Calendar Number of Year Departments

Additional Recommendations 21

These recommendations are not explicitly linked to specific findings.

• R1
  Each department is responsible to maintain a list of sensitive equipment items (not defined as fixed assets in 11-04SP2) as identified: (a) All electronic devices with a monthly access or rental lease fee including, but not limited to, cellular telephones, photocopiers and radio communication devices. (b) All personal digital assistants (PDAs), digital cameras or video cameras and any electronic equipment or photography equipment with a purchase price of $1,000 up to $5,000. (c) All computer central processing units (CPUs), laptop computers, and all printers, scanners, monitors and facsimile machines with a purchase price of $1,000 up to $5,000. (d) Each department may make a determination to include items in addition to those identified in this Standard Practice on its list.
• R2
  “Purchase price” is defined as the acquisition cost of an item, including the purchase price, before trade- in allowance, less discounts, plus freight, transportation and installation costs and sales or use tax.
• R3
  Each department will be responsible to ensure that employees return County property, which is provided for use off site, to the department in the event of the transfer, termination or separation from employment.
• R4
  Once a department establishes the list of sensitive equipment (as well as those items added to the list pursuant to 1(d) above), the list shall be updated on an annual basis and filed with the County Clerk. COMplAINTS COMMITTEE COMplAINTS COMMITTEE COMPLAINTS COMMITTEE MEMBERS Kent Fogleman, Chair Ever Marie James Brad Kuiper Albert vande Steeg 16 COMPLAINTS COMMITTEE The Grand Jury receives complaints throughout the year. The purpose of this committee is to review all complaints and determine if the Grand Jury has jurisdiction to investigate the complaint. If jurisdiction is confirmed and the complaint warrants investigation, it is assigned to an appropriate committee. In some cases, an ad hoc committee is formed to handle the complaint. Complaints are typically received on an official Complaint Form. Although the Grand Jury normally does not investigate unsigned complaints, sometimes, depending on the issue, it will conduct an investigation from an anonymous source. The 2009-2010 Grand Jury received 47 new complaints and two were referred from the 2008-2009 Grand Jury. Of those, 17 were assigned and investigated while 20 were not within the jurisdiction of the Grand Jury. The additional 12 complaints are being referred to the 2010-2011 Grand Jury. HUMAN SERVICES/ ECONOMIC DEVElOpMENT COMMITTEE DEVElOpMENT COMMITTEE HUMAN SERVICES/ECONOMIC HUMAN SERVICES/ECONOMIC DEVELOPMENT COMMITTEE MEMBERS Ever Marie James, Chair Julie C. Crites Clifford DeVost Shawn-Marie Green Rosie Hinojos Donna Howard William E. Howard Melinda O’Connor Porfirio (PV) Rodriguez 18 HUMAN SERVICES/ECONOMIC DEVELOPMENT COMMITTEE The Human Services and Economic Development Committee had the responsibility of reviewing all aspects of social services and economic development operations in the county, including: Child Support Services Redevelopment Agency Department of Aging and Adult Services Transitional Assistance Department Economic Development Agency Veterans Affairs Department Housing and Community Development Workforce Development Human Services Group Administration Cities/Municipalities Performance, Education and Resources Centers School/Community College Districts Preschool Services Special Districts Public Guardian/Public Administrator Areas of specific review undertaken by the Committee included the following: City of San Bernardino Conservatorship/Guardianship County Airports Department of Aging and Adult Services Foster Care HUD Dollar Homes Program In-Home Supportive Services Redevelopment Agency The Human Services and Economic Development Committee submits reports on the following topics: HUD Dollar Homes Program Department of Aging and Adult Services (See Response Accountability Section of Report) During the course of the Grand Jury term the Human Services and Economic Development Committee had the Redevelopment Agency Subcommittee examine operation of the following Cities Redevelopment Agencies: Chino Ontario Chino Hills Rancho Cucamonga Colton Rialto Fontana San Bernardino Montclair Upland 19 CITY OF SAN BERNARDINO ECONOMIC DEVELOPMENT AGENCY HUD DOLLAR HOMES PROGRAM
• R5
  RESPONDING AGENCY RECOMMENDATIONS DATE Board of Supervisors 10-01 through 10-02 09-30-2010 7 SENSITIVE PROPERTY
• R10
  Most of this increase occurred in FY 2007-08 and FY 2008-09 as a result of a unilateral decision by the County to replace pay-call firefighters with full-time firefighter-emergency medical technicians (EMT), providing constant staffing at the facility with EMT trained personnel. However, even after considering this dramatic rise in costs, since FY 2007-08, the City’s cost of fire services has increased at rates surpassing those charged by the Sheriff for police services, by an average of approximately 7.9 percent per year. At the time of this report, the County Fire Department had not notified the City of contract cost increases for FY 2010-11. Absent this information, but assuming that these expenses rise at the same average rates as in prior years, the City could face additional costs of over $580,000 for basic police and fire services next year. Financial Outlook The General Fund financial outlook for the City is not promising. The lingering effects of the recession continue to adversely impact sales tax and other sources of local tax revenue, and financial consequences arising from the State’s budget crisis make the reliability of certain tax revenues uncertain. Further, building and development activity remains low. The City’s own projections of operating revenues assume that income will remain stagnant or continue to decline in the short term. Based on discussions with the City’s Finance Director and as noted in the City’s most recent Interim Financial Report6 , payments from APUA for the purchase of the sewer and water systems will be reduced by $3.2 million in FY 2010-11. According to the Finance Director, these reductions are necessary to conform with the underlying assumptions contained in the $76.8 million in the 2009 Series A - Adelanto Public Utility Authority Refunding Bonds issued earlier this fiscal year. Stagnant revenues, the potential for substantial additional costs for police and fire services, and the loss in income from the sale of the sewer and water utilities, present serious financial difficulties for the City. To resolve these financial difficulties, City representatives state that they are relying on the sale of the Adelanto Community Correctional Facility to a private correctional services provider for approximately $28 million. Reported widely in the press, a final agreement has been entered into with a closing date of June 4, 2010. The City has also taken steps to terminate employees who currently operate the jail facility as of that date, as part of the transition plan from City to private operation of the facility. These actions will provide such staff with a severance package that will extend pay and benefits to August 4, 2010. November 17, 2009, Thirteenth Amendment to Contract with City of Adelanto for the Sheriff’s Department to Provide Law Enforcement Services, Schedule A 6 City of Adelanto Interim Financial Report, Fiscal Year 2009/10, 50% of the Fiscal Year Complete, July 1, 2009 – December 31, 2009 Harvey M. Rose Associates, LLC 6 Section 1: General Fund Financial Condition For the long-term, the City has discussed the possibility of asking the voters to create a fire district that would be financed through an additional property tax levy or parcel tax. This may provide a long-term, partial solution for addressing the structural budget deficit. However, the experiences of a neighboring jurisdiction earlier this decade, to extend property taxes established to support fire district operations7, failed to obtain approval from a 2/3 voter supermajority that was necessary for passage. In Adelanto, voters may be even more reluctant to impose additional taxes on themselves, given the City’s current economic environment and recent decisions by the City to increase water service charges by 229 percent over the next five years.8 Lastly, the City should seriously consider long-term cost savings solutions to its structural deficit. This could include reductions in the number of hours that fire stations are manned, based on call volume and activity, as well as the number of hours that patrol deputies are on duty. Although the review of such alternatives was outside of the scope of this analysis, the City should immediately evaluate the impact they would have on the Adelanto community. Further, the City Council should convene a public workshop to evaluate the current and long-term financial condition of the City and to explore solutions to the structural deficit. This process should be designed to obtain input directly from Adelanto taxpayers. Lack of Reliable Financial Data It should be noted that this analysis was conducted primarily from data reported in the City’s various budget documents and interim financial reports. Audited financial statements were not finalized for the year ending June 30, 2007 until just prior to the release of this report, although a draft report was provided earlier; and, financial statements for the years ending June 30, 2008 and 2009 have not been prepared. This is a significant cause for concern, since the City cannot expect confidence in its financial data without a thorough review by an independent auditor. This deficiency was noted in the September 2009 LAFCO Community Service Review. At that time, the Adelanto Finance Director stated in a letter to LAFCO that the final June 30, 2007 comprehensive annual financial report (CAFR) would be produced in September 2009, a draft June 30, 2008 CAFR would be available in September 2009 and the audit of the June 30, 2009 financial statements would begin in October 2009. When we initially met with the City in early February, we were told that the June 30, 2007 CAFR would be finalized within days, the June 30, 2008 CAFR would be complete within “one to two weeks” and that the June 30, 2009 CAFR would be completed “ ” At the exit conference for this report, we were provided with a copy of the final 2007 CAFR. However, the City also confirmed that work on the 2008 and 2009 CAFRs had been suspended because the financial auditors needed to complete work on the June 30, 2008 Adelanto Public Utility Authority financial statements and June 30, 2009 Adelanto Redevelopment Agency financial statements. Work on these CAFRs has now resumed with a goal of completing them as expeditiously as possible. November, 2002, City of Hesperia, Measure B 8 2009 Series A - Adelanto Public Utility Authority Refunding Bond Issue, Harvey M. Rose Associates, LLC 7 Section 1: General Fund Financial Condition We understand the current challenges facing City staff. However, the successful completion of the City’s financial statements is essential for increasing the public’s confidence in the reported financial condition of the City. Unless this situation is resolved, it will become even more difficult to convince voters of the need to approve additional local taxes. Given the inability of the City to meet self-imposed deadlines to date, this continues to be an area of concern. Harvey M. Rose Associates, LLC 8
• R21
  This proposal is pending and the outcome is uncertain. The RDA’s financial situation has a direct impact on the General Fund. First, it is highly unlikely that the RDA will be able to repay the $2,524,243 advance that it received from the General Fund in prior years, since this obligation is subordinate to all other debt. Further, to the extent RDA resources are needed to meet the terms of the County settlement agreement and retire accumulating debt, the City will be hampered in its ability to develop and attract Sales Tax generating retail business or other development that would benefit the General Fund. Adelanto Redevelopment Agency Basic Financial Statements, June 30, 2009, Notes to Basic Financial Statements, Note 7H. Harvey M. Rose Associates, LLC 13
• R23
  These funds are substantial. However, the bond agreement rate model assumes that the City will no longer be able to accelerate payments from the Water Utility to resolve a General Fund deficit, should one occur. Accordingly, beginning in FY 2010-11, the decision by the City to re- fund APUA debt essentially contributed to a $3.2 million General Fund operating deficit from FY 2009-10 levels. Because the payments to the General Fund will remain fixed through FY 2022-23, the impact from this decision will grow with inflationary cost increases, unless other sources of income are identified by the City. The basis for this analysis is provided in Table 3 and Table 4, below. Table 3 Schedule of APUA Payments to the General Fund FY 2005-06 through FY 2008-09 Beginning Scheduled Surplus Total Ending Balance Payments Revenues Payments Balance Wastewater FY 05-06 6 ,431,169 3 21,558 (49,583) 271,975 6 ,431,169 FY 06-07 6 ,431,169 3 21,558 26,439 347,997 6 ,431,169 FY 07-08 6 ,431,169 3 21,558 37,613 359,171 6 ,431,169 FY 08-09 6 ,431,169 3 21,558 46,716 368,274 6 ,431,169 Total 1,286,232 61,185 1,347,417 Water FY 05-06 2 6,485,464 1 ,324,273 478,752 1,803,025 2 4,562,413 FY 06-07 2 4,562,413 1 ,228,121 2,023,912 3,252,033 2 1,841,391 FY 07-08 2 1,841,391 1 ,092,070 2,848,759 3,940,829 1 8,255,019 FY 08-09 1 8,255,019 9 12,751 3 ,718,975 4,631,726 1 4,089,328 Total 4,557,215 9,070,398 13,627,613 Grand Total FY 05-06 3 2,916,633 1 ,645,831 429,169 2,075,000 30,993,582 FY 06-07 3 0,993,582 1 ,549,679 2,050,351 3,600,030 28,272,560 FY 07-08 2 8,272,560 1 ,413,628 2,886,372 4,300,000 24,686,188 FY 08-09 2 4,686,188 1 ,234,309 3,765,691 5,000,000 20,520,497 Total 5,843,447 9,131,583 14,975,030 Note: Budgeted payments in FY 2009-10 were $5.4 million with a note that the transfer will decline to approximately $2.2 million in FY 2010-11. Harvey M. Rose Associates, LLC 10 Section 2: APUA Asset Purchase Payments Table 4 Schedule of Anticipated APUA Payments to the General Fund FY 2009-10 through FY 2022-23 Fiscal Year Wastewater Water Total FY 10 3 86,835 5,013,165 5 ,400,000 FY 11 3 41,601 1,888,399 2 ,230,000 FY 12 3 44,077 1,885,923 2 ,230,000 FY 13 3 47,079 1,882,921 2 ,230,000 FY 14 3 50,791 1,879,209 2 ,230,000 FY 15 3 55,492 1,874,508 2 ,230,000 FY 16 3 61,629 1,868,371 2 ,230,000 FY 17 3 69,966 1,860,034 2 ,230,000 FY 18 3 81,929 1,848,071 2 ,230,000 FY 19 1 ,365,711 864,289 2 ,230,000 FY 20 2 ,230,000 - 2,230,000 FY 21 2 ,230,000 - 2,230,000 FY 22 2 ,230,000 - 2,230,000 FY 23 1 ,424,507 - 1,424,507 It is important to note that the APUA increased both wastewater and water rates to finance operations and pay its debt obligations in preparation for the 2009 Series A - Adelanto Public Utility Authority Refunding Bond Issue. In August 2009, wastewater fees were increased to levels that would cover operations plus the debt incurred with the 2009 refunding, including the payment of outstanding principal and interest to the General Fund. Similarly, in that same month, water rates were increased by approximately 229 percent through FY 2014-15 for the same purposes. Therefore, it is highly unlikely that the APUA will default on its debt service obligations, so the General Fund can rely on these payments as a stable source of income for the next twelve to thirteen years. Harvey M. Rose Associates, LLC 11
• R08-52
  Provide additional workspace for the Sheriff’s Scientific Investigation Division taking into account the growth of the county.
• R08-53
  Increase the number of Crime Scene Investigators from 12 to 24
• R08-54
  Increase the number of Deoxyribonucleic Acid (DNA)/Forensic Analysts from 10 to 20. Findings and Responses are as follows:
• R10-15
  Establish a data base which will track the critical program information for each home and a process for monitoring subsequent home sales.
• R10-16
  Include a detailed covenant history within the data base while filing with the County Recorder a “Notice of Affordability Covenant” on each property. 22
• R10-17
  Assure that all EDA partners are well versed in HUD or other program requirements.
• R10-18
  Institute an in-house program or engage an outside vendor to provide vetting and homeownership responsibility education for first-time homebuyers. COMMENDATION The EDA has already taken steps to implement a number of the above-mentioned recommendations. EDA now keeps a detailed data base to track the sale and resale of Dollar Homes, as well as all covenant agreements. An outside agency has also been contracted to assist with monitoring, marketing and reviewing all sales agreements to qualified buyers. The Grand Jury commends EDA personnel for the time and effort they spent in complying with this committee’s requests. Upon review of all the facts provided by EDA and after conducting interviews with EDA personnel, it is obvious that EDA has taken corrective action to address implementation and oversight deficiencies in affordable housing projects, such as the HUD’s Dollar Home Program. These types of projects provide for the betterment of cities, such as the City of San Bernardino, and they can only be successful when they are administered as they are intended.
• R10-40
  Direct the City Manager and staff to complete the comprehensive annual financial audit reports for the fiscal years ending in June of 2008 and 2009 no later than July 31, 2010.
• R10-41
  Direct the City Manager and staff to produce the completed annual financial audit report of the year ending June 30, 2010 by September 30, 2010. This is contingent on the schedule of the independent auditor that the City contracts with.
• R10-42
  Request that the City Manager develop and present a comprehensive financial projection and plan for resolving the City’s structural deficit in the next five years, by using the audited numbers and expenditure trends shown in the ending budget of June 30, 2010 as the base. This should be 57 completed and committed to by the staff and Council by the end of the year.
• R10-43
  Immediately start discussions with the San Bernardino County Sheriff’s Department and the San Bernardino County Fire Department in a concerted effort to reduce the cost of services provided to the City by both departments. This may involve the very difficult task of reducing selective services provided by the departments for a period of time until the financial situation begins to improve. This could include but is certainly not limited to the reduction in the hours that patrol deputies are on duty or the hours that fire stations are manned. There are other services that both departments provide that could be limited depending on the work load or specific requirements of the City.
• R10-44
  It is strongly recommended that a series of public workshops be held to discuss the financial condition of the City and to explore all possible solutions to the deficit that faces the City. We understand that the problems are many, very complex, and some very hard decisions will have to be made. The more input and assistance that can be obtained from the citizens would be of tremendous help to the Council and Staff. One possibility would be requesting the citizens to approve a fire district to assist in funding this function. Although we understand this is a very unlikely possibility due to the present economic situation and the recent failure to obtain the necessary support in local adjacent communities. This is another reason that we recommend the Adelanto taxpayers be made aware of the problems that are facing the city and the possible alternatives if the situation is not dealt with in a timely fashion.
• R10-45
  It is recommended that the City negotiate with the County to modify the terms of the Redevelopment Agency (RDA) settlement agreement to 58 permit a long term debt relief, which could possibly include the exchange of property which is owned by the RDA.