Cash Flow: State government must pay its bills on time
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State government's disregard for paying bills on time (or spending money on time, for that matter) isn't news. But what may have come as a surprise to some is the degree to which some agencies have fallen behind. During the interim meeting of the legislative Joint Committee on Finance last month, Deputy State Auditor Anthony Woods said in 2022, the state Department of Highways had more than $1 billion in invoiced work, and more than 90 days to pay more than $50 million of those invoices. Then it took more than a year to pay $2.5 million. The auditor's office has been working with the DOH.
"Say we know that these payments have been sitting out there a while," Woods said, according to a WV Public Broadcasting report. "We can move that ahead of all the other payments in line. Typically, we process payments on a first in, first out basis. But when there are delayed invoices or things that are urgent and priority, we can bump those to the front."
Seems like common sense and good business practice, doesn't it? It is simply respectful and courteous to keep up with what is owed to a contractor or vendor.
"When you perform a job and six months, eight months go by and you're owed a half a million dollars and you're working on additional projects, cash flow can become a very serious issue," Bryan Hoylman, president and CEO of Associated Builders and Contractors of West Virginia, said. "Issues that have caused a number of problems where you have to lean on lines of credit. It's just very frustrating when it's the state that is letting the projects. These are taxpayer funds."
Bureaucratic layers can be a problem, too, as Woods told the committee there are plenty of complaints against the Department of Health and Human Resources. Among the reasons for that department's slow payment is the number of steps to go through in the invoice payment process.
"If I recall, when we were working on some of this for the Prompt Pay Act, (DHHR) had about 3,000 or 4000 invoices during this same time frame that were paid greater than a year," Woods told the committee.
It appears as though the auditor's office is working to get a handle on this gross mismanagement of taxpayer dollars. But lawmakers must be certain not to reward those who have no sense of urgency about paying what is owed -- that is, taxpayer dollars owed to taxpayers.