sinking fund.

CL1 Page 85

9. The contract provides for a financial evaluation to assess the accuracy of contract base rates. CITY COUNCIL'S RESPONSE TO FINDING #9: AGREE. The City's agreement is subject to the following clarification. The 1997 ACRC contract at Section 6.13 provided a mechanism for evaluating "through-put costs." Under its provisions, ACRC was to have an independent third party acceptable to the City evaluate through-put costs of its 1996 operations. The purpose of this evaluation was to assess the accuracy of certain rates set forth in the contract referred to as the "Base Rates." In the contract, there is a Base Rate for each recyclable material handled on behalf of the City by ACRC. Derived from these Base Rates are rates known as the "Blended Rates." As with the Base Rate, there is a Blended Rate for each recyclable material handled. The Blended Rates are derived entirely from the Base Rates. The summation of the Blended Rates for each material handled is the amount per ton paid to ACRC for its services under the contract. ACRC, in compliance with contact terms, employed an independent third party acceptable to the City (Hunter, Hunter & Hunt, CPAs - "HH&H") to conduct the through-put evaluation. HH&H concluded that the overall amount paid to ACRC by means of the "Blended Rate" was reasonable based on its 1996 costs of operation data. HH&H also concluded that it was not possible to verify the Base Rates contained in the contract according to acceptable accounting principles. Instead, HH&H determined that the Base Rates had been derived from estimates which could not be verified, and accordingly, made no

CL2 Page 24

Although some recent progress has been made in streamlining and modernizing the Blue Lake City's financial operations, considerable work is still needed to address issues raised by the annual audit reports, provide an adequate system of internal control, and safeguard against unwarranted losses.

CL3 Page 24

An appropriate segregation of accounting duties is needed to insure internal control.

CL4 Page 24

An adequate system of review and approval, consistent with Government Auditing Standards, is needed for transaction, accounting entries, and outputs.

CL5 Page 24

A formal operations manual is needed to provide guidance and documentation for all financial policies and procedures, including capitalization's and depreciation of capital assets.

CL6 Page 24

A complete fixed-asset inventory is needed to account for Blue Lake City assets and provide a means of reconciling all accounts related to those assets.

CL7 Page 24

Greater efforts are needed to resolve financial and policy issues so that a current operating budget can be adopted in a timely fashion.

CL8 Page 29

The Rohnerville Agricultural Farm is a part of the Sheriff's Work Alternative Program (SWAP). a. Estimated assets of the Rohnerville Farm: $74,452.00 b. SWAP (Sheriff Work Alternative Program) participants have spent approximately 5,104 person hours working at the farm this year. c. In 1999 SWAP provided the jail with 51 hogs or approximately 9,000 pounds of edible pork. d. The garden portion of the farm provides fresh vegetables for the jail. e. Firewood is split and delivered to qualified senior citizens by SWAP participants. f. SWAP participants pay to work at the farm. g. SWAP participants do not require jail housing, relieving jail overcrowding.

CL9 Page 29

Juvenile Hall a. The Juvenile Hall Facility is well kept and maintained. b. A grant has been received for improvements to Juvenile Hall. Improvements to be as follows: Additional TV monitors, upgrading kitchen and lobby, building vehicle sally port, adding two additional interview rooms, and replacing roof over classroom and multipurpose rooms. CONCLUSIONS:

CL10 Page 32

Due to this lack of mutual agreement, the maintenance of the facility has declined considerably, resulting in inconvenience to the public.

CL11 Page 32

The door locks of the facility have been changed several times by the Tribe without the consent or knowledge of Humboldt County, resulting in operational hardships for Humboldt County staff and the public.

CL12 Page 32

The Superior Court Executive Officer was notified by Humboldt County to relocate the Superior Court operations at Hoopa to Eureka effective February 1, 2000.

CL13 Page 33

The movement of the Superior Court operations from Hoopa to Eureka creates a hardship to the people residing in the Klamath- Trinity Valley region.

CL14 Page 33

According to the Tribal Judge in a letter dated December 10, 1999, "The Sheriff's Department's right to continued use of the property will be negotiated through Floyd Stokes, Chief Hoopa Valley Tribal Police and the Tribal council."

CL15 Page 33

No member of the Hoopa Tribal Council responded to requests to appear before the Humboldt County Grand Jury. CONCLUSIONS:

CL16 Page 88

Recyclables, according to the amended contract, are to be collected from single family residences by the Arcata Garbage Company, Inc., and separated at the curb by the company. CITY COUNCIL'S RESPONSE TO FINDING #15: AGREE.

CL17 Page 89

The city is to separate recyclables collected in bins and to provide for their delivery to the 10th Street processing facility. CITY COUNCIL'S RESPONSE TO FINDING #16: DISAGREE. Under the 1997 ACRC and AGC agreements, the City was required to separate recyclables collected in bins, as well as recyclables collected curbside, and to provide for their delivery to the ACRC 10th Street processing facility. However, under the Second Amendment to the AGC contract, which was entered into between the City and AGC on March 8, 2000, after approval by the City Council at the Council meeting held on February 16, 2000, recycled materials are separated by customers into separate toters or separate compartments of bins, and are transported by AGC to ACRC's 10th Street facility. The City does no sorting of recyclables. 17. "CRV Adjustments" are revised in the amended contract with city to receive all value from ACRC 9th Street facility. To date, the ACRC maintains this is not possible. CITY COUNCIL'S RESPONSE TO FINDING #17: DISAGREE. Under the Second Amendment to the ACRC contract, the dispute between ACRC and the City concerning CRV was resolved as follows: a. At ACRC's 9th Street facility, signs are now posted that have been approved by the City, which indicate to Arcata customers using 9th Street that they may designate their California Redemption Value (CRV) to the City's account. All recyclables so designated are accurately weighed on a certified scale by ACRC and are credited to the City. b. This credit is presented periodically by ACRC to the City and appropriate adjustments are made to the payment from the City to ACRC for recycling services. c. To settle the dispute between the City and ACRC concerning CRV value for 9th Street that had not been paid for the 24-month period from 1997 until the date of the Second Amendment, it was agreed that for the 24-month period following the Second Amendment, the amount of credit to which the City is entitled pursuant to paragraph a above will be doubled.

CL18 Page 90

ACRC has not charged non-Arcata self-haulers for processing since 1998. CITY COUNCIL'S RESPONSE TO FINDING #18: AGREE. The City Council's agreement is subject to the clarifications set forth in response to Finding # 1 above.

CL19 Page 90

The amended contract also provides for "Market Price Adjustments," going back to September 4, 1997, including adjustments not made since the beginning of the contract. CITY COUNCIL'S RESPONSE TO FINDING #19: AGREE. The City Council's agreement is subject to the following clarification. The survey being conducted at 9th Street referred to in Finding #2 above will assist the City and ACRC in accurately calculating the market price adjustment retroactively to 1997.

CL20 Page 90

The 1997-1998 Humboldt County Grand Jury investigated this issue and made several recommendations. a. The city closely monitor compliance of the terms of the contract. b. The city demand timely and accurate monthly weight reports from ACRC. c. The city and ACRC fine tune the recycling process and make every effort to make it user friendly. CITY COUNCIL'S RESPONSE TO FINDING #20: AGREE. CONCLUSIONS:

CL21 Page 29

The operation at the Rohnerville Agricultural Farm is well run on a very low budget.

CL22 Page 29

The improvements to be made as the result of the grant for Juvenile Hall will greatly improve the security and working conditions.

CL23 Page 32

According to a county official, on at least five separate occasions, Humboldt County has proposed a new lease agreement for adoption by the Tribe.

CL24 Page 32

No new lease agreement has been agreed upon by the Tribe and Humboldt County as of the date of this report.

CL25 Page 32

County officials have stated that no written policy exists concerning Humboldt County lease agreement.

CL26 Page 32

In recent years the Tribe has been sharing the use of the facility with Humboldt County.

CL27 Page 32

Until the time of this report Humboldt County had been paying all utility fees for the facility.

CL28 Page 32

Disagreements still exist between Humboldt County and the Tribe as to the authority and responsibility of each party concerning the use of the facility.

CL29 Page 33

In the absence of a comprehensive written policy to guide Humboldt County officials in matters pertaining to the leasing of facilities, Humboldt County has experienced continuing difficulties in lease renewal, determination of authorities and responsibilities, and the resolution of operational problems at the Hoopa Justice facility.

CL30 Page 33

In spite of repeated attempts, Humboldt County has been unable to consummate a current lease agreement with the Tribal Council for the use of the Hoopa Justice Facility.

CL31 Page 33

The disagreements which still exist between Humboldt County and the Tribe as to the authority and responsibility of each party concerning the use of the facility have resulted in the following problems: a. deteriorated maintenance of a Humboldt County facility. b. inconvenience to the public. c. operational hardships for the Humboldt County staff. d. the loss a valuable local service to Hoopa area residents. e. a continuing hardship for the people of the Klamath-Trinity Valley region.

CL32 Page 38

There is no security or intruder alarm system for the building.

CL33 Page 38

There is no Community Service Officer.

CL34 Page 45

lighting be improved and alarms installed in the fenced parking area behind the substation. SHERIFF DEPARTMENT'S RESPONSE TO RECOMMENDATION #6: Agree, in part. The lighting should be improved; however, there is no need to alarm the open storage because the outstation has an enclosed evidence storage room in the adjacent Garberville Volunteer Fire Department Building.

CL35 Page 42

The outside fenced parking area is at times used to store evidence such as vehicles that were related to a crime, or other evidence that is too large to be stored inside. This area is not alarmed and is poorly lit.

CL36 Page 42

The inside evidence storage area and equipment storage area are in a separate building. This building has no alarm system and is poorly lit.

CL37 Page 42

The staff at the substation stated there is very little communication with the Sheriff.

CL38 Page 50

The Humboldt County District Attorney's office completed an investigation of the disposal of the salvaged materials, and concluded the following: a. Public Works officials had, indeed, given salvaged bridge materials, without charge, to two private citizens and one Humboldt County employee. b. several Humboldt County employees interviewed opined that the salvage materials were of no value to Humboldt County. c. although there were possible violations of Humboldt County policy, no criminal offense was committed by anyone in connection with the disposal of the salvaged materials.

CL39 Page 50

No further action was taken by the District Attorney's office.

CL40 Page 51

The Humboldt County Administrative office investigated the procedures followed in the disposal of the salvaged materials and addressed the matter to all Humboldt County Departments in a memo dated August 6, 1999. In that memo, it was concluded that the Humboldt County Public Works Department did not violate Humboldt County Ordinance No. 681 and that the efforts directed toward investigating the matter and responding to the Humboldt Grand Jury were far more costly than the value of the materials. These conclusions were made in spite of the following facts: a. no attempt was made by the Humboldt County Public Works Department or any other Humboldt County office to determine the monetary value of the salvaged materials. COUNTY ADMINISTRATIVE OFFICER'S RESPONSE TO FINDING #12.A.: Disagree. This is the crux of the ongoing disagreement on this item. The Grand Jury has a cost estimate of at least $7,625. Unfortunately, the Grand Jury cannot share how this number was calculated. Public Works staff looked at the conglomeration of materials nailed together as having no value to them and, since it was commercial construction debris, it could not be burned. The disposal option was to haul it to the landfill and pay to have it disposed when private parties asked if they could have it. In the County's viewpoint, it had a negative value. b. no attempt was made by Humboldt County Public Works staff to follow the requirements of Ordinance No. 681. c. no cost data was established by any Humboldt County department for the time spent by the Humboldt County Public Works Department, the District Attorney's Office, or any other County office in responding to the Humboldt County Grand Jury. ADMINISTRATIVE SERVICES DEPARTMENT'S RESPONSE TO FINDING #12: Agree in part and disagree in part. The August 6, 1999, memo said the Grand Jury concluded that Public Works had violated County Ordinance and that subsequent investigations came to different conclusions. Administrative Services' review of the value of the materials stopped with Public Works' declaration that the dismantled bridge was worthless and would be costly to dispose of in the County landfill. Since Public Works is the repository of County knowledge on bridges and solid waste, Administrative Services would not question a Public Works value determination without good cause which did not appear in this situation. Administrative Services does not know if any other office tried to determine the value of the dismantled bridge. Administrative Services does not know whether Public Works made an attempt to follow Ordinance No. 681 but the Purchasing Agent was not involved in the bridge disposal. Administrative Services does not know whether any department tracked time in responding to the Grand Jury. However, given Public Works' belief that the bridge was worthless and therefore a potential liability to dispose, it necessarily follows that all costs incurred in researching the matter were more valuable than the bridge.

CL41 Page 52

Humboldt County officials indicated that the cost of disposing of surplus materials through the competitive bid process is generally in the range of $100 - $300. CONCLUSIONS:

CL42 Page 41

The Humboldt County Grand Jury found no error in the process used for the issuance of the construction permit.

CL43 Page 41

Permission to use the private road must be determined collectively by the members of the private road association using applicable rules and regulations. 00-06 SHERIFF DEPARTMENT'S GARBERVILLE SUBSTATION INTRODUCTION: The Sheriff's Department Garberville Substation is located in the southern area of Humboldt County, some 67 miles south of Eureka. Deputy Sheriff's working out of the Garberville Substation serve the southern portion of the county from the Trinity County line on the East, to the Pacific Ocean on the West, and North of the Mendocino County line to Redcrest. FINDINGS:

CL44 Page 42

The office area is wired for an alarm/intruder system; however, it is inoperative.

CL45 Page 42

There are no separate rooms for male and female officers to change clothes.

CL46 Page 42

The interoffice mail service to Eureka is unreliable. There is no regular service at this time.

CL47 Page 38

There are several vacancies in the positions allotted for the staffing of the substation, both in supervision and patrol personnel. CONCLUSIONS:

CL48 Page 43

Notwithstanding the upgrading of the radio system that has already been made there are still transmission and receiving problem in the area covered by personnel working out of the substation. The problems are serious, and they compromise the safety of the sheriff's employees and the public. The Sheriff's Department has received complaints, grievances and threats of litigation regarding the radio system. If the radio system is not corrected, greater problems will follow.

CL49 Page 43

The alarm system is not in good working order; therefore, the safety of the employees, office equipment, evidence and other items is jeopardized.

CL50 Page 43

Because the fenced parking area behind the substation is at times used to store evidence such as vehicles that were related to a crime or other evidence that is too large to be stored inside, this area should be alarmed and have better lighting.

CL51 Page 45

reliable interoffice mail service be provided between Garberville and Eureka. SHERIFF DEPARTMENT'S RESPONSE TO RECOMMENDATION #4: Agree. This is a County Central Services Issue.

CL52 Page 45

a Community Service Officer be hired to do routine duties. SHERIFF DEPARTMENT'S RESPONSE TO RECOMMENDATION #5: Agree, in part. Grant funding is being sought to hire a Correctional Officer for the outstations. A Correctional Officer provides a greater range of services compared to a Community Services Officer.

CL53 Page 45

an alarm system be installed in the evidence room. SHERIFF DEPARTMENT'S RESPONSE TO RECOMMENDATION #7: Agree. This should be a portion of the system identified in number two above.

CL54 Page 46

the Sheriff improve communications with the officers in the substation. SHERIFF DEPARTMENT'S RESPONSE TO RECOMMENDATION #8: Agree. As Sheriff, the time I dedicate to one aspect of the Department is somewhat limited due to other responsibilities and commitments. When time and opportunity allow, I will make an effort to maximize communications with the outstation staff. I maintain an open door policy, and any employee may arrange to meet with me about matters that need my input or attention. I am also available to staff by telephone, pager and radio. My home phone number is available to all departmental staff should the need be urgent enough that they believe I should be contacted at my residence. RESPONSES: THE FOLLOWING RESPONSES TO REPORT 00-06 ARE REQUIRED IN ACCORDANCE WITH P.C. 933 AND THE STANDARD FORMAT FOR RESPONSES.

CL55 Page 47

There is no security system in any of the buildings at this facility. CONCLUSIONS:

CL56 Page 47

The maintenance facility at Garberville is old and in need of major upgrading or complete replacement.

CL57 Page 47

There has been little effort over the years to keep this facility up to current standards.

CL58 Page 49

Upon completion of the bridge renovation, Public Works officials made no attempt to determine the monetary value of the salvaged materials.

CL59 Page 49

Public Works officials made no attempt to obtain Humboldt County Board of Supervisors authorization or to involve the Humboldt County Purchasing Department in the disposition of the salvaged materials, as required by Humboldt County policy and Ordinance No. 681.

CL60 Page 50

Public Works officials made no attempt to recover any of the value of the salvaged bridge materials.

CL61 Page 50

Public Works officials gave permission for one or more private citizens to take the materials for their own private use.

CL62 Page 50

As determined by written estimates by private vendors in Humboldt County, the wholesale monetary value of the salvaged materials given away is not less than $ 7, 625.00 with pick up and transportation provided by the buyer at the storage site.

CL63 Page 50

California Government Code, Section 25350, et seq., and Article XVI, section 6, of the California Constitution, provide, in part, that unless a public purpose is served, no public funds or property (e.g., materials or equipment) shall be given to a private citizen.

CL64 Page 50

No public purpose was served, as required by applicable California State laws, when the bridge materials were given to private individuals solely for private use.

CL65 Page 52

At the time the Hadley Memorial Bridge renovation contract was adopted it was clearly the intent of the Humboldt County Public Works management staff and Humboldt County Board of Supervisors that the salvageable bridge materials would be retained by Humboldt County for its use or benefit.

CL66 Page 52

All Public Works Department employees knew, or should have known, that no surplus materials can be disposed of without the concurrence of the Purchasing Agent, as required in Ordinance No. 681.

CL67 Page 52

Salvaged bridge materials valued at not less than $7,652.00 were given away to one or more private citizens without any attempt to: a. determine the monetary value of the materials. b. recover any value of the materials. c. obtain authorization from the Humboldt County Board of Supervisors. d. involve the Humboldt County Purchasing Agent in the process, as required by Ordinance No. 681.

CL68 Page 53

Disposing of these materials by competitive bid process would have cost Humboldt County no more than $300.00 and would likely have resulted in the recovery of well over $7000.00 for the Humboldt County treasury.

CL69 Page 53

Public property (i.e., salvaged bridge materials) was given away to one or more private individuals for private use, in violation of both Humboldt County and California State laws.

CL70 Page 53

The Humboldt County District Attorney's office was unwilling or unable to address itself to these apparent violations of law.

CL71 Page 53

The Humboldt County Administrative Services office failed to develop sufficient information to reach the conclusions offered to Humboldt County departments in the memo dated August 6, 1999, and seriously underestimated the gravity of the actions taken by the Humboldt County Public Works department personnel in disposing of the salvaged materials. ADMINISTRATIVE SERVICES DEPARTMENT'S RESPONSE TO CONCLUSION #7: Disagree. The District Attorney investigated the matter and did not prosecute anyone involved. Public Works investigated the matter and found the value of the bridge to be less than nothing; to the best knowledge of Administrative Services, no County staff has been disciplined or suffered punishment for any actions involved. Therefore, the memo appropriately reminded departments of Ordinance No. 681 and cautioned them about trying to dispose of property without attempting to recover costs.

CL72 Page 55

A $276,000 grant for a water system upgrading was available in 1990 from the Department of Health Services.The funding would have been provided by the California "Safe Drinking Water Act" of 1984. The grant was never applied for nor utilized.

CL73 Page 55

A preliminary engineering report for the water system upgrade was prepared by SHN Consulting Engineers (Report #88034).

CL74 Page 55

The PCSD has not filed, as required, a yearly audit report to the Humboldt County Auditor.

CL75 Page 55

Two separate groups are claiming to represent the Phillipsville Mutual Water Association (PMWA).

CL76 Page 55

Water bill payments ($4,900) are being held by the Humboldt County Superior Court until a decision to whom the money goes can be made. Court hearing is tentatively scheduled for March 23, 2000. CONCLUSIONS:

CL77 Page 64

The City of Eureka is contemplating a grant to the Henderson Center Merchants Association for promotional purposes using the tax revenue sharing process. CITY COUNCIL'S RESPONSE TO FINDING #13: AGREE. The City has entered into a funding agreement with the Henderson Center Merchants Association for promotional purposes using sales tax generation as a measurement for the calculation of the allocation of City funds. CONCLUSIONS:

CL78 Page 55

The PCSD has the legal authority and obligation to acquire and operate the water system so that the people of Phillipsville can expect a potable water supply.

CL79 Page 55

Funds being held by the Humboldt County Superior Court are required for the proper operation of the water system.

CL80 Page 55

The existing water system is over fifty (50) years old and has created problems for many years. It needs replacing.

CL81 Page 55

Needed are new main and transmission lines, efficient treatment facilities, upgrading the spring source, and a back-up source.

CL82 Page 55

Lack of funding availability is jeopardizing the safety of the water system.

CL83 Page 58

The Humboldt County Auditor/Controller's office reported that non-compliance of audit requirements is due to a shortage of qualified employees because of funding problems.

CL84 Page 58

Many special districts told the Humboldt County Grand Jury they cannot afford the costs of annual audits.

CL85 Page 58

The Humboldt County Board of Supervisors, in January 2000, acted to implement Government Code 26909 by authorizing one-half (½) additional employee and by implementing subsection (f) of said code. CONCLUSIONS:

CL86 Page 63

Financial arrangements between the City of Eureka and the retail enterprises were made by the city manager and dealerships. These financial arrangements were then approved by the Eureka City Council on their consent calendar. CITY COUNCIL'S RESPONSE TO FINDING #9: DISAGREE. These financial agreements were negotiated with the full authority of the City Council. The North Coast Auto Agreement was approved as a consent agenda, however the Harper Motor's Agreement was approved as a Resolution. The public has an opportunity to address the City Council on all matters on the agenda, including items on the consent agenda.

CL87 Page 63

Of the 7.25 cent sales tax collected by retail enterprises, only 1 cent is returned by the state to the city's general fund. CITY COUNCIL'S RESPONSE TO FINDING #10: AGREE.

CL88 Page 63

Monies for these financial arrangements come and/or comes from the City's general fund. CITY COUNCIL'S RESPONSE TO FINDING # 11: AGREE.

CL89 Page 63

An eight foot high wooden fence, required by California Fish and Game, is not included in the agreement regarding public improvements with North Coast Motors. CITY COUNCIL'S RESPONSE TO FINDING #12: AGREE.

CL90 Page 58

Many districts may fail to understand audit requirements due to a lack of communication with the Humboldt County Auditor/Controller's office. .

CL91 Page 58

If neither the county nor state tracks, requires and examines the annual reports, the financial condition of many districts will remain unknown.

CL92 Page 58

Oversight, to insure compliance with Code 26909, should be shared by the county and the state.

CL93 Page 59

The public's right to know the fiscal condition of their local entities will remain unfulfilled until full legal compliance occurs.

CL94 Page 62

Anticipated increase in sales tax revenue, generated through sales of Ford cars and Ford automotive parts over the next ten years will be shared by Harvey Harper Ford and the City of Eureka, enabling the business to amortize the expenditures made to improve the dealership. CITY COUNCIL'S RESPONSE TO FINDING #5: AGREE. Since the issuance of the 1999-2000 Grand Jury Report, Harper Motors Inc and the City of Eureka have agreed to rescind the sales tax revenue sharing agreement approved in December 1999.

CL95 Page 62

A grant in the amount of $100,000 was made by the City of Eureka to North Coast Motors to assist in construction of a new facility at 4320 Broadway. CITY COUNCIL'S RESPONSE TO FINDING #6: AGREE.

CL96 Page 62

The agreement between the City of Eureka and North Coast Motors requires public improvements as well as additional employment of personnel at the dealership. CITY COUNCIL'S RESPONSE TO FINDING #7: AGREE.

CL97 Page 62

The City of Eureka anticipates $40,000 per year in additional sales and property tax revenues and the creation of ten additional jobs at the dealership. CITY COUNCIL'S RESPONSE TO FINDING #8: REQUIRES FURTHER ANALYSIS. At the time the North Coast Motor's revenue sharing agreement was approved by the City Council, $35,000 per year in additional sales tax generation was anticipated, along with the creation of ten new jobs.

CL98 Page 64

Agreements between the City of Eureka and the auto retailers appear to be within the provisions of the California State Statutes. CITY COUNCIL'S RESPONSE TO CONCLUSION #1: AGREE.

CL99 Page 64

No process for monitoring the quality or rate of increased employment appears to be in place. CITY COUNCIL'S RESPONSE TO CONCLUSION # 2: AGREE.

CL100 Page 65

A wooden fence at the business property does not appear to be a public improvement in keeping with the North Coast Motors agreement. CITY COUNCIL'S RESPONSE TO CONCLUSION # 3: AGREE. The Wooden fence was a requirement of the California Department of Fish and Game for the protection of the wetlands area. The City funds received by North Coast Auto were for other project related improvements.

CL101 Page 71

Placement Issues 4.1 CWS professionals state that there are insufficient Native American homes licensed for placement of Native American children resulting in only 1 of 4 of these children being placed in Native American homes. 4.2 Therapeutic foster care providers state that there are not adequate treatment facilities in Humboldt County for dependent children. 4.3 State laws require each child placed out-of-county to be visited at least once per month by a Humboldt County social worker at taxpayers' expense. 4.4 County implemented client "wraparound" programs, from 1994-95 to 1999, resulted in a decrease of 29 children placed in out-of-county group homes representing a savings of $1,419,000. 4.5 Only 19 two-bed in-county therapeutic foster care homes exist. SOCIAL SERVICES DEPARTMENT'S RESPONSE TO FINDING #4.5: Disagree. As of June, there were 21 Therapeutic Foster Homes with 45 beds available. The Department, in a cooperative partnership with Humboldt County Mental Health and Probation, continues to recruit and train foster parents, including Therapeutic Foster Care parents. This is an ongoing process due to natural matriculation, adoption of Therapeutic Foster Care placed children and other factors. The development of the Therapeutic Foster Care home was intended to be used as a temporary transitional placement for children who require a more intensive foster care setting due to their emotional needs. For various reasons, including longer than anticipated stabilization needs, long term mental health issues, and lack of alternative placement settings, the initial plan was not adhered to and the beds have been fully utilized. It must be noted that the Therapeutic Foster Care placement should be seen as one option or strategy related to the needs of Severely Emotionally Disturbed (SED) children. Clearly, the amount of intensive in home services (Wraparound) targeted at preserving families must be enhanced as well as other (local) placement options. The development of the Youth Service Bureau local group home facility and Probation's Regional Facility are examples of alternative placements used to stabilize SED children. 4.6 CWS professionals state that inadequate foster care facilities exist in Humboldt County to meet the need for placement. 4.7 There is a State estimate of $ 5,003 per month per child for out-of-county therapeutic foster care placement versus $1,000 for in-county placement. SOCIAL SERVICES DEPARTMENT'S RESPONSE TO FINDING #4.7: Disagree. Children placed in an out-of-county Foster Family Agency or foster care placements are placed at a rate of $1,511.40 per month. The average Therapeutic Foster Care rate for children placed in Humboldt County is approximately $1,500.00 per month. The $5,003.00 referred to in the Grand Jury report is the initial rate established for children eligible to participate in the Title IV-E and SB 163 Wraparound programs and represents the costs for a Level 13 Residential Care Placement. 4.8 As of February 1999, 37 children were placed in out-of-county group care homes at an average cost of $ 4, 653 per child, per month at an annual average of $2,065,932. SOCIAL SERVICES DEPARTMENT'S RESPONSE TO FINDING #4.8: Disagree. Currently we have 7 children placed in out-of-county group homes, with an average monthly rate paid of $7,213.00. The range in rates paid is from $4,258.00 per month to $9,977.00 per month. Between Child Welfare Services and the Probation Department there are a total of 18 children placed in out-of-county group homes.

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Remaining Miscellaneous Findings 5.1 DSS staffing has doubled in ten years with no proportional increase in administrative staff. BOARD OF SUPERVISORS' RESPONSE TO FINDING #5.1: Agree with the following clarification. In fiscal year 1989-90, the Department had approximately 244 employees and six Management staff. The ratio of employees to managers was approximately 40:1. As of the fiscal year 1999-00, the Department had approximately 410 employees and nine "management" staff, yielding a ratio of approximately 45:1. The Department has since worked with the Board of Supervisors and Personnel to add two new management positions and now has a ratio of 37:1. PERSONNEL DEPARTMENT'S RESPONSE TO FINDING #5.1: Agree. The Social Services Department provided us with the following statistics. In fiscal year 1989- 90, there were approximately 244 employees and six management staff in Social Services. The ratio of employees to managers was approximately 40:1. As of fiscal year 1999-00, the Department had approximately 410 employees and nine management staff, yielding a ratio of approximately 45:1. There have since been two new management positions added with a new ratio of 37:1. 5.2 There are more than 60 private/public organizations in Humboldt County that deal with child welfare. 5.3 Since 1983, child abuse and the service CWS provides have been the subject of eight Humboldt County Grand Jury reports. 5.4 Previous Humboldt County Grand Jury reports found that funding for family maintenance and reunification was inadequate. CWS workers report that funding continues to be inadequate. SOCIAL SERVICES DEPARTMENT'S RESPONSE TO FINDING #5.4: Agree. Funding for Child Welfare Services overall is significantly inadequate as reported in the April 2000 American Humane Society SB 2030 Child Welfare Workload Study Report. Statewide the results of the study indicate the current family maintenance workload standard is 34.97 cases per worker. The study's minimum recommended caseload per worker is 14.18 cases and the optimum recommended caseload per worker is 10.15 cases. Similarly, the SB 2030 Workload Study's Statewide current family reunification (FR) caseload is 27.0 per worker. The minimum recommended caseload is 15.58 and the optimum caseload recommendation is 11.94. Specific to Humboldt County, Social Workers' combined family maintenance and family reunification caseload in the "ongoing unit" for the period 12/99 - 5/00 averaged 16 per Social Worker, with a range of 14-18 cases per month. 5.5 The 1998 Humboldt County Board of Supervisors approved the formation of the Oversight Committee for county child welfare services. As of January 2000, no reports have been produced. BOARD OF SUPERVISORS' RESPONSE TO FINDING #5.5: Agree. The Oversight Committee has been meeting on a monthly basis for the past year, in addition to an all day meeting that occurred on June 2, 2000. The plan is to present a report to the Board of Supervisors in late summer 2000. 5.6 The occurrence of drug and alcohol abuse in Humboldt County contributing to child neglect/abuse problems notwithstanding, CWS professionals state that the primary cause is a lack of parenting skills in families. 5.7 Many State and Federal programs exist for meeting the needs of children, but each places separate restrictions on the use of funds by the Department of Social Services. These restrictions place additional problems on the Department in meeting needs, according to CWS officials. CONCLUSIONS:

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the DSS and the Department of Mental Health promote an increase in Humboldt County foster care homes of all types through appropriate recruitment, training, screening and support. SOCIAL SERVICES DEPARTMENT'S RESPONSE TO RECOMMENDATION #6: Agree. The recommendation has been partially implemented. The Department supports enhancing the availability of local placement alternatives when placement is needed to maintain child safety. In conjunction with increasing strength based family preservation services to reduce the number of children requiring removal, the Department will continue to support the development of various levels of foster care placements in a collaborative effort with Probation and Mental Health. The Department of Social Services will also establish a method in conjunction with Probation and Mental Health (through the Family Intervention Team Policy Committee) to increase dialogue and mutually agreed upon support services to the Foster Parent Association. The Department will, through discussion at Family Intervention Team II and the Human Services Cabinet, assess the need for additional Foster Care homes and other strategies related to this recommendation.

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CWS work in Humboldt County communities to establish more parent training and family maintenance training programs as tools for child abuse prevention. SOCIAL SERVICES DEPARTMENT'S RESPONSE TO RECOMMENDATION #7: Agree. The recommendation has been implemented. Most recently the Department of Social Services Child Welfare Division has partnered with Humboldt County Mental Health, Children Youth and Family Services (CYFS) to develop a voluntary family maintenance program, called the Voluntary Intervention Program (VIP), for families needing Child Welfare Service intervention, and whose children can safely remain in the family home. The VIP will strengthen parenting capacity through a combination of mental health counseling, rehabilitative and case management services and social work services from the Child Welfare Division. Since 1996 the Department of Social Services has partnered with the Humboldt County Public Health Department in providing early intervention services to families through the Alternative Response Team (ART). ART provides up to six months of services utilizing a Public Health nursing team to enhance parenting, health and daily living skills to strengthen families. The Humboldt County Department of Social Services sponsors the NET, a community-based collaboration comprised of agencies, schools, nonprofit organizations, community members and consumers from all communities in Humboldt County. The purpose of the NET is to develop community resources to provide a variety of prevention needs within their communities including parenting and support resources to assist families. The Humboldt County Department of Social Services contracts with the Humboldt County Child Care Council to provide Family Preservation Family Support services to families and parenting education in the community. In addition, Department of Social Services partners with Humboldt County Child Care Council to provide Child Welfare Service Family Preservation services to families who enter the Child Welfare system. The Humboldt County Department of Social Services, Child Welfare Service division has membership on the Community HUBS, working together with other agencies and communities to develop resources for parents in a variety of ways.

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CWS identify and eliminate barriers to effective emergency response. SOCIAL SERVICES DEPARTMENT'S RESPONSE TO RECOMMENDATION #8: Agree. The recommendation has been implemented. Child Welfare Emergency Response Supervisors and Program Managers have begun an ongoing process of meeting with Law Enforcement Agencies in the County, including the District Attorney's Office, to discuss development of a common understanding of the definition of child abuse and neglect across agencies to increase the capacity for joint investigations, enhance cross reporting practices, and develop inter-agency protocols. Child Welfare Services has been a pilot County PROJECT with the Structured Decision Making process since March of 1999. This structured process is a cornerstone of our improved emergency response system and provides Child Welfare Services with standardized data across time related to the Division's actions. The implementation of Structured Decision Making is through a phased in process, with the final phase occurring June 1, 2000, with the implementation of Structured Decision Making in the Family Reunification program. In addition, over the past seven months, the addition of a second Program Manager position focused on Emergency Response, a Deputy Director of Programs overseeing Child Welfare Services and CalWORKs, an evaluator, a Community Education Specialist, a "legal" Clerk position, increased technology and co-located Mental Health, Probation and Public Health staff should also serve to enhance the effectiveness of the Child Welfare Services Emergency Response system. Finally, Child Welfare Services will continue to work with Mandated Reporters through enhanced community training to enhance their understanding of the role of Child Welfare Services and the information needed by the agency related to the reporting of child abuse.

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CWS ensure that all geographic areas of Humboldt County are equally and adequately served. This would include an assurance that services are provided with consideration for cultural and ethnic needs. SOCIAL SERVICES DEPARTMENT'S RESPONSE TO RECOMMENDATION #9: Agree. The recommendation has been partially implemented but will require substantial additional resources, study and involvement from all County human services agencies and the community to fully implement. The planning for enhanced County presence in outlying areas is a primary goal in the Human Services Cabinet AB 1259 Strategic Plan and assessing and increasing the County's capacity to deliver culturally appropriate and relevant services is a goal of the Human Services Cabinet Strategic Plan. The Cabinet has an established Cultural Competency Committee of which the Department of Social Services is a member, and through this Committee has provided and/or supported various training for County staff and other entities. The complexity of the recommendation will require ongoing efforts from County as well as Private Non Profit agencies, schools and the community. The Department of Social Services supports and will continue to participate in planning and eventual implementation of an enhanced County presence in outlying areas and the enhancement of culturally relevant services. In addition, the Department will continue to engage in the recruitment of Native American foster homes, homes in outlying areas and other efforts relating to the Indian Child Welfare Act. The Department will also continue to assess increasing various methods of enhancing services to parents and foster parents in relation to the AB 1259 Strategic Plan and in cooperation with other local collaborative and funding sources such as Proposition 10. RESPONSES: THE FOLLOWING RESPONSES TO REPORT 00-12 ARE REQUIRED IN ACCORDANCE WITH P.C. 933 AND THE STANDARD FORMAT FOR RESPONSES.

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The contract allows the "Working Group," composed entirely of city officials and personnel, to establish if the net-scrap value should be included in determining the base rates. CITY COUNCIL'S RESPONSE TO FINDING #10: DISAGREE. At the meetings held on September 8, 15 and 22, the City approved contract amendments and authorized the City Manager to execute the Second Amendment to the ACRC contract. The Council's approval was conditional upon City staff conducting an independent assessment of the reasonableness of contract amounts paid to ACRC that included consideration of the effect of net scrap value. ACRC agreed to allow net scrap value to be considered by City staff in its independent assessment and provided City staff with all relevant financial information concerning net scrap value. However, ACRC required that this information be treated as proprietary. Under Section 8.10 of ACRC's contract with the City, ACRC has the right to prevent disclosure of financial information that is proprietary in nature. ACRC allowed the City's finance director to review the relevant proprietary financial information germane to the net scrap value issue and the City agreed that this information was proprietary and perfected by the provisions of Section 8.10. Accordingly, the finance director is allowed to disclose only her conclusions, but not any specific proprietary information pertaining to net scrap value. Based on her review, and based on consideration of other financial information provided by ACRC from its 1997 and 1998 tax returns, City staff determined that total contract revenue paid to ACRC under the contract was reasonable. City staff, like HH&H, also determined that the Base Rates cannot be verified. The conclusions of City staff's independent evaluation of contact revenues was presented to the City Council at a public meeting held on February 16, 2000. On the basis of the staff recommendations, contract revenue were determined to be reasonable. The Council also determined that because the Base Rate could not be verified, there was no legal basis for the City to reduce that compensation paid to ACRC under the contract. The Council's decision were consistent with the findings and conclusions of staff.

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A new section was added by the second amendment to the contract, pre-paying $28, 458.50 to ACRC for city's share of improvements to 10th Street facilities, plus a loan of $51,466 to build the mechanized sort line, and $46,702.44 per year to operate a sort line. THE CITY COUNCIL'S RESPONSE TO FINDING #11: DISAGREE. The Second Amendment to the ACRC contract, was executed on December 23, 1999, and included all of the contract provisions that had been approved by the City Council at public meetings held on September 8, 15 and 22. Specifically, it included pre-payment of $28,458.50 to ACRC for the City's share of improvements to 10th Street, plus a loan of $51, 466.00 to build the mechanized sort line and $46,702.44 per year to be paid to ACRC to operate the sort line as approved by the Council at those meetings.

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Additions to the contract under the second amendment created favorable financial terms to the ACRC, including a low interest of 5.5% for the loan, and monthly payments of 1/12 of the yearly estimated loan repayment for the 10th street improvements. CITY COUNCIL'S RESPONSE TO FINDING #12: DISAGREE. The Second Amendment was approved by the City Council at public meetings held on September 8, 15 and 22, and was executed by the City Manager on December 23 pursuant to the authority vested in him by the City Council at those meetings. The Second Amendment did not create favorable financial terms for ACRC, but for City rate payers. At the time of the Second Amendment ACRC had agreed to purchase, install and operate a new sort line. It did so on the condition that all of its costs would be paid ultimately by City rate payers, including loan amortization costs. ACRC had arranged institutional financing for the purchase and installation of the sort line. Under the Second Amendment, all of the costs of financing these purchases and installation would be passed on to City rate payers. The City, in reviewing ACRC's proposal, determined that it was more economical for rate payers if the City made a direct loan to ACRC in place of its proposed institutional loan. The City was able to lend money from its enterprise funds at a rate of 5.5%, a rate substantially below the rate the institutional lender would have charged ACRC. To this extent, rate payers are the direct beneficiaries of this below-market-rate loan.

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The amended contract states that the parties intend to settle the four described "disputes," but no evidence of progress has been provided. CITY COUNCIL RESPONSE TO FINDING #13: DISAGREE. The Second Amendment to the contract specifically states that by it the parties are resolving certain disputes, including the through- put audit, the parity requirement dispute, the market price adjustment dispute, and the net CRV at 9th Street dispute. The staff reports presented to the City Council dated September 3, September 15, September 17 and February 11 included detailed discussion of all matters in dispute, including the above disputes with ACRC and matters in dispute between the City and AGC. All of these disputes were resolved: the ACRC disputes by means of the Second Amendment and the AGC disputes pursuant to action taken at the public meeting held on February 16, 2000. 14. "Periodic Weight Reports" based on a survey conducted for the city department of Environmental Services are provided for in the amended contract, and are being conducted by a Humboldt State University group. CITY COUNCIL'S RESPONSE TO FINDING #14: AGREE.

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Staff Training 1.1 A lack of professional training programs for social workers in Humboldt County increases the possibility that workers are inadequately trained for their duties. SOCIAL SERVICES DEPARTMENT'S RESPONSE TO CONCLUSION #1.1: Disagree. It must be noted that the Department is unclear regarding what the Grand Jury's definition of "training" programs are. The Department concurs with the Grand Jury on urgent need for a local Masters of Social Work program that would serve to increase the level of Social Worker expertise and educational training for recruitment purposes. The Department disagrees with the Grand Jury regarding (possible) references to inadequate Department ongoing training that Social Worker employees received. The Humboldt County Department of Social Services provides numerous professional training opportunities for Child Welfare Services staff. The majority of Child Welfare Services training is provided through contract by the University of California, Davis Extended Education Program, including Child Welfare Services Core Training, Emergency Response Protocol Training, Child Welfare Services Law Training, and many other focus areas. Social Workers within Child Welfare Services have received extensive training through the Structured Decision Making Pilot Project addressing risk and safety assessment, family/child strengths and needs assessment, and reassessment processes. Numerous Social Work staff participated in the Mental Health 2000 training regarding substance abuse. Staff have been involved in training regarding Family Unity, Best Practices, CAST sponsored training, and child interview training. In addition, we provide ongoing in-house staff training for new and experienced Social Workers regarding child abuse and neglect dynamics, emergency response, family maintenance and reunification and permanency planning programs. Further, County Counsel provides ongoing training regarding Child Welfare Services legal issues. The Department will, through the Human Services Cabinet and related to AB 1259, continue to work collaboratively to provide and/or participate in training to enhance Child Welfare Services staff knowledge. 1.2 That same lack of training programs increases the difficulty of recruiting and maintaining professional staff. SOCIAL SERVICES DEPARTMENT'S RESPONSE TO CONCLUSION #1.2: Partially Disagree. The need for a local Masters Level Program is an example of "training" that would enhance Social Worker preparation and would increase recruitment potential. However, there are many conditions that affect staff recruitment and retention, including compensation, working conditions, recognition for the difficult and professional job staff performs, caseload issues and support from the community.

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Recruitment and Retention 2.1 Noncompetitive pay scales, difficult working conditions, and the adherence to the California Statewide Merit System for recruitment puts Humboldt County in a disadvantageous position. 2.2 Staffing shortages have existed for many years leading to less than satisfactory services for many clients.

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Emergency Response 3.1 Excessive case loads, due to inadequate staffing, result in child abuse referrals not always being adequately managed. 3.2 The narrow scope of State definitions of child abuse and neglect results in many children's real needs not being met.

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Placement 4.1 The shortage of foster homes of all types in Humboldt County results in children's needs not being adequately met 4.2 The shortage of in-county foster placement facilities results in out-of-county placement causing an extreme financial burden on the DSS and Humboldt County taxpayers. 4.3 Reducing the amount of out-of-county foster care placements could result in significant savings, which might be reallocated to better and more in-county foster care. 4.4 The result of County efforts to increase the number of Native American child placement facilities appears to be inadequate.

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Miscellaneous 5.1 In spite of continued Humboldt County Grand Jury findings and recommendations over the past decade or more, the improvements in the DSS operations and funding levels are still inadequate. 5.2 Serious questions exist regarding the allocation and apportionment of funds in the operations of the DSS. 5.3 Parent training and family maintenance training are effective measures for the prevention of child abuse, but receive inadequate support in Humboldt County. 5.4 Structures do exist to oversee and implement improvements in the services of the DSS but appear not to function effectively.

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Changes in the contractual arrangements have systematically benefited the ACRC. CITY COUNCIL'S RESPONSE TO CONCLUSION # 1: DISAGREE. As set forth in the responses to the findings of fact, changes have been made in the contractual relations with ACRC that have systematically benefited the City. The fact that there might be mutual benefit to ACRC from those changes is consistent with fundamental principles applicable to all agreements; that is, unless there is mutual benefit to a contractual arrangement, there would be no incentive to enter into it. The important point in connection with the changes concerning the City's recycling system is that all changes were considered by the City Council in public meetings in which the City Council carefully considered a variety of options and the opinions of the public, and, based on those considerations, authorized amendments to the ACRC and AGC contracts consistent with the recommendations of City staff.

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There has been very limited public input on recycling issues, despite increased costs to Arcata taxpayers. CITY COUNCIL'S RESPONSE TO CONCLUSION #2: DISAGREE. As set forth above, there have been numerous public meetings and study sessions on the proposed changes to the City's recycling system. The Grand Jury's position seems to be that because a citizen's advisory group was not constituted by the City Council to advise the City on the proposed changes to the ACRC and AGC contracts, the City is somehow derelict in its duties. Nothing could be further from the truth. The City is not required by state law to constitute advisory committees, and, in fact, is ill-advised to do so where the subject matter is of a technical nature. In the case of the City's recycling system, the matter is further complicated by the fact that it involves contractual relations with two entirely separate, independent entities. The contracts are not up for renewal; instead, negotiations are occurring in the context of changes in state law mandating that the city alter its recycling program. All bargaining has been strictly at arm's length. Notwithstanding the limitations the City faced, it is the opinion of City staff that the current changes in the ACRC and AGC are beneficial to the rate-payers and citizens of Arcata and have resulted in a vast improvement to the system.

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The city has largely ignored recommendations of the 1997-1998 Humboldt County Grand Jury. a. The city, though agreeing with the recommendation, appears not to closely monitor compliance. b. The city, though agreeing with the recommendations, appears not to demand weight reports from ACRC. c. The city disagreed with the recommendation to fine tune the process and make it user friendly. CITY COUNCIL'S RESPONSE TO CONCLUSION # 3: DISAGREE. The City's position is that recycling in Arcata is more user-friendly. Recyclables are now collected curbside on the same day each week from each residential customer. Previously, different recyclables were picked up each week of the month for these customers, which resulted in confusion and underutilization. Adapting to this more user-friendly system required extensive modification of the receiving facilities located at ACRC's 10th Street facility. The City is closely monitoring ACRC's contract compliance, and does demand and receive periodic weight reports from ACRC.

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the City of Arcata either firmly enforce its contract with the ACRC, or provide the service itself. CITY COUNCIL'S RESPONSE TO RECOMMENDATION #4: This recommendation will not be implemented because it is unwarranted and unreasonable. The decision of the City as to how it will administer its contracts is a matter within its sound discretion. The City may elect to waive or strictly enforce provisions of a contract, and, provided it is reasonable to do so, the discretion to make this decision is solely vested with the City. The ACRC contact which awarded ACRC the exclusive right to process recyclables in the City, expires in 2004. Until then the City has no legal right to provide recycling services in the City of Arcata, even if it wants to, unless there were a material breach of the ACRC contract. Since the contract with ACRC was entered into in 1997, there has been no material breach of the ACRC contract which would have given the City the right to cancel the contract and provide the service itself. None is expected between now and 2004. RESPONSES: THE FOLLOWING RESPONSES TO REPORT 00-13 ARE REQUIRED IN ACCORDANCE WITH P.C. 933 AND THE STANDARD FORMAT FOR RESPONSES.

Conclusions 119

Commendations 4

No Responses Found 2