As a result of ongoing investigation of the finances of the state’s arts agencies, the state’s financial overseers have taken a good first step in taking over the agencies’ accounting work. After lawmakers hear more this week about whether the problems are isolated or more widespread, they should decide if further corrective action is necessary.

An audit, conducted by the Office of the State Controller, found that the state’s cultural agencies had mishandled the creation of a new entity to advocate for the arts and that $4,000 appeared to be inappropriately spent on lobbying activities through the law firm of Verrill Dana. In his report, released last month, State Controller Edward Karass noted that while the amount of money in question was small, his office found the relationship between the cultural agencies and Verrill Dana to be “odd in its nature.”

“We find there to be too many vagaries surrounding the activity that has been engaged in by all involved,” the report noted. Among those vagaries were the creation of the Maine Community Cultural Alliance, a group for which the controller could find no meeting minutes, budget materials or board member roster. The Maine Arts Commission contributed $3,000 in federal funds and the Maine State Museum put in $1,000, from the state’s General Fund, to initially fund the alliance, according to the controller’s audit. This money was part of a payment to Verrill Dana to provide advice and legislative background information about what was going on in the State House related to cultural issues, according to the law firm. The audit recommended that this $4,000 be returned to the federal and state government.

Further, the audit said the agencies had “poor control” and “little monitoring” of the work done by Verrill Dana.

As a result of the audit, the accounting work of the cultural agencies – which include the Maine Arts Commission, the Maine State Library, the Maine State Museum and the Maine Historic Preservation Commission – has been transferred to the Department of Administrative and Financial Services.

Commissioner Rebecca Wyke made it clear that this was done not to consolidate state services but to “implement better controls and to ensure state resources are safeguarded.”

The cultural agencies maintain that the audit involves only a small amount of money. The issue isn’t how much money was involved, but how far the agencies strayed from acceptable state practices. Through briefings to legislative committees and further state auditing currently under way, lawmakers will soon learn how far the agencies did stray.

Bringing them back in line with state practices will then be a top priority.