Despite a rocky first year, the controversial merger of state government’s nine watchdog agencies has achieved some success with the potential for more, the Office of Governmental Accountability’s executive administrator reported Tuesday.

“I think there is good news: The business of the state of Connecticut continues,” David L. Guay told Gov. Dannel P. Malloy at the monthly commissioners’ meeting at the Capitol.

Guay conceded that uniting nine autonomous watchdog groups to consolidate and share business functions was not without challenges.

“Clearly this is a work in progress,” he said, adding that the agency nonetheless is leaner, “seeking those savings and efficiencies and refining the processes of government.”

The legislature approved an $8.6 million budget earlier this month for the OGA for the fiscal year that begins July 1. That’s down 20 percent from the $10.7 million allocated in total across nine watchdog agency budgets in 2010-11 — the fiscal year before the merger.

“I am mindful that success is rarely achieved alone,” Guay said, praising both “the outstanding employees” as well as the heads of the nine watchdog divisions within OGA. “Their willingness to make this work has been an example to all.”

Malloy, who inherited a projected budget deficit approaching $3.7 billion when he took office in January 2011, recommended an array of agency consolidations to help close that gap, along with tax increases, a union concessions package and other spending reductions.

Among the most controversial of proposals was a plan to unify the State Elections Enforcement and Freedom of Information commissions, the Office of State Ethics and six other watchdog agencies into one entity under a director appointed by the governor.

Legislators agreed to the merger, but balked at giving Malloy full control over watchdog leadership. Instead they agreed that the nine divisions within the new Office of Governmental Accountability would retain autonomy over their respective watchdog functions. But they would merge certain business functions that would be overseen by an executive administrator.

Lawmakers also agreed that the leaders of the nine watchdog agencies would form the Governmental Accountability Commission. And though the governor would appoint the executive administrator, Malloy would have to choose from among three finalists recommended by the watchdog agency heads. In addition, the commission has the authority to evaluate the executive administrator.

The Malloy administration and the OGA bumped heads right out of the gate, even before an executive administrator had been chosen.

In late June 2011, before watchdog agency heads had even begun interviews for the first executive administrator, Malloy named a high-ranking member of his budget office to serve in the post in an acting capacity — even though the statute ordering the merger prohibited the governor from doing so at that time.

The administration quickly backpedaled and said it only wanted someone from the budget office to work with watchdog divisions to plan for budget cuts should a pending bid for state employee union concessions fail.

In their first progress report, six months after the merger, OGA officials made two very different pitches to the legislature.

Guay wrote that he faced an “awkward relationship” with the watchdog agencies, contested their authority to evaluate or dismiss him, and sought more authority to change staffing and job functions.

“There is clearly reluctant acceptance of this merger,” Guay told The Mirror during an interview at the time. “Where I don’t have the authority (to streamline operations), I would like the clarity of being shown who does.”

Watchdog agency heads fired back in their own segment of the progress report, urging legislators not to enhance Guay’s authority and to preserve the divisions’ control over their respective budgetary and personnel decisions.

The State Elections Enforcement Commission wrote at the time that being subject to an executive administrator who is appointed by the governor — an elected official whose campaign actions are regulated by SEEC — “it would be an anathema to our independence.”

Lawmakers ultimately made no changes to the OGA system, but leaders of the Appropriations Committee also indicated to watchdog agency heads on several occasions that the consolidation was not going away.

Malloy said after Tuesday’s commissioners’ meeting that he was pleased to hear Guay’s assessment of the consolidation one year out. “I know it’s troublesome for some folks,” the governor said, praising Guay for “a leadership style that’s allowing us to accomplish some success.”

Carol Carson, executive director of the Office of State Ethics and chairwoman of the Governmental Accountability Commission, said Tuesday, “I agree with the executive administrator that everyone’s working hard to make this a success.

“It’s still a work in progress. But frankly, it’s too early to evaluate.”

Keith has spent most of his 31 years as a reporter specializing in state government finances, analyzing such topics as income tax equity, waste in government and the complex funding systems behind Connecticut’s transportation and social services networks. He has been the state finances reporter at CT Mirror since it launched in 2010. Prior to joining CT Mirror Keith was State Capitol bureau chief for The Journal Inquirer of Manchester, a reporter for the Day of New London, and a former contributing writer to The New York Times. Keith is a graduate of and a former journalism instructor at the University of Connecticut.

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