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Report to the Arizona State Legislature

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Report to the Arizona State Legislature . STATE OF ARIZONA OFFICE OF THE AUDITOR GENERAL A PERFORMANCE AUDIT of THE ARIZONA RESOURCES INFORMATION SYSTEM MARCH 1980 A REPORT TO THE ARIZONA STATE LEGISLATURE REPORT 80-1 OFFICE OF THE DOUGLAS R. NORTON. CPA AUDITOR GENERAL AUDITOR GENERAL March 28, 1980 The Honorable Bruce Babbitt, Governor Members of the Arizona Legislature Mr. Joe T. Fallini, State Land Commissioner Transmitted herewith is a report of the Auditor General, A Performance Audit of the Arizona Resources Information System. This report is in response to a July 19, 1979, resolution of the Joint Legislative Budget Committee. A summary of this report is found on the blue pages at the front of the report. A response to this report by the State Land Commissioner is found on the yellow pages preceding the appendices of the report. My staff and I will be happy to meet with the appropriate legislative committees, individual legislators or other state officials to discuss or clarify any items in the report or to facilitate the implementation of the recommendations. Respectfully submitted, Douglas R. Norton Auditor General Staff: Gerald A. Silva Coni R. Good Brian C. Dalton James A. Sexton I12 NORTH CENTRAL AVENUE SUITE 600 PHOENIX, ARIZONA 85004 255-4385 OFFICE OF THE AUDITOR GENERAL A PERFORMANCE AUDIT OF THE ARIZONA RESOURCES INFORMATION SYSTEM REPORT TO THE ARIZONA STATE LEGISLATURE REPORT 80-1 TABLE OF CONTENTS SUMMARY INTRODUCTION AND BACKGROUND FINDINGS FINDING I The history of the Arizona Resources Information System (ARIS) is replete with improper or nonexistent planning and unclear purpose. As a result, as of March 1, 1980, ARIS represents a $1.5 million investment in aerial photographs and maps and a relatively sophisticated computer system which performs only rudimentary record-keeping tasks. CONCLUSION RECOMMENDATION FINDING I1 Data processing acquisitions for the Arizona Resources Information System are a chronology of apparent unauthorized expenditures and improperly recorded expenses that would represent violations of Arizona statutes and the fiduciary responsibility of State officials. CONCLUSION RECOMMEND AT ION FINDING I11 Legislation is needed to clarify the intended purpose of the Information Resources Division. CONCLUSION RECOMMENDATION OTHER PERTINENT INFORMATION Production and Use of Orthophotoquads Definitions of a Geographic or Natural Resources Information System and Remote Sensing WRITTEN REPONSE TO THE AUDITOR GENERAL'S REPORT APPENDICES APPENDIX I Arizona Statutes regarding ARIS and the Information Resources Division of the State Land Department APPENDIX I1 Office of the Auditor General survey of potential agency users of map, Landsat imagery and other cartographic products APPENDIX I11 Report on the survey of requirements of the Arizona Resources Information System APPENDIX IV October 9, 1979, Letter to the State Automation Director from IRD (ARIS) Director APPENDIX V October 17, 1979, Letter to IRD (ARIS) Director from the State Automation Director APPENDIX VI Resume of the Director of the Natural Resources Information Systems Project with the National Conference of State Legislatures APPENDIX VII Final Report of the Director of the Natural Resources Information Systems Project with the National Conference of State Legislatures APPENDIX VIII The Applied Remote Sensing Program at the University of Arizona APPENDIX IX March 5, 1980, Legislative Council Memorandum APPENDIX X February 25, 1980, Legislative Council Memorandum APPENDIX XI February 29, 1980, Legislative Council Memorandum APPENDIX XI1 February 20, 1980, Legislative Council Memorandum APPENDIX XI11 November 26, 1979, Letter to the State Automation Director from the State Land Department APPENDIX XIV March 4, 1980, Legislative Council Memorandum SUMMARY The Arizona Resources Information System (ARIS) was created through the actions of the Governor in 1971 and initially staff was assigned to the Department of Economic Planning and Development. In early 1972, ARIS was transferred to the Department of Property Valuation which was merged into the newly formed Department of Revenue on July 1, 1974, Through a joint agreement with the U.S. Geological Survey and the National Aeronautics and Space Administration, the State of Arizona procured high-altitude photographs and orthophotoquads (base maps at a standard scale). ARIS staff supervised the acquisition and sale of these maps and conducted various demonstrations concerning the processing and usage of natural resources data. In 1978, the Legislature passed Senate Bill 1307 (later codified as Arizona Revised Statutes Sections 37-171 through 176) transferring ARIS to the State Land Department through the creation of the Information Resources Division. The statutory duties for the Division include, among others, providing a data bank for the State Land Department, producing maps and related information for geographic areas and coordinating activities of State governmental agencies and political subdivisions regarding use of satellite imagery. ARIS and its activities have been funded primarily through the State General Fund. Staffing has ranged from three to five full-time equivalent positions each year. Our review of the Arizona Resources Information System revealed that the history of ARIS is replete with improper or nonexistent planning and unclear purpose. As a result, as of March 1, 1980, ARIS represented a $1.5 million investment in aerial photographs and maps and a relatively sophisticated computer system which performs only rudimentary record-keeping tasks. (page 12) Our review also revealed that data processing acquisitions for ARIS are a chronology of apparent unauthorized expenditures and improperly recorded expenses that would represent violations of Arizona statutes and the fiduciary responsibility of State officials. (page 30) In addition, our review disclosed legislation is needed to clarify the intended purpose of the Information Resources Division. (page 46) The report contains information regarding the value and usage of orthophotoquads. Definitions of remote sensing and geographic information systems are included. (page 51) It is recommended that consideration be given the following: - The Legislature appropriate funds for the 1980-81 fiscal year to allow for a 12 month lease/purchase of the central processing unit requested in the Information Resources Division 1980-81 budget request. Expenditure of such an appropriation should be contingent upon: 1) approval by the Data Processing Division of the Department of Administration of the lease/purchase, and 2) the signing of a formal lease/purchase agreement between the State Land Department and the equipment vendor. (page 28) The State Land Department, Department of Administration's Data Processing Division and the National Conference of State Legislatures' resource team should conduct a detailed user-needs study and develop a system plan by September 30, 1980. Additional ARIS data processing equipment acquisitions should be contingent upon the preparation of the user-needs study and its review and acceptance by the appropriate legislative committees. (page 28) - If it is determined that such an information system is needed, the Legislature should clearly define the scope, goals and users of the system. (page 29) - Future State Land Department requests for ARIS-related data processing equipment and approval of other expenditures should be based on user-needs surveys and system plans. (page 29) It is also recommended that: - The State Land Department throughly review its internal accounting controls over the use of funds and the resulting classification of expenditures. This review should include all sources of funds used by the Land Department and not be limited to State-appropriated funds. (page 44) - Following this review, the State Land Department institute the necessary changes to prevent future unauthorized and illegal uses of funds. (page 45) - When questions arise regarding the classification of expenditures, the accounting staff of the State Land Department consult with the accounts and controls section of the Division of Finance to ensure proper classification. (page 45) - The State Land Department institute a procedure for the periodic review of insurance coverage provided by the Risk Management Division of the Department of Administration and update this coverage on a timely basis. (page 45) - The Legislature amend Arizona Revised Statutes Section 37-173 if it is determined the development of a computerized data bank should be continued. The statute should expressly state the types of additional information which may be collected, the specific needs of other identified State agencies for which data may be collected, if any, and the financial or other arrangements which would apply to such a liaison. (page 50) INTRODUCTION AND BACKGROUND In response to a June 19, 1979, resolution of the Joint Legislative Budget Committee, the Office of the Auditor General has conducted a performance audit, in accordance with Arizona Revised Statutes (A.R.S. ) 41-1279, of the Arizona Resources Information System (ARIS) now located within the Information Resources Division (IRD) of the State Land Department (SLD). ARIS began as a result of two independent actions of the Federal and the Arizona State governments in 1969 and 1970. In 1969, the National Aeronautics and Space Administration (NASA) funded research projects in Arizona that resulted in the establishment of the Arizona Regional Ecological Testing Site (ARETS) as a joint venture of the University of Arizona and
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