TRENTON - A state audit has found that more than $10 million a year intended for drug and alcohol prevention and education programs instead funded petting zoos, community fairs, and one agency's rent.

State Comptroller Matthew Boxer found that the Governor's Council on Alcoholism and Drug Abuse (GCADA) handed out grants with little oversight.

The audit released yesterday also found that the agency is overstaffed and fails to meet basic responsibilities such as following up on how money distributed to the state's 21 counties is spent.

"It cannot be acceptable for a government agency to spend $30 million over the last three years without attempting to find out what the public is getting for that money," Boxer said at a news conference announcing the findings.

Boxer said the agency frequently failed to question why grant money was requested or whether funds, once awarded, produced positive results.

The audit covered the last three years, but the lack of oversight dates back far longer, Boxer said. The audit is the first for the agency since it was created in 1989.

"This has led to state dollars being used to fund, among other things, pony rides, a petting zoo, and tattoos and balloon art at a community day event," he said.

Concluding that the agency "is failing to do its job in a way that is consistent with what the public would expect and deserve," Boxer made 10 recommendations for improvements, which the agency has accepted. It rejected an 11th recommendation that it be merged with the Division of Addiction Services, which would save an estimated $600,000.

In a written response, Mary Lou Powner, executive director of GCADA, said many of the comptroller's conclusions are "seriously flawed."

"The council also wishes to expresses its deep disappointment at the failure of the Comptroller's Office to meet with or interview any of the council members," the response states.

Assemblywoman Sheila Oliver, who chairs the Assembly Human Services Committee, was among the first to call for reforms.

"To see money going places other than for direct assistance for addiction is not just a smack in the face to taxpayers, but to the very people these programs are supposed to help," said Oliver (D., Essex).