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Findings 8 findings
F1
The Oversight Committee shall “monitor the activities of the Treasurer, and cause to be performed an annual audit to determine the Treasurer’s compliance within the Investment Policy and other appropriate regulations”. This committee will include from three to eleven members as determined by the Board of Supervisors, in consultation with the County Treasurer. County Codes require the Committee shall include persons from the following categories: The County Treasurer, the Auditor/Auditor Controller/Finance Director l An appointed member of the Board of Supervisors l The Superintendent of Schools or a designee l A representative selected by a majority of the presiding officers of the governing bodies of the l school districts within the County that are required or authorized to deposit money in the County Investment Pool One to five bipartisan members of the public that have expertise in public finance and come l from diverse economic backgrounds
F2
The office of Tax Collector has been the subject of investigation for several years. Too often
F3
Approximately 60% of the investment portfolio appears to be placed in low interest bearing securities (short term). NVEST (Mutual Funds) had a shortfall of $428,091. according to the Investment Report September 2003. http://www.co.lake.ca.us/generalinformation/grandjury/report0304/taxcollector.html (2 of 5)4/17/2007 3:06:48 PM County of Lake - 2003/2004 Grand Jury Report -Grand Jury Selection
F4
There has been a budget request of $30,000. for equipment needed by the Treasurer/Tax Collectors office. The request was approved and written into the budget two fiscal years (2000-2002), however the purchase was not made and the money not spent. When interviewed, members of the Treasurer/Tax Collector’s staff agreed that the Remittance Processing equipment was important and would increase their efficiency. The staff did not know of the actual request for the funds, the approval of the funds in the budget, or the failure to purchase the equipment. The County budget subsequently reflected the discontinued request by the Treasurer/Tax Collector in 2002/2003. A request was again made for equipment in 2003/2004. This time the equipment was titled Copy/Scan Check Endorser-Encoder. The purchase has not been made to date, despite a repeated budget approval.
F5
During the interviews, the staff reported only four people open daily mail and remove checks sent to the County. Because of the State budget crisis the office staff will not increase in size soon and remains an area of concern for the current staff, as all mail received is not opened each day. Methods used to open mail are antiquated. The Remittance Processing equipment would help remedy the situation, obviously the reason for the budget request. Currently, mail with enclosed checks are placed in trays and remain unopened for days or even weeks.
F6
The County pays Wells Fargo Bank in excess of $70,000. for banking services annually. Other banks have shown an interest in serving Lake County with decreased fees for service.
F7
Through interviews the Grand Jury found formal training and ongoing training for Treasurer/Tax Collectors staff deficient.
F8
The Treasurer/Tax collector’s office held auctions for properties with tax liens, over $4,000,000. was collected, an amount greater than anticipated.
Recommendations 8
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R1The Oversight Committee does not have authority to direct daily operations. The Grand Jury strongly recommends the Committee assume a more positive role in the monitoring and implementation of the recommendations of the Auditors.
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R2The 2003-2004 Grand Jury agrees with the current and past findings of Smith & Newell and strongly recommends the Department make suggested changes.
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R3Reconcile this shortfall if it has not been addressed to date. Rethink low interest or short-term investments of the County Operating budget of the reported $137,000,000 for the purpose of finding more revenue. Consider how much is paid annually to the investment counselor and how long that counselor has been retained by the County. Require Requests for Proposal (RFP) from local investment experts.
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R4The Grand Jury fails to see why such an important piece of equipment, requested by the Treasurer/Tax Collector, has not been purchased and why was the request made three different years and forgotten? Requests from other County departments have been denied for lack of funds when $30,000. has been approved for the Treasurer/Tax Collector’s office and not spent. When County money is budgeted for a specific, necessary, requested item, that money should be used to enhance the profitability and efficiency of the requesting department, and ultimately the County.
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R5The lost interest on monies paid to the County is incalculable and inexcusable. Deposits should be made http://www.co.lake.ca.us/generalinformation/grandjury/report0304/taxcollector.html (3 of 5)4/17/2007 3:06:48 PM County of Lake - 2003/2004 Grand Jury Report -Grand Jury Selection daily, as is the practice in business and Government. A Bank Courier should be dispatched daily to the Treasurer/Tax Collectors department.
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R6A Request for Proposal (R.F.P.) is sent to other banks to engage their services. The transition to another banking institution may incur initial costs but eventually will prove cost effective.
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R7Regularly scheduled training should be planned to include individual instruction. Policies and procedures relative for each position in the department should also be included.
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R8Further tax sales should be held, with the added possibility of Internet sales in conjunction with other Counties. ADDITIONAL RECOMMENDATION: The 2003/2004 Grand Jury recommends further observance of the Treasurer/Tax Collector’s office by the 2004/2005 Grand Jury. REMARKS: Office morale is exceptionally good with staff cohesive, friendly, considerate and willing to help each http://www.co.lake.ca.us/generalinformation/grandjury/report0304/taxcollector.html (4 of 5)4/17/2007 3:06:48 PM County of Lake - 2003/2004 Grand Jury Report -Grand Jury Selection other. Budgeting problems hinders efficiency while obtaining funds to increase the size of the staff is an unknown. The Grand Jury commends this staff of dedicated people for their hard work. RESPONSE REQUESTED: Treasurer/Tax Collector Lake County Board of Supervisors http://www.co.lake.ca.us/generalinformation/grandjury/report0304/taxcollector.html (5 of 5)4/17/2007 3:06:48 PM County of Lake - 2003/2004 Grand Jury Report -Grand Jury Selection 2003/2004 Grand Jury Report LAKE COUNTY GRAND JURY FINAL REPORT FINANCE COMMITTEE Clearlake Chamber of Commerce PURPOSE: In response to a citizen’s complaint regarding mismanagement and potential monetary fraud by a Clearlake Chamber of Commerce official, the Finance Committee conducted an investigation into the funding of the Chamber of Commerce by the City of Clearlake and questioned the appropriateness of the funding of the Redevelopment Agency. BACKGROUND: Since July 25, 1996 allocation of funding to the Chamber has been determined annually at the discretion of the City Council during their budgeting process. The City of Clearlake and the Redevelopment Agency each budgeted $20,000 for the year 2003, providing the Chamber of Commerce with operating capital. Following rumors of mismanagement, the City of Clearlake, as guardians of the public money, had the duty of demanding an accounting of the use of the allocated funds. An audit was requested and due to be delivered to the City by March 14, 2003, with the provision that the City would withhold any monies still owed to the Chamber if the audit was not received. The audit was not forthcoming. The amount withheld by the City of Clearlake and the Redevelopment Agency totaled $10,000. In July 2003, the City Council adopted the 2003-2004 budget with funding for the Chamber. The funding budgeted was for the Chamber of Commerce or another entity who would provide tourism and business promotions. This background information indicated the complaint was out of the jurisdiction of the Grand Jury and better handled through the District Attorney’s office. However, based on California Community Redevelopment Law, other issues were discovered by the Finance Committee that warranted review. COMMITTEE ACTION: The Finance Committee interviewed senior level staff from the City of Clearlake and the Clearlake City Council, officials of Lake County Government, conducted telephone and internet interviews with http://www.co.lake.ca.us/generalinformation/grandjury/report0304/chamber.html (1 of 3)4/17/2007 3:06:49 PM County of Lake - 2003/2004 Grand Jury Report -Grand Jury Selection attorneys versed in California Community Redevelopment Law, reviewed California Redevelopment Law Manual, reviewed 1999-2000 Grand Jury report documents and numerous news articles regarding Redevelopment Agency funding to the Clearlake Chamber of Commerce.