Response to 2005106 Grand Jury Report on Officer Involved ShootingsICritical

R10-15

years become toxic waste areas because of the runoff. She had concerns about putting a park next to a detention area. Mr. Sharkey commented that wastewater also becomes a water quality issue. e. Other Mr. Lawrence received a notice from Butte County regarding how much the tax shift was going to be for ERAF. The estimate was $100,000, however, the State used 2002-2003 tax rolls as the basis, so the actual amount of the shift was $83,094. The District had Regular Board Meeting Minutes December 8,2004 originally anticipated a 25% shift, but that was later reduced to 10%. Mr. Lawrence further explained that in the original proposal, local government would lose 25% of their properly taxes for two years and at the end of that period, their tax rates would be returned to 2003/04 levels plus growth on future development. However, he recently learned at a CARPD Legislative meeting that the "growth" factor had been dropped from the legislation for Proposition IA. The estimated loss of revenue from growth for FRRPD is $6,000-$8,000 per year. By contrast, the Hayward Recreation and Park District contributes $1 2 million to ERAF and will lose $2 million per year in estimated growth. VI. ITEMS FROM THE FLOOR HEARING OF CITIZENS Persons wishing to speak on a topic, which is not listed on this agenda, may do so when the chairman opens the meeting for items from the floor. Please come to the podium and wait to be recognized by the chairman. When recognized, please state your name and address for the record. According to the Brown Act, the Board cannot take any action at this meeting. YOU MAY BE LIMITED TO FIVE MINUTES. Irene Poe, Vice President of Goso Ms. Poe welcomed the new Board members and congratulated returning members and looked forward to working with the Board this year. She mentioned that GOSO had its annual election and new members that she would have introduced tonight were not present due to the weather. Bill Connelly 5490 Debbie Avenue, Oroville Mr. Connelly welcomed the new Board members and commented that he will be sworn in January 3rd at 12:OO p.m. at 25 County Center Drive. As a newly elected Supervisor, he wanted to be a teamplayer and help the District. He looked forward to working together on projects. He hoped that the contention that took place at this meeting can be put behind us and work together in the future. VII. BOARD ITEMS FOR NEXT AGENDA FERC Project 2100 Alternative Re-Licensing - Update: Local control of state facilities Nelson Soccer Complex Update: Third party agreement, critical habitat status, and cost from Gallaway Consulting on the conservation easement endowment. Director's Reports: Availability of City Council Chambers Status of Palomino Ridge Development VIII. EMERGENCY SITUATIONS -NONE Pursuant to Government Codes 54954.2 and 54956.5 the Board may take action on items not listed on the agenda when emergency situations exist as defined by these codes. M. ADJOURN There being no other business, Chairman Thompson adjourned the Attest: Scott Wm. ~awrenceB, oard Secretary Exhibit 5 151 OROVILLE, CALIFORNIA 95965 MUNICIPAL AUDITORIUM, 1200 MYERS STREET PHONE: (530) 533-2011 FAX: (530) 533-2724 August 9,2006 Honorable Steven J. Howell, Presiding Judge Butte County Superior Court One Court Street Oroville, CA 95965 Re: Response to the 2005-2006 Grand Jury Report Honorable Judge Howell: As the new general manager of Feather River Recreation and Park District, I have been requested by the Grand Jury to respond to their report. The Grand Jury's report has come at a time when the Feather River Recreation and Park District finds itself at a crossroads. The concerns the Grand Jury has expressed, particularly the management of finances, needs closer and more diligent consideration-and do not-fall on deaf ears. The District's Board and administrative staff are lookina forward to the oooortunitv to correct anv mistakes made in the past. We ha; every intentior; 'to maie any and ail changes necessary to ensure a vibrant future for the region and community we serve. It has been the intent of the District Board to complete the Bedrock Skate and Bike Park. To that end, the District Board has approved all project-scoped elements and components of this eleven-year development enhancement project. This project has been a high priority to alleviate a serious liability involving skate and bike enthusiasts' use of the historic downtown business area and the city-owned Municipal Auditorium, as well as to address the recreation needs for at-risk youth and young adults and for the enjoyment of a new generation of recreation participants. The District Board strongly feels it has orovided this communitv and the North State with a uniaue ark that is safe for all "sers. We understand ihe Grand Jury's belief that the f/sca'l impact this park may have had on the District's finances is cause for concern. However, the District Board and administrative staff are confident that the total costs of all elements of the project have been covered by a sound fiscal foundation and, in large part, by grant funding. The biggest challenge the District has ahead is to reconcile its revenue generation and invigorate its recreation programs. It was this April that the Butte County Treasurer and Auditor/Controller made the Board of Directors and administrative staff fully aware of the seriousness of the District's financial situation. Already the Board and staff have been working hard to make a list of recreation programs that people in the community truly want but will also provide solid revenue to bolster the District's budget. The District team has given a great deal of thought to how we will accomplish a robust palette of beneficial recreational programs. It is the District Board's intent to create programs that will serve a wide cross-section of the community, meeting the needs of children, adults, and seniors, as well as generating necessary revenue. The District is in grave need of invigoration and change; the Board of Directors and administrative staff understand this. We in fact, are excited about the opportunity to implement changes and make the Feather River Recreation and Park District an even stronger agency for servicing the community; providing parks, activities, facilities, and services to people of all ages in the greater Oroville area that will enhance and enrich their lives. The District Board and staff intend to work together to create the best possible future for this community. Sincerely, u Bob Sharkey General Manager Exhibit 6 --. FEATPREI) RIDERS RUBEN ALCANTAHA DUSTIN GUENTHER TUESPAY, AUGUST 15,2006 Beginning at 1 pm BEDROCK SKATEIBIKE PARK --- Etnie Shoes presents Demostrations for your enjoyment by Eight of the top BMX Riders in the Nation Exhibit 7 CITY OF OROVILLE RESOLUTION NO. 5959 A RESOLUTION OFTHE OROVILLE CITY COUNCIL MAKING CERTAIN FINDINGS THAT CERTAIN PUBLIC IMPROVEMENTS TO THE BEDROCK SKATUBIKE PARK ARE OF BENEFIT TO THE OROVILLE REDEVELOPMENT AGENCY PROJECT AREA WHEREAS, the Oroville Redevelopment Agency, pursuant to the provisions of the Community Redevelopment Law (Div~sion2 4, Part 1 of the California Health and Safety Code), has adopted a Redevelob ment Plan (the "Redevelopment Plan") for a redevelopment project area situated in t e C~tyo f Oroville known as the Oroville Redevelopment Project No. 1 (the "Redevelopment Project Area"); and WHEREAS, the 0:oville Redevelopment Agency, pursuant to the provisions of the Community Redevelopment Law and the Redevelopment Plan, is authorized to finance public improvements providing that the legislative body makes findings as to the benefit to the Redevelopment Project Area resulting from the ~mprovementsa nd that the public owner of the proposed public improvements has no other reasonable means of financing the improvements; and WHEREAS, Bedrock SkateIBike Park is an important recreational facility that contributes to tourism and serves the needs of citizens within the Redevelopment Project Area; WHEREAS, the need for further park amenities is necessary to develop the full potential of Bedrock SkateIBike Park; WHEREAS, additional public improvements in the form of a skatelbike facility are proposed by Feather River Recreation and Park District within the Redevelopment Project Area; WHEREAS, Feather River Recreation and Park District adopted a resolution z finding that it did not have an funds for the public improvements at Bedrock SkateIBike Park, such resolution is attac ed as Exhibit A"; NOW, THEREFORE the City Council of the City of Oroville does resolve as follows: SECTION 1.The City Council makes the following findings relating to the Bedrock SkateIBike Park Project: a. Bedrock SkateIBike Park is an impoqant rec!eational facili" wIhl ch will contribute to the elimination o bllght wlthrn the Redeve opment Project Area, and will implement the goals of the Redevelopment Plan. b. Bedrock SkatetBike Park serves the residents within the Redevelopment Project Area. c. Bedrock SkatelBike Park requires further develoP m ent to be a positive impact on existing businesses, househo ds, and the local area youth, and for the ellmination of blight within the Redevelopment Project Area. PASSED AND ADOPTED by the Council of the City of Oroville at an adjourned regular meeting of January 21, 2003 by the following vote: AYES: Council Members Berry, Corkin, Jernigan, Simpson, Mayor Andoe NOES: Vice Mayor Hatley ABSTAIN: None ABSENT: Council Member Koslin Gordon Andoe, Mayor ATTEST: OROVILLE ClTY COUNCIUOROVILLE REDEVELOPMENT AGENCY TO: MAYOR AND COUNCIL MEMBERSICHAIRPERSON AND COMMISSION RUBEN DURAN, ClTY ADMINISTRATORIEXECUTIVE DIRECTOR FROM: CHARLES MILLER, DIRECTOR OF PARKS AND TREES RE: APPROVAL OF FINDINGS FOR USE OF RDA FU-NDS FOR IMPROVEMENTS AT BEDROCK SKATE IB IKE PARK DATE: JANUARY 21,2003 SUMMARY . . The Council will consider adopting a resolution approving the findings necessary in order to use Oroville Redevelopment Agency (RDA) funds for improvements to Bedrock Skate1 Bike Park. DISCUSSION The Feather River Recreation and Park District (FRRPD) has proposed to construct a Skate IB ike Park facility at Bedrock Park. This facility will be located south east of the upper parking lot. FRRPD has established a Skate IB ike Park fund for this project. The Department of Parks and Trees had previously proposed constructing a Skate Facility in Hewitt Park. The Department of Parks and Trees has discontinued pursuing the Hewitt Park Skate Facility. Currently, the Hewitt Park Skate Facility account#397-8150-9607 has a balance of $4,250.00. The Council approved the release of these funds to the FRRPD Bedrock Skate IB ike Park at the December 3,2002 Council meeting. At the FRRPDrs December I I,2 002 regular board meeting Resolution No. 830-02 was passed, making the necessary findings that FRRPD does not have the necessary funds to develop Bedrock Skate IB ike Park. Resolution No. 830-02 is attached for Council's review. This item is before the Council for approval of the findings, and before the RDA for approval of disbursement to FRRPD of funds upon proof of expenditures. - FISCAL IMPACT Funding in the amount of $4,250.00 is available in account #397-8150-9607, Hewitt Park Skate Facility. RECOMMENDATION CITY COUNCIL: 1. Adopt Resolution No. 5959, A RESOLUTION OF THE OROVILLE CITY COUNCIL MAKING CERTAIN FINDINGS THAT CERTAIN PUBLIC IMPROVEMENTS TO BEDROCK SKATElBlKE PARK ARE OF BENEFIT TO THE OROVILLE REDEVELOPMENT AGENCY PROJECT AREA NO. 1.. . REDEVELOPMENT AGENCY: 1. ~ ~ ~ r tohev di'sb ursement of $4,250.00 from account no. 397-8150-96067 to the Feather River Recreation and Park District upon receipt of expenditures relating to the Bedrock SkateIBike Park. FRRPD Resolution No. 830-02 Resolution No. 5959 December 3, 2002 staff report -. BUTTE COUNTY ADMINISTRATION MEMBERS OF THE BOARD 25 COUNTY CENTER DRIVE OROVILLE, CALIFORNIA 95965-3380 BILL CONNELLY Telephone: (530) 538-7631 Fax: (530) 538-7120 JANE DOLAN MARY ANNE HOUX CURT JOSIASSEN PAUL M CINTOSH KIM K. YAMAGUCHI Chief Administrative Officer September 5, 2006 Honorable Steven Howell, Presiding Judge Butte County Superior Court One Court Street Oroville, CA 95965 Re: Chief Administrative Officer’s Response to the 2005-2006 Grand Jury Final Report Dear Judge Roberts: Penal Code Section 933 and 933.05 provides that the governing body of the public agency shall comment to the presiding judge of the superior court on the findings and recommendations pertaining to matters under the control of the governing body. The Board of Supervisors, as the governing body of the County of Butte, will provide its response to the 2005-06 Grand Jury Report by the statutory deadline. The past Grand Jury, though, has asked that all departments mentioned within that report provide a direct response to the Presiding Judge. While all legal requirements for a response to the Grand Jury Report have been met by the County of Butte, in the spirit of cooperation, I am providing this direct response to those areas where the Grand Jury sought a response from the Chief Administrative Officer. One of the roles of the Chief Administrative Officer is to act as the de facto chief of staff to the Board of Supervisors. In that role, I directed the preparation of the Board of Supervisors’ initial response to the Report. It should not be a surprise, therefore, that my response to the Report, as the Chief Administrative Officer, is very similar to the response provided by the Board of Supervisors. THE BUTTE COUNTY AUDITOR-CONTROLLER – PART 1 THE OFFICE AND STAFF Grand Jury Findings 1. The current Assistant Auditor-Controller was hired without any background in government accounting practices resulting in delays and deferment of decisions and policy setting to a department supervisor. It is not apparent that he has any supervisory or management skills. He consistently relies on a lower level supervisor to make his decisions and set policy and procedure for the office. The respondent neither agrees nor disagrees with this finding. The Chief Administrative Officer and his staff are not involved in the hiring or supervision of any Auditor-Controller staff, and can only become involved at the invitation of the Auditor- Controller. 2. Lack of management skills of the Auditor-Controller and the Assistant Auditor-Controller has led to an antagonistic work environment where employees are fearful for their safety/well being. The respondent neither agrees nor disagrees with this finding. The Chief Administrative Officer and his staff are not involved in the supervision of Auditor- Controller operations and is not directly involved in Auditor’s Office employee investigations. 3. Treatment of employees in the Auditor-Controller’s office is frequently inconsistent with Butte County Personnel Rules and MOUs. The respondent neither agrees nor disagrees with this finding. The Chief Administrative Officer and his staff are not involved in the supervision of Auditor- Controller operations and is not directly involved in investigations of County policy compliance. 4. The Auditor-Controller is seldom available to employees or other County officials. The Grand Jury believes that when the Auditor-Controller attempts to resolve an issue, his lack of familiarity with his office’s processes and policies often exacerbates the problem. The respondent neither agrees nor disagrees with this finding. The Chief Administrative Officer and his staff are not involved in the supervision of Auditor- Controller operations, and elected department heads are not required to record actual time worked into the County’s timekeeping system. 5. The Auditor-Controller sometimes manages employee situations with sarcasm and derogatory comments about his employees. Several of his subordinate managers have adopted his management style as their role model for management by intimidation. Additionally, the hostile behavior is undermining the County’s ability to do business on a daily basis as the anger and hostility disseminates into communications with other County departments. The respondent neither agrees nor disagrees with this finding. The Chief Administrative Officer and his staff are not involved in the supervision of Auditor- Controller operations or the management of Auditor-Controller staff. Although the respondent is aware of less than professional communication, he does not know how much is attributed to any hostile behavior. 6. The Assistant Auditor-Controller and Finance Officer initiated and participated in a juvenile and mean spirited prank on an office supervisor, which clearly was demeaning 2 and made the supervisor feel threatened. This type of behavior is unprofessional and unbecoming a member of a management team. The respondent neither agrees nor disagrees with this finding. Any investigation of this incident was internal to the Auditor’s Office or arranged by the Human Resources Department. The Chief Administrative Officer and his staff were not involved. The respondent agrees that such behavior would be unprofessional and inappropriate for any County employee. 7. Multiple testimonies suggest that the Cost Section Supervisor may have come to work with the odor of alcohol on her person on several occasions. To date no action has been taken regarding this behavior. Ignoring this behavior puts the department’s employees in danger and puts the County of Butte at risk. The respondent partially disagrees with this finding. The Human Resources Director has informed the respondent that the Auditor-Controller has addressed the issue. 8. The Cost Section Supervisor has demonstrated unprofessional and unacceptable behavior towards various county employees. The respondent agrees with this finding. 9. As a result of the Grand Jury’s investigation into alleged behavioral issues within the Auditor-Controller’s office, the County initiated a comprehensive investigation of the issues. As a result, the County is considering several additional training programs for their managers and line level staff. The respondent agrees with this finding. 10. Problems found by the Grand Jury in the Auditor-Controller’s office should not have reached the level observed. It is apparent that the Human Resources department has limited authority when dealing with departments of elected officials. The respondent agrees with this finding. Grand Jury Recommendations 1. The Board of Supervisors should utilize the Chief Administrative Officer and his Deputy Administrators to organize a public hearing to discuss possible options for a ballot initiative proposing one or more of these potential solutions: a. Eliminate the Auditor-Controller position completely b. Separate the positions of Auditor-Controller, where the Controller acts as a Chief Financial Officer (CFO) reporting to the Chief Administrative Officer (CAO) c. The Auditor-Controller position remains intact with a higher level of accountability to the taxpayers. The recommendation has not been implemented but will be implemented in the future. Extensive analysis is needed to explore the practical options possible for a ballot initiative before a public hearing can be facilitated. The next opportunity to combine a ballot measure with a general election is June 3, 2008, so such a ballot measure would need to be prepared, approved by the Board of Supervisors, and submitted to the County Registrar of Voters prior to March 7, 2008. The respondent believes that the recommendation to hold a public hearing will be implemented by April 1, 2007. IMPORTANT NOTES: • The office of County Controller was not created by the Butte County Charter nor the Butte County Code. Creating such an office is permissible but not required by State law or county charter. However, the Board of Supervisors, by Resolution adopted on August 22, 1955, pursuant to Government Code sections 26880 and 26885, created the office of County Controller and ordered that the County Auditor shall hold the office ex-officio. The Resolution also held that the order may be repealed at any time by majority vote of the Board of Supervisors. • If the electorate approves a Charter amendment to eliminate the office of Auditor on June 3, 2008 the amendment would not become effective until filed and accepted by the Secretary of State pursuant to Government Code section 23723. As a practical matter, however, such an amendment could not eliminate the office until after the expiration of the existing term of the incumbent. The next term begins on January 8, 2007, and ends on the first Monday following January 1, 2011. Therefore, a Charter amendment considered by the electorate on June 3, 2008 that eliminates the office of the auditor would become effective January 3, 2011. • The electorate may be able to approve a Charter amendment creating the position of controller, comptroller, or chief financial officer that is independent from the office of auditor. Further analysis is required to determine what options are available to the electorate. A new office created by a Charter amendment can take effect as soon as the amendment is filed and accepted by the Secretary of State. • The Board of Supervisors may be able to adopt an ordinance amending the County Code creating the position of controller, comptroller or chief financial officer that is independent from the office of auditor. Further analysis is required to determine what options are available to the Board of Supervisors. 2. The County needs to take immediate and appropriate action to eliminate the dysfunction of the management staff of the Auditor-Controller’s office, to include training and disciplinary action up to and including termination of employment. Should replacement of employees be chosen, the County needs to insure that candidates strictly meet the job qualifications for the job to which they are applying. Solving the problems with management, in this Grand Jury’s opinion, would take care of a majority of the personnel problems in the department. The recommendation will not be implemented because the respondent is unable to do so. Only the Auditor-Controller is able to hire, take disciplinary action and require such training of his employees. The Board of Supervisors could authorize the Chief Administrative Officer to investigate and enforce compliance of County administrative policies, require training of employees, and audit the management of other departments, but the Board does not have the statutory authority to authorize the Chief Administrative Officer to make hiring appointments in the office of an elected department head. 3. Butte County has spent nearly $1,000,000 to implement a time keeping system to insure accurate timekeeping and to control payroll costs. Procedures should be implemented and steps should be taken to not allow an employee to record time worked on any day other than on the day worked, without approval from the department head and the CAO’s office. The recommendation will not be implemented because it is not reasonable. Many County employees are not at their regular worksite at the end of the day to enter time worked that day. Fieldwork, training events, and participation in out of the office meetings are examples of such instances. However, the respondent agrees that all employees should be encouraged to enter time worked as soon as practical. 4. Elected officials should set an example for their employees and make himself available to his employees during working hours. Elected department heads should record their hours worked for public record. The respondent is unable to comment on this recommendation. The recommendation is not enforceable within the authority of the Chief Administrative Officer. 5. The County should take immediate action to insure that all managers of departments in the County attend and participate in a series of mandatory training sessions as defined by the HR Department. Managers should be required to complete all training within one year and department heads should be held accountable to insure successful completion. The recommendation has not been implemented, but will be partially implemented. By January 2007 the respondent will assist the Human Resources Director in preparing a plan and resource request for Board of Supervisors consideration to create a mandatory supervision and management program affecting all departments. 6. Each employee of the Auditor-Controller’s office should be provided with a copy of the Butte County Personnel Rules in order to fully understand their rights as employees of Butte County. The recommendation has been implemented. On August 3, 2006 the Human Resources Director provided each employee of the Auditor-Controller’s office with a copy of the Butte County Personnel Rules. 5 7. The Butte County Board of Supervisors and CAO should empower the Human Resources Director to assert the same authority throughout all County departments. The recommendation has not been implemented, but will be partially implemented. By January 2007 the respondent will prepare a plan and resource request for Board of Supervisors consideration to create a policy compliance program affecting all departments. AUDITOR-CONTROLLER ADDENDUM: BUTTE COUNTY HUMAN RESOURCES Grand Jury Findings 1. The HR Director notifies each department when a performance review is due, however no follow up is made to ensure that the review ever gets done. One without the other is not effective. The respondent partially disagrees with this finding. Each department head is responsible for ensuring that their employees receive timely performance reviews. The Human Resources Department does send out regular reports of past due evaluations to all departments. The respondent agrees that timely performance evaluations are very important. 2. Performance reviews are a measurement of an employee’s job performance and a vehicle to groom the employee for advancement or disciplinary action should the job performance decline. Additionally, it suggests ways the employee can stretch and grow to enhance their knowledge and skills. Without performance reviews there is no justification for promotions or disciplinary actions. The respondent agrees with this finding. 3. The County currently could filter inappropriate email between County employees with current software or additional software. This could slow the forwarding of inappropriate or offensive emails. The respondent agrees with this finding. 4. Butte County has insufficient policy to control inappropriate or offensive email between county employees. The respondent partially disagrees with this finding. Butte County computer use policies and memoranda of understanding with employee groups both delineate appropriate and inappropriate use of computers. The type of e-mails described by the Grand Jury clearly fall in the inappropriate category. However, the Board has directed that the County’s computer use policy be strengthened, as well as new security policies put in place, and expects to take action on those by January 2007. 6 5. With the exception of AB1825 training, no other mandatory training exists for County managers. The respondent agrees with this finding. 6. As a rule, employee reviews are not done in a timely fashion. Many Butte County employees who have reached the top of their salary range do not receive annual performance evaluations. The respondent partially disagrees with this finding. The respondent agrees that performance evaluations should be completed on a timely basis. The Human Resources Director reports that while there is room for improvements, County departments are generally in compliance with timely submittal of performance evaluations. Grand Jury Recommendations 1. The County should make the following classes mandatory for all current management employees and require all probationary managers to attend the following training prior to the completion of their probationary period. Management employees should be required to repeat workshops identified by the HR Department no less than every two years to stay current with Federal and State laws and County policy: • EEO & Hostile Workplace • Discipline Process • Grievance & MOU Administration • Non Discrimination Partnering for Performance (performance evaluation process and policies) • Managing Absenteeism (how to manage overlapping leaves of absence, various protected leaves, and how all this coordinates with Butte County policy) • Positive Discipline (coaching, counseling and communicating expectations) • Progressive Discipline (imposing formal discipline when coaching counseling and communicating expectations has not been successful) • Non-Discrimination (includes sensitivity training concerning protected characteristics, sexual harassment, and retaliation) The recommendation has not been implemented, but will be partially implemented. By January 2007 the respondent will assist the Human Resources Director in preparing a plan and resource request for Board of Supervisors consideration to create a mandatory supervision and management program affecting all departments. 2. All employees of the Auditor-Controllers' office should be encouraged and allowed to attend all pertinent and appropriate trainings offered by the Butte County Department of HR. The respondent is unable to comment on this recommendation. The recommendation is not enforceable within the authority of the Chief Administrative Officer. However, the respondent supports this recommendation. 7 3. HR Department should track attendance of all trainings given and notify departments when the annual participation of supervisors and managers is required. The recommendation has been partially implemented. The Human Resources Department currently tracks attendance for all mandated trainings it provides to other departments. By January 2007 the respondent will assist the Human Resources Director in preparing a plan and resource request for Board of Supervisors consideration to create a mandatory supervision and management program affecting all departments. 4. Information Services should install email filtering software on the County email system that automatically filters County employees’ email and insure that all employees are aware of a sufficient, adopted email policy. The recommendation has not been implemented, but will be partially implemented. By January 2007 the respondent will prepare an updated e-mail use, retention and inspection policy for Board of Supervisors consideration and request the Information Systems Director to recommend appropriate additional security safeguards and filters. 5. The HR department should be the de-facto enforcer of County policy and must be empowered by the Board of Supervisors to serve in this capacity. There cannot be special rules for departments of elected officials. The recommendation has not been implemented, but will be partially implemented. By January 2007 the respondent will prepare a plan and resource request for Board of Supervisors consideration to create a policy compliance program affecting all departments. 6. The HR department should implement procedures for timely notification to managers of upcoming performance reviews of their employees. Department managers must be held accountable for completion of annual performance reviews, and HR needs to provide follow up with the department before reviews are due. The recommendation has not been implemented, but will be partially implemented. By January 2007 the respondent will prepare a plan and resource request for Board of Supervisors consideration to create a policy compliance program affecting all departments. THE BUTTE COUNTY AUDITOR-CONTROLLER PART II: AUDITING THE AUDITOR AND HIS AUDITORS Grand Jury Findings 1. By Generally Accepted Accounting Practice standards, there are currently insufficient separation of duties or internal controls within the Butte County Auditor-Controller’s office. The respondent neither agrees nor disagrees with this finding. The respondent notes that the Auditor is an independently elected official and, as such, is responsible for the operation of his department, including compliance with Generally Accepted Accounting Practices. If this finding is accurate, though, the respondent would have serious concerns. 2. In spite of the recent changes in location and management of the Pentamation financial system, there are still many challenges and shortcomings with proper management and security of the financial data. The respondent partially disagrees with this finding. Since the county financial system was relocated to the Information Systems department server room the security of the system hardware and data has greatly improved. System access logs are now kept, regular back-ups are made, and a dedicated firewall appliance system will be installed during fiscal year 2006-2007. 3. Many Butte County departments do not trust the budget detail contained in the Pentamation Financial Database. At an added expense to Butte County, some departments keep their own set of books to discover errors and unwarranted changes by the Butte County Auditor-Controller’s office. The respondent agrees with this finding. 4. Adjustments to payments and cash receipts have been made by one or more employees of the Auditor-Controller’s office after the fiscal year end has been closed and the Financial Statements have been prepared by an independent audit firm. These Financial Statements are required by California law. The respondent neither agrees nor disagrees with this finding. The respondent could not independently verify this finding. 5. Butte County Administration and Information Systems are currently leading an effort to improve the Pentamation database security and performance, and improve the accuracy of the budget and expenditure details. The respondent agrees with this finding. 6. Butte County is in the process of moving many of the functions of the Auditor- Controller’s office to other County departments, partially to establish better internal controls/separation of duties, and partially to compensate for poor management and training by the current Auditor-Controller and his top managers. The respondent partially disagrees with this finding. The primary reason for the movement of responsibilities is for better internal control, but it is also to shift information technology duties to the experts in the Information Systems Department so that business processes can be further automated and streamlined, as provided for in the 9 I/T Effectiveness Plan and Network Security Policy accepted by the Board in February 2005. This effort is a key piece of the expansion of the current Pentamation Open Series accounting system to become an enterprise-wide financial and human resources information system managed by Information Systems. The enterprise-wide system would fully integrate existing timekeeping (Kronos), purchasing, human resource, payroll and accounting systems, and automate cash receipting processes throughout the organization. Over the last three years the County has invested in physical infrastructure to provide for a fully integrated network. This next step enables the County to begin to take advantage of that technology and infrastructure to achieve much greater economies of scale in the conduct of routine administrative processes. This effort is consistent with the Information Services Department’s three-year strategic plan and the policies of the Board of Supervisors. 7. Adequate and uniform policies, procedures, and training are not currently developed or available within the Auditor-Controller’s office. Consequently, Butte County employees are not prepared to train other County departments to manage their own financial data. The County cannot move forward with a separation of duties, where County departments are responsible for managing their own budget expenditure detail in Pentamation, without policy and training. The respondent agrees with this finding. 8. The Butte County financial statements, produced by Gilbert and Associates, cannot be relied upon as an accurate reflection of Butte County’s financial status. This was due to: unreliable data, lack of adequate management and training in the Auditor- Controller’s office, and a rush to provide feedback and data (to assist in the production of a final Audit report by the current Assistant Auditor-Controller and his subordinates). The respondent neither agrees nor disagrees with this finding. The respondent does not have the accounting expertise to verify this finding. The respondent will recommend that this should be researched by an independent accounting firm. 9. Butte County’s Assistant Auditor-Controller rejected a draft management letter from Gilbert and Associates addressed to the Butte County Board of Supervisors. This action prevented the Board of Supervisors, the CAO, and the public from seeing findings and recommendations that the management letter contained. The respondent neither agrees nor disagrees with this finding. However, based on the information provided by the Grand Jury, this finding appears to be accurate. 10. The 2005 Financial Statements for Butte County, produced by Gilbert and Associates, shows far less long term financing obligations than the long term financings data maintained by the Treasurer’s and the Auditor-Controller’s offices. The respondent agrees with this finding. 10 11. The 2005 Financial Statements, produced by Gilbert and Associates, were not completed in a timely fashion due primarily to unprofessional behavior by the management and staff of the Butte-County Auditor-Controller’s office. The respondent neither agrees nor disagrees with this finding. The respondent cannot confirm the reason for the untimely completion. However, the respondent is taking a more active role in managing the contract with the current auditing firm. 12. Gilbert and Associates, while accepting the normal maximum payment amount required in a government contract, spent an abnormally large amount of extra hours required to finish the 2004 and 2005 audit report and financial statements. These extra hours were required because of poor training, attendance, and unprofessional behavior by David Houser’s employees. The respondent neither agrees nor disagrees with this finding. The respondent cannot confirm the actual hours worked or the reason for any extra hours of work. However, the respondent is taking a more active role in managing the contract with the current auditing firm. 13. Many of the recommendations and findings of the management letters produced by Gilbert and Associates from 2003 and 2004 have not been fully implemented. The Audit Committee, suggested in the 2003 management letter to the Board of Supervisors, has not produced any minutes or policies for review by the Board of Supervisors or the public. In 2005 and 2006, vacation and furlough were still being approved without prior approval or a formal leave request. A formal fraud policy has not been adopted by the Board of Supervisors as suggested in the management letter. The respondent partially disagrees with this finding. The respondent agrees that some of the recommendations have not yet been fully implemented. “Many” is a mischaracterization of proportion. 14. As of November 11, 2005, Butte County had over $118,000,000.00 in non-voter approved long term financings, of which the principal balance owed was over $110,000,000.00. The Treasurer’s Office and the Auditor’s Office show $4,317,000.00 of this debt is not collateralized. Should a future Board not appropriate funds for this debt, they would still likely owe a debt in conflict with California Constitution Article 18. The respondent disagrees with this finding. The total financings described by the Grand Jury include short-term cash flow loans secured by annual property tax revenues. Annual property tax revenues also secure the solar project gap loan. The California Energy Commission (CEC) loans are not collaterized and the CEC does not require any security interest be filed on the equipment. The promissory note between the County and the CEC indicates the debt to the CEC and the loan agreement indicates the source of repayments. 15. Butte County Code does not require a review of contracts by the Auditor-Controller, only that all contracts are forwarded to his office. The respondent partially disagrees with this finding. A review by the Auditor- Controller is required when a contract requires the exchange of funds. As described in the Grand Jury Report this step often slows the contract administration process significantly. However, the respondent is exploring how the County Financial System may be used to simplify the process with an automatic electronic real-time budget appropriation verification so that a contract does not need to be delivered to the Auditor’s Office for appropriation review prior to it being executed. 16. Contracts, such as the solar contract, have been executed without a properly encumbered source of funds or collateralized long term debt. The respondent disagrees with this finding. The Treasurer’s inter-fund (GAP) loan for the solar contract is secured by a promissory note and a loan agreement. These documents were drafted by the bond counsel firm of Stradling Yocca, reviewed by County Counsel and executed both by the Board of Supervisors and the County Treasurer. The loan agreement, under Section 5 Security, states: “In the event the County fails to make payment under Section 2, the moneys otherwise owed to the County General Fund from the collection of secured property taxes shall be paid to the Note Repayment and Interest Fund in an amount sufficient to cure the default.” The current principal balance of the loan is $ 839,480.00 and the estimated fiscal year 2006-2007 General Fund secured property tax receipts are $19,000,000.00. The California Energy Commission (CEC) loans are not collaterized and the CEC does not require any security interest be filed on the equipment. The promissory note between the County and the CEC indicates the debt to the CEC and the loan agreement indicates the source of repayments. 17. County departments that are connected to the solar panels have had significant increases in utility costs when factoring in ISF transfers to pay for the Treasury “GAP loan.” The respondent partially disagrees with this finding. Application of the costs of utilities to the departments using the energy is appropriate accounting procedures. Increased utility costs for these departments have primarily been due to increased power usage, particularly by the District Attorney. The County departments that are connected to the solar panels have also had corresponding and equal increases in budget appropriations to fully offset the cost increase so that there is zero fiscal impact to the operations of those departments. Once the loan is paid off in 2009 the departments will see a large decrease in utility costs that should be well below historical levels. The long- term savings of the project will far exceed the total cost. 12 18. County departments are frequently not provided final budget detail for review before a final, adopted budget is approved by the Board of Supervisors. A-87 and ISF charges are frequently much higher in the final budget than in the Proposed Budgets. The respondent partially disagrees with this finding. The respondent disagrees entirely with the first part of this finding, and mostly agrees with the second part of this finding. County departments and the public are always provided all details of the proposed budget for review and comment well before the budget is considered and adopted by the Board of Supervisors. The County budget process is very open with ongoing opportunities for department input throughout. The Chief Administrative Officer and his staff are constantly apprising departments of new budget information, legislative dynamics and fiscal forecasts so that the entire organization is kept on the forefront of the budget development process. Much of this communication is primarily by means of department heads with the expectation that they will disseminate to the appropriate employees under their control. Support service costs (A-87 & ISF) are estimated in the early stages of the budget process so that departments may prepare their budget requests, however, the costs are updated based on more current information prior to consideration of the proposed budget. For some services the cost estimates decrease, but more often it increases due to normal inflationary factors. 19. Butte County’s methods for tracking and justifying indirect charges are inconsistent, poorly documented. The methods and tools for tracking charges by A-87 departments vary greatly from department to department. This inconsistency could jeopardize grant funding eligibility due to A-87 requirements for justification and consistency of indirect charges. The respondent disagrees with this finding. The methods and records are independently audited each year by the State Controller’s Office and certified by the State of California to be consistent with the federal Office of Management and Budget (OMB) Circular A-87. The methods for allocating costs must vary greatly among the support service departments in order to comply with OMB Circular A-87 because the services are so varied. However, regular review of the methodology should occur with opportunity for input from all County departments, and that an annual training regarding cost allocation principles and methodologies should be provided to all interested departments. Complete transparency and open dialogue of the cost allocation process would alleviate the concerns among County departments. The respondent will direct any departments that allocate costs (Administration, Auditor, County Counsel, Human Resources, Information Services, and the Treasurer) to make available all source documents used to allocate costs including time, accounting and facility records, to any department requesting such records. 13 20. Butte County’s methods for tracking employees’ time worked and eligible leave is inconsistent. Butte County policy regarding time card tracking has not been fully updated to reflect the demands of the Kronos Workforce Timekeeping system. Additional controls are needed to ensure consistent implementation of County policy and to verify the integrity of the payroll data, at time of payment through the Pentamation system. Current practices create the opportunity for fraud. The respondent agrees with this finding. 21. Account codes used for tracking budget detail in the Pentamation database are unique to Butte County, are poorly documented, and are currently frequently changed without notice. This has created, and will continue to create, many obstacles to Butte County’s employees managing their own department budget detail and expenditures. The respondent agrees with this finding. 22. Current Butte County policy does not require or guarantee any consistent allocations of Proposition 172 funding to be distributed to any single Butte County defined public safety agency. Both County contributions and Proposition 172 contributions to the defined public safety agencies has varied significantly from year to year, making it difficult to build, prioritize and maintain quality public safety programs that are not funded by grants. The respondent partially disagrees with this finding. The respondent agrees that appropriation for various County departments may vary from year to year based on Federal and State mandates, service demands, and funding limitations. However, the respondent disagrees that any portion of Proposition 172 revenues should be restricted to specific public safety departments. One of the Board of Supervisors’ primary legislative roles is to adopt Butte County’s annual budget. The process for preparing, adopting, implementing, and auditing a county budget is long and complex. In this process, the Board of Supervisors balances the desires of local taxpayers with State and Federal mandates, policies, and program requirements. Local governments across the State continue an ongoing collective effort to maximize local discretionary spending authority. California Government Code Section 30200 requires the State Controller to prescribe uniform accounting procedures for counties. The State Controller’s Accounting Standards and Procedures for Counties manual details the uniform charts of accounts, fund structure, functions, and activities. The purpose of this manual is twofold: (1) to ensure conformance to generally accepted accounting principals; and (2) To facilitate comparison and analysis of county financial reports on a statewide basis by minimizing differences between counties’ philosophies, methods, and terminologies. Section 1.08.a.(1) of the State Controller’s manual states that the County’s General Fund is to be used to account for all financial resources except those required to be accounted 14 for in another fund. Section 1.09 states “Only the minimum number of funds consistent with legal operating requirements should be established. Using too many funds causes inflexibility and undue complexity in financial management. It should be avoided in the interest of efficient and economical financial administration.” Proposition 172 revenues are a dedicated state-allocated tax to be used exclusively for eligible public safety services. This revenue is received by the County’s General Fund as directed by the State Controller. Government Code Section 30052 defines “public safety services” as including, but not limited to sheriffs, police, fire protection, county district attorneys, county corrections, and lifeguards. Government Code Section 30056 prohibits a city or county from spending less of its own “financial resource’ on “all combined public safety services” in any given year when compared to what it spent during the 1992-93 fiscal year. In other words, a city or county may not reduce its own sources of funding for public safety services as a consequence of receiving Proposition 172 sales tax revenues. This is called a Maintenance of Effort (MOE) requirement. Pursuant to statute, Butte County’s public safety sales tax MOE calculation for fiscal year 1992-93 considered specific budget units for the District Attorney, Sheriff, Probation Department, and Fire Department. The fiscal year 2006-07 Proposed Budget appropriates $32 million to these eligible public safety services in excess of the amount required by the MOE. This demonstrates that public safety services continue to be a high priority of the Board of Supervisors. Attorney General Opinion Number 02-913 states that a county board of supervisors has the discretion to change the annual allocation of Proposition 172 funds among eligible public safety service agencies. The Board of Supervisors’ legislative authority would be compromised if the County were to self-impose an un-mandated restriction on any source of local discretionary funds. 23. The current practice of transferring Proposition 172 funds from the public safety account to the General Fund masks the final allocations and expenditures. This practice has created mistrust among departments that receive these funds. County departments have previously requested an accounting of Proposition 172 MOE allocations and have been denied that request. The respondent disagrees with this finding. Butte County’s treatment of Proposition 172 funds is in compliance with Government Code Section 30056 and direction provided by the State Controller. Further, Proposition 172 revenues are clearly identified in the County budget. Section 30056 mandates that total spending for all combined public safety services be maintained from year to year. Nothing in Section 30056 requires that a specific public safety service agency receive a certain amount during each fiscal year. Again, this discretion and authority resides with the Board of Supervisors. All available information regarding the accounting of Proposition 172 MOE allocation has been provided to County departments. 15 24. Policies, procedures, desk manuals, and training have not been adequately kept up to date in all organizational units within the Butte County Auditor-Controller’s office. Existing desk manuals inappropriately contain security pass codes for access to financial information. Documentation prepared for a specific employee in the Cost Section could be construed as harassing or discriminatory. The respondent neither agrees nor disagrees with this finding. The Chief Administrative Officer is not involved in managing the offices of elected officials. However, the respondent agrees that all elected and appointed department heads should ensure that policies, procedures, desk manuals, and training should be adequately kept up to date with sufficient security where needed. The respondent also believes all documents should be void any appearance of harassment or discrimination. 25. Posting of expenditures and receipts in the Pentamation system has been slow, inaccurate, and inconsistent. Journals of financial transactions have not been consistently available to affected departments in a timely fashion. This has caused difficulty for departments in managing their budgets. The respondent agrees with this finding. 26. Between July 1, 2003 and May 3, 2006, David Houser consumed more than half of the Auditor-Controller’s combined budget units 533 (Memberships) and 543201 (Transportation & Travel/ Outside Purchase) for his memberships, car and cell phone allowance, and trips to conferences. These costs have not been a direct benefit to Butte County or County employees. The respondent agrees with this finding. However, respondent notes that there is an indirect benefit if information learned from training and conferences is relayed to other employees. 27. The majority of the employees of the Auditor-Controller’s office have had no professionally standardized training related to government accounting during their employment by Butte County. Consequently, implementation of Generally Accepted Accounting Principles and GASB guidelines have been erratic. Fiscal policies are made by the Auditor’s employees in the moment as the need arises without prior communication to affected County departments. The respondent agrees with this finding. 28. The working conditions found in the Auditor’s office appear to be safety, health, and fire hazards. The respondent neither agrees nor disagrees with this finding pending investigations. The respondent has directed the County Safety Officer to investigate. The County Safety Officer has investigated the office with an inspector from California Division of Occupational Safety and Health, an ergonomics specialist, and the Fire Marshall, and will address all concerns. 16 29. Many of the responsibilities of the Auditor-Controller are being transferred to other Butte County departments, narrowing the scope of his responsibilities. California Penal Code 927 states, “a grand jury may, and when requested by the Board of Supervisors shall, investigate and report upon the needs for increase or decrease in salaries of the County-elected officials. A copy of such report shall be transmitted to the Board of Supervisors.” The respondent disagrees with this finding. Only some of the responsibilities of the Auditor-Controller have been or are currently being transferred. “Many” is a mischaracterization of proportion. Grand Jury Recommendations 1. Pursuant to California Penal Code 927, this Grand Jury recommends a decrease in salary for the position of the Butte County Auditor-Controller of 25% of current salary and salary range, at the next legal interval to do so, due to significant portions of departmental responsibility being moved to other County departments. The Butte County Board of Supervisors should, pursuant to California Penal Code 927, request the Grand Jury to reassess this salary decrease in three years by providing data to the Grand Jury related to Butte County audit results, management letters, salaries and compensation of Auditor-Controllers in comparable sized counties, and functional responsibilities of the Auditor-Controller in the comparable sized counties. The recommendation will not be implemented because it is not reasonable. The Board of Supervisors may not lower the salary of an elected official during his or her term of office absent an emergency. Based on initial analysis, the next “legal interval” for a salary decrease is at the start of the term beginning on January 3, 2011. A decrease at the start of that term would negatively impact the size of the candidate pool running for the office. It is a common economic factor in any recruitment for any position, whether elected or appointed, that as the salary for a position is lowered the number of qualified people pursuing the post is decreased, and as the salary is increased so goes the number of qualified candidates. 2. Upon direction by the Butte County Board of Supervisors, the CAO should contact the audit firm, Gilbert and Associates, and report to the Board what unpaid labor and travel costs may be due so that Butte County employees’ unprofessionalism does not undermine the County’s ability to attract competitive bids. The recommendation has not been implemented, but will be implemented by the respondent if directed. 3. The adopted Butte County computer use and ethics policy should be reviewed and updated as needed to ensure that it specifically addresses the Pentamation Financial Database. Documenting pass-codes in non-secure locations should be grounds for disciplinary action. Any employee that uses security credentials not assigned to themselves to access or alter financial data should be placed on administrative leave 17 until an investigation is completed and appropriate course of action is decided by recommendation of Butte County’s Department of Human Resources. The recommendation has not been implemented, but will be partially implemented. The County computer use and ethics policy will be reviewed and updated as necessary by January 2007. Any violation of this policy or any other adopted policy is enforceable by department heads, including the imposition of disciplinary action. Department heads can place employees on paid administrative leave during the investigation of a policy infraction. The Human Resources Department is available to departments for consultation and will provide recommendations regarding appropriate course of action. 4. The outstanding obligations for both the CEC loans for Butte County’s solar panel project and the GAP loan owed to the Butte County Treasurer should be appropriately collateralized. There should be no ambiguity to a future Butte County Board of Supervisors as to the impacts of deciding not to appropriate funds to pay for these long term obligations. The recommendation will not be implemented because it is unwarranted. The California Energy Commission (CEC) loans are not collaterized and the CEC does not require any security interest be filed on the equipment. The promissory note between the County and the CEC indicates the debt to the CEC and the loan agreement indicates the source of repayments. The GAP loan between the County and the County Treasury is fully collaterized via a loan agreement and a promissory note which provide that, in the event of a default, secured property tax monies otherwise owing to the County General Fund be diverted to cure the default. 5. The available budget in the Auditor’s office for training, travel, and professional memberships should be increased to a level that each employee can attend needed training. The recommendation will be implemented to the extent that resources will reasonably allow. The respondent agrees that employee training and professional development is a very important investment that the County must make. Consideration of other County demands for its limited resources is necessary, and such consideration typically occurs during the annual budget process. 6. The Audit Committee should review Butte County’s implementation of account codes used in the Pentamation Financial system and develop policy to standardize account codes with the State of California standards as much as possible. A policy standardizing account codes, including a method for appropriately adding or deleting account codes, as well as documenting and communicating those changes, should be forwarded to the Board of Supervisors for their review after review by the Audit Committee. The Grand Jury believes that a log of added and deleted account codes should be kept by those responsible and forwarded quarterly to the Audit Committee for their review. The recommendation has not been implemented but will be implemented to the extent that the respondent is authorized to do so. The respondent will work with the Auditor-Controller to review the existing chart of accounts, and explore improvements and maintenance of the chart of accounts. 7. Changes to expenditures and receipts should not be made after closing a fiscal year’s books or July 31 of each year. Errors and omissions should be documented and forwarded to the Butte County CAO and Auditor-Controller for appropriate actions. The respondent is unable to comment on this recommendation since it is directed to the Auditor-Controller. However, the Chief Administrative Officer agrees with the recommendation. 8. Uniform accounting policy should be adopted county-wide and relevant documentation should be forwarded to all affected Butte County Department Heads for their distribution. The recommendation has not been implemented but will be implemented to the extent current resources and Auditor-Controller support will allow. The respondent will make himself available to work with the Auditor-Controller and Treasurer-Tax Collector to develop a plan for developing, maintaining and enforcing a uniform accounting policy adopted by the Board of Supervisors, and report to the Board of Supervisors by January 2007 what additional resources, if any, are required to carry out the plan. 9. Butte County Code should be updated to require a signature for a legally required review by the Auditor’s Office before a contract is executed. Failure to complete such a review in a County policy defined time window by the Auditor’s office should be grounds for disciplinary action for the assigned employee. The recommendation will not be implemented because it is unwarranted. Alternately, the respondent will recommend to the Board of Supervisors an update to the Butte County Code that requires the Purchasing Agent to review all contracts before they are executed and to send an original of each executed contract to the Auditor-Controller for proper encumbrance. 10. Payments, receipts, and journals should be posted accurately within a reasonable number of days defined in Butte County policy. Failure to do so should be grounds for progressive discipline per County policy. The recommendation has not been implemented, but will be partially implemented. The respondent will make himself available to work with the Auditor-Controller and Treasurer-Tax Collector to develop a plan for developing, maintaining and enforcing a uniform accounting policy adopted by the Board of Supervisors, and report to the Board of Supervisors by January 2007 what additional resources, if any, are required to carry out the plan. Any violation of such policy or any other adopted policy is enforceable by department heads, including the imposition of disciplinary action. 19 11. A designated member of Butte County Administration should be the primary point of contact for most, or all, facets of the annual Butte County Audit. All relevant communications with the Auditor-Controller or his staff, including email, should include a copy to the designee of Butte County Administration. The recommendation has been implemented to the extent the respondent is authorized. 12. The Butte County Auditor-Controller should instruct his Internal Auditor, or other qualified employee, to comprehensively audit distributions of Proposition 172 funds and ensure that these funds are allocated and distributed in accordance with relevant California codes and regulations. All public safety agencies that receive Prop. 172 monies should be defined as such in Board adopted policy. A report should be prepared and forwarded to all members of the Audit Committee, the Board of Supervisors, the affected public safety agencies, and the Grand Jury. This recommendation will not be implemented because it is not warranted. Butte County is in compliance with all relevant sections of Government Code. As stated earlier, the fiscal year 2006-07 Proposed Budget appropriates $32 million to eligible public safety services in excess of the amount required by the MOE. This demonstrates that public safety services continue to be a high priority of the Board of Supervisors. Developing new County policy to permanently allocate a percentage of Proposition 172 funds to specific public safety departments would compromise and restrict the Board of Supervisors’ legislative authority. In addition, such practice would not be consistent with the intent of Proposition 172 nor the State Controller’s established accounting standards and procedures. The intention of Proposition 172 is for counties to maintain an MOE level of funding in return for receiving these revenues in the County’s General Fund. 13. Butte County Administration should spearhead an effort to coordinate with County defined public safety agencies, (defined as required by Proposition 172/ AB2788), to bring forward a recommendation to the Board of Supervisors for an MOU for calculating each public safety agencies’ share of this funding source within the Maintenance of Effort calculations as described earlier in this report. The Board of Supervisors should consider including stipulations in the policy that Proposition 172 funds are never transferred to the General Fund so that full transparency and accountability is always maintained. This recommendation will not be implemented because it is not warranted. Butte County is in compliance with Government Code Section 30056 in dealing with Proposition 172 funds. The County maintains full transparency and accountability in using these funds in its budget process. A policy stipulation that Proposition 172 funds are never transferred to the County’s General Fund would violate the intentions of Proposition 172 and direction provided by the State Controller. 14. The Auditor-Controller’s department should be inspected on an ongoing basis by the Fire Marshall and other experts for health and safety problems. The recommendation has not been implemented but will be mostly implemented. The County Safety Officer has and will continue to inspect the department’s offices on an ongoing basis. The County Safety Officer has investigated the office with an inspector from California Division of Occupational Safety and Health, an ergonomics specialist, and the Fire Marshall, and will address all concerns. 15. An ergonomics assessment should be performed for each staff member and appropriate workstations should be installed in the Auditor-Controller’s office. The recommendation has not been implemented but will be implemented by January 2007. The assessment has been completed and the workstations are being procured. 16. The Butte County Board of Supervisors should consider allocating additional funding for aggressive audit sampling and review of the following items for a minimum of the next three years (these items need not be completed by the November 30th due date or under the same cover as the normal, annual audit): A. payroll and timekeeping data including, but not limited to, policies and procedures related to billing for indirect costs, proper crediting of accruals and payments of vacation/sick leave/furlough, B. refunds given for Development Services land use or building permits and related impact fees, C. refunds and disbursements given for what are referred to, but not necessarily legally defined as, trust accounts held by Butte County, D. legally defensible collateralization of all financial obligations owed by Butte County that extend beyond a single fiscal year, and a legally defined debt limit that includes authorizing California Codes or Regulations. This recommendation has not been implemented but will be implemented in the future. An independent accounting firm will be contracted to review the above-noted items by January 2007. ISSUES IMPACTING GRAND JURY EFFICIENCY Grand Jury Findings 1. Current Grand Jury facilities limit and affect the Grand Jury’s performance of authorized Penal Code duties. The respondent partially disagrees with this finding. While facility limitations could affect the Grand Jury’s performance, the current and past Grand Juries have been able to perform their duties as authorized by the statute. The County has worked with previous Grand Juries to find facilities to better meet their needs. However, past Grand Juries have chosen to continue the current arrangements. 21 2. Greater facilitation, coordination, and policy regarding the physical requirements of the Grand Jury are needed between Butte County and the Superior Court. The respondent partially disagrees with this finding. The County has worked with past Grand Juries to deal with physical requirements of the Grand Jury. The County will continue to work directly with current and future Grand Jury to better address facility and other unmet needs within the financial constraints of the County. 3. Without violating the confidentiality of the Grand Jury, volunteers can provide support to the Grand Jury by offering skill trainings, by donating equipment, supplies, and by performing public outreach. The respondent agrees with this finding. 4. Current Per Diem does not cover all out of pocket expenses. Waste and inefficiency can be minimized by providing centrally located and secure facilities for office space and record storage. The respondent agrees with this finding. Grand Jury Recommendations 1. Allow the Grand Jury to utilize appropriate office space in the old Juvenile Hall complex or the old Carnegie Library, or a similar space, provided it can be appropriately secured and climate controlled for the preservation of records until space becomes available at 25 County Center Drive in approximately 2015. This recommendation requires further analysis. Within the next six months, the General Services Director will discuss records storage needs with the Grand Jury. Existing County facilities will be examined with the Grand Jury. It should be noted that the Carnegie Library is the property of the City of Oroville and the County has no control over its use. 2. Butte County should coordinate with the Superior Court and two (2) current and/or former Grand Jury volunteers to resolve issues of policy and functional responsibility assignments for supplies and facilities until such time as Grand Jury law appropriately reflects the separation of the Superior Courts from the county. This coordination should include regular meetings to ensure good communications. This recommendation will not be implemented because it is not warranted. While the Grand Jury reports to the Presiding Judge, the County is responsible for funding its operations. Any and all supplies and facilities needs should be addressed with the General Services Director. 3. In the short term, Grand Jury office facilities need to be large enough, for the entire Grand Jury to meet. Butte County should designate a point of contact within its administration, for volunteers to coordinate a location with sufficient materials and work 22 area containing a telephone line, fax machine, Internet access, computer equipment, and furniture for record storage. Most of this equipment could be donated or purchased inexpensively from surplus. This recommendation has been implemented. The County’s General Service Director is the designated contact for the Grand Jury for addressing facility, communication, and supply needs. As addressed in Recommendation #1, the County will discuss facility needs with the Grand Jury within the next six months. Included in this discussion will be other needs such as communication, records storage, and other supplies. 4. Butte County should coordinate with the Grand Jury to provide access to basic office supplies. It is very likely that the purchasing power of the County could provide supplies at a much lower price than Jurors pay at a retail store. A rationed allotment of supplies for each Grand Jury term could greatly offset out of pocket expenses. This recommendation has not been implemented but will be implemented in the future. Within one month of being contacted by the Grand Jury, the General Service Director will coordinate the implementation of this recommendation. He will ensure that basic office supplies can be purchased in a timely manner at reasonable costs through County suppliers thus reducing or eliminating out-of-pocket expenses for the Grand Jury members. 5. Butte County should pay Per Diem at an average rate of the same counties used in its compensation study for its employees in the 2005/06 fiscal year. This recommendation has not been implemented but will be implemented in the future. Within the next six months, County staff will draft an ordinance, for Board consideration, increasing Grand Jury mileage reimbursement and per diem rates equivalent to that of County employees. The current mileage reimbursement of twenty- four cents per mile ($.24/mile) and per diem of twenty dollars ($20) was adopted in January 1981. The rate for the new ordinance should be tied to the existing County travel policy, so if the rates increase for County employees, the Grand Jury would see an equivalent increase. This concludes the response of the Chief Administrative Officer to areas within the Grand Jury Report for fiscal year 2005-06 where they sought comments from the CAO. Sincerely, Paul McIntosh Chief Administrative Officer 23 AUG 8 ilrub Gridley Unified School District 429 Magnolia Street Gridley, California 95948-2533 Phone (530) 846-4721 Fax (530) 846-4595 Clark S. Redfield, Superintendent August 23,2006 Presiding Judge Re: Butte County Grand Jury Report Response One Court Street Oroville, CA 95965 Dear Members of the Grand Jury, Attached you will find our response and summation with supporting information to the Butte County Grand Jury's report. If you have any further questions, please feel free to contact me at 846-4721, ext. 28. Sincerely, Lloyd Pierce Gridley Unified School District Board of Trustees President enclosures Response to the Grand Jury report regarding Gridley Unified School District Thank you for providing the Gridley Unified School District with the 2006 Grand Jury report and the opportunity to respond. I will speak about specific comments made in the report and then conclude with a summary. 1. Page B-3 "The investigation found that no general increase had been granted Gridley teachers in a number of years prior to 2001". The Gridley Elementary school District and The Gridley Union High School District joined together in 1998199 forming the now Gridley Unified School District. Taking a look at the salary schedule for the High School and Unified School District the following chart indicates the general salary increase provided to teachers prior to 200012001 school year. (Salary schedules attached) High School District and Unified District BA + 45 units Step One 199411995 $25,849 199511996 $26,262 1996119 97 $26,878 This represents a 3 1% increase in salary for 1997119 98 $28,222 the seven years prior to 2001 1998119 99 $28,823 199912000 $29,976 20001200 1 $34,050 200 112002 $34,253 BA + 60 units Step Five 1994/1995 $28,036 1995119 96 $29,597 This represents a 23% increase in salary 1996119 97 $31,159 for the seven years prior to 2001 1997119 98 $32,7 17 199811999 $34,233 199912000 $35,603 20001200 1 $36,848 200 112002 $37,971 Elementary School District and Unified District BA + 45 units Step One 1994119 95 $24,962 1995119 96 $25,479 1996119 97 $26,902 This represents a 37% increase in salary for 1997119 98 $27,709 the seven years prior to 2001 1998119 99 $28,823 199912000 $29,976 20001200 1 $34,050 200 112002 $34,253 BA + 60 units Step Five 1994119 95 $29,648 1995119 96 $30,263 This represents a 28% increase in salary 1996119 97 $3 1,953 for the seven years prior to 2001 199711998 $32,911 This chart demonstrates the cost of living increases only. As indicated in the report the teachers also received the increases for years of experience and additional college credit. 2. Page B-4 "According to a former GTA representative the District asked the GTA to keep the CTA consultant away during negotiation because it was afraid the CTA might blow the whistle on its financial condition". The districts financial condition was well known at the time of the bargaining with GTNCTA. Copies of the Gridley Unified School District budget are provided to the leadership and negotiation chair of the' Gridley Teachers association as well as made available to the public. The county had already developed an agreement where the district would use deferred maintenance funds to pay off a loan from the Butte County Office of Education. At no time was there any General Education funds used to contribute to the work at the high school or other facilities construction projects. In conversations with the District representative at that bargaining table at that time it was a mutual agreement to leave the consultants out of the bargaining process. That agreement included both the CTA consultant and the District consultant. 3. Page B-4 "According to a former GTA representative, the Board directed that no minutes be taken in the meetings when the CTA representative was not present." In collective bargaining sessions either team can take minutes for their side. A Board can not direct the teachers bargaining team to not take minutes. It is the experience of the current superintendent that district teams seldom take minutes, because they rely more on exchanged proposals and signed tentative agreements because they are joint documents not the impressions of one side or the other. In conversations with the District representative at that time there is no recollection of any request to not take notes. 4. Page B-4 and B-5 "The following table sets out the total GUSD teachers salaries, ." and percentage change of yearly salary increases for 1995 - 2003 This chart accurately reflects the total dollars paid to all teachers for salary. It does not take into account any increases or decreases in enrollment that would require increases or decreases in the number of teachers needed to serve the students of the Gridley Unified School District. The chart used in the first discussion item reflects actual salary schedule increases. 5. Page B-5 "Salary information from BCOE, however, shows that at least seven fully credentialed teachers in Gridley did not receive the $32,000 minimum salary specified by the State for 1999/2000." This oversight has been corrected 6. Page B-5 "the superintendent indicated to the Grand Jury that he would never have allowed a meeting to occur without the CTA. It is not the determination of the superintendent who GTA chooses to have serve on their bargaining team. I would not ask GTA to change their team composition. Notes are a matter of individual team decision, and again the records that are most important to the bargaining process are the exchanged proposals and the signed tentative agreements.