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2. It has failed to protect the independent character of the auditing functions.

As constructive recommendations are to be incorporated in a subsequent report the first of these defects will be left without discussion at this time. The comment in this report bears entirely on the second constitutional defect, namely, on the results of the failure to protect the office, or, to put it in another way, on the acts of the legislature which have laid upon the office duties and functions that are at variance with its constitutional purpose.

Defects in Legislation Governing the Office

The history of the comptroller's office would be an interesting chapter in a study of irresponsible government. It is sufficient for the present purpose, however, to describe the result. Being left almost entirely in the control of the legislature and in its establishment being made a creature of statute law, the office was assigned three absolutely discordant and irreconcilable duties, namely:

1. The comptroller was required to determine what revenue charges should be set up and what amounts were to be collected.

2. The comptroller was also required to collect the revenues, the amount of which was to be determined by his own official acts.

3. The comptroller was required to audit and verify the collections as well as the accruals which were made in his own office.

Here we have an auditing office, established as a part of the constitutional machinery for fixing and enforcing administrative responsibility, and yet laboring under administrative duties assigned to it by statute, the effect of which is to destroy the disinterestedness of its audit and verification. The auditor as an instrument for enforcing responsibility has had turned over to him by an irresponsible representative government the very autocratic powers that the representative system was established to correct, when these powers were exercised by the executive.

The Present Organization of the Office

Lest it be thought that the conclusion above reached is unwarranted, the present organization is shown in outline below-arranged by working units and subdivisions of personnel, according to functions performed by each (previous to the law of 1915).


Activities having to do with determining what revenue charges shall be set up for collection.

Transfer Tax Bureau

Imposes transfer tax and penalties under the transfer tax law.

Corporation Tax Bureau

Locates taxable corporations; obtains evidence necessary to levy taxes; makes the levies; handles matters relating to reduction of capital stock, etc.

2. Activities having to do with collecting revenues. Transfer Tax Bureau


Collects transfer taxes imposed under transfer tax

Corporation Tax Bureau

Collects taxes imposed on corporations; issues warrants for unpaid taxes, etc.

School Debt Tax Bureau

Collects taxes due under school debt tax law.

3. Activities which have to do with auditing financial transactions.

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Finance Bureau

Has supervision over auditing of all accounts against state; supervises sinking funds, trust funds and bond sales.

Audit Bureau

Makes audits of state institutions, boards, commissions and departments; passes on contracts for maintenance of state institutions; keeps appropriation and retirement fund accounts; prepares financial and budgetary statements; prepares the comptroller's annual report,


The Land Tax Bureau

Has charge of matters relating to the admission and rejection of taxes on non-resident lands; prepares deeds for land sold for taxes; examines assessment rolls; reports on matters referred by the commissioners of land office; makes computations relating to state aid, to highways, etc.

Stock Transfer Tax Bureau

Examines records of companies, transfer agents and persons engaged in the brokerage business to determine whether required tax is paid.

Mortgage Tax Bureau

Audits and supervises accounts of county treasurers in connection with moneys received from recording officers.

License Bureau


Supervises private bankers, steamship ticket agents,

Bureau of Canal Affairs

Supervises financial transactions relating to canals. Bureau of Highways

Audits accounts of highways department; examines contracts for construction, audits payment of estimate,


State Printing Division

Supervises expenditures for state printing.

Organic Changes Provided for in Recent Bill

The foregoing represents the organization of the comptroller's office, as it existed at the time the descriptive report of the government of the state was prepared and as it exists today. What is known as the Hinman Act was signed only a few days since. This act took away from the comptroller certain tax-collecting agencies which had charge of corporation, transfer, franchise and mortgage taxes. It was a step in the right direction, but still the comptroller, through his ex-officio connections and other administrative responsibilities, is far from being an independent auditing officer.

Section 179 of the Hinman Act provides specifically that, although the powers and duties formerly conferred upon the comptroller in relation to the assessment, determination, revision, readjustment and imposition of corporation taxes shall be transferred to the new state tax department, "the duties of collecting corporation taxes assessed and the refunding of such taxes as paid" shall continue to be exercised and performed by the state comptroller. It is obvious that the bill does not take out of the comptroller's office all of its discordant functions. It does not provide for its complete independence. Although the work may be followed up on more consistent lines, the office is not protected against future invasions by legislative enactment. This office, which is so essential to the working plan for making the government responsible and for protecting the state from exploitation, can itself only be protected by constitutional enactment. It is essential that the comptroller, as the auditor-general of the State of New York, be set aside and entirely isolated so that pressure may not be brought to bear upon him to permit the office of audit to be used for ends that are inconsistent with its underlying




So far attention has been given to the means provided for determining the public will, and for impressing this on officers charged with the duty of performing services required. What has been said refers to the representative side of the enterprise, viz., to the "electorate," to the "representative" body, and to the relations of the representative body to the administration. Accepting Anson's distinction, which has already been twice mentioned, the report has thus far dealt with the constitutional means of deciding what to do." It remains to evaluate the means provided for "doing it."

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What is Meant by "Administration"

The word "administration" is from a Latin verb, which means to anage, to execute. Management has to do with the preparation, submission, approval and execution of plans. In a representative system the board is a part of management to the extent that its approval is necessary. Otherwise management is primarily an executive function.

Problems of Management

The problems of management fall into two general classes corresponding to functions or activities of similar character, viz.: (1) those which have to do with the state or other institution acting as a proprietor -activities of a kind that must be carried on no matter how extensive its functions; (2) those functions or activities in the nature of services rendered to the public-things done in carrying out the purposes for which the institution exists. The first of these will be hereinafter referred to as proprietary functions; the second will be called in contradistinction public service functions. Each institution has similar proprietary functions and problems, but the public service functions differ as widely as there are different institutions. Each institution has its own purpose and an organization and technique developed or to be developed suited to its work.

Proprietary Functions and Problems

Among the common proprietary functions or groups of activities are


1. Obtaining and caring for the funds required, whether raised as revenue or by borrowing.

2. The employing and caring for the personnel needed on the


3. Acquiring and caring for the supplies and equipment and properties required to make the personnel effective.

4. Paying the debts and current obligations of the government. While there are adaptations within these groups of activities, they constitute only variants of methods for doing the same kind of thing and have in them common consideration for the administrator.

Public Service Functions and Problems

The public service functions differ with each institution or enterprise. Those which are carried on by the government of the state may be grouped as follows:

1. Military protection.

2. Promotion of public education, art, science and recreation.
3. Construction, operation and maintenance of public works.
4. Promotion of health and safety.

5. Regulation of public service corporations.

6. Regulation of insurance and banking.

7. Promotion of agriculture and industry.

8. Protection and promotion of the interests of labor.

9. Care and education of the dependent, defective and delinquent classes.

General Requirements of Organization for Administration

As in the case of policy determination, definite expedients and institutional adaptations have been developed for management and mastery of details of administration. The technique varies widely, but each organization when considered broadly may be characterized as belonging to one or another of the following types:



A type in which executive control is centralized-one which
has at its head a chief executive through whom persons.
in charge of the several functions are held responsible.
A type in which executive control is decentralized-one which
has many executives independent of each other.
A nondescript type of organization-one whose development
seems to have been governed by no principle-in which
some of the departmental executives may be held re-
sponsible through an officer who is called chief executive,
other departmental executives may be independent and
still others may hold such an ill-defined position that they
are uncertain as to whom they are responsible.

Executive and Departmental Organization of the State

(The organization provided for and developed under the constitution for the government of the State of New York is of the third or

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