State Audit Blasts Illinois Racing Board

The Illinois Racing Board was charged with a variety of improprieties, from failing to properly monitor the state's totalizator system to not collecting admission fees from simulcasting outlets, in a state audit released Feb. 20.

A total of six bullet-pointed violations were outlined in the synopsis of the report, which covered a two-year period ending June 30, 2002. In addition to the tote system and admission charges, the remaining allegations include:

--Failure by the IRB to perform audits of major accounting and administrative controls once every two years, as required by law;

--Lack of control over equipment. State property control officers were not always made aware of new purchases.

--Failure to act on an interagency agreement with the Department of Revenue to check if any employees were delinquent tax payers;

--Lack of oversight in the hiring of per diem employees.

The report questions the IRB's ability to monitor the tote systems while determining the state's total annual handle, which according to previous IRB annual reports was $1.11 billion in 2001 and $1.1 billion in '00. State and local governments received $26 million in tax revenue each year, but it is alleged the IRB used figures that were unchecked in determining the amount owed the state.

"The Illinois Horse Racing Act of 1975 vests the board with the power to prescribe reasonable rules and regulations to provide for the prevention of practices detrimental to the public and to promote the best interest of racing," the synopsis of the report reads. "It would be prudent to require the vendors to have an independent review performed on their information systems environment."

The IRB has accepted a recommendation in the audit to commission an independent review of the state's tote system. Walter Dudycz, executive director of the IRB, said Wednesday the board has already made several changes to address the charges. He attributed the problems that emerged during the audit, which began in 2000, to personnel changes that took place at the time.

"That was a very transitional period," Dudcyz said, referring specifically to the shakeup in the executive director post. Jack Kubic left as executive director early last year and was temporarily replaced by Marc Laino, who now serves as deputy director. Kubic became the full-time executive director Sept. 1.

"Those things have been brought to our attention and we are addressing them," Dudcyz continued. "We have been dealing in a very aggressive manner to rectify the findings and fully satisfy any concerns that have been brought up."

The synopsis of the audit states the remaining findings against the IRB "are less significant and are reportedly being given attention by the Board."