaking to the hostile work environment I was encouraged to try to get mister dose to retire I will not deal. At this time I think while i'll take questions but only one more thing is I should have included this but i'm actually a current license teacher in the side of arkansas i'm still utilizing pbs for my professional development so this is not a bitter employee situation II got promoted while I was there and planned to retire there that was my plans I was happy to know that I would probably never make six figures because I believe in the work that I did but I consider myself thankful to have gotten out when I did because of the seven terminations that came less than two months after I stepped out the door I probably wouldn't have been one to start so I just I want this now I believe in the work I did and it was good work it just was a bad culture and about environment. Insured you have anything to say. Yes I just like to address the fcc concerns if I can. I can saw pbs has a broadcast license and as such a obligated under the rules and regulations of the fcc to maintain an operate that license under the specific technical operation conditions and laws required by the fcc. Yeah. The. As chief technical officer I was required to set the operating standards which was really the roadmap of success so that when editors and produces produced video content for the organization. It fully complies when it's broadcast two fcc standards and regulations. Unfortunately. The. The present executive management has steered the organization away from a broadcast culture. To one of more of an artistic and a film style culture. And they wanted to go off and shoot in formats that are very hard to convert. To fcc standards and to and to be compliant. I addressed this issue. With both such any comparison edly on and courtney pledger. Ah. And. They decided to let suggenly experiment and her staff. With different video standards. And really the whole rise and shine in year twenty two. Turned out to be an experiment and this was because the the editors and produces involved who shot the segments full rise and showing have a person close personal relationship with cortney and such any compurse. So I was overruled. Italy on specifically told me because I was unable to demonstrate. That the way that they were producing it was not going to be successful that they were going to let the experiment happen. So that actually took place they were over two hundred signates filmed up for that season. They were done in a in a format that I did not believe that was successful I actually wrote such any computers up through the hire process which definitely was involved with an express my concerns and I was overruled and told to to air this material. The. As cheap technical officer i'm responsible for the master control operation and getting the media to the different platforms in the correct and legal standards. This material was handed to our master control and scheduled to a for that rise and shine season. The. It fell way short of the fc standards for quality. And it also did not meet the capsing the requirements actually in the process of captioning which is a requirement for us fcc requires that all the content we create be a hundred percent close captioning and available for disabled people within the state of our consultants part of our license requirements. And the caption tracks and the captioning of that material was broken in the conversion format when they were trying to convert it from film standard. Two broadcast standard I made my concerns aware to courtney pleasure needleon I said that the files are corrupt they do not make the standard and I was told that you know we had no chance to go back and fix it. And that we added anyway. I express my concerns about the culture at an executive meeting where all the directors were involved. And said really least practice after this example has to stop. There needs to be more compliance and procedures put in place of foreign verification so that this does not happen again. Ah I was yanked out of that meeting by courtney and demanded to attend a meeting with her one on one in her office. Where I was basically told to shut up don't tell anybody about it because. This material going to a without the captioning if somebody had complaint to the fcc the was every likelihood that fines would have been imposed. On the organization. So I was told not to make a aware of the quality control issues with the false broadcast and certainly not to make any comment or report it to anybody and the I was had my courier threatened by courtney pleasure if I did. Thank you in folks we're gonna move on to questions now. The. Centre clarkster your first step. Good morning questions really for the other group someone in the right now yes sir thank you. Suitarise. The. Right thing was like a bathroom and so and i'm really i'm backing way up before these people have testified and I want to just. You don't mind I want to talk about a little bit of the question we were doing a staff a minute ago and kind of were asking staff to do something that we should not ask them to do we do not so it just has a perspective what you have in front of you and if you don't have it you need to grab it is there is not it done the refindings there were recommendations in the responses to recommendations and that's generally the summary is that fair. And so everything about that is not about feelings and so to ask a staff member what do you feel like they're doing we can't do that for asking the into do something that subjective which is you know get away from what their court principles are and what they're supposed to be about date minute and auditor that has feelings now I may have intuition understand that you know there may be something you to pursue this direction i'm not saying that but we've we're asking them to report their feelings we're asking them to do the wrong thing as it's it's bacs through asking from them and so just in the future we can refrain from asking them about how do they feel like something's going to feel like they're doing a better job because it's not fair to ask them and the other thing that an auditor does they only deal with the past their reviewing history they're not reviewing something in real time now we can ask them to do a review or something else that maybe they could get into that but that's not what what is happening here we've asked them to art it's something which only deals with historical items so again I just want to be careful and we are asking audit you know what what do you feel like they're doing today well they shouldn't know what they're doing today what it how does the audit going so far will if you are asking them to do that or you know get in front of the outcome of audit you're asking him to again you're in for your influencing the audit which we shouldn't want to do as a committee at so which I just just some comments for the chair if we get going down that road again apologize for the the latency and be able to make the statements but I don't think it's fair to ask or stay off how they feel about things especially things they're in the middle of our things that haven't happened yet or proven to be true. Thank you yes sir thank you. Chest film thank you mister cheer thank you for being here and sharing your stories. But I want to get back to the on it. Was there a finding that something was a miss and fcc this is to the stairs. As I keep hearing about fcc and all of this is there a part of the article. No matter thank you. The agency into agreement to procure goods and services from the company's own by the same person. Or any of you aware of this country. The. Yes. Can you check that you knew that they knew. That jumping on toward was going on. They didn't know there were questions about it yes I can't say that it was also it was a procurement coordinator and we went to the cfo and that would be you know the cfo that we went to was our direct supervisor he transferred back to another agency but he's gone yes and you are gonna yes ma'am and you're gonna from pds and you are gone from yesterday so I want to know. How your chester money is demanding to the findings in the audit report because at the time we were currently we were employed there. So the. Let me ask did you interview. Interview lots of staff is part of fraud interviews and it's part of our process for doing their employees though yes maybe we're so they were part of good teaching anything. If we've talked to several of these people on different vacations is that why you say that it was delivered is that predicated on their customer and no man we do we don't put anything out just based on somebody given this information we do are due diligence that are at that information in a court for standards but just to be clear when I dealing with the fcc. Just to be clear that's correct in the site report that correct and in this article report you said that the agency has worked with you is the correct. To the agency that's currently in place they work with you they were cooperative in getting us documents yes it just. So there was no push back from them on anything that you asked for. No ma'am. Thank you. Representative sprinker you're recognized thank you mister chair and I too thank you all for being here in a appreciate the concern is that you all raise they sound like personnel issues so let me s the chairman is it the practice of this particular committee to address personal issues because it sounds like there are some employees here that have concerns about the way that they've been treated and as a result of that this seems to be playing a part in the added findings so I guess my question are there claims of retaliatory treatment or a different treatment is currently pending with these particular employees that this particular time if so I don't in my opinion I don't think that this is a issue that needs to be addressed by this committee it needs to be handled by some some of the body so i'm trying to relate to found out how this test the money in this whole situation relates to this added finding so I add think the seller to just feel for her comments and and then those of the simple in the back he's gone now but seems like to me that what we're having the conversation about does that have anything to do with this particular added is there a personnel issues here and if there are pending claims by these particular persons that's a whole different situation in my opinion and just sold a you is is there anyone here who can speak to their or are there pending claims by either of these individuals here today relayed it to their ticket them having said something the unbelieving that they are being retaliated again so discriminated against whatever words you want to use based upon what's going on the findings of the side that's my question thank you and I think it's important that we listen this force today. I said thank you and I think it's important that we hear these folks out today they. Send you brian you recognize that you miss chair. Just a quick question have any of you or to your knowledge and are you of your co workers party time leaving approach the commission pbs commission about these issues but no sir we did not at one point and it was not said directly to me but I did have a two employees come to me and want to express their concerns to the commission they were told not to go to the commission there is also a former employee that did branch out and go to the commission and she is now got she was there maybe three weeks when they did it was. Told one basically. There I did not personally directly go to any of the commissioner mainly because I couldn't find a direct email for them or they would have also received my email but I am aware of another former employee who now works directly with one of those commissioners and that email and other things have been shared with her but that's very recent but that's take. Send a clark you're recognized. Thank you. Mr dovis. I don't know that your test money has anything to already with the representative has anything to do with what we're looking at today but i'm a big fan and the adjust assumed you retired period it's the only way we'd ever do away with that show with somebody who put all those things on a bucket list himself and and goes in seasonal at those decisions I guess we'll always lie with management but I am certainly disappointed. In that would you consider coming back if it if so someone ever want to restart the show. Possibly if it was reinstated like I said a lot of people miss it and a lot of people I mean that that's what they looked forward to take their families to all these places and explore themselves and if it's you know it's everybody was just shocked that you know the show would no longer be in production. You know and I just want to say that you know the latter might. Co workers at the the stress that has been you know arkansas pbs used to be I think one of the top five places that people sought to work for in this state. And now it's at the bottom of the total pole of people wanting to go work there because of the stress in the rat that they've been put on good employees have been there twenty twenty five years. You know solid performers you know the director of production who was recently let go he was the most magnificent creative person I ever work with. And it was shocked to me that that he know that he got he was fired and and it's just you know a in mind in you know people sitting here andrews you know the most wonderful mind of of an engineer. It is just appalling to me as what happened at that place and it's it's. It just I just bothered my mind. So for what it's worth mr yes sir appreciate you having these witnesses here today go along with what represents springer hate to say though I would hope the two and others would ask the tears a jpr to take a look at this because that certainly is a committee where we can look into all of it and ask any questions that we want from anyone and I i'm glad that these people are here to open up that we need to do that. And and thank you for having them today. Yes sir. Representative consolidate your recognizer thing mischair i'm going back to the audit reports on the the company that the same book is split in the two different companies eight days. Prior to getting one of these contracts for under under twenty thousand dollars that did they do work with. The. With your before as as a single company and ever have to bid anything or. The. I don't know if they had done work with us before as a single entity I don't want to speak to that one hundred percent however I believe that they did the procurement coordinator had mentioned that but I don't want to speak to that a hundred percent that she's transitional they don't wear there when this when this happened yes one thing I would like to say to that too even though they split companies and eight days prior there was a new one if it had been done appropriately. This would have been out forbid because you would have gone over that threshold the other thing I would like to say is a lot of times what they would do is submit the right below that number and then come up and do a change order. To ensure that there was more money that was going to be paid. There is one particular company and it was not mentioned in this audit i'm thinking it will be on this upcoming art it that is a production company they're guaranteed a hundred thousand dollars a year they don't pay them that hundred thousand to avoid that so they break it out of the twenty thousand dollars payments however that works throughout the year but they're told they're going to get a hundred thousand dollars and they don't go through the processing okay so do you know of any other companies or individuals who own multiple companies who do the same kind of work I think it was brought up by the director of of education previously that there is another individual who earns up to four companies that. Bids of these contracts for under under twenty thousand dollars aware of that. Not their specific names of the companies I don't have that with me right but that you know that's has that happened because here's a thing audit are auditors only look at my kind of big picture they don't dig into every single contract right so they just happen to catch us one that was your splitting two companies on by one by one person I guess what i'm trying to get at is is is that what happens regularly to keep all of these under. Twenty thousand dollars yes it does. When another issue that we had of regarding this is scope of works that the scope of work will get done for example we had one company during this time period the vendor submitted an invoice per half the payment it was paid within a week of po we still didn't have the work that was touched what were said was verbally to the procurement coordinator about one of the division directors they need the money to start and she the division director will create language to make it appear they are doing something and being provided work. That's not okay so if if if audit dig into every single. Contract they would find that a lot of these are our single owners individuals that own multiple businesses are there getting these contracts they leave some of them yes this. Justice situation yes okay thank you. Are also one of the concerns which was raised are by the committee is that the same vendors are being used. Repeatedly and selectively and that's exactly the case for rise and shine these the vendors were introduced to the organization by such the compurs in twenty twenty one which was the first rise and signed season. Which was post-covered so she and it took all the negotiations with those vendors directly. She openly talked about at a production meetings and executive meetings that she had used these vendors previously both in her previous employment at a ui uis and dillots and that she had will she consider these home creative crew and she wanted to use them on this project so it was openly discussed that uh. The. See what the bids below twenty thousand dollars that she could choose and selectively use these individuals both in a twenty twenty one and twenty twenty two and it was ongoing it a season. The last season which is twenty three. So where where we are aware of that practice. In twenty twenty one. The bids were sit under twenty thousand dollars and then when the vendors under took work they were able to climb to a higher price by doing change orders. That was slightly abused the change order amounts in twenty twenty one were quite exorbitant and and went above the budgets so it's obvious that in twenty twenty two they were looking for other ways to be able to to highland to deal with that. The other thing we have to remember to is that I can solve pbs is a fully equipped television station. We have lights we have. Dollies we have. We have the personnel. To do lighting to do audio to do the productions. So as. Cto. I did not really see the the need to contra. Just to pick it back on that I was privy and saw with my own eyes several scopes of work that were for nineteen thousand nine hundred and ninety nine dollars and I can't speak to if those were owned by the same people sometimes because I am not aware that there are several of those individuals or organizations that can directly tap back to such any comparison her former work and sell even on top of that there was and I don't want to speak too much on it but there was a linked and learning a much if you're familiar with linked in but there was a five hundred thousand dollars contract that that money also got mixed up in the rise and shine and time and effort as well and so those were just situations again I was not in any way a person who signed any of that documentation but I saw them several times because my direct supervisor at she was the one who a lot of times had to write that scope of work based on what the information she was being given and so of course you know one time you see nineteen thousand dollars on nineteen thousand okay maybe that's true but about forty five toms later so I would say post twenty nineteen there are probably several of this. Senator selling your recognizer. I'm sure it should yeah thank you you know it was mentioned earlier by the representative that I think she is looking back my way about how this all started I would mention that the group of legislature tours were invited to pps for a presentation and we weren't at that presentation I had to leave early as I was walking out several of the employees that are speaking here I think two of them they are speaking here came out of the out of the building chasing me in tears. That there were a number of issues that were not based on feelings are emotion they were based on the facts that were presented to us on the audit side and yes i've been involved with audit yes i've been involved with the whistle blowers and seeing the evidence that they have not here say but evidence speaking specifically too legislative audit and while this testimony has gone beyond that and I appreciate that mr chair because we have oversight not just oversight over the audit but oversight or would all the agencies that are under uh under the legislature so I appreciate you the line that testimony yes I was involved in this from the beginning and yes it was all based on evidence of the issues before audit thank you. When i'll make one more comment right it was mentioned earlier that there were rumors going around about maybe a potential conflict of interest I have not shared any rumours about how things have gone i've heard of but I have not shared those rumours about whether there was conflict of interest. Between current administration thank you thank you repsite flowers you recognize me thank you. Just a quick question for. Staff here today. Um and let me say this I have been in the position before of um. Being in a hostile work environment and i've also been in the position where i've been in management. And. Had to deal with. Issues like that from that perspective and so I take. Those claims and experiences of people who work. For the state and work on private sector very seriously. Um. During the time that you all were working for pbs arkansas or etn at the time. Was there ever a time that you filed any complaints about the hostile work environment through hr or any complaints through any relevant at appropriate. Entities that would deal with the issues of concern. So prior to her becoming our hr there was two that I worked with prior to that and so first is the answer your question no I did not file any formal complaint and a big part of that is i'm to be honest i'm a single mom's two kids I don't want to lose my job and and so honestly that's another reason i'm sitting here because you know you eventually the disactive decisions that people make threatened the lovely hood of some of us and so when stephanie came on board there were several other employees that chose to leave they got different jobs and they had exit interviews and several of them were kinda like you can trust her because I had gotten into a place where I was like i'm not going to hr and it wasn't it because I think that those individuals just they knew there were problems as well but you know we all have just different powers in different decisions that we make and sell our family chose to step into her door and I just told her don't ask me a question that you don't want me to tell the truth because I will and so that's when it started and then I provided all of the documentation I had and a then I stuck with an auditor once or twice before I left and so adjusted honestly she's the reason i'm here because this is again i'm sorry to reiterate this is not being being a bit of employee I wanted to retire there happily sell and so I just this is a situation where I just want people held accountable for the decisions that they make and for people like this who were terminated I want them to feel like their fight was worth it. So. And if I may add to that um. When stephanie joined the organization it was like a breath of fresh air. Previous hour managers were prepared to turn a blind eye and not really advocate for the staff. About what was going on within the organization so it was refreshing when stephanie joined. She's the reason that I came forward. And I worked with her on the hr process. Uh to bring the situations that are was asked to be involved with which when a against government regulations. And and and compromise me personally. As the chief technical officer I was. Responsible for talk signing off and recommending any technology within the organization and and. Because of what was going on I was always asked to sign off on or my name was used to legitimize purchases within the organization. Which is something that. Morally I could not stand for. And i. Personally went to stephanie and made to aware of. Umm the compromises that I was being asked to make. And the choices that I was being asked to make. And so per consultation is an advocate on which path to take with that. Uhm. And it's. Because of my involvement with stephanie that. Uhm i've had the carriage to come. I'm at a which is say to you. And I don't know you I don't know a lot of the circumstances I don't have anything in front of me it does take courage to come forward I will also say for my car leaves. That um. I know again first hand that when you're dealing with issues this serious in this sensitive as it relates to staff and work environments there is a process that's important that is important to flash out so that whatever the accountability outcomes need to be they will be based on fact they will be based on interviews across the board on all sides and I will just add finally that you know I think that situation dismay senator chesterfield as well as representative spring or spoke to the fact that. You know while and i'm saying for myself while I think that these are issues that are important to be looked at in the proper forum and in the proper process. This is not that but these issues that we've heard today are not directly germane to the art at findings that are in front of us moreover there is another audit process that is in place or that is is that is continuing that I am concerned um. That could be. Inappropriately you're unfairly. Uhm up impacted by this in terms of the article process and if it is so that all of these things happened. You know I just don't think that we want to take away from the credibility of something that comes from the final article that's in process right now. And so I just would as that we move with caution and handle these issues and they are proper forum and handle them in a way that is fair and sure so if the outcome whatever the outcome is it can be respected and and not scrutinized in any way and with that I thank you for being here central paid your recommendation. Thank you mister chair and I guess before I get to my question I just first like to say. I don't know if if you all missed reading the audit report or what but. The findings regarding the time and effort sheets is what I want to ask you some questions about that's in the audit report. And it deals with falsifying documents. And I believe at least two of these witnesses before us right now how direct testimony about that. So my question is. I assume these time and effort sheets are like tamcords is what does the payroll calculation and then it's also what allocates that expense to whatever project they were working on. Very similar to what we do in on all will business will be run a shop you know you have a seat you know they worked on this particular vehicle for this many hours or minutes and that way you divided the time up according to the work order. How many employees. It does yes. Work on time and effort sheets are that is their method of of payment that is for the entire education division due to the audit from two thousand and nineteen when things won't be and reported correctly okay so this audit from what i'm reading shows it we check thirty sheets out of a hundred and fifty nine. Would the hundred and fifty nine bees a hundred and fifty nine separate employees no sir what happens with the time and effort sheets each week the employee is to fill out what they did for the growing at for depending on which grant they worked on and dispersed their hours so we can have an accountability trail for that so that's each week and payroll pay period as two weeks period and so you were a horror issue. How many employees came to you. With a complaint or question about why they were being asked to change their to falsify the sheet. Your time at the time and effort sheets right at least seventy eight okay so for me when you have a culture and a business. Where you ask employees. To do something unethical. Like falsified documents. And then you purchase the company of those employees who are not comfortable doing that. They're either going to naturally seek other employment. Or they're going to at some point blow up in and your rafara. Better the company ends up being perged of ethical and honest employees and everything this left are those that are willing. To falsify the documents which means they're probably willing to do other things like. Fly the edge of the envelope on procurement law. Which you know I understand there's a huge loophole in procurement law. An exploit in the loopholes not necessarily criminal. But it just adds to the culture that we're talking about here so at least seven or eight employees. Complained about being asked to alter their time and effort sheet what percentage of employees are we doing method. If if you're talking about eight that almost that's basically thirty percent of the people who are on tom and effort okay that was my question and i'm right i'm running I was writing down names as we speak i'm up to i'm just trying to remember in my mind and approximate and I would alight I would like to say to the time and effort sheets on july twentieth of particular employee came to me and presented her concern she was in tears because she did not want to sign the time and effort sheets because she did not work the time she was being told the allocate when I expressed that to my direct supervisor to speak somewhat to processes we did follow supervisory chain a generalized email went out to everyone saying that they were having problems with their tom and effort sheets basically it wasn't didn't say don't go to stephanie because when our own payroll I want my documentation to be able to back it up but it was basically if you have problems come to myself or your division director for education I was then talked to on multiple occasions to tell who the employee that said this I did finally direct your pledge or did come in my office and I did finally give her the name but I did not still comfortable doing that the employee come to me with her concerns and I was trying to keep it private well thank you and i'll wrap this up but I just want to say. Um. When you when you ask people to valid their principles in our ethics on small things. You found out who's willing to and who's not. You create a. A bit old boy system were crowded people around you that's willing to do what what's not quite right and then you end up with the twenty thousand dollars problems that we're talking about on the procurement law and I appreciate i'll come forward to appreciate your sharing your testimony I would hope that since this is a taxpayer funded entity that we can hire and retain ethical people and I would hope that we can operate it successfully without asking them to violate their conscience or to falsify documents and I certainly appreciate the audit agency for for uncovering this but for my colleagues i'd just like to say that usually where they're smoke there's fire enough soon we probably have the tip of the iceberg thank you thank you mister chair sinner johnson you recognize thank you miss chairman. I have say I could not disagree more with the people who said that this process is not remained to the audit process our auditors go in and find facts for us and I certainly want to uh didn't found myself a center dismance remarks at our staff is excellent I have never worked with more dedicated in in objective people ugh and I want to compliment them they're not making policy decisions there simply providing us with data and information and we the general similarly make policy decisions and weight do interrupt myself in full disclosure arkansas pbs is in mind it is strict sincarn way my hometown have known I guess every director since a lee reeves the first director my daughter is a former employee. And I have known director pledger for some time and considered a friend. Um. This is she came up about the fc license and am very troubled by this because not only is or something legalities there ugh when when governor hutchison was pushing the year a transformation and consolidating all these agencies because of the fc license in the requirement that the commission in that license holder not be the state of arkansas per se they were kept as the licensees that not correct fault job in just not if i'm kind of understanding how that if you don't know that's okay pressing you on there but that was what I was told during transformation what i'm hearing today and seeing the day is another case and it's happened before people that around this process allowed the ultimate. Responsible entity a commission sometimes is not always cognizant of what's going on down in a below there they're part on the organizational char and this bothers me a light mr chairman because this is when we get the kind of things that have come forth now II just want to say that I am certainly willing and glad that we've already voted to continue this learn more information but that's what we do whether is that it was mentioned by senator clark my beats should let me look at JPR in addition but our job is to protect the taxpayer dollars and legislative auditor mrperiod norman his staff they find facts for us and then we evaluate those facts and some pamsels facts are just raw numbers and they don't add up router they were not they discover something it was done in properly through those numbers and sometimes they find procedural things that weren't followed for example you know we always see there's no contract with something then that's a violation of the constitution so we have to have a contract to spend money and do things and so I want again. State that this is german to the process appreciate everyone that's participated both panels and this is how we find facts so at this point I will leave it at that point thank you for staff thank you for your job thank you for continuing to be objective and provide us with the information we need to do our jobs thank you mister may I say one i'm sorry no political hit me may I say one thing there are two to speak to what you're saying about getting the information and what others have mentioned there are other employees passed and present that would be willing to come forward. It's just a matter of seeing things that have happened in the past and there's not really been a correct of action to that what they are willing to speak to the time and effort to expenditures to various. Issues to that as well there would have been several other role here but they just couldn't get off of their current jobs they want it to be are probably life streaming it but there would have been several other individuals here. The. Representative right you're recognized. The. Thank you. You'll this all started out a couple hours ago and the big thing that was going on at that point was not taking us for items that were below twenty thousand dollars and we seem like we had a tremendous amount of purchases that were less than twenty thousand dollars which does not look really right. Can I ask you this. You might have been there for a long time and now you're not there. You all know being there at this point these day did have anything to do with what you may have known about the the purchases that were made there were blow twenty thousand dollars I don't know how to answer that appropriately because that is something that will never actually have full knowledge of to to really know what the reason was behind it. Yeah. I can't answer that to say that there was. Concrete knowledge I think I think there was personally but I can't say that there was going. Are you asking if I departed because of my knowledge to that I just try to use their possibility that that could happen to you and did you know about this ma'am about this these purchases that were below I did not know about specific companies because that wasn't a part of my job description necessarily and I was not in a management position but yes I had knowledge of those things and so that was a my departure absolutely played a role granted I chose my departure but it did play a role in everything that was taking place including knowing that there were unethical practices happening okay limited is the problem that that you had. Do you think that it with the broadcasting company do you think that that was about the term shoes or do you think it was a combination of that and the purchases below twenty thousand dollars. I would say that the purchases. Representative springer you recognize me thank you sir what okay thank you all again for being here and the since we're going over this finding that some page seven related to these times sheets or is it you all either one of your testimony here today that one or more of the individuals who are that a representing attention you have personal knowledge that they asked that this be done is that with personal knowledge. I was one of those that was asked by someone who is here from the agency in anybody else anyone else here that yes ma'am I have several employees that came to me with the same wonder i'm saying do you have a person not not about do this one at the individuals here today come to you personally and ask you to the snap about your not about here saying not about to some when it came to tear you there but do you have personal knowledge about the testimony respect to this there that's my question that asked me if I knew about the changes that you are personally aware about the changes that's what it may estimate. The date that one of these individuals asked you to sign off over on the time she that you knew that was not correct this my question I have been asked to approve time in the system before nope my question is that one of the persons here today as either one of you to at a change of a determined she that you knew was not correct that's my question so that that's that's your test of one or more of the person through today s yes okay thank you that's what I wanted to know i'm sorry I didn't know I wouldn't understand what you're saying. Members. I have no one in the queue. Do any of you have any questions of any witnesses that have appeared here today. Seeing none you are excuse. And members this initial report will be considered as non president due to representative war laws motion. With that i'd like to see a couple things before I gavel us out. I'd like to compliment. So we have one more report okay. In them we do have one more report. Then were there will move on to that. That is on saver security. Thank you mister chair. Arkansas code requires legislative audit to compile and submit to the general assembly and annual most of all cyber security incidents is reported to us by public unities. Prior to the passage of act two sixty of the twenty twenty one regular session. There were there was no requirement for public unities and arkansas to report cyber security incidents the general assembly recognized the need to collect information in a valuate incidences so that pro active measures could be taken to prevent disruption of government operations for the purpose of this report the term public unity refers generically to organizations at all levels of arkansas government. And a cyber security incident is any event that compromises the security confidentiality or integrity of an initiatives information systems applications data or network. During the regular session of twenty twenty three the arkansas general assembly enacted two notable cyber security laws. First act eight forty six authorized the formation of the arkansas cyber response board. Which overseas the arkansas self funded cyber response program and a phones cyber security criteria for which participating initiatives must adhere. Second act five o four mandate that public energies develop policies pertaining to the authorized use of technology technological resources and addressing cyber security concerns. Between you are warned 2022 and june thirtieth of this year one hundred and thirty cyber security incidences were reported by seventy five public initiatives at all levels of state government. A complete list of these incidents is provided in appendix c of the report. Additionally examined one on page two and on the slide provides a summary of incident is by tight for the current review period and for the period covered in the prior report. Are these one hundred and thirty incidents as reported seventy three have been resolved and fifty seven remained under investigation. Two incidents were considered especially significant. One incident with a single rant and where attack against a vendor serving officers in seventy two counties in the state. This attack halted most operations in those offices from multiple days with some of us is remaining offlined for weeks and for a few minutes. The other incident involved a large school district that experienced ransom where attacks against its computer network. This attack halted the districts ability to connect to its accounting and student management applications. Driver security threats facing arkansas public unities are continuously involving an increasing in numbers. As a result it is imperative that the state continue its proactive approach to cyber security. Recognizing that cyber security incidence is well inevitably occur preparation is key to minimizing interruptions protecting sensitive information and maintaining public and employee confident and the safety and security of government networks. This concludes my presentation I would be happy to answer any questions from the. Search paid your recognizer thank you mr chair my question is on page three when stung at the first diverse security incident. It says a. Near the hand of the second chapter they're paragraph I mean it says. While no rants and was reportedly paid. So the way you qualify that with reportedly i'm i'm just. Do we suspect there was rating paid or not so this was a private vendor a private business for the site of arkansas and. We were told that there was no ransom pay so nothing was reported to and they they being a private business for the state. Or I under no obligation. Okay so i'm in basically you got you put in there and kind of qualified it not because you had any suspicion but just because you didn't have a way verifying that's correct yes okay so then on the next paragraph there when it's tom at the second instance. It says the district contracted with the cyber security firm. This. So they this wasn't. This was the. Ransom where did they have to pay anything other than just the contract with the. Saver security form or was yes rant and where was in this and the second incident okay thank you thank you mister chair. Sent a bright you recognize your thank you mister chair and looking at these reports and in. Going back through the wall did we look at any of the administrative office of the courts. Or any court jesus system through the county at the circuit level or the district through the city level. So when when they're reported to as we reach out to. To the end of reporting unity in depending on the circumstances in the actual issue involved we we do go and look at some of that information now we do on a as just a course of action work at court systems through our normal audit process we stay pretty close to the administrative office of the court to. And anything that's reported we we have pretty were good working knowledge of it so I don't know if that answers your question but that's that's one. Members are there in the questions. The. See none thank you mister call the and in emotion I have emotion. And I need a circuit have a second all of favorites the I in the opposed. This has been reviewed. Members of the business the next meetings of the legislative joint audit committee will be helped thursday the december the seventh for a horror day and friday december the eighth twenty twenty three. Is there any new business to be brought forward. Yeah. See none I have just a few things to say. I want to just congratulate and thank our audit team for an announced standing job of what they do on this audit in own the artists they've always done. This german sitting beside me has nearly five decades of being with our audit agency. They are non partisan they have served under. Both republican in democrat lead the legislative branches. And we have a lot of questions that was ask of them today. And they're luckily par. They call the strikes they call the balls as they see them. The. If we try to influence the article staff. If we tread it. Change. The man on way they called the balls and strikes. That's like going out slippery path but I just want to think. Our professionals for the great job they are doing and that they did on this report. And with that thank you all for being here.