Reading the summary, dangerous I know. There are hints that the exact costs of running cell phones are not known. What I'm finding odd, is that on a quantity of 48,000 phones, the average monthly rental is $35. An off the page, consumer cell plan with AT&T is $39.99 monthly. Is this some silly figure based on ignorance of the actual contract costs or have California really negotatied such a bad deal? Heck even the pre-pay GoPhone package at $2 per day used, would cost them around $12M a year, probably significantly less as the phones that aren't used won't incur any costs at all.
I think your comment regarding DMV clerk is probably a bit of an exagerration. You'll find any state government, that there are a lot of senior managers, plus a surprising amount of workers who are out there working on the road and may need to be contactable. State employees might include policemen, construction, highways engineering, police force, park rangers, social workers etc. etc. At a wild guess at least 40%+ of the employees would be mobile and in the community on a routine basis.
We had some debate on this in our state equivilant organisation in the UK. We quickly realised that on our contact, the cost to issue and support and run a phone for two years, is the equivilant of a couple of hours pay for the average employee (we have an excellent contract, not ridiculously high salaries). We've also found that the free handsets issued for the contract have good resale/cycle cash value, perhaps covering one year line rental.
So the shocking conclusion was that the cost in management time to evalutate whether an individual needs a phone, was more expensive than the contract. If we screwed up the decision and put someone's safety in danger (ie. female social-worker, with potentially dangerous clients), the resulting law suits might make $20M seem cheap.