The number of youth offenders in state custody has been steadily declining for years, but a Utah legislative audit released Thursday found that Juvenile Justice Services spending has not mirrored the decreasing population in its care.

Despite a 35 percent drop of youths served since 2011, JJS operating expenses have increased. Its appropriated funding rose more than $5 million from 2012 to 2017.

In an 81-page audit, the state’s legislative auditor expressed concern that the juvenile system has added new and costly internal programming without documenting a cost-benefit analysis or considering whether similar services could contracted to private providers at a cheaper rate.

During a Legislative Audit Subcommittee meeting Thursday, lawmakers seemed troubled that the audit found JJS officials had presented inaccurate and “misleading” statistics when seeking state funding.

For example, JJS for years had been reporting costs per bed — which are not always full on any given day — rather than costs per juvenile.

In 2016, JJS had reported the cost per bed averaged $202 a night. But auditors calculated the cost per juvenile was actually nearly $400 a night.

Auditors believe that by reporting per-bed costs, JJS is not aware of significant increased costs. Also, inefficiencies in staffing and other resources are not being revealed.

“What was the rationale for what looks like a calculus that undersells or underscores the growing cost per juvenile?” House Speaker Greg Hughes asked. “Why did you pick this statistic?”

(Scott Sommerdorf | The Salt Lake Tribune) Speaker of the House Greg Hughes, R-Draper, questions Juvenile Justice Services director Susan Burke during the Legislative Audit Committee's hearing on a "Performance Audit of Juvenile Justice Services", Thursday, January 25, 2018.

JJS Director Susan Burke said the per-bed costs was always the metric they used in their annual reports, and agreed the agency “overlooked” the possibility of calculating costs per youth, as many agencies in other states do.

But the director said she was was “offended” that auditors characterized this and other reporting measures — like inconsistent metrics for recidivism rates — meant JJS was trying to mislead lawmakers.

“I believe Juvenile Justice Services has been very transparent and open in how we operate our business,” she said.

Sen. Gene Davis, D-Salt Lake City, questioned whether JJS may be “overbedding” and could reduce its bed space. Auditors agreed there are likely more state-funded beds in juvenile facilities than are actually needed.

“In the juvenile facilities, we are paying the same whether the bed is empty or the bed is full,” auditor supervisor Brian Dean said.

Auditors recommended that the Legislature consider whether steps should be taken to control JJS spending. After Thursday’s subcommittee hearing, lawmakers moved to pass the audit onto the Executive Offices and Criminal Justice Subcommittee and the Social Services Appropriations Subcommittee for further review.

In the report, legislative auditors also expressed concern about JJS officials’ “lack of transparency” in recent years as they have sought legislative funding. In 2015, the agency pursued funding for a detention center in Weber County, according to the audit, but at the same time was moving money previously budgeted for detention centers to pay for a new internal program.

The report also noted a time in February 2017 when a JJS staffer wrote in an email to an auditor that a 16-bed girls’ residential treatment facility was full. But at that time, there was one girl in the facility — which averages three girls per night and has never been full.

Burke said this was a miscommunication with staffers, who likely communicated the facility was full because of girls who were there for schooling during the day but did not spend the night.

In that same month, JJS officials indicated that they took over managing two detention centers previously run by private providers because of poor service quality and to save costs. JJS estimated the takeover could save the state $400,000 — but instead has cost the state more than $1.2 million in the past two years.

“We acknowledge that quality care is essential,” the audit reads, “but are concerned that JJS has not taken sufficient steps to ensure state resources are used efficiently and effectively.”

The number of private providers contracting with JJS has decreased since 2014, and auditors expressed concern that JJS continues to add new internal programming without considering contracting to those private providers. The report recommended that JJS improve relationships with private contractors, and document a cost-benefit analysis when it decides to create more internal programming rather than contract services.

The audit comes a year after lawmakers passed a bill that made sweeping changes to how youths are treated in the juvenile justice system, with the goal of keeping low-risk youth offenders in their homes instead of detention centers.

JJS officials said last year that these efforts not only result in better outcomes for youth, but also carry significant cost savings. Burke said they plan to give allocated funding back to the state that has been saved since the changes have been put into place.

(Scott Sommerdorf | The Salt Lake Tribune) Juvenile Justice Services director Susan Burke, left, answers questions during the Legislative Audit Committee's hearing on a "Performance Audit of Juvenile Justice Services", Thursday, January 25, 2018.

In a written response to the audit, JJS officials wrote they are “in the midst of transformational change.” In the past two years, they have worked to reduce costs by keeping youth offenders in their homes, they wrote, and reinvested those savings to provide more in-home services, install additional security measures at JJS facilities and boost staff compensation.

“We look forward to ongoing dialogue with the Legislature about how we continuously increase efficiency and effectiveness,” the response reads.

JJS officials agreed to change the way they track and report costs per juvenile, and will track recidivism over two years. They also agreed to complete a cost-benefit analysis moving forward “when making complex decisions about programs and resource allocations.”