Julie Blaha, Pam Myhra have different plans for state auditor's office

Republican Pam Myhra wants to grow the state auditor's office and dig into an area it doesn't typically review: state agency spending. Democrat Julie Blaha hopes to offer counties occasional free audits and expand the office's educational resources.

Myhra, a certified public accountant and former state legislator, and Blaha, a former math teacher and union leader, both plan to shake up the state auditor's office, which monitors more than $20 billion in local government spending. But the race — which is open for the first time in more than a decade — has received little attention in a busy election year.

"This is probably the office people know the least about," said Blaha, who wants to change that.

The state auditor's main job is to keep an eye on what cities, counties and other local government entities spend. The office landed in the news after a 2015 law allowed counties to hire private auditing firms instead of having the state auditor review their books annually. State Auditor Rebecca Otto, a Democrat, fought the change in the courts, saying it would gut the office's responsibilities.

The Minnesota Supreme Court ruled this spring that counties could use outside firms. But Otto emphasized after the ruling that her office can still review county spending, even after a private audit.

Blaha said it's important to maintain the office's ability to conduct audits, but she would take a different approach than Otto. The crux of the issue is local government officials want to save money, she said, and private audits can cost less than the state process. She proposed that the state cover the cost of a county audit every three or five years, while counties continue to pay for the other years.

Blaha said she would work with legislators to devote state dollars to the audits, and appeal to Republicans by emphasizing that the change would result in direct savings for local governments.

Myhra approved of the change to allow private audits. She said counties were not just concerned about money, but the timeliness and lack of recommendations in the state auditor's work. But she agreed with Otto that it's important to have state oversight of the outside firms. Under her leadership, Myhra said, the office would do performance reviews of the firms' work.

Myhra wants to add staff in the auditor's office and look into state programs, citing a Fox 9 report of fraud in a child care subsidy program overseen by the Department of Human Services. The Legislative Auditor's office typically handles such reviews.

On Friday, Blaha issued a news release calling out Myhra for sharing "uncorroborated and racially charged allegations" about the child-care funds going to terrorist groups overseas.

Blaha previously said if Myhra wants to catch fraud with audits, that would necessitate "a dramatic, dramatic expansion of the office" that would be very expensive.

Myhra said she joined the race because she found herself shaking with anger after reviewing laws governing the auditor's office, which she called outdated. She said she'd ensure the state complies with government auditing standards, and she would shift some work that used to belong to the state treasurer. The auditor's office took on the responsibilities when the treasurer's job was eliminated, and Myhra said that resulted in auditors reviewing work they helped manage, which she called inappropriate.

Myhra, 61, served two terms in the Minnesota House representing Burnsville. In the 1980s she spent six years as an audit manager for international accounting firm KPMG, then left to raise and home-school her three children. She has since taken hundreds of hours of continuing education to maintain her CPA license, she said, but has not continued to work in accounting. She wants to be the first certified public accountant to lead the office, Myhra said, and that message appeals to people of all parties.

"Whether they are Republican or Democrat, they think it's important to have someone with credentials in that office," Myhra said. "They want their tax dollars to be used wisely."

She is trying to reach voters at events across the state, including a Mexican Independence Day celebration in Minneapolis. Most of the people she approached took her business card and moved on. She occasionally got in a line or two: "I'm a certified public accountant … I want to keep a closer watch over our tax dollars."

In Myhra's first term in the State House she sat next to Rep. Jenifer Loon, R-Eden Prairie, who called her seatmate "meticulous." Myhra had a color-coded organizational system and would handwrite responses to constituents, Loon said. She wasn't the type of legislator to frequently opine on issues, but when she did speak up, her comments were thoughtful and people listened, Loon said.

While Myhra's comments are measured, Blaha, 48, of Ramsey, offers ideas at a rapid pace. Her speeches are punctuated with jokes. Door-knocking in Bloomington last month, she got a warm reception at the home of second-grade teacher Katlin Ring. Blaha, who taught middle-school math, waxed nostalgic about the start of a new school year, adding with a laugh, "I'm not going to offer to make you bulletin boards."

Myhra seems to have made up her mind about what needs to be done without getting broad input, Blaha said. She wants to do things differently. One of her first steps, if elected, would be meeting with county auditors and city and town clerks to find out what changes they want to see.

Blaha has already been doing some of that work, and said improvements to the accounting system technology used by small cities and towns is important. She also plans to expand the office's educational offerings, such as informational sessions on tax increment financing, to encourage people to learn about how local government operates and get involved.

This is Blaha's first bid for public office, but her civic involvement dates to the 1990s, when she was president of Minnesota National Organization for Women. She served as president of the Anoka-Hennepin teachers union and recently was Minnesota AFL-CIO secretary-treasurer.

Bill McCarthy, president of the Minnesota AFL-CIO, said when Blaha was elected, she quickly took control of the finances and understood how to lay out a budget, address campaign finance issues and work with their auditor. She is skilled at talking through issues, like the financial ramifications of the Supreme Court's Janus ruling, to come up with solutions, he said.

The auditor position has been a springboard to higher office for some politicians, including Governors Mark Dayton and Arne Carlson.

But Blaha and Myhra both said, at least for now, they are only focused on one job.

Jessie Van Berkel • 651-925-5044