Maine’s 2024 audit didn’t just expose dollar amounts—it laid bare a governance model where accountability is performative, and where structural deficiencies have allowed the mismanagement of taxpayer dollars to become routine. The first post highlighted what went wrong, while this one explains why it keeps happening.
Despite annual warnings, millions lost, and the direct endangerment of vulnerable Mainers, the cycle of mismanagement continues because the incentives, culture, and systems that govern Maine’s agencies are designed to preserve bureaucracy, not reform it.
The Incentives Problem: Why Bureaucratic Failure Is Risk-Free
If a manager in the private sector oversaw a $3.7 million misallocation, failed to verify vendor pricing, or rubber-stamped contracts without oversight, they’d be fired—or worse, prosecuted. In Maine’s government? They’re more likely to receive a promotion than a pink slip.
That’s because state agencies operate with no real performance accountability. The Office of State Procurement Services (OSPS), for example, failed to enforce legally required cost analyses under 5 M.R.S.A. §1825-B, and yet there’s no evidence of disciplinary action, termination, or even formal review of leadership failures.
This is not new. For years, Maine Policy Institute has warned about the lack of performance-based incentives in our public systems—from our 2020 push to reform Maine’s constant budget growth to repeated warnings which highlighted lax budget review processes and low state agency opacity. The truth is clear: there are no real consequences for failure in Augusta, and without reforms to tie funding, promotion, or employment to measurable outcomes, these patterns will persist.
Ignoring Obvious Concerns
The audit revealed dozens of contracts issued without competitive bidding, many split intentionally below $5,000 to avoid oversight. It also found agencies issuing payments after work was completed—sometimes without documentation or cost justification.
But this goes far beyond procurement. The same rubber-stamp mentality infected child welfare, where the Department of Health and Human Services placed children in foster homes without completing legally required abuse and neglect screenings.
This culture is not accidental—it is the result of policy decisions. Maine’s procurement law carves out broad authority for “sole-source” justifications, often based on vague or unverified criteria. 5 M.R.S.A. §1825-B.2.C gives a waiver from competitive bidding when a “reasonable investigation” is conducted and it “appears” that only one source would provide those resources. Agency heads have little incentive to use competitive processes and avoid fast-tracking vendor relationships, even if those shortcuts mean violating the spirit—or the letter—of state law.
MPI and other policy groups have consistently flagged the risks of sole-source contracts, opaque vendor relationships, and centralized procurement lacking independent verification. Maine needs reforms that introduce third-party procurement reviews, enforce disclosure of contract rationale, and penalize misuse.
Fragmented Responsibility
One of the audit’s most damning revelations was the state’s failure to cross-check data between agencies. DHHS issued SNAP benefits to deceased individuals because it lacked a basic system to compare benefit rolls with the state’s death registry.
This kind of failure is not technological—it’s the system’s design that is the problem. Maine’s data systems are siloed by design, with each agency controlling its own universe of information, and little incentive to build interoperable systems. This makes fraud easier to miss, and accountability nearly impossible to trace.
Compare this to states like Florida, which have adopted centralized eligibility and data systems to identify duplicate benefits, improper payments, or regulatory violations in real time. In Florida they have implemented a Public Benefits Integrity Office, which has the purpose of investigating public assistance fraud or misuse of any public benefits.
These systems save money and prevent scandal—but implementing them in Maine would mean threatening entrenched agency control. Meanwhile, welfare fraud cases are rarely prosecuted in Maine, as Governor Paul LePage noted less than half of welfare cases presented to the Attorney General’s office were prosecuted in 2016. The Attorney General at that time is now Gov. Janet Mills. Until Maine policymakers insist on shared responsibility and systems integration, siloed failure will remain the norm.
How Maine Ignored the Alarm Bells
What is worse is that for the Department of Education and Department of Health and Human services, there have been warning bells for a while.
The Maine DOE has been flagged before for financial mismanagement, including undercompensating private schools by millions for town-tuitioned kids since 2016, to having delayed public audits due to a statewide auditor shortage, to even recently the Maine DOE paying the Portland Press Herald over six figures in federal COVID relief funds to create positive coverage of how they allocated COVID-era money. The obvious question is: if Maine’s DOE is so well-managed, why would they need to pay for positive press coverage?
Additionally, the DHHS has received repeated warnings on child placement safety, and while the Maine Legislature technically has the capacity to oversee the executive branch, this only occurs on a case-by-case basis. There is no requirement audits are reviewed, there is no direct usage of audit reports in appropriations procedures, and the state auditor’s reports only focus on the fiscal side of things, not performance.
The best Maine has for performance audits, the entire first half of the “you get what you pay for” parable, is occasional reports by the Office of Program Evaluation and Government Accountability. These reviews are rare, typically less than five a year, and are incredibly limited in scope. Their report names, “OPEGA informational briefing,” are at least accurate, because they are very often as brief as less than 10 pages. This means that while the Maine auditor’s office generates five-hundred-plus page annual audit reports on the fiscal side of things, OPEGA might publish less than fifty pages a year in performance related “briefs.”
Conclusion
Maine’s oversight crisis didn’t start in 2024—it’s been building for over a decade. It is the predictable result of structural flaws, weak incentives, and a political culture more focused on avoiding conflict than demanding accountability. Maine’s financial problems have been building up to this point for years, and it is going to take serious work from the state Legislature to fix them. In the third and final post of this series, I will discuss exactly what lawmakers can do to fix these problems.