California’s Employment Development Department (EDD) has come under scrutiny following a state audit that revealed significant waste in spending. The audit disclosed that the agency has expended approximately $4.6 million on cellphone bills for devices that largely went unused.
Unused Cellphones Costing Millions
The findings of the audit indicate that the EDD maintained cellphones and wireless hotspots without verifying their utilization for over four years. This issue emerged during the COVID-19 pandemic when the department acquired 7,224 devices to support remote work for its employees.
Audit Findings
- Half of the acquired devices had seen no usage for at least two years.
- Approximately 25% were inactive for three years.
- 99 devices were never used at all.
State auditors traced 54 months of billing invoices and pinpointed 6,285 devices that had not been used for four consecutive months. Initially, the agency had around 2,000 more cellphones than its call center workforce. This disparity increased as staffing levels returned to pre-pandemic norms.
Staffing vs. Equipment Discrepancy
As of April 2023, the EDD employed 1,787 call center staff but was still maintaining service plans for 5,097 mobile devices. The audit highlighted the disconnect, emphasizing the need for better asset management.
Management’s Response
EDD officials claimed ignorance regarding the excessive spending, despite regular invoices from Verizon outlining the usage patterns. The audit underscored that EDD management should have reviewed the necessity of keeping active service plans for the devices with no recorded usage.
Steps Toward Improvement
In response to the audit’s recommendations, the EDD took immediate action in April by canceling service plans for 2,825 devices. Furthermore, the agency has instituted a policy to terminate service for devices that remain unused for 90 days.
Implications and Further Findings
The California state auditor included the EDD’s misuse of mobile devices in a broader report concerning improper activities within state agencies. The audit also uncovered an unrelated incident involving the California Air Resources Board, which overpaid an employee on extended leave by $171,000 as he neared retirement.
This situation underscores the necessity for diligent monitoring and management of state resources to prevent further waste. The EDD is now tasked with implementing strategies to ensure that taxpayer funds are used effectively moving forward.
