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State Corrections officials say they had authority to order lethal injection drugs from a source in India without following usual state purchasing protocol, according to a state auditor report issued Monday.

The department paid about $54,400 for the drugs, but never received them because they were not approved for import by federal agencies. And there was no agreement by the provider, Harris Pharma, to refund an up-front payment if the drugs were not delivered, the report said.  

Later, when Corrections Director Scott Frakes asked for a refund on 1,000 vials of sodium thiopental, Chris Harris responded that that was not possible. Nebraska's failure to receive the drug was no fault of his company, he said. 

There was no request for a refund on pancuronium bromide ordered from Harris at the same time even though state Corrections officials said the drug also was never received by the department. 

State Auditor Charlie Janssen released the report Monday on the lethal injection drugs purchase gone awry, substantiating what Corrections Department documents had previously revealed. The drugs are used as part of the state's death penalty protocol.

In July, Omaha Sen. Ernie Chambers asked for more information on the attempted drug purchase. In October, Omaha Sen. Burke Harr put in a second request for the state auditor's office to investigate the attempt by the Department of Correctional Services to acquire lethal injection drugs from a foreign broker.

Harr said he made the inquiry to find out why the state didn't receive the drugs, and then why it didn't get back taxpayers' money.

When he asked for the report, Harr said he wanted to know why the state wasn't suing to get its money back. "Is it normal for the state to just walk away when the other side breaches a contract?" 

Janssen said answers to those types of questions would have to come from the attorney general's office.

Janssen said the report wasn't an audit, but rather an attempt to get the information regarding the drug purchase in chronological order.

Chambers said the Corrections Department didn't answer all the questions about the purchase to his satisfaction. On some things, Corrections officials quoted state law that they said gave them authority to ignore other laws. 

When asked if the department got approval from the Department of Administrative Services for the drug purchases, since the dollar amount was over the unrestricted open market purchase authority, Corrections said approval was not required. 

By state law, the department has authority to create its own process for obtaining the necessary lethal injection drugs, including without a prescription, upon a written request from the Corrections director, department officials told state auditors. 

"This was enacted separately from the statutes regarding the material division of Administrative Services, with the recognition that the obtaining of lethal injection drugs was unique," said Robin Spinkler, deputy director of administrative services for the Corrections Department.

The execution protocol includes no competitive bidding requirements or requirements for obtaining approval under the specific statute, Spindler said. 

"NDCS has previously worked with Chris Harris to obtain these drugs," she said. "NDCS was not aware of any other vendors providing sodium thiopental and pancuronium bromide."

When asked if anyone at the department discussed the prepayment process with the state accounting department at the Department of Administrative Services, the answer was no.

"The purchase of these drugs did not fall under the prepayment provisions of the DAS accounting manual," she said.

The manual says prepayments are not illegal, per se, but are in conflict with the normal claims process since the state has given up assets in anticipation of goods or services to be provided at a later date. The potential loss to the state is greater with prepayments, and extreme care should be taken and such payments minimized, it says.

Harr said anyone entering a contract or agreement should always contemplate what would happen if what is contracted for isn't delivered.

The drugs in question were part of an execution protocol the department is seeking to replace with a more secret process.

"We're not going to know if we learned from our mistake because if these regs go through, we'll never know if we spent this money or not," Harr said. "That's one of the concerns I have.

"These are government dollars. We want transparency. Thank goodness we found out about this."

He is hopeful, he said, that Gov. Pete Ricketts will say the state learned its lesson from the misspent $54,400 and in the future will take heed. 

Chambers said he would talk to Sen. Bob Krist, chairman of the Executive Board, about having the Legislature's fiscal office go over the report and offer some conclusions on what it said. 

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Reach the writer at 402-473-7228 or jyoung@journalstar.com

On Twitter @LJSLegislature.

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State government reporter

JoAnne Young covers state government, including the Legislature and state agencies, and the people they serve.

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