A performance audit of the Department of Economic Security ex-offender program

              STATE OF ARIZONA
OFFICE OF THE
AUDITOR GENERAL
A PERFORMANCE AUDIT
OF THE
DEPARTMENT OF ECONOMIC SECURITY
EX- OFFENDER PROGRAM
FEBRUARY 1981
A REPORT TO THE
ARIZONA STATE LEGISLATURE
REPORT 81 - 1
DOUGLAS R. NORTON. CPA
AUDITOR GENERAL
STATE OF ARIZONA
OFFICE OF THE
AUDITOR GENERAL
January 30, 1981
Members of the Arizona L e g i s l a t u r e
The Honorable Bruce Babbitt, Governor
M r . William S. Jamieson, Jr., Director
Department of Economic S e c u r i t y
Transmitted herewith is a r e p o r t o f t h e Auditor General, A Performance
Audit of the Department of Economic S e c u r i t y , Ex- Offender Program. This
report is i n response t o the August 27, 1980, r e s o l u t i o n of the J o i n t
L e g i s l a t i v e Budget Committee.
The blue pages present a summary of t h e r e p o r t ; a response from the
Department of Economic S e c u r i t y is found on the yellow pages preceding the
appendices.
My'staff and I w i l l be pleased to discuss or c l a r i f y items i n the r e p o r t .
Respectfully submitted,
Douglas R. Norton
Auditor General
S t a f f : Gerald A. Silva
Peter Francis
Enclosure
LEGISLATIVE SERVICES WING SUITE 200 STATE CAPITOL PHOENIX. ARIZONA 85007 255- 4385
O F F I C E OF THE AUDITOR GENERAL
A PERFORI'MITCE AUDIT OF THE
DEPARTMENT OF ECONOMIC SECURITY
EX- OFFENDER PROGRAM
A REPORT TO THE
ARIZONA STATE LEGISLATURE
REPORT 81- 1
TABLE OF CONTENTS
Page
SUMMARY
INTRODUCTION AND BACKGROUND
FINDINGS
FINDING I
Job placements claimed by the Department of Economic
Security Ex- Offender Program have been overstated and
i n some cases c o n s t i t u t e fraud.
CONCLUSION
RECOMMENDATIONS
Improvements a r e needed i n Department of Economic
Security record- keeping and job placement-v
a l i d a t i o n procedures.
CONCLUSION
OTHER PERTINENT INFORMATION
WRITTEN RESPONSE TO THE AUDITOR GENERAL'S REPORT
APPENDICES
APPENDIX I - DES Operating Manual: Purpose and O b j e c t i v e s o f
the Ex- Offender Program
APPENDIX I1 - Department of Economic S e c u r i t y memorandum of
November 3, 1980, regarding job placement
standards and c r i t e r i a , and Auditor General
response
APPENDIX I11 - Excerpts from DES Operating Manual: Standards
Regarding Job Placements
APPENDIX I V - Department of Economic S e c u r i t y memorandum of
September 16, 1980, regarding standards f o r
placement t r a n s a c t i o n s
APPENDIX V - Employer survey and responses
SUMMARY
The Office of the Auditor General has completed a performance a u d i t of the
Department of Economic S e c u r i t y ( DES) Ex- Of fender Program i n accordance
with a J o i n t L e g i s l a t i v e Budget Committee r e s o l u t i o n . T h i s a u d i t , which
focuses primarily on the v a l i d i t y of job placements claimed by the
Program, was conducted i n cooperation with the Department of Economic
S e c u r i t y , O f f i c e o f S p e c i a l I n v e s t i g a t i o n s ( OSI).
Auditor General s t a f f a s s i s t e d DES i n v e s t i g a t o r s i n drawing sample cases
f o r i n v e s t i g a t i o n , accompanied DES i n v e s t i g a t o r s on s e l e c t e d interviews
with employers and ex- offender c l i e n t s , and reviewed and t e s t e d
i n v e s t i g a t i v e records and conclusions f o r adequacy and accuracy. I n our
opinion, DES procedures were s u f f i c i e n t , and its conclusions reasonable
and supportable.
Our review of the DES i n v e s t i g a t i o n of claimed Ex- Offender Program job
placements revealed t h a t 26 percent of the claimed placements were i n v a l i d
and half of the i n v a l i d placements appear to be fraudulent. I n a d d i t i o n ,
51 percent of the v a l i d placements i d e n t i f i e d by OSI were f o r l e s s than 60
days' employment and may not q u a l i f y a s a successful placement. Past DES
a d m i n i s t r a t o r s have not only known of t h e s e r e p o r t i n g i m p r o p r i e t i e s but,
i n some cases, encouraged them.
During the course of the Department of Economic S e c u r i t y i n v e s t i g a t i o n and
throughout our a u d i t , d e f i c i e n c i e s i n record keeping were noted which
hindered v e r i f i c a t i o n of job placements. Ex- Offender s t a f f contacts with
employers were poorly documented, and many c l i e n t c o n t a c t r e c o r d s were
i n s u f f i c i e n t t o determine what s p e c i f i c a c t i o n had been taken on behalf of
c l i e n t s . I n a d d i t i o n , important information r e l a t e d t o stipends issued t o
c l i e n t s was missing from the records. F i n a l l y , DES has conducted periodic
s t u d i e s t e s t i n g t h e v a l i d i t y of Ex- Offender Program and Job Service
Program placements, b u t t h e v a l i d a t i o n s t u d i e s have f a i l e d t o discover
serious problems i n the Ex- Offender Prograrn because procedures used to
v e r i f y placements d i d n o t s o l i c i t s u f f i c i e n t information.
It is recommended that:
The Legislature evaluate the need for continuing the Ex- Offender Program
in view of information recently developed by DES- OSI.
If the Ex- Offender Program is to be continued:
1. Only placements actually made by Ex- Offender workers be reported
and counted as valid job placements.
2. Supervision of workers be improved to ensure conformity with
operating standards and accuracy of reporting.
3. New operating manual provisions which clarify differences between
jobs found by clients and job placements made by the Ex- Offender
Program be adopted and enforced.
It is also recommended that:
Documentation of employer contacts and the purposes of stipends be
improved.
Future validation studies include sufficient employer and client contact
to determine the validity of claimed job placements.
INTRODUCTION AND BACKGROUND
On August 27, 1980, the J o i n t L e g i s l a t i v e Budget Committee requested the
Office of the Auditor General, pursuant t o Arizona Revised S t a t u t e s
( A. R. s.) $ 41- 1279, t o conduct a performance a u d i t of the Department of
Economic S e c u r i t y ' s Ex- Offender Program.
The Ex- Offender Program was e s t a b l i s h e d i n 1971 to a s s i s t offenders f i n d
and maintain employment following r e l e a s e from prison. Although i n i t i a l l y
Federally funded as a demonstration p r o j e c t , t h e Program was taken over
and funded by the S t a t e i n 1973.
The Ex- Offender Program provides employability development and
comprehensive manpower s e r v i c e s to prison irnmates and ex- offenders t o
f a c i l i t a t e an orderly r e t u r n t o meaningful employment and, thereby, reduce
recidivism. The Program provides p r e r e l e a s e s e r v i c e s , which include
counseling and vocational information and guidance. Assistance provided
a f t e r r e l e a s e includes i n d i v i d u a l , group and family counseling; r e f e r r a l
t o t r a i n i n g programs and community s e r v i c e s ; job development and
placement; and f i n a n c i a l support ( s t i p e n d s ) f o r s p e c i f i c c l i e n t needs.*
Expenditures f o r the Ex- Offender Program have grown from $ 330,900 i n
f i s c a l year 1976- 77 t o an estimated $ 551,200 i n f i s c a l year 1980- 81.
Staffing a l l o c a t e d t o the Program during t h i s period has increased from
19.0 to 22.5 f u l l - t i m e equivalent ( FTE) p o s i t i o n s . Ex- offender s t a f f
members c u r r e n t l y a r e located i n a l l s i x Department of Economic S e c u r i t y
( DES) D i s t r i c t s and at the S t a t e Prison i n Florence.
* For a more d e t a i l e d d e s c r i p t i o n of the purpose and o b j e c t i v e s of the
Ex- Offender Program, see Appendix I.
During f i s c a l year 1979- 80, DES reported r e g i s t e r i n g 1,970 new a p p l i c a n t s
i n the Ex- Offender Program, placing an estimated 1,022 Program c l i e n t s
i n t o full- time employment and i s s u i n g 1,025 s t i p e n d s , averaging $ 68 each.
During f i s c a l year 1980- 81, DES estimates t h a t 1,800 c l i e n t s enrolled f o r
services w i l l be placed i n 1,100 permanent jobs and w i l l receive 715
s t i p e n d s , averaging $ 111 each.
Audit Scope and Approach
The scope of our a u d i t d e a l t primarily with the v a l i d i t y of job placements
claimed by the Ex- Offender Program. Additional information r e l a t e d to
e f f e c t i v e n e s s of the Program, however, was obtained and reviewed. This
information included types of jobs, average hourly pay, duration of
employment and use of s t i p e n d s . In a d d i t i o n , a survey w a s conducted t o
s o l i c i t employer opinions of the Program and suggestions f o r improvement.
Our a u d i t findings regarding the v a l i d i t y of job placement a r e based
p a r t l y on the r e s u l t s of a s p e c i a l DES Office of S p e c i a l I n v e s t i g a t i o n s
( OSI) i n t e r n a l i n v e s t i g a t i o n conducted simultaneously with o u r a u d i t . To
avoid d u p l i c a t i o n of e f f o r t , we monitored the procedures and progress of
the DES i n v e s t i g a t i o n . Our a u d i t s t a f f a s s i s t e d DES i n developing a
sample of cases f o r i n v e s t i g a t i o n , accompanied DES i n v e s t i g a t o r s on
selected interviews with employers and ex- offender c l i e n t s , reviewed case
f i l e s and t e s t e d the r e s u l t s of the DES i n v e s t i g a t i o n f o r accuracy. In
our opinion, the r e s u l t s reported by DES a r e s u b s t a n t i a l l y accurate."
A s a follow up t o the Ex- Offender i n v e s t i g a t i o n , DES is conducting a
s i m i l a r review of the e n t i r e Federally funded Job Service Program. It i s
a l s o conducting an i n t e r n a l a u d i t of the Ex- Offender stipend fund.
We thank the Director of DES and h i s s t a f f f o r t h e i r e x c e l l e n t cooperation
and a s s i s t a n c e during our a u d i t .
" DES c u r r e n t l y is attempting t o r e s o l v e q u e s t i o n a b l e cases by
contacting the caseworkers involved. A s a r e s u l t , new information may
be developed which may impact on DES conclusions i n a few cases.
FINDING I
JOB PLACEMENTS CLAIMED BY THE DEPARTMENT OF ECONOPIIC SECURITY EX- OFFENDER
PROGRAM HAVE BEEN OVERSTATED AND I N SOME CASES CONSTITUTE FRAUD.
Our review of a Department of Economic Security ( DES), Office of Special
I n v e s t i g a t i o n s ( OSI) i n v e s t i g a t i o n of claimed Ex- Offender Program job
placements revealed t h a t a t l e a s t 26 percent of the claimed placements
were i n v a l i d and h a l f of the i n v a l i d placements appear t o be fraudulent.
In a d d i t i o n , 51 percent of t h e v a l i d placements i d e n t i f i e d by OSI were f o r
l e s s than 60 days' employment and may not q u a l i f y a s a successful
placement. Past DES a d m i n i s t r a t o r s have not only known of t h e s e r e p o r t i n g
improprieties but, i n some cases, encouraged them.
Sampling Method and Procedures
Job placements claimed by the Ex- Offender Program a r e reported on the
Employment Security Automated Reporting System ( ESARS), the DES Job
Service Information System, which maintains a record of employer job
orders ( job openings), c l i e n t r e f e r r a l s t o employment and job placements.
From the ESARS system, DES drew a s t a t i s t i c a l sample of the 1,062 job
placements reported by the Ex- Offender Program f o r the period October 1,
1979, through August 31, 1980. The number of job placements sampled was
284, which represented 26.7 percent of a l l job placements reported f o r the
period and which provided a confidence l e v e l of 95 percent and p r e c i s i o n
of -+ one percent." Audit s t a f f a s s i s t e d DES by e s t a b l i s h i n g the sample
s i z e and providing a list of random numbers which was used t o s e l e c t the
job placements sampled.
" Sample r e s u l t s adjusted the p r e c i s i o n t o approximately -+ 4 percent due
t o the high incidence of i n v a l i d placements.
A l l 284 sampled placement t r a n s a c t i o n s were i n v e s t i g a t e d by DES. Case
f i l e s were reviewed and personal interviews were conducted with employers
and ex- offender c l i e n t s t o determine i f a c l i e n t ' s job was, i n f a c t ,
obtained through the e f f o r t s of the Ex- Offender Program. Auditor General
s t a f f accompanied DES i n v e s t i g a t o r s on s e v e r a l of the interviews and
t e s t e d t h e accuracy of DES conclusions by reviewing the f i l e s and
conclusions f o r 25 randomly s e l e c t e d cases. Procedures used by DES
i n v e s t i g a t o r s on the cases reviewed appear t o be s u f f i c i e n t and t h e i r
conclusions reasonable and supportable.
What c o n s t i t u t e d a v a l i d ex- offender placement proved to be a confusing
and c o n t r o v e r s i a l i s s u e throughout the audit.* For example, according to
the DES operating manual provisions i n e f f e c t f o r the sample period,** the
Ex- Offender Program may take c r e d i t - only f o r jobs its c l i e n t s obtain
d i r e c t l y through the Program. However, according t o a DES a d m i n i s t r a t i v e
memo dated September 16, 1980,*** the Ex- Offender Program may a l s o take
c r e d i t f o r jobs t h a t Program c l i e n t s obtain on t h e i r own or through other
agencies, provided t h a t : 1) the Ex- Offender Program contributed t o the
job entry by providing bonding s e r v i c e s , t o o l s , c l o t h i n g , f i n a n c i a l a i d or
o t h e r s e r v i c e s , and 2) t h e r e is documentation t h a t Ex- Offender s t a f f
contacted the prospective employer p r i o r t o r e f e r r a l . Table 1 summarizes
r e s u l t s of the DES review of 284 Ex- Offender Program claimed placements
using the September 16, 1980, a d m i n i s t r a t i v e memorandum's d e f i n i t i o n of a
placement.
* See Appendix I1 f o r correspondence r e l a t e d to placement c r i t e r i a .
** See Appendix 111.
*** See Appendix I V f o r a copy of t h i s memorandum.
TABLE 1
SUMMARY OF DES INVESTIGATION OF HOW
EX- OFFENDER PROGRAM CLIENTS FOUND THEIR JOBS*
D i s t r i c t I D i s t r i c t I1 A l l Other S t a t e
( phoenix) ( T'ucson) D i s t r i c t s Total
N= 164 N= 77 N= 43 N= 284
Obtained Through Ex- Of fender
Program
Not Obtained Through Ex- Offender
Program
On own
Through Department of
Corrections
Through other sources
No record of employment
Unable to Determine
As shown i n Table 1, 51 percent of the placements claimed by the
Ex- Offender Program were found t o be v a l i d Ex- Offender job placements. I n
26 percent of the cases, however, job placements claimed were i n v a l i d i n
t h a t c l i e n t s e i t h e r found t h e i r jobs on t h e i r own, through the Department
of Corrections, through other sources or t h e r e was no record t h a t the
c l i e n t was a c t u a l l y employed. I n 23 p e r c e n t o f the cases, DES
i n v e s t i g a t o r s could make no determination because of i n s u f f i c i e n t or
c o n f l i c t i n g information. P r o j e c t i n g t h e r e s u l t s of Table 1 t o the 1,062
job placements claimed by the Program between October 1, 1979, and
August 31, 1980, it can be s t a t e d with 95 percent confidence t h a t 230 t o
327 of the claimed Ex- Offender job placements a r e invalid.**
* Rased on the d e f i n i t i o n of a placement described i n the September 16,
** B19as8e0d, mone mporreancdiusmio nfr olme v De lE So. f -+( s 4e. e6 Appeprecnednixt. IV)
It should be noted t h a t i n approximately 34 percent of the job placements
c l a s s i f i e d i n Table 1 as not obtained through the Ex- Offender Program,
there is evidence t h a t the Program provided some type of s e r v i c e , such as
a stipend f o r t o o l s , t o the c l i e n t . However, these cases do not qualify
as placements since t h e r e is no documented employer contact by Ex- Offender
Program s t a f f p r i o r t o r e f e r r a l .
The following cases a r e examples of i n v a l i d placements claimed by the
Ex- offender Program:
CASE I
According t o the employer's records, the c l i e n t was hired off t h e s t r e e t .
Although the company has used the DES Job Service Program, the owner had
not heard of the Ex- Offender Program. There was no record of services
provided t o the c l i e n t by the Ex- Offender Program.
CASE I1
The employer s t a t e d t h a t h i s company a d v e r t i s e s f o r help through the
newspaper, and h i r e s a l l employees off the s t r e e t . The c l i e n t confirmed
t h a t h i s job was obtained through the newspaper and not through the
Ex- Offender Program, although the Ex- Offender Program i s s u e d s e v e r a l
stipends t o the c l i e n t f o r a d r i v e r ' s l i c e n s e , motor vehicle r e g i s t r a t i o n ,
a medical examination, clothing and personal a r t i c l e s .
CASE I11
The employer s t a t e d t h a t the c l i e n t was hired a s a r e s u l t of a l e t t e r he
wrote asking f o r a job before h i s r e l e a s e from prison. The employer had
never heard of the DES Ex- Offender program. The c l i e n t confirmed t h a t he
obtained h i s job on h i s own. The Ex- Offender Program did i s s u e t h e c l i e n t
a $ 100 stipend for gas and temporary housing on the day he was hired.
CASE I V
According t o the employer, the c l i e n t was introduced t o him by the
c l i e n t ' s wife, who was working f o r the employer a t the time. The c l i e n t
confirmed t h a t he obtained h i s job through h i s w i f e ' s e f f o r t s . The
Ex- Offender Program provided the c l i e n t a stipend of $ 144 f o r carpentry
t o o l s .
Possible Fraud i n 17 Percent of Cases
OSI i n v e s t i g a t o r s concluded t h a t of the 284 claimed ex- offender placements
sampled, 37 ( 17 percent) were not only i n v a l i d , but appeared t o be
fraudulent as well. Table 2 summarizes the apparently fraudulent
placements a s determined by OSI.
TABLE 2
SUMMARY OF EX- OFFENDER JOB PLACEMENTS INVOLVING
FRAUD AS DETERPIINED BY DES INVESTIGATORS
D i s t r i c t I D i s t r i c t I1 A l l Other S t a t e
( phoenix) ( ~ u c s o n ) D i s t r i c t s Total
Number of placements
sampled 16 4 77 43 284
Apparent cases of
fraud i d e n t i f i e d
Percentage of
placements sampled 13% 19%
A s shown i n Table 2, 21 apparent cases of fraud were found i n D i s t r i c t I
( phoenix), 15 i n D i s t r i c t I1 u us con) and one i n the other DES d i s t r i c t s .
P r o j e c t i n g t h e r e s u l t s of Table 2 t o the 1,062 job placements claimed by
the Ex- Offender Program from October 1, 1979, to August 71, 1980, it can
be s t a t e d with 95 percent confidence t h a t from 104 t o 179 of these
placements a r e apparently fraudulent.*
The following a r e examples of cases which appear t o be fraudulent:
CASE I
Eight c l i e n t s were reported a s having been placed by the Ex- Offender
Program as r e c r e a t i o n l e a d e r s i n a s p o r t s program at the University of
Arizona's McIiale Center. Payroll records confirmed t h a t the c l i e n t s had
been employed between June 9 and July 30, 1980, a s p a r t of a summer youth
program. According to a coach a t the University, however, a l l e i g h t
c l i e n t s were students a t the University, high school coaches or high
school teachers. None were ex- offenders. Working simultaneously and f u l l
time a t the University i n the same youth s p o r t s program was the
ex- offender employee who reported the placements.
* Based on precision l e v e l of -+ 7 .5 percent.
CASE I1
According t o the employer, the c l i e n t was hired on ? larch 7, 1980, as a
r e s u l t of a newspaper ad. According t o the c l i e n t , he: 1) contacted the
Ex- Offender Program a f t e r r e l e a s e from prison, 2) received no a s s i s t a n c e ,
and 3) was i n s t r u c t e d by the Ex- Offender s t a f f interviewer t h a t i f he did
obtain employment, he should report it to the Ex- Offender Program. He
contacted the Program a f t e r g e t t i n g h i s job through an ad i n the l o c a l
newspaper and was interviewed extensively concerning the f a c t s of h i s
employment.
CASE I11
The c l i e n t s t a t e d t h a t he got h i s job through the Job Service Program i n
Tempe. H i s employer said he was hired o f f t h e s t r e e t . According to the
c l i e n t , he contacted the Ex- Offender Program two months l a t e r because he
needed a stipend f o r t o o l s . A t t h a t time, the Ex- Offender Program
s o l i c i t e d information concerning the c l i e n t ' s job and took c r e d i t f o r the
placement t h a t had occurred two months previously.
CASE I V
The employer s t a t e d t h a t the c l i e n t had w r i t t e n t o the company p r i o r to
h i s r e l e a s e from prison and the company had agreed t o h i r e him. According
to the c l i e n t , he wrote t o about 15 companies p r i o r t o h i s r e l e a s e ,
looking f o r a job. When he subsequently reported t o the Ex- Offender
Program Office, he was r e f e r r e d f o r food stamps and to t h e S a l v a t i o n Army
f o r clothing. He s t a t e d t h a t the Ex- Offender Program was i n no way
responsible f o r h i s obtaining employment.
CASE V
The c l i e n t was employed on March 11, 1980, i n a l o c a l Headstart Program.
Employer records list the c l i e n t a s a p a r t i c i p a n t i n the Ex- Offender
Program under a Victim- Witness Program, run by the County. According t o
the c l i e n t , he was not an ex- offender and did not get h i s job through the
Ex- Offender Program. Contact with the County Victim- Witness Program
confirmed t h a t the c l i e n t never was a c l i e n t of its program.
Valid Placements For Less Than 60 Days' Employment
May Not Constitute Successful Placements
According to information gathered by DES i n v e s t i g a t o r s , 51 percent of the
284 claimed ex- offender job placements sampled were, i n f a c t , v a l i d
Ex- Offender Program placements ( see Table 1 on page 7). However, 51
percent of the v a l i d job placements i d e n t i f i e d by OSI were f o r l e s s than
60 dayst employment and, as such, may not q u a l i f y as successful placements
a s prescribed by w r i t t e n DES procedures.
DES Rule No. 2- 1- 03. I. 10. f , dated January 1977, regarding terminations
from the Ex- Offender Program s t a t e s , i n p a r t :
" h. Terminations: For the ongoing recidivism study
and f o r reporting purposes the following
d e f i n i t i o n s w i l l be u t i l i z e d :
" LEVEL I. The c l i e n t ' s job was obtained through
the Ex- Offender Program and the c l i e n t is
terminated a s a successful Job Placement having
been on the job 60 days.
" LEVEL 11. The c l i e n t found h i s job through
sources other than the Ex- Offender Program and the
c l i e n t is terminated a s a successful Job Placement
having been on the job 60 days." ( ~ r n ~ h a s iasdd ed)
A s p a r t of our review of the Ex- Offender Program, we tabulated the
duration of employment f o r those Ex- Offender Program c l i e n t s i d e n t i f i e d by
OSI as v a l i d l y placed. Table 3 summarizes our t a b u l a t i o n .
TABLE 3
SUMMARY OF DURATION OF EMPLOYMENT
FOR EX- OFFENDER CLIENTS IDENTIFIED
BY DES AS VALIDLY PLACED
Number of
Days Employed
1- 5
6- 10
11- 30
31- 59
60 and more
Unable t o determine
Number of
Valid
Placements Percentage
Cumulative
Percentage
A s shown i n Table 3, i f the 60- day continuous employment c r i t e r i a i n Rule
No. 2- 1- 03.1.10. f, is s t r i c t l y applied, a t l e a s t 51 percent of the 144
valid Ex- Offender Program job placements would not q u a l i f y a s successful
placements.
It should be noted t h a t , according to one DES a d m i n i s t r a t o r , t h e r e were
verbal as well as w r i t t e n i n s t r u c t i o n s to Ex- Offender Program personnel
regarding v a l i d Ex- Offender job placements t h a t did not include the 60- day
c r i t e r i a . In other words, a placement f o r any duration was to be counted
as a successful placement. However, i n a September 16, 1980, memorandum*
the Acting A s s i s t a n t Director of the Division of Employment and
R e h a b i l i t a t i o n S e r v i c e s and a Job Service Program a d m i n i s t r a t o r during the
period reviewed provided a d e s c r i p t i o n of a successful job placement t h a t
included the 60- day c r i t e r i a .
Thus, it appears t h a t , a t b e s t , Ex- Offender Program personnel were
confused by a lack of formal policy regarding v a l i d job placements and, a t
worst, Ex- Offender Program personnel i n t e n t i o n a l l y ignored DES procedures
i n order t o i n f l a t e the number of successful Ex- Offender job placements
reported.
Causes of Problems
To determine why placement t r a n s a c t i o n s were i n a c c u r a t e l y reported,
Program o f f i c i a l s were interviewed, and evaluation r e p o r t s and other
documents were reviewed.
Personnel Evaluations Are
Based on Number of Placements
Personnel evaluations ( performance Planning and Evaluation ~ e ~ o r t sf) o r
Ex- Offender Program personnel have been b a s e d ' p a r t l y on numbers of monthly
placement t r a n s a c t i o n s . I n e f f e c t , Ex- Offender Program personnel were on
a quota system i n t h a t they were expected to average 15- 17 placement
t r a n s a c t i o n s a month, with 18 or more placements a month considered
meritorious. Workers admitted to being under pressure to meet placement
goals because pay increases and promotions a r e based on t h e i r personnel
r a t i n g . Some i n v a l i d placements apparently were reported i n a n e f f o r t t o
meet these goals.
* See Appendix I V .
I n one D i s t r i c t Office, new personnel performance and evaluation reports
recently were developed which do not s t r e s s the number of placements.
Emphasis instead is placed on documentation of records and the q u a l i t y of
services to c l i e n t s .
Workers Are Poorly Supervised
The DES operating manual s t a t e s t h a t , a t the D i s t r i c t l e v e l , team
supervisors a r e responsible f o r the accuracy of records and r e p o r t s . The
Ex- Offender team supervisor:
. .. reviews the caseload r e g u l a r l y t o ensure the
d e l i v e r y of s e r v i c e s t o c l i e n t s is s a t i s f a c t o r y .
He assures t h a t the c l i e n t s and team records a r e
maintained a c c u r a t e l y , t h a t s e r v i c e s given to
c l i e n t s a r e documented and t h a t f i l e s contain
management information necessary to the team's
e f f i c i e n t and e f f e c t i v e operation a r e maintained
and complete and up t o date. The Team Supervisor
should c o n t i n u a l l y evaluate the t e a m ' s o p e r a t i o n
and advise h i s supervisor of any d e f i c i e n c i e s i n
the o p e r a t i o n . . . ( ~ E s 2.1- 03.~)"
However, team s u p e r v i s o r s d i d not, i n many cases, comply with the above
procedures. A s a r e s u l t , program records and r e p o r t s p e r t a i n i n g t o
placement t r a n s a c t i o n s a r e inaccurate and d e f i c i e n t . I n f a c t , according
to a former worker, a team supervisor in one d i s t r i c t a c t u a l l y encouraged
workers to take c r e d i t f o r some i n v a l i d placements. Recognizing t h i s
problem of poor team supervision, DES recently appointed new supervisors
i n both the Phoenix and Tucson Ex- Offender o f f i c e s .
DES Administrators Were Aware of
Problems with the Ex- Offender Program
DES a d m i n i s t r a t o r s have known f o r s e v e r a l years t h a t workers i n the
Ex- offender Program were taking c r e d i t f o r placements t h a t did not conform
to e s t a b l i s h e d DES policy. However, no attempt was made u n t i l r e c e n t l y t o
c o r r e c t t h e s i t u a t i o n .
According t o the DES a d m i n i s t r a t o r responsible f o r the Ex- Offender Program
during t h e period under review, a previous program supervisor decided t h a t
Ex- Offender Program placements did not have t o conform t o the Federal job
placement d e f i n i t i o n s and standards which apply t o the DES Job Service
Program. This policy was e s t a b l i s h e d d e s p i t e the f a c t t h a t the
Ex- Offender Program: 1) had been a n a d j u n c t to the Job Service Program,
and 2) i n i t i a l l y conformed t o the Job Service Program reporting standards
and procedures. A s a r e s u l t , Ex- Offender Program personnel were allowed
to take c r e d i t f o r some job placements they d i d n o t make provided t h a t
they a s s i s t e d i n the job placement by providing some type of s e r v i c e , such
a s a stipend.
I n a d d i t i o n , i n t e r n a l DES evaluation r e p o r t s and other DES documents
dating back to 1976 i n d i c a t e t h a t DES a d m i n i s t r a t o r s were not only aware
of the l a x placement c r i t e r i a used by the Ex- Offender Program, but were
aware of the problem of f a l s i f i e d placements as well.
For example, an evaluation of the Phoenix Ex- Offender Program o f f i c e by
the Bureau of Employment and Training i n January 1976 s t a t e d the following:
" The semiannual evaluation of the Phoenix Ex- offender
Team disclosed a wide v a r i e t y of d i s c r e p a n c i e s ( , ) most
of which predate the present s t a f f shortage. Reported
placements were not documented, case f i l e s were
incomplete and poorly documented, employer contact
cards were not being u t i l i z e d , o f f i c e f i l e s were not
maintained, and v i t a l o p e r a t i o n a l documents a r e not
r e a d i l y a v a i l a b l e i n the f i e l d o f f i c e . "
A followup v e r i f i c a t i o n of placements i n the Phoenix Office was conducted,
and the following r e s u l t s were reported i n April 1976:
" Of the twelve permanent placements reported [ f o r
February, 19761, 2 c l i e n t s got t h e i r own jobs, four had
t h e i r own jobs on i n t a k e , t h r e e g o t jobs through Spruce
House [ ~ e ~ tof. ~ o r r e c t i o n s ] . One c l i e n t was placed
from job bank. One c l i e n t f i l e had no documentation
relevant to placement, one c l i e n t f i l e was
unavailable... From the documentation a v a i l a b l e , it
could not be determined i f any of the above placements
claimed were valid."
This subsequent evaluation concluded with the following
statement:
" The records indicated s i g n i f i c a n t improvement i n the
areas which had been addressed. However, t h e r e were
recommendations made i n the previous evaluation r e p o r t
which were not addressed. Some of these items could
have been e a s i l y and quickly r e c t i f i e d . I n the area of
documented job placements, t h e r e seems t o be an inverse
r e l a t i o n s h i p t o s t a f f , i . e . , as s t a f f s i z e increases
t h e v a l i d placements decrease. During the December
evaluation the reason f o r t h e l a c k of placements and
f o r the lack of documentation was s t a f f shortage. For
the month of February, t h e r e was more s t a f f a v a i l a b l e
together with fewer v a l i d placements and questionable
documentation."
Further, t h e p r a c t i c e of allowing workers t o claim placements which did
not conform to the Job S e r v i c e s t a n d a r d s was apparently encouraged by
Bureau of Employment and T r a i n i n g a d m i n i s t r a t o r s , * although t h e procedure
was never o f f i c i a l l y approved. I n response to a January 1976 evaluation
of the Phoenix Ex- offender Program o f f i c e , the l o c a l manager s t a t e d :
" I am concerned t h a t the evaluations placed so much
emphasis on t h e v e r i f i c a t i o n of placement when they
( t h e Bureau of Employment and raini in^), i n f a c t , have
encouraged our. .. taking c r e d i t f o r jobs found by
c l i e n t s . "
F i n a l l y , it appears t h a t t h e r e was considerable confusion and o u t r i g h t
disagreement within the Ex- Offender Program regarding job placements. In
October 1976 the Phoenix manager s t a t e d t o the a d m i n i s t r a t i o n :
" In April, I was advised t h a t ( a Bureau of Employment
and Training o f f i c i a l ) had i n s t r u c t e d the Phoenix team
t h a t it was not necessary to adhere t o D. O. L.
( ~ e ~ a r t m e n t of ~ a b o r ) standards f o r recording
placements. I immediately i n s t r u c t e d the team to
r e t u r n t o D. 0 . L. c r i t e r i a f o r i d e n t i f y i n g placements.
We must r e f e r and v e r i f y r e f e r r a l s as a h i r e before a
placement can be counted."
* It should be noted t h a t t h e i d e n t i t y of the Bureau of Employment and
Training a d m i n i s t r a t o r s who encouraged the claiming of inappropriate
placements could not be discerned from a v a i l a b l e documentation. A DES
a d m i n i s t r a t o r was named by two DES employees i n i n t e r v i e w s w i t h a u d i t
s t a f f a s having encouraged the p r a c t i c e . However, t h a t a d m i n i s t r a t o r
no longer is employed by DES.
In January 1978, an Ex- Offender Program team supervisor s t a t e d the
following t o the Job Service Program Manager:
" . . . p r i o r t o FY 1974, the ( EX- offender program)
used a s t a t i s t i c a l l y loose hand count whereas
today we a r e bound by the more r i g i d d e f i n i t i o n s
and documentation of the DOL ESARS [ computer]
system ... Under the hand count system, it was a l l
too common f o r f i e l d teams t o record a s
placements c l i e n t s who found t h e i r jobs other
than through the ( EX- offender program) on the
r a t i o n a l e t h a t they had been a s s i s t e d by the
( EX- off ender program) and without the program
they would not have been hired."
Other documents, i n c l u d i n g a c o n f i d e n t i a l memorandum t o the Job Service
Program Manager, i n d i c a t e t h a t the problem of f a l s i f i e d placements was
brought t o the a t t e n t i o n of the DES a d m i n i s t r a t i o n i n 1978. However, no
apparent c o r r e c t i v e a c t i o n was taken. Recent statements by an Ex- Offender
Program o f f i c i a l confirm t h a t Job Service Managers and Bureau s t a f f were
aware t h a t placement c r i t e r i a which did not conform to w r i t t e n standards
were being used by workers, but managers made only token e f f o r t s to
prevent the p r a c t i c e .
CONCLUSION
An i n v e s t i g a t i o n by DES i d e n t i f i e d t h a t a t l e a s t 26 percent of Ex- Offender
Program claimed job placements were invalid and half of the invalid
placements appear t o be fraudulent. In a d d i t i o n , an estimated 51 percent
of t h e i d e n t i f i e d valid placements may not q u a l i f y a s successful
placements. DES a d m i n i s t r a t o r s n o t only have known of t h e s e r e p o r t i n g
i m p r o p r i e t i e s b u t , i n some cases, have encouraged them.
It is recommended that:
1. The Legislature evaluate the need for continuing the Ex- Offender
Program i n view of information recently developed by DES- OSI.
2. I f the Ex- Offender Program is to be continued:
- Only placements actually made by Ex- Offender workers be
reported and counted a s v a l i d job placements.
- Supervision of workers be improved to ensure conformity with
operating standards and accuracy of reporting.
- New operating manual provisions which c l a r i f y differences
between jobs found by c l i e n t s and job placements made by the
Ex- Offender Program be adopted and enforced.
FINDING I1
IMPROVEMENTS ARE NEEDED I N DEPARTMENT OF ECONOMIC SECURITY RECORD- KEEPING AND
JOB- PLACEMENT VALIDATION PROCEDURES.
During the course of the Department of Economic Security ( DES) i n v e s t i g a t i o n ,
and throughout our a u d i t , d e f i c i e n c i e s i n record keeping were noted which
hindered v e r i f i c a t i o n of job placements. Ex- Offender Program s t a f f contacts
with employers were poorly documented, and many c l i e n t c o n t a c t r e c o r d s were
i n s u f f i c i e n t t o determine what s p e c i f i c a c t i o n had been taken on behalf of
c l i e n t s . I n a d d i t i o n , important information r e l a t e d t o s t i p e n d s i s s u e d to
c l i e n t s was missing from the records. F i n a l l y , DES has conducted p e r i o d i c
s t u d i e s t e s t i n g t h e v a l i d i t y of Ex- Offender Program and Job Service Program
placements, but t h e v a l i d a t i o n s t u d i e s f a i l e d t o discover s e r i o u s problems i n
the Ex- Offender Program because procedures used t o v e r i f y placements did not
s o l i c i t s u f f i c i e n t information.
Record Keeping Inadequate
For a placement to q u a l i f y a s v a l i d , DES procedures normally require t h a t
employers be contacted p r i o r to r e f e r r i n g a c l i e n t . According t o Department
of Labor c r i t e r i a , Ex- Offender Program personnel must make p r i o r arrangements
with a prospective employer i n order f o r a subsequent job placement t o be
valid. Even informal, verbal placement standards, used by the Ex- Offender
Program during the period under review, required p r i o r employer contact a s a
condition f o r claiming a v a l i d placement, and DES procedures required t h a t
employer contact be documented on the c l i e n t ' s a p p l i c a t i o n and contact record.
I n s p i t e of the above requirements, 74 percent of the ex- offender placements
i d e n t i f i e d a s v a l i d by DES i n v e s t i g a t o r s had no documentation of employer
contact p r i o r t o r e f e r r a l . Case records were p a r t i c u l a r l y d e f i c i e n t i n t h e
Phoenix o f f i c e , where documented employer contact was lacking i n 93 percent
of the cases.
DES i n v e s t i g a t o r s found t h a t even when employer contact was documented i n
case f i l e s , the documentation often was not s u f f i c i e n t . For example, the
names of employer r e p r e s e n t a t i v e s contacted frequently were not l i s t e d . A s a
r e s u l t of poor documentation, DES i n v e s t i g a t o r s were unable t o determine how
c l i e n t s got t h e i r jobs i n 23 percent of the job placements sampled. In
a d d i t i o n , important information on the purpose and use of stipends issued to
c l i e n t s was missing i n 24 of 159 records ( 15 percent) we reviewed i n the a
c e n t r a l o f f i c e f i l e . ( s e e page 23 f o r a discussion of stipends.)
V a l i d a t i o n S t u d i e s Failed to I d e n t i f y Problems
H i s t o r i c a l l y , DES has attempted to v e r i f y Job Service Program and Ex- Offender a
Program placements by conducting i n t e r n a l v a l i d a t i o n s t u d i e s . These s t u d i e s
included reviews of case r e c o r d s , i n t e r v i e w s with job developers and contact
with employers i n an e f f o r t t o v e r i f y placements. These v a l i d a t i o n s t u d i e s ,
however, f a i l e d to i d e n t i f y the extent of reporting problems i n the
Ex- Offender Program.
a
For example, a v a l i d a t i o n of the Tucson Ex- Offender o f f i c e was completed i n
September 1980. According t o the DES v a l i d a t i o n r e p o r t , 88 placements,
representing 55 percent of a l l placements reported f o r the period October
a
1979 through August 1980, were t e s t e d . A 5.4 percent e r r o r r a t e was found
and the following conclusion was reached.
" It appears to the v a l i d a t i o n team. .. t h a t a l l
current members of the Tucson Ex- Offender s t a f f
have reported placements honestly since October
1979 through July 1980.. ."
The r e s u l t s of the September 1980 Tucson Ex- offender o f f i c e v a l i d a t i o n d i f f e r a
markedly from the r e s u l t s of the OSI i n v e s t i g a t i o n covering a comparable
period, i n which 15 cases of possible fraud were i d e n t i f i e d , representing 19
percent of the placements sampled. ( see page 9) Another e i g h t cases of
fraud not included i n the o r i g i n a l sample a l s o were i d e n t i f i e d by DES
i n v e s t i g a t o r s .
It appears t h a t the procedures used by v a l i d a t i o n teams a r e inadequate i n
t h a t information s o l i c i t e d from employers is apparently of i n s u f f i c i e n t
d e t a i l to allow f o r i d e n t i f y i n g i n v a l i d and f r a u d u l e n t c a s e s and Ex- Offender
Program c l i e n t s are not contacted to determine how they got t h e i r jobs.
CONCLUSION
Records maintained by the Ex- Offender Program a r e inadequate, e s p e c i a l l y with
regard t o documenting employer contacts and the purposes and uses of
stipends. I n a d d i t i o n , DES i n t e r n a l v a l i d a t i o n s t u d i e s have f a i l e d t o
i d e n t i f y problems i n the Ex- Offender Program.
RECOMMENDATIONS
It is recommended t h a t :
1.. Documentation of employer contacts and the purposes of stipends be
improved.
2. Future v a l i d a t i o n s t u d i e s include s u f f i c i e n t employer and c l i e n t
contact to determine the v a l i d i t y of claimed job placements.
OTHER PERTINENT INFORMATION
The following information p e r t i n e n t to the Ex- Offender Program was
obtained during the course of our a u d i t .
Stipends
The Ex- Offender Program maintains a s e p a r a t e s t i p e n d fund to provide f o r
the immediate needs of ex- offenders. The DES operating manual does not
specify the purposes f o r which stipends may be issued except t h a t s t i p e n d s
may not be issued f o r the purchase of an automobile, out- of- city or
out- of- State t r a v e l ( except to secure employment), a l c h o l i c beverages or
drugs. E l i g i b l e c l i e n t s may receive up to $ 300 i n stipends.
A s p a r t of our a u d i t , we examined 159 stipends issued to Ex- Offender
Program c l i e n t s . Some of the stipends were issued f o r t o i l e t r i e s , auto
p a r t s and r e p a i r s , including one auto r e p a i r costing $ 200. Stipends a l s o
were issued f o r household a r t i c l e s , eyeglasses, auto insurance and drug
treatment a t a Phoenix h o s p i t a l .
Table 4 summarizes the uses of the 159 stipends reviewed.
TABLE 4
SUMMARY OF THE USES OF
THE 159 STIPENDS REVIEWED
Average Amount
Purpose Number Amount Per Stipend
Clothing/ shoes
~ e n t / u t i l i t i e s
Tools
Transportation
Gasoline
Chauffeur's l i c e n s e
D r i v e r ' s l i c e n s e
Physical exam
Auto p a r t s / a u t o r e p a i r s
Food and gasoline
T o i l e t r i e s
0 t her
Multiple purposes
No record/ unable t o determine
Total
Average Stipend Amount
A s shown i n Table 4, the most frequent use of stipends was f o r clothing
and shoes, rent or u t i l i t i e s and t o o l s . Other purposes included gasoline,
food, d r i v e r ' s or c h a u f f e u r ' s l i c e n s e s , medical examinations and
t r a n s p o r t a t i o n .
Overall, stipends averaged about $ 50 each. Stipends f o r t o o l s averaged
$ 125, rent $ 93, auto p a r t s and r e p a i r s $ 79, clothing and shoes $ 44 and
food and gas $ 61.
DES c u r r e n t l y is conducting a more thorough i n t e r n a l a u d i t of the
Ex- Of f ender Stipend Fund.
Types of Jobs and Hourly Pay
One of the purposes of the Ex- Offender Program is t o place c l i e n t s i n
meaningful employment. Types of job placements made by the Ex- Offender
Program and hourly pay received by c l i e n t s serve to i n d i c a t e , a t l e a s t i n
p a r t , i f the goal is achieved.
Table 5 shows the types of employment of c l i e n t s v a l i d l y placed by the
Ex- Offender Program. Most c l i e n t s ( 62 percent) found jobs i n s e r v i c e
occupations ( e. g., commercial cleaning, j a n i t o r i a l work and food s e r v i c e )
or i n s t r u c t u r a l work occupations ( c o n s t r u c t i o n ) . Seven percent were
placed i n a g r i c u l t u r a l and f o r e s t r y jobs, four percent i n c l e r i c a l and
s a l e s jobs, and four percent i n machine t r a d e s . Five percent of jobs
found a r e c l a s s i f i e d as p r o f e s s i o n a l , t e c h n i c a l or managerial i n nature.
These included counseling, mechanical d r a f t i n g and commercial design.
140st jobs obtained by Ex- Offender Program c l i e n t s were u n s k i l l e d ,
low- paying p o s i t i o n s . Hourly pay Statewide averages $ 3.41 per hour. Pay
was highest i n D i s t r i c t I ( phoenix), averaging $ 3.53 per hour, and lowest
i n t h e f o u r nonmetropolitan d i s t r i c t s , where pay averaged j u s t above
minimum wage ($ 3.25 per hour).
TABLE 5
PERCENTAGE OF CLIENTS OBTAINING EMPLOYMENT BY
EMPLOYMENT TYPES: VALID PLACEMENTS ONLY
C l a s s i f i c a t i o n of Occupations*
Professional, t e c h n i c a l and
managerial
C l e r i c a l and s a l e s
Service
A g r i c u l t u r a l , f i s h e r y , f o r e s t r y
and r e l a t e d
Processing
Machine t r a d e s
Bench work
S t r u c t u r a l work
Miscellaneous occupations
D i s t r i c t I
( phoenix)
N= 64
D i s t r i c t I1
( ~ u c s o n )
N= 37
A l l Other
D i s t r i c t s
N= 30
S t a t e
Total
ri= 131
* C l a s s i f i c a t i o n conforms t o the Department of Labor's Dictionary of
Occupational T i t l e s .
We were unable t o determine how the job types obtained by c l i e n t s i n the
DES Ex- Offender Program compares to job types obtained through other
programs and agencies. The Department of Corrections, which a l s o develops
jobs f o r ex- offenders, does not maintain s t a t i s t i c s on types of employment.
Employer Opinion
To determine employer opinion of the Ex- Offender Program, we surveyed a l l
176 employers involved i n the 284 sampled placements. Eighty- seven of the
176 employers ( 49 percent) responded to the survey.*
Most employers ( 77 percent) were f a m i l i a r with the Program, although 39
percent indicated t h a t its purpose and the nature of t h e s e r v i c e s it
provides had not been explained t o them by Ex- Offender Program s t a f f .
More than half the employers ( 52 percent) a l s o responded t h a t they had not
been contacted by Ex- Offender Program personnel or t h a t contact was
infrequent. Overall, most employers ( 60 percent) r a t e d c o n t a c t w i t h s t a f f
a s e x c e l l e n t or s a t i s f a c t o r y . Twenty- eight percent rated contact with
s t a f f as poor, and 12 percent rated it very poor.
When asked to compare the Ex- Offender Program with o t h e r public, nonprofit
job r e f e r r a l agencies, employer opinions were mixed. About 14 percent
thought the Program was b e t t e r than those of other agencies, while
s l i g h t l y more ( 15 percent) judged the Program poorer than those of other
agencies.
About half the employers ( 51 percent) said they were contacted by
Ex- Offender Program s t a f f p r i o r to a job r e f e r r a l , while 46 p e r c e n t s a i d
Ex- Offender Program s t a f f contacted them a f t e r a c l i e n t had been hired.
To improve the Ex- Offender Program, employers recommended b e t t e r screening
of a p p l i c a n t s , more explanation of the program to employers, improved
communication and contact between workers and employers, and more
follow- up a f t e r c l i e n t s a r e on the job.
* See Appendix V f o r a copy of the survey and survey responses.
Recidivism Study
DES, i n cooperation w i t h t h e Department of Corrections, is conducting a
recidivism study of Ex- Offender Program c l i e n t s . Preliminary r e s u l t s
reported by DOC i n d i c a t e t h a t c l i e n t s who p a r t i c i p a t e d i n the Program and
were p o s i t i v e l y terminated i n 1978 experienced a recidivism r a t e of 11.7
percent f o r the period ending December 71, 1979. Negatively terminated,
unsuccessful Program c l i e n t s , on the other hand, demonstrated a recidivism
r a t e of 22.1 percent f o r the same period.
These preliminary r e s u l t s , however, cannot be considered conclusive i n
l i g h t of the information i n t h i s report regarding the v a l i d i t y of
Ex- Offender Program job placements. I n our opinion, an independent review
of the study r e s u l t s should be conducted.
@ Brttce Babbitt
GO VER, YOI<
ARIZONA DEPARTMENT OF ECONOMIC SECURITY
1717 WEST JEFFERSON. PHOENIX, ARIZONA* P 0. BOX 6123 85005 Sill Jumirron, j r .
UII? EC7' 0fZ
Mr. Douglas R. Norton, CPA
Auditor General
Office of the Auditor General
Legislative Services Wing, Suite 200
State Capi to1
Phoenix, Arizona 85007
Dear Mr. Norton:
Thank you for providing the Department an opportunity to review the
Ex- offender audit report.
The Department is quite pleased that virtually all the recommendations
listed in the report have been implemented. Although the audit focused
mainly on the reporting of placements, there are other valuable services
provided to ex- offenders.
Steps have been taken to ensure the accurate reporting of all activities
and we are proceeding with appropriate action regarding individuals who
falsified placement information.
Attached is a summary of the recommendations and the Department's
responses.
Please contact me if you require further information.
BJJ: DRE: td
Attachments
Sincerely ,
F o l l o w i n g are t h e recommendations of t h e a u d i t and the D e p a r t m e n t ' s
r e s p o n s e :
A. ONLY PLACEMENTS ACTUALLY MADE BY EX- OFFENDER WORKERS BE REPORTED
AND COUNTED AS VALID PLACEMENTS.
DES aghea . Comeca2ve action hah been implemented treindohcing Akh
hecommendation. A dirtective wacl A; tLamm. itted on SepAemba 2 2 , 7 980
mandaLLng oMRy p h c e m e ~ an dedined by DepatLtment ad Laboh & eAa
be counted acs valid phcementJ. Follow up ; trLCLining n a n i o ~ w me
conducted i n Novanbeh and Decemba t o con6h. m that & me would be
no ntinundmRdnding a ; to & at covlnLi, tuLen a valid pLacemertt.
B. SUPERVISION OF WORKERS BE IMPROVED TO ENSURE CONFORMITl WITH OPERATING
STANDARDS AND ACCURACY OF REPORTING.
DES aghea. ALE nupehvihom have been hnued apecidic pwQomance
~ XandcvLdn i n which they cctiee be held accou~ tab~ deot r e~ nwLingX hat
Rheh employeen can6ohm MLi; th & opmcr; t. ing ~ Xandctndcl and ; that &
& epotl; ting be accuha. te. Specidic haining i n h e g d 20 2kin occutrhed
duhirzg Novmbeh and Decmbm 06 1 9 8 0 . Peh~ ohmance and e v d d o n
& epohtJ have been hevhed doh . in a l l dinhi&.
C. NEW OPERATING MANUAL PROVISIONS WEIGH CLARIFY DIFFERENCE BETWEEN
JOBS FOUND BY CLIENTS AND JOB PLACEMENTS MADE BY THE EX- OFFENDER
PROGRAM BE ADOPTED AND ENFORCED.
DES agtreen. The opehating manual h a been ovmhaded and c U 6 i e d
& h npeciae & eation given ; to de6iuting documcWon necdcd 20
jwlidy a l l amvice deciniuvln . The hevhcd manual, ah we& ah
; ttraining in p o c e d u h ~ and debinitiovln, wehe phovided Ro &
pogmm nAa66 i n Novembeh, 1980.
D. DOCLJbENTATION OF EMPLOYEE CONTACTS AND THE PURPOSES OF STIPENDS BE
IFPROVED .
DES aghea . An indicaXed above, ; the hevhionh 014 ; the opchaAing manual
have no; t odq n; trrenncc! t b hccomm~ ndation; buA: i u ~ 2 X continue ~ 3 be
molzitatrcd dandy to ahnwre ; that . it h being doUowed.
E. FUTURE VALIDATION STUDIES INCLUDE SUFFICIENT EMPLOYEE AND CLIENT
CONTACT TO DETERMINE THE VALIDITY OF CLAIMED JOB PLACEMENT.
DES ag4ee. b. The heAponAibarj 6uh valida/ tion been nhi& ted to
an o4ganizaLbrzde unit expenienced i n doteca2ng Qtraud and independed
06 Rhe Ex- 06denda ? hogtam. A Izundbaoh ad pfioccdwr~~ bm ed on ; the
hevised o p W n g manud ~ A A been comyloted. Each EX- oQdendeh T m
NU be dotrm& y vdidated once each cjucatc~.
SUMMARY
The r e p o r t p o i n t s out and the Department agrees t h a t confusion of
various terms and d e f i n i t i o n s used i n government ( e - g . , placements; job
entry; p o s i t i v e outcome; p o s i t i v e termination l e v e l s I, 11, 111; c l i e n t
success; e t c . ) created a s i t u a t i o n where i n most i n s t a n c e s good f a i t h
a c t i v i t y by s t a f f i n a s s i s t i n g ex- offenders took place but did not
meet the narrow d e f i n i t i o n s of the job s e r v i c e program funded by the
Deparmtent of Labor.
Unlike most of the Department's other programs, ex- offenders who have
been helped to r e e n t e r t h e mainstream of s o c i e t y are not l i k e l y t o give
t e s t i m o n i a l s about the a s s i s t a n c e provided. Nevertheless, t h e Department
believes t h i s program t o be valuable and most i n s t a n c e s has a s s i s t e d an
ex- offender i n being r e h a b i l i t a t e d . Every p o s i t i v e r e h a b i l i t a t i o n lowers
the recidivism r a t e which can be converted t o savings i n state i n c a r c e r a t i o n
c o s t s .
APPENDIX I
DES OPERATING MANUAL :
PURPOSE AND OBJECTIVES OF THE EX- OFFENDER PROGRAM
PAGE NUMOER
ARIZONA DI3PARThZENT OF ECONOMIC SECURITY DES 2- 1- 03 . A
CHCPTER - - -
ARTICLE
2 Employment & Train- i- ng - - - _ -
SURJECT
0J 1. x- Ot fcntlcr I'roj: rnni 1 7 -
DES 2- 1- 03
A. Introduction
The Ex- Offender Program was authorized under the Manpower Development and
Training Act on January 1, 1971, as a demonstration project. The first
six months was a TOOLING UP period to hlre staff, locate office space,
etc. Subsequently, the Arizona Legislature has underwritten the funding
of this program and placed it under the control of the Departnent of
Economic Security.
While the Ex- Offender Program is the responsibility of the Department of
Economic Security, it was developed cooperatively with other agencies and
organizations working with inmates and ex- offenders. Some of these are
now part of the Department of Economic Security ( VR, Social Services,
WIN, and NABS). The others are Department of Corrections, Vocational
Education, The Seventh Step organization and other agencies and
organizations to enhance services to the Ex- Offender Program clientele.
This operating manual does NOT supersede any other current DES manual but
is addressed solely toward serving certain unique programmatic needs of
the Ex- Offender EDT teams, e. g. X- 0 teams should continue to fully
utilize and become familiar with all DES manuals. The following DES
Program lianuals are also mandatory for those activities which are
applicable to Ex- offender Program staff: DES 2- 1- 01 Employment
Counseling; DES 2- 1- 16 TJTC; DES 2- 2- 02 Employer Relations; DES 2- 3- 03
Glossary; DES 2- 6 Forms Section.
1. Purpose - The purpose of the Ex- Offender Program is, by using as a
vehicle the team concept, to provide employability development and
comprehensive manpower services to prison inmates and ex- offenders
to facilitate an orderly return to meaningful employment in such a
manner as to reduce the recidivism rate.
2. Objectives
a. To furnish pre- release DES Job Service assistance to inmates at
the Arizona State Prison ( Florence, District V), Ft. Grant
Training Center, Safford Conservation Camp ( Safford, District
VI), Women's Division ( Phoenix, District I), Medium Security
Institution ( Tucson, District 11), and any newly established
institution community treatment centers in all Districts.
These services will include counseling, vocational information
and guidance, and referral to outside Department of Economic
Security systems. The full range of Job Services will be ~ iven
to eligible clients statewide.
ARIZONA DEPARThIENT OF ECONOMIC SECURITY
CHAPTER
be To furnish ex- offenders manpower services through Teams in the
areas of Phoenix and Tucson. These services will include
individual, group and family counseling; COACH and BUDDY SYSTEE
type support; referral to necessary community services;
referral to training; and, job development and placement, with
follow- up. The supportive services will be available until
vocational adjustment is complete.
PAGE NUMBER
DES 2--- 1 - 03-- . A--. 2 . a -- --- . -
ARTICLE
' c . The Teams should coordinate their activities with those of the
Department of Corrections, Vocational Education, City Police,
Sheriff's Office, Adult Probation and other appropriate
community agencies.
2 Empl.- o- y- m - e-- n t 6 Training----
SUBJECT
03 Ex- Offender Program
The overall objective is to reduce the recidivism of
ex- offenders through personalized service by securing
meaningful jobs and assisting a person to make a satisfactory
adjustment to living in the FREE society.
3. Priorities - In order to remain within the scope of the agency and
the l~ cislative intent and philosophy, the follow in^ priorities of
service will hr ndh~ red to by nll teams to clients who arc:
a. Ex- Offenders recently released from Arizona Correctional
institutions includiil~ Interstate Compact. ( 6 months or less)
b. Referrals from state parole officers of those clients still on
parole status.
c. Department of Corrections Hal- fway House residents.
d. Inmates on work release programs in districts where state
correctional institutions are located.
e . A11 other clients ( Federal and Probationary) served on time
available basis in order to maintain caselond control.
The prccedinr priority levels will be observed by all teams, and
adherence thereto will be the responsibility of the Team Supervisor.
The dclivrry of service to institutional inmates is of hinhest
conccrn and will be monitored during bf- annual team evaluations.
APPENDIX I1
DEPARTMENT OF ECONOMIC SECURITY
MEMORANDUPI OF NOVEMBER 3, 1980, REGARDING
JOB PLACEMENT STANDARDS AND C R I T E R I A ,
AND AUDITOR GENERAL RESPONSE
TO Jerry Silva
Auditor General's Office
D
F . H O ~ D i s t r i c t Administrator
District I lOOA
DATE: November 3, 1980
REFERENCE:
@ S I ~ O J F C T &- Offender Internal Investigation
We are c& g to a p i n t in the investigation where identification mst
be rrade as to the validity of X- O placements.
Charlie Sharp, EI, has indicated that your office muld prefer to apply
criteria as listed in Chapter 2, J3nployment and Training, DES 2- 1- 03.1.10F
of DES Manual dated January 1977- cow attached.*
A t the beginning of the investigation there was so much confusion in the
reprting process, I f e l t we needed a statmt from a respnsible
authority as to what constituted a so- called Level I, I1 or I11 Placanent.
A canbination of written and verbal statanents constituted the description
which was signed by Mr. Ron Bachmn, then Acting Assistant Director, DES,
and Job Service Program Ahinistrator during the period in question ( copy
attached).** This statement was obtained for the purpose of applying
criteria in effect during the period of the review and was not intended
to represent an acceptance of management practices which consisted of
written and verbal instructions for a basic function ( placement), the key
p i n t in the mission of the X- 0 Program, and totally unacceptable. Use
of this criteria is also a protection of the mrkers involved who had
res~ onded to instructions from proper authority within the Departrent.
One p i n t I wish to stress, referring to the Level I Placement which has
been described as DOL criteria, to my knowledge, DOL criteria has never
included the requir& t that the worker r d n on the job sixty days in
order for the transaction to be counted as a placement. This requirement
is not a IXIL requirement. ( Attachrent ETA Handbook No. 373, Page 118,
published 1979)
I muld strongly recomnend the use of placement criteria as interpreted
by R. Bachrran, with the exception of the requirenent that an q l o y e e must
ramin on the job sixty days before a valid placenmt can be recorded, to
reviw the X- 0 operations for the period in question in order to tell it
like it was. This does not in any way imply acceptance of these inter-pretations
as reasonable m g a n e n t practices. The lapse of discipline
in mintaining written standards is wholly unacceptable.
- -
Q8 Ldd/ 4 -,' ,.- 1-+
C- ,-- 2
, / JRF01ey: da *
A t t .
* See Appendix 111.
0 2 0 3 13- 76) ** See Appendix IV.
3 Z -' SLAS R NORTON. CPA
* UOITOR OENERAL
STATE OF ARIZONA
OFFICE OF THE
AUDITOR GENERAL
November 7, 1980
Mr. John F o l e y , D i s t r i c t A d m i n i s t r a t o r
D. E. S. - D i s t r i c t 1
815 North 1 8 t h Street
Phoenix, AZ. 85006
Cear Mr. Foley:
Thank you f o r a l l o w i n g me t o comment on t h e a p p r o p r i a t e placement criteria f o r
t h e X- 0 prosram e v a l u a t i o n .
1.3 we d i s c u s s e d t h e o t h e r day, it is i m p e r a t i v e t h a t t h e criteria used t o
e v a l u a t e t h e X- 0 program be t h e same as t h e criteria under which t h e program
was supposed t o o p e r a t e . To u s e a n i n a p p r o p r i a t e criteria would, f o r a l l
i n t e n t s and p u r p o s e s , i n v a l i d a t e t h e e v a l u a t i o n r e s u l t s .
U n f o r t u n a t e l y it seems t h a t t h e r e is c o n s i d e r a b l e c o n f u s i o n as to e x a c t l y what
was t h e placement criteria under ~ i h i c h t h e X- 0 program d i d , i n fact, o p e r a t e .
T h e r e f o r e , I a n p r o c o s i n q t h a t t h e prograrn be e v a l u a t e d under two sets of
p l a c e n e n t c r i t e r i a . I n o t h e r words, one set o f r e s u l t s would reflect t h e use
o f t h e c r i t e r i a a s l i s t e d i n C h a p t e r 2, Employment and T r a i n i n g , DES 2 - 1 - 03.
I. 10F d a t e d January 1977 and a n o t h e r set o f r e s u l t s would reflect t h e u s e o f
t h e c r i t e r i a d e s c r i b e d i n R. C. Bachman's September 16, 1980, letter to you.
I n my o p i n i o n t h e above compromise is t h e fairest and most i n f o r m a t i v e way to
pre. 3ent t h e e v a l u a t i o n r e s u l t s . To use o n e p l a c e m e n t criteria t o t h e e x c l u s i o n
o f t h e o t h e r simply does n o t seem a p p r o p r i a t e g i v e n t h e c u r r e n t state of
u n c e r t a i n t y .
I f you ha; e any q u e s t i o n s or wish to d i s c u s s t h i s matter f u r t h e r , p l e a s e
c o n t a c t me.
S i n c e r e l y ,
4& kdJ* Gerald A. S i l v a
P e r f o r m a n c e A u d i t I4anager
11- 2
LEGISLATIVE SERVICES WING . S~ JITE 203 STATE CAPITOL PHOENIX. ARIZONA 85007 . 255- 4385
APPENDIX I11
EXCERPTS FROM DES OPERATING MANUAL:
STANDARDS REGARDING JOB PLACEMENTS
- . ' + U C Y U M d a R
DEP. ARI'S1ENT Ot.' EOONOlIIC SI.: CURITS DES 2- 1- 03. I. 10. i
CIi A C T C U -----
I A H T I C L *
2 Emplo)- ment L Trn i n i n g I
-- , 1 Applicant S e n t i c e s
s u s d r l r 0- r. REV. no.
03 Ex- Of fender Pro): ram 1 01- 77
. Job Entry: Thia component is a p p r o p r i a t e f o r those c l i e n t s who
a r e p l a c e d - o n t o job8 o t h e r than stop- gap. AEter being employed
f o r 30 dnys in tha Job Entry component, tha c l i e n t should hava
a change of e t a t u s i n t o Job Placement.
8. Job Placement: C l i e n t s vho have completed 30 days i n Job Entry
a r a a u t o m a t i c a l l y assigned i n t o the Job Placement component. A
c l i e n t i n Job Plnccmcnt ohould remain t h e r e f o r 30 days b e f o r e
being revlcwed f o r termination from the a c t i v e caseload by t h e
team.
Upon completion of 30 consecutive days i n Job Placement, the
c l i e n t would normally be terminated from t h e team's a c t i v e
caseload. Hovever, if there is n reason t o r e t a i n the c l i e n t
on t h e a c t i v a c a s e l o a d so t h a t continued s u p p o r t and s e r v i c e s
can ba provided, i t should c e r t a i n l y be done.
h. Terminations: For t h e ongoing r e c i d i v i s m s t u d y and f o r
r e p o r t i n g purpoacs t h e following d e f i n i t i o n s w i l l be u t i l i z e d :
LEVEL I. The c l i e n t ' a job vas obtained through t h e Ex- Offeader
Progrm and the c l i e n t is t e r n i n a t e d as a s u q c e e s f u l Job
Placement having baen on t h e job 6Q days.
LEVEL 11. The c l i e n t found his job through sources o t h e r than
the Ex- Offender P r o g r m and t h a c l i e n t is terminated as a
s u c c e s s f u l Job Placement havlng been on the job 60 days.
LEVEL 111. ( Good Cause) This category i n c l u d e s a l l o t h e r
c l i e n t s terminating from the program f o r reasons judged to be
p o s i t i v e o r nautRal.
LEVEL I V . ( Bad Cauoe) This type of termination is f o r those
c l i e n t e who hava received some s e r v i c e and who a r e terminated
from the progrnm v l t h o t h e r than good cnuee f o r one of t h e
following reaaone :
f . A d m i n i s t r a t i v e . r e a s o n . For example, dangeroua conduct,
a c t i v e drug abuee o r a c t i v e a l c o h o l l s n .
11. Refusal t o p a r t i c i p a t e i n the program.
ill. C l i a n t cannot ba l o c a t e d , ( Before terminating a c l i e n t
f o r t h l a r e a s o n , the team should allow a 2- week period to
ARrl; qNA DEP.+\ RTXIENT OF ECONO51IC SECURITY DES 2- 1- 03. I. 10. h. if1
ARTICLC -- CHAP'CLR
2 Employment & T r a i n i n g 1 1 Applicant Services
RLV. NO.
03 Exdf f ender Pro~ rarn
alapao - and make several a t t e n p t e t o c o n t a c t the
e n r o l l e e . )
iv. Cl i a n t i n c a r c e r a t e d .
LEVEL V. ( Bad Cause, Drop Out) This c a t e g o r y w i l l be u t i l i z e d
only f o r t h o s e c l i e n t s who f i l l e d out an a p p l i c a t i o n , a t e i t h e r
one of the i n s t i t u t i o n s o r In a l o c a l o f f i c e , and who did not
make any subsequent a t t e m p t t o c o n t a c t the team and UHO CANNOT
BE CONTACTED BY THE TEAM, i. e., No 8 i g n i f i c a n t services have
been rendered.
A l l c l i e n t s vill be terniinated at Leva1 5 upon l e a v i n g the
i n e t i t u t i o a . These c a s e s w i l l b e r e a c t i v a t e d v i t h an ES- 511 by
the r e c e i v i n g team.
All XO- 009, Termination Notices,, s e n t to SAO must c o n t a i n
s u f f i c i e n t n o t e s i n t h e comments s e c t i o n to j u s t i f y t h e
t e r m i n a t i o n , L. e., Ff " l o s t contact" what steps were taken to
c o n t a c t c l i e n t , p a r o l e o f f i c e r o r anyone with knowledge of the
c l l a n t .
APPENDIX I V
DEPARTMENT OF ECONOMIC SECURITY
MEMORANDUM O F SEPTEMBER 16, 1980, REGARDING
STANDARDS FOR PLACEMENT TRANSACTIONS
TO. Mr. John Foley l O O A
D i s t r i c t AJministrator
R. G. aachman 901A
Acting Assistant Dil- ector
DATE: September 16, 1980
SueJECT: Standards for Ex- offender Placement Transactions
In response t o your request f o r standards t o be applied t o Ex- offender
Placement Transactions t o i d e n t i f y v a l i d placements during the period
of the survey 10/ 1/ 79 through 8/ 31/ 80;
1. Attached is a description of c r i t e r i a t o be applied describes
Level I Assisted Job Entries. These a r e the only transactions
which may be entered i n t o the ESAR system.
5: '
4. / . .... 4.
.? <; L.;,!. .-.: c./ i; , <
,
RGBichman : a<'-'
- . . . .
Enclosure
IV- 1
LEVEL I Assisted Job Entries
C l i e n t ' s job was obtained a f t e r s p e c i f i c assistance from the Ex- offender Program
by method A , B or C below and the c l i e n t is terminated as a successful job entry ( I
having been on the job 60 days.
Placement according t o DOL c r i t e r i a :
1. Job order prepared prior t o r e f e r r a l .
2. Prior arrangement made with employer f o r the r e f e r r a l of
an individual o r individuals.
3. Individuals r e f e r r e d had not been s p e c i f i c a l l y designated
by the employer.
4. Verification from a r e l i a b l e s o u r c e , preferably the employer,
t h a t the individual entered the job.
4. Placement recorded on appropriate employment service forms.
Note: This job entry is the only type t o be also reported on the ES- 514L.
Enter a s a I A on forms XO- 009 and XO- 002.
Developed Job Interview
A contact by Ex- offender s t a f f with an employer r e s u l t i n g i n a
c l i e n t r e f e r r a l t o t h a t employer for an employment interview and
subsequent employment. Employer contact mcs: be made before
r e f e r r a l .
Enter as I B on forms XO- 009 and XO- 002. Referral must be documented
in Part I V , ES- 511 Record of Service and on the XO- 003A, Client
Contact Record.
C. Other Specific Job Assistance
Client enabled to e n t e r job located on his own through s p e c i f i c
assistance provided by Ex- offender Program s t a f f . Such a s s i s t a n c e
s h a l l include Federal Bonding Services; provision of t o o l s or cloth-ing;
and provision of f i n a n c i a l a i d , goods, or s e r v i c e s , which
d i r e c t l y contributed to the job entry and has been documented i n
ZS- 511, Part IV, Record of Services and form XO- 003A, Client Contact
Record. Employer contact must be made p r i o r to r e f e r r a l . E n t e ~ a s
I C on XO- 009 and XO- 002.
DOUGLAS R NORTON. CPA
AUDITOR GENERAL
STATE OF ARIZONA
OFFICE OF THE
AUDITOR GENERAL
December 22, 1980
Dear S i r :
The Office of the Auditor General is conducting a performance a u d i t of the
Ex- Offender Job Assistance Program operated by the Arizona Departnient of
Econonic Security ( DES). You a r e l i s t e d i n DES Job S e r v i c e r e c o r d s a s an
enployer t o whom c l i e n t s have been r e f e r r e d by the Ex- Offender Program.
P l e a s e t a k e a few moments t o answer t h i s q u e s t i o n n a i r e and r e t u r n it by
January 5, 1981, i n the enclosed, self- addressed envelope. Your opinion
is very i ~ p o r t a n tt o our evaluation of t h e Ex- Offender Program.
Your response w i l l be t r e a t e d i n a c o n f i d e n t i a l manner and not s u b j e c t t o
p u b l i c d i s c l o s u r e .
1. How f a m i l i a r a r e you with the DES Ex- Offender Program?
! lumber Percent
3- Very Familiar 13 14.9: _ J Somewhat Familiar 5 4 52.1
* Z Mot Familiar A t A l l 2 0 23.0
2. How f r e q u e n t l y a r e you contacted by Ex- Offender Program s t a f f ?
Z- Very Frequently 7 8.1%
i., Occasionally 3 5 40.2
0 Very I n f r e q u e n t l y 2 6 29.9
3 Never Contacted 19 21.8
3. Have Ex- Offender s t a f f explained the purpose of the program and
t h e n a t u r e of t h e s e r v i c e s it provides?
5 Yes 52 61.2%
4. Do Ex- Offender s t a f f contact you p r i o r t o r e f e r r i n g a c l i e n t to
you for e z p l o y ~ e n t c o n s i d e r a t i o n ?
-
i Yes 4 3 51.2%
2- No 2 7 32.1
- Soneti- es, But ? lot Alvays 14 16.7
v- 1
LEGISLATIVE SERVICES WING SUITE 200 STATE CAPITOL PHOENIX. ARIZONA 85007 255- 4385
Page 2.
5. Do Ex- Offender s t a f f c o n t a c t you a f t e r you have employed a program
c l i e n t ?
- - - Yes
Number
3 8
r-- No 28
- Sometimes, But Not Always 16
Percent
46.3%
6. I n general, how would you r a t e the contact you have had with Ex-
Offender Program s t a f f ? @
:-? Excellent
- S a t i s f a c t o r y
f: Poor
T- Very Poor
7 . How does the, Ex- Offender Program compare t o other p u b l i d n o t f o r
p r o f i t job r e f e r r a l agencies with regard t o s e r v i c e t o you and
the c l i e n t s it serves?
Number Percent
C B e t t e r Service Than Other Agencies 11 13.6%
Z About the Same Service A s Other Agencies . 26 32.1 ( 1
E Poorer Service Than Other Agencies 12 14.8
; 7 - No Opinion/ No Basis For Conparison 3 2 39 05
8. What improvements, i f any, do you f e e l a r e needed i n the Ex- Offender
Program?
a
9. Please list any a d d i t i o n a l comments you wish t o make.
Thank you f o r your a s s i s t a n c e , i f you have any q u e s t i o n s p l e a s e c o n t a c t
Mr. Peter Francis a t 255- 4385. zad- 6".-
Gerald A. S i l v a
Performance Audit Manager
G AS/ gck
Enc.