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Questions over coding error linger

Press Photo by Lisa Call Pam Sharp, director of the North Dakota Office of Management and Budget, right, discusses a coding error that may affect immediate funding for renovations to Dickinson State University's Stoxen Library, while Sen. Rich Wardner, R-Dickinson, looks on during a Feb. 10 press conference at DSU.

After a coding error by the state treasurer's office left renovations to Dickinson State University's Stoxen Library hanging in limbo, state democrats questioned budget management during a Bismarck press conference held Tuesday.

In the last legislative session, about $9 million was appropriated for renovations to the library, provided revenue collections were $25 million ahead of forecast by Dec. 31.

That "trigger" was met on Dec. 31, but erroneously.

A federal fund electronic deposit came into the treasurer's office where the money was miscoded with a three digit number by hand on Dec. 31, sending $12 million to a mineral deposit account and $1.2 million to a flood account and it should have been reversed, State Treasurer Kelly Schmidt said.

On Jan. 7, the coding error was discovered and corrected the same day, she said.

Despite the correction, state officials announced DSU's qualification for the funding on Jan. 13.

Gov. John Hoeven and several other state officials held a press conference at DSU on Feb. 10 announcing the coding error and its possible impact on immediate funding.

Pam Sharp, director of the state Office of Management and Budget, said her office does not receive accounting reports until the first of each month so she would not have known about the correction until the first part of February.

"The only way we could have known that they (treasurer's office) made that adjustment is if they would have told us otherwise we'd have to go and look at their source documentation, which we don't do," Sharp said Thursday.

At Tuesday's Bismarck press conference, democrats questioned timelines and why the funding announcement was still made after the coding error was corrected.

"We do corrections for every agency in state government so it is not uncommon for us to make a correction," Schmidt said. "There would be no reason for us to pick up the phone and call them. It's not part of the policy."

There was no reason the treasurer's office would have known a Dec. 31 trigger was in place, said Sheila Peterson, OMB's deputy director.

"Obviously we have a general fund budget that exceeds $3 billion and so in any given month there are going to be adjustments that need to be made and so I don't think it would normally have been that the treasurer would call us on every single adjustment they make," she said.

Rep. Frank Wald, R-Dickinson, who was a proponent in securing funding for renovations to the library, said there is no question that a coding error should have been communicated to the OMB.

Another area official feels a notification about a $12 million change was necessary.

"These things just shouldn't happen, I mean we're talking a $12 million error here," said Rep. Shirley Meyer, D-Dickinson, who served on the 2009 Government Operations Division of a standing committee for House Appropriations. "We may have bigger issues out there. These coding issues have been going on and on and on."

In the 2007-2008 legislative interim, the state auditor's office conducted an operational audit on the state treasurer, cited a document prepared by the North Dakota Legislative Council staff for House Appropriations committee, dated Jan. 13, 2009.