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Gov. Christie on Friday released 19 reports on how to improve (via shrinkage or elimination) inefficient government operations. The reports were prepared by his Transition New Jersey subcommittees, which conducted thorough reviews of all departments, agencies and authorities of the state.

On the campaign trail and throughout the gubernatorial transition period, Christie often spoke out against the special municipal aid that the state allocates largely to “distressed” cities like Jersey City. (The reason the city’s Fiscal Year 2010 budget was introduced at the last minute two weeks ago was to make sure we received our $14 million in aid before Christie had the chance to take it back.)

In his transition team’s report on the Department of Community Affairs (DCA), which oversees this type of aid, the administration calls for more oversight of aid, both from the state and the local government side.

Referring to the Division of Local Government Services (DLGS), which is the section of the DCA that manages the aid, the team (which was headed by Jersey City Sen. Sandra Cunningham) says the division’s core mission is hampered by “a lack of fiscal and operational accountability, inadequate technology, and reduced levels of staffing.”

Specifically, the report says that, when it comes to aid to distressed cities, “the lack of DLGS oversight or
local corrective action steps inevitably promotes a culture of dependency. In contrast, there is a lack of
flexibility for compliant, well-managed municipalities to be creative and innovative in their finance
practices.”

To that end, the team suggests a few changes:

- Move to digital. Currently, the report notes, “566 municipal, 21 county, and various authority and fire district budgets are all submitted to DLGS on paper. The technology has been described as ‘painfully inadequate.’ Budgets could be reviewed more quickly and, if needed, more frequently with electronic reporting. Additional software would provide greater transparency and allow for better information on government finance and operations, while creating a valuable database for local governments, taxpayers and nonprofits.”

- Audits. “Utilization of operational audits and performance measurements to evaluate special aid and grants-in-aid should be considered,” the report reads. “Additional oversight is needed not only in monitoring the financial status and compliance of grants, but also to ensure the intended purpose and goals of the grants are being met.”

- Increase Reporting from Local Governments and Nonprofits. The biggest reform proposed in the report is to strongly consider implementing “corporate responsibility best practices at the recipient level” similar to the federal Sarbanes-Oxley law, which sets out rigorous accounting and auditing standards for all U.S. public company boards, management and public accounting firms. “As a first step, a certification of fiscal controls should be required from the Mayor, Business Administrator, Chief Financial Officer (or equivalent), the governing body and their nonprofit counterparts,” the report says. This type of reporting would potentially require a representative or representatives from any local government receiving DCA funds to review and sign quarterly and/or annual reports certifying that those reports don’t misstate or omit material facts. To help local governments comply, the report suggests “sufficient training” that would get everyone up to speed.

You can read the entire report here.