| Return to index for this investigation

A newly-released state audit reveals that a little-known but powerful state agency has been beset by serious management failures including violating state laws requiring documentation of its workload and record-keeping.

NECIR-BU reported in August that Gov. Deval Patrick’s administration was alerted to deep problems within the Division of Administrative Law Appeals as early as May, 2008, including the fact that cases were dragging on for up to four years without a decision.

Patrick’s appointee to run the agency in 2007, Shelly Taylor, resigned last August amid the NECIR-BU probe.
She continued to earn $6,300 in consultant pay for two months following her departure, despite the fact decisions issued by the agency dropped by half since she took over. And even though staff levels remained the same since Taylor took over, the number of hearings scheduled has plummeted.

Though without a high public profile, DALA, as it is often called, makes critical decisions impacting everyday life in Massachusetts. It hears appeals from licensed professionals like doctors, nurses, aides and day-care operators who are contesting discipline imposed by state boards. Local and state employees appeal to DALA when they disagree with their pension calculations. DALA also hears cases regarding disputes relating to public construction projects, environmental permits, and wage and hour violations.

“DALA magistrates routinely preside over cases of public importance and DALA’s decisions can have significant and lasting consequences for the public and for individuals and their families,” the audit states.
The Feb. 4 audit found, among other things, Taylor had failed to file an annual report with the Legislature during her tenure, in violation of state law. The agency had also failed, in violation of state law and a requirement from the Office of the Comptroller, to conduct a risk assessment or internal control plan to ensure the agency was adequately protecting its operations, finances and records.

New management at DALA since Taylor’s departure filed the report with the Legislature last September. But, in a written response to the audit, DALA officials said the Office of the Secretary of Administration and Finance, which oversees DALA, should be responsible for fulfilling the risk assessment and internal control requirements.

The audit also found serious problems developing at other state agencies due to DALA’s failure to promptly notify parties if an appeal had been filed in a case. For instance, DALA sometimes failed to notify the Attorney General’s office if a business had appealed a citation from the AG for alleged violations of wage laws.

If the citation remained unpaid and the AG wasn’t aware of the appeal, it issued a lien against the business.
“The lien then needed to get removed, which was quite time-consuming and complicated, as the Department of Revenue understandably did not want to remove a lien unless a business made payment on the lien,” the audit states.

Among other audit findings:

- The backlog of outstanding cases was increasing even though new filings dropped. The backlog of pension cases, for instance, more than doubled between 2002 and 2009

- In at least 121 cases, preliminary decisions were being written but were not finalized or issued to the parties. Despite Taylor’s goal to have a decision issued within 90 days after the close of the record in the case, decisions could take as long as 1 ½ years to become final

- DALA’s case management system was flawed and cases were not being properly tracked
DALA officials said, in a written response to the overall audit findings, stated the “suggestions for remedial measures in the report are thought-provoking and are being considered seriously by management and implemented where appropriate.”