Historic Announcement– California’s Books Are Open – 201,000 Vendors Received $87 Billion In State Payments

Is the spending in the public interest, or the special interest?

With California government now running a $100 billion surplus, citizens might like to know where the politicians are stashing their cash. Now you can. As long as you have access to the internet, for the first time in history, you can track state spending down to individual vendors.

Be prepared, though, because the results aren't pretty.

Our auditors at OpenTheBooks.com just posted the line-by-line payments to 201,684 state vendors who received nearly $87.2 billion during fiscal year 2021.

We accomplished what the governor, controller, attorney general, lawmakers, a Superior Court judge, and state bureaucrats refused to do. We opened the books on California’s line-by-line state expenditures.

It was an historic knockdown, drag out, dogfight that lasted a decade and spanned the last two California controllers. Since 2005, the state invested $1.1 billion in accounting software, yet still couldn’t publish a complete record of state spending.

In January 2020, we sued Controller Betty Yee in a Sacramento Superior Court after her office rejected our sunshine request for state spending. Yee claimed that she “couldn’t locate” any of the nearly 50 million bills she paid in 2019.

California was the final holdout on state checkbook transparency. Forty nine of the 50 states, the U.S. federal government, and 15,000 municipalities produce their line-by-line spending in response to our request.

Incredibly, in a January 2022 ruling, Judge Steven M. Gevercer agreed with another argument advanced by the controller – the California checkbook data was of limited public value and the burden on the controller to release even a single transaction outweighed the public interest. So, we got nothing.

We vehemently disagreed with the ruling. We believe state expenditures are the most important public record, because it allows citizens to follow the money.

Therefore, we shifted to plan B and filed 442 California Public Record Act requests with each state agency. Most agencies complied. Only 25 junior colleges, the University of California at Irvine, and the Board of Regents refused to acknowledge our requests (see chart below).

Now, finally, the books are open. We’ve posted nearly every dime, online, in real time for the disclosed fiscal year 2021 state expenditures.

Here are just three tidbits we tracked down after searching state spending:

• Buying Clout?: Governor Gavin Newsom’s wife founded a public charity (The Representation Project) and some of her biggest donors are those with near monopoly marketplace power in the fields of utilities, telecom, and healthcare. Companies include AT&T, Comcast, Kaiser Permanente, and Planned Parenthood.

• Wealthy Foundations: The George Soros funded Tides Center, with $126 million in net assets, received nearly $4 million which included $50,000 to its sister organization Tides Advocacy, a 501(c)4 organization, that wants to defund the police and supports organizations “doing critical work against state terror.” The San Francisco AIDS Foundation, with $30 million in net assets, received $802,861 in payments mostly from the Department of Public Health. Recently, the organization released a guide to having “a fun and filthy weekend— free of anxiety” for an annual “kink and fetish festival” called “Dore Alley.”

• Lawyers: Why are some of the most prominent law firms in the state receiving millions of dollars in state payments? The California Department of Justice headed by the California Attorney General employed 1,100 lawyers and an additional 3,700 employees. Yet, Munger, Tolles & Olson LLP received $3.4 million; Loeb & Loeb LLP received $2.8 million; Musick Peeler received $1.7 million; and Reed Smith LLP received $1.6 million.

Gov. Newsom seems to champion environmentalism recently signing a bill regulating “harmful plastics pollution to protect communities.”

Yet state agencies contracted with Coca-Cola for $769,794, PepsiCo for $1.1 million, and Nestle received $1.6 million with $1.4 million going to their bottled water division. According to a report released last year from environmental group Break Free From Plastic, Coca-Cola and PepsiCo are the top one and two worldwide plastic polluters and Nestle ranked fourth.

There are thousands more stories just waiting to be told and you can start your search here.

The state expenditure data doesn’t include payment descriptions. So there’s still transparency work to do. For example, we had to reach out to The Bill and Melinda Gates Foundation – with an endowment of $49.9 billion, to find out why they received state funds. $436,336 in grant reimbursement payments from the University of California, Berkeley followed a research project to a different institution and nearly $20,000 in unused scholarship funds earmarked for minority students were reimbursed to the Gates Millennium Scholars program.

Over the last decade, the California Controller tested our will and wallet. However, this wasn’t our first rodeo. In 2012, we sued Illinois and opened seven years of state spending. In 2018, we sued Wyoming and opened six years. We knew that we would eventually force open the books in California as well.

Transparency is the foundation of smart government because it answers key questions in public policy: "How much does government really cost?" and "Are there indications of waste, fraud or corruption?" If the citizenry does not know the impact government has on their lives, it has no ability to exercise its right of oversight.

If you come to OpenTheBooks.com what will you find in your town or across the state?

With tens of billions of dollars in state contracts, grants, awards, reimbursements and payments, it's nearly certain you'll find a local business, citizen, politician, or organization receiving a piece of the state spending pie.

As you review all of the spending, keep our late honorary board chairman, former U.S. Senator, Dr. Tom Coburn's question to taxpayers in mind: Is the spending in the public interest, or the special interest?

After all, it's your money.

Adam Andrzejewski is the founder of the transparency organization OpenTheBooks.com.

Note: The companies funding the governor’s wife’s charity, the foundations, and the lawyers mentioned in the piece received a comment request and none responded by the publication deadline.

ADDITIONAL READING:
California’s Accounting System Cost $1.1 Billion And Still Can’t Produce A State Checkbook | Forbes | December 12, 2019

California Is The Only State To Hide Its Spending | Forbes | December 7, 2021

California Wants To Keep $300 Billion In Spending A Secret | Editorial, Orange County Register | May 2, 2022

ABOUT US:
OpenTheBooks.com – We believe transparency is transformational. Using forensic auditing and open records, we hold government accountable. In 2021, we filed 47,000 FOIA requests and successfully captured $12 trillion government expenditures: federal spending; 50 state checkbooks; and 25 million public employee salary and pension records from 50,000 public bodies across America. Our works have been featured on the BBC, Good Morning America, ABC World News Tonight, The Wall Street Journal, USA Today, Chicago Tribune, The New York Times, NBC News, FOX News, Forbes, National Public Radio (NPR), & many others.

Our organization accepts no taxpayer funding and was founded by CEO Adam Andrzejewski. Our federal oversight work was cited twice in the President's Budget To Congress FY2021. Andrzejewski's presentation, The Depth of the Swamp, at the Hillsdale College National Leadership Seminar 2020 in Naples, Florida posted on YouTube received 3.8+ million views.