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Montana Secretary of State Corey Stapleton

Montana Secretary of State Corey Stapleton testifies before the State Administration and Veteran Affairs Committee at the State Capitol in this IR file photo.

The report from the Legislative Audit Division found that Secretary of State Corey Stapleton commuted with a vehicle leased from the state to Helena from a residence "over 200 miles away" for at least 69 days.

The report does not name Stapleton specifically, but refers to "an office employee required by law to maintain a residence in Helena." Stapleton is the only person in the office required to live in Helena, as laid out in the state Constitution. He was living in Billings before his 2016 election to secretary of state.

State law prohibits an employee from using a state-owned vehicle to commute from a residence to a work site, with some exceptions. The audit shows the Secretary of State's office did not provide documentation that use of the vehicle, a "large pickup truck," met any of the exemptions.

For the period from Jan. 1, 2017, to June 30, 2018, the pickup was used to commute between Stapleton's residence at least 69 days, for a cost of at least $5,722 and about 27,000 excess miles on the vehicle, according to the audit.

Other documentation shows the vehicle was used for commuting purposes at least 47 days in fiscal year 2018 and 22 days in fiscal year 2017, mostly on the weekends, according to the report. 

Overall, the report shows the vehicle was used for business purposes about 71 days out of the 546-day lease. There were 406 days where the reasons for the use of the vehicle could not be determined, according to the report. The cost of the lease for that time was $3,158.

The lease ended April 1 after the Secretary of State's office was notified that its use of the vehicle did not comply with state law. Auditors also made a referral to the Attorney General's office. The audit says a state officer or employee violating the restrictions on state vehicle use is a misdemeanor.

Total cost for the vehicle over the audit period was $12,743.

The Secretary of State's office wrote to auditors that it felt using Stapleton's non-Helena home as a telework site "offered significant benefits to the state," according to the audit. The reasons cited were reducing mileage and wear and tear on the vehicle by using remote work sites while traveling throughout the state on office business.

The audit points out this is still contrary to state law.

The Secretary of State's office said Tuesday it was not able to comment on the audit.

"The Legislative Audit Division asked us to limit our comments on their report until the committee meets next week," said Julie Lake, chief operations officer, in an email. "To reiterate our response to them: We received approval for the intended use of the vehicle, we do have proper controls in place to ensure compliant relationships, and we revised our internal control plan regarding federal HAVA (Help America Vote Act) money."

John Barnes, a spokesman for the attorney general, said Tuesday the office is reviewing the audit report.

The Legislative Audit Committee meets June 25-26 in Helena. Lake's response refers to other issues found in the audit.

In a response to the audit, Stapleton wrote in a letter that "successfully managing 'windshield time' requires skill and coordination of scheduling and teleconferencing."

Stapleton continued that in the office's outreach to the "220,000 businesses, 56 county election offices and 700,000 registered voters in Montana," the "most productive and efficient use of state resources for achieving these goals is the combination of outreach and telework."

The letter also says the office "sought and was granted permission from the governor's budget director for a long-term motor pool vehicle lease to support agency missions."

On Tuesday the governor's budget director said the Secretary of State's office requested and received verbal approval for a long-term motor pool lease, to be used in accordance with state law.

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Leases like that are fairly common, and each agreement prohibits use that does not comply with state law, said budget director Tom Livers.

Last fall, the budget office "became aware in a meeting with staff from the Secretary of State that actual usage of the vehicle may not comply with state policy and law," Livers said.

At that point, the budget office communicated with the Secretary of State to clarify vehicles could only be used if state law was followed and provided a copy of the state's travel policy.

The budget office also directed the state motor pool to deny any new requests to replace the vehicle that was in use at that time.

"As an independent elected official, it is the Secretary of State's responsibility to ensure his office is in compliance with state policy and laws," Livers said.

The audit found other issues within the office, including relationships between three office employees related through birth or marriage. Two of the employees were in a supervisor-supervisee relationship, according to the audit. That existed a little more than a month, when the office changed the supervisor after auditors raised questions.

The office did not concur with the audit's recommendation to enhance internal controls to identity relationships and ensure proper segregation of duties are implemented.

The office said it already had "key controls in place to ensure relationships within the office are identified and proper segregation of duties/supervision exist."

Additionally, the audit found issues with how the office recorded $3 million in an 2018 Help America Vote Act elections security grant. The audit found the office incorrectly recorded a revenue estimate in its enterprise fiscal fund of $3 million in the 2018 fiscal year. Since it is federal funding, however, the estimate should have been recorded in a federal special revenue fund.

The office received and deposited the federal funds during the 2018 fiscal year, but did not spend them. State accounting policy requires that to be recorded as unearned revenue, but it was not done that way by the Secretary of State's office. The office said it concurred with the auditor's finding in this area and said it would review polices to correct the error in the future and correct the budget misstatement.

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