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State auditor is asked to look into employee overpayments

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Lawmakers seeking to rein in salary overpayments to public workers are asking the state auditor to look into department practices that can give employees excessive amounts of nonbase compensation, such as overtime and unpaid leave.

A special Senate committee formed to review employee compensation amid reports of overpayments and so-called "pension spiking" advanced a resolution Tuesday seeking audits of various state agencies and operations.

State Auditor Marion Higa is asked to review, among other issues, the use of overtime pay, excessive use of sick leave and other forms of compensation, such as compensatory time, which may contribute to increased payments to employees and inflate pension payments.

The resolution also asks the auditor to investigate patterns of abuse and look for any specific instances of spiking — a practice in which employees earn substantially more than their base pay near the end of their careers to boost future retirement pay.

Additionally, the auditor is asked to examine the extent to which state employees have been overpaid, how much has been repaid, what is being done to collect the overpayment and how much is written off as uncollectable.

Most of the overpayments stemmed from poor record-keeping of leave time that resulted in workers getting more than they were due, or when an employee left the job. The state is trying to collect about $1.5 million in overpayments, some of it dating back to 1984.

Sen. Donna Mercado Kim, chairwoman of the Senate Special Committee on Accountability, put departments on notice that the Legislature would seek to follow up on the audits next year to gauge efforts by agencies to get a better handle on overpayments.

"I believe this puts it on the front burner, but it’s imperative that we stay on top of them to keep it there," Kim (D, Kalihi Valley-Halawa) said. "Like anything, after a while things go back to the way it was, and they forget about it."

Some officials have said an antiquated, paper-based system made record-keeping more difficult, and that improvements are expected to come as part of Gov. Neil Abercrombie’s plan to upgrade the state’s information technology system. Officials pledged to work with the Legislature and the attorney general’s office to clear inconsistencies and attempt to correct problems.

"The big takeaway is I think that all of my colleagues and myself are pretty shocked that certain practices have gone on for decades and nobody has really addressed the problems," said Sen. Sam Slom (R, Diamond Head-Hawaii Kai), a committee member. "It’s not a partisan issue; it’s a bipartisan issue and it’s taxpayer money.

"Obviously, there have not been oversight procedures in place. They have to do it now, but they should have done it before."

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