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Published: Thursday, 7/6/2006

Report calls for less control by governor at the BWC


COLUMBUS The governor has too much power over the Ohio Bureau of Workers Compensation, according to a report by the state s anti-corruption watchdog.

So long as nearly absolute power is vested with the governor, the potential for the abuse of this power exists, says the review by Evaluation Associates, of Norwalk, Conn., that was released today. The only way to assure that power will not be abused is to spread it among a variety of persons.

The firm, hired by Inspector General Tom Charles, says the bureau s Oversight Commission should have more power, including the hiring of the bureau s administrator. That would dismantle the changes that Governor Voinovich persuaded the GOP-controlled legislature to adopt in the mid-1990s.

The report states:

  • The bureau s Oversight Commission should hire the agency s administrator-CEO. Currently, the governor is in charge of hiring and firing.

  • The governor should not retain the current power to appoint all five voting members of the Oversight Commission, but instead should have an equal number of appointments with the legislature, the state auditor, and the attorney general.

  • Investment experts on the Oversight Commission should have full voting privilege, and more experts in accounting and insurance should be added.

  • An independent legal advisor should be hired to eliminate the conflict of the attorney general serving as legal advisor at the same time having the power to file civil charges against the bureau.

    The primary fiduciaries are the members of the Oversight Commission, the report by Evaluation Associates says. The buck, as it were, stops with them. If the members of the Oversight Commission are to be held fiduciarily responsible for everything that happens at the BWC, then they must have the power to exercise that responsibility.

    The report makes references to media coverage of the scandal, which began in April, 2005 when The Blade first reported on problems with the bureau s $50 million investment in rare coin funds controlled by Tom Noe, a Republican fund-raiser and gubernatorial appointee to the Ohio Board of Regents and the Ohio Turnpike Commission.

    The ensuing scandal, commonly known as Coingate, has attracted the attention of federal and state law enforcement officials and has resulted in resignations, terminations, and recently, indictments of key individuals involved with BWC investments, the report says. More importantly, the close scrutiny of BWC activities which Coingate has drawn has exposed countless failures in the process of managing, controlling, supervising, and monitoring the investment of BWC assets.

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