Audit claims USTAR overstated success

Thursday , March 06, 2014 - 2:03 PM

Antone Clark, Standard-Examiner Correspondent

SALT LAKE CITY — Set up to help the state expand opportunities in technology and research, the Utah Science Technology and Research Initiative (USTAR) has over-reported its success and doctored its numbers in some cases, according to a state audit of the group released Tuesday.

A probe of USTAR practices and finances, discussed in a legislative committee Tuesday, lists 15 findings involving the organization set up in 2006 to help the Beehive State innovate in technical areas and provide more high-paying jobs.

USTAR has facilities on both the University of Utah and Utah State University campuses.

The state has invested $134.2 million from fiscal years 2007 through 2014 in the economic development/research program.

The findings claim USTAR’s assessment of its innovation are overstated and inaccurate and they claim to have created jobs, which no longer exist. A large portion of the 3,380 jobs the organization claims have come were actually construction jobs, related to building a research facility the 77-page audit says. It goes further to point out many of the jobs were low-paying and part-time.

The audit also says the return on investment from the organization have not materialized for the state. USTAR reports a ROI of 219 percent in their numbers, which the audit said includes $120 million in funding not affiliated with USTAR research.

Other audit findings include:

• Sponsored research has met expectations, but was still over-reported.

• USTAR should clarify expectations for their research team.

• Oversight and better budgetary practices should be enacted.

• Better oversight of research buildings is needed.

• USTAR needs to ensure compliance with open meeting laws.

• In some cases research dollars were being used for non-research activities.

Approximately $5.7 million of research funding has been used by the organization for operation and maintenance of its facilities, the audit says.

Senate President Wayne Niederhauser suggested the organization hasn’t proven its worth.

“I’m not saying there hasn’t been a lot of good, but it seems like we’ve just dressed up a program we could have funded without a special name and given research money to the University of Utah and Utah State University,” Niederhauser said.

“As I think about the audit and its completeness, it appears to me that this (USTAR) is a glitzy way to fund U of U and USU research ... It seems like this was more funding for the research of these universities and we could have done without a glitzy title,” he added.

Ted McAleer, executive director of USTAR, did not make any excuses for the findings in the audit and said appropriate responses are being taken to each of the 15 findings. He said the findings fall into three areas; performance, investment returns and policy and procedures.

“You have my commitment that we will manage each of these areas at the USTAR meetings,” McAleer said.

State Auditor General John Schaff said the main message of the audit is USTAR needs to provide more structure as part of its accountability.

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