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The state agency responsible for helping Utahns with disabilities find work and live independent lives was poorly managed, costing the agency about $33 million, according to a new state audit, which recommended moving the entity to another office where it could receive adequate oversight.

The Utah State Office of Rehabilitation provided an array of vocational training and other rehabilitative services to an estimated 20,000 disabled Utahns in 2014.

But the review by the Utah Legislative Auditor General's Office found that inadequate oversight of the agency resulted in it running a $4.9 million deficit in 2014, draining $17 million in reserve funds and requiring legislators to pony up $6.3 million to keep the programs afloat.

In addition, the rehabilitation office expects to be penalized as much as $6 million by the federal government.

The auditors blamed the discrepancies on poor oversight from the Utah State Office of Education and suggested that the state's rehabilitative services might be better managed under the Department of Workforce Services.

"The board [of education] failed in its governance of USOR," said Leah Blevins, the audit supervisor, noting that in 97 board meetings, USOR appeared seven times and focused on successes at the agency. USOR officials presented issues through "rose-colored glasses," Blevins said.

Darin Brush, the new director of USOR, said the agency, the state office of education and the state board of education take their oversight responsibilities seriously and are working on changes to prevent future budget problems.

But Rep. Brian King, D-Salt Lake City, said he's not convinced the state office of education can manage USOR.

"I'm concerned about the functionality of our state office of education," King told the education officials. "You've got to sell it to me that we should keep it with you. … I'm not sure USOE has, to my satisfaction, given me any confidence we should leave it there."

Utah Board of Education member Jennifer Johnson said staffing changes have been made within USOR and the state office of education to improve oversight.

Blevins told legislators that USOR operated with inadequate financial information and continued to sign up new clients for services it couldn't afford to provide. Instead, the agency should have put clients on a waiting list to control its spending.

"It was all well-intended," Blevins said. "The intent was to help as many people as they could. It just kind of caught up with them."

There is now a waiting list at USOR, and new applicants are screened and prioritized for services, Brush said.

Twitter: @RobertGehrke