Nevada City Government:

Conclusions 74

• CL1 Page 1
  In its 2001-2002 Report, the Jury recommended, among other matters, (a) the City develop a much-needed records management system; (b) the City implement the Local Government Records Management Guidelines issued by the California Secretary of State; and (c) the City initiate a records security and back up system.
• CL2 Page 1
  The City has had to hire additional personnel to perform functions of the City Clerk and to cover the responsibilities of the former Office Operations Supervisor.
• CL3 Page 1
  The incumbent City Clerk, in her individual capacity, has sued Nevada City alleging wrongful termination of her employment as Office Operations Supervisor.
• CL4 Page 1
  Over seventy percent of California cities utilize an appointed City Clerk in order to provide more effective oversight of the work of that position. Conclusions:
• CL5 Page 1
  The City, as of March 2007, could not provide the cost of the reports referred to in No. 8 above; however, materials reviewed by the Jury suggest the cost will exceed $200,000. Conclusions:
• CL6 Page 1
  3. Over the years, the functions of the elected office of City Clerk and the appointed office of Office Operations Supervisor were allowed to become blended and the duties indistinguishable.
• CL7 Page 3
  In the five years since the Jury’s 2001-2002 Report, the City has made no observable effort to correct, let alone improve, the manner in which its municipal records are kept, indexed or safeguarded.
• CL8 Page 3
  The manner in which the City’s records are maintained and accessible preclude reasonable access thereto and utilization by members of the public, City officials or members of the City Council.
• CL9 Page 3
  Effective oversight of the City’s affairs by the City Council is impaired by the current lack of any ordered record keeping and protection policy. Page 3 of 9 pages
• CL10 Page 4
  The examination of the City’s books by its expert consultants also disclosed only sporadic bank statement reconciliation, no general ledger reconciliation to cash, and substantial variances in financial accounts.
• CL11 Page 4
  The City’s expert consultants also found, historically, the City’s basic accounting activities were left to the year-end auditors, and the new Government Accounting Standards Board Policy, GASB 34, which became effective in 2004, had not yet been implemented by the City.
• CL12 Page 4
  In the course of the review of the City’s affairs by the City and its expert consultants, a number of undeposited checks payable to the City dating back several years were discovered.
• CL13 Page 4
  Effective February 19, 2007, the City hired a Finance Manager to replace a full-time financial consultant who has worked over the past months to address many of the deficiencies noted above. Page 4 of 9 pages Conclusions:
• CL14 Page 6
  The City has had to hire additional personnel to perform functions of the City Clerk and to cover the responsibilities of the former Office Operations Supervisor.
• CL15 Page 6
  The incumbent City Clerk, in her individual capacity, has sued Nevada City alleging wrongful termination of her employment as Office Operations Supervisor.
• CL16 Page 6
  Over seventy percent of California cities utilize an appointed City Clerk in order to provide more effective oversight of the work of that position. Conclusions:
• CL17 Page 9
  The City, as of March 2007, could not provide the cost of the reports referred to in No. 8 above; however, materials reviewed by the Jury suggest the cost will exceed $200,000. Conclusions:
• CL18 Page 5
  The manner in which the City has managed its finances over the past many years has resulted in the loss of significant revenue to the City.
• CL19 Page 5
  The City has clearly been at unnecessary risk of financial loss by reason of the manner in which its financial records were maintained (or not maintained), and the apparent absence of any oversight or meaningful audit of its financial practices.
• CL20 Page 5
  The continued operation of the City’s current financial practices and procedures would be a breach of the public’s trust.
• CL21 Page 5
  With the guidance of the full time consultant, the City appears to be making substantial progress in implementing appropriate financial procedures and policies.
• CL22 Page 5
  The Jury commends the City for its hiring of a Finance Manager.
• CL23 Page 6
  At the time of the Jury’s investigation, the Jury found that deeds conveying real property to the City had not been recorded.
• CL24 Page 6
  At the time of the Jury’s investigation, City Ordinances and Council Resolutions were not being maintained in an organized manner, were not readily accessible by the public, and had not been codified, indexed or published since 1990. Additionally, City Council Minutes had not been filed since 1995.
• CL25 Page 6
  The incumbent City Clerk is no longer performing the material duties of that public office.
• CL26 Page 6
  The City is without a functioning City Clerk to perform the statutory duties imposed by California Government Code §§40801-40814.
• CL27 Page 6
  The incumbent City Clerk, while also the City’s Office Operations Supervisor, failed in a material manner to perform both the statutory City Clerk duties and those of Office Operations Supervisor, to the detriment of the City.
• CL28 Page 7
  Prior to April 26, 2006, the City did not employ any experienced accounting personnel, and the City’s financial software had not been upgraded for almost two decades.
• CL29 Page 3
  At the time of the Jury’s investigation, there was insufficient oversight of the City’s administration of various grant programs and loans.
• CL30 Page 7
  At the time of the Jury’s investigation, available records pointed to inconsistent application of City Ordinances.
• CL31 Page 3
  At the time of the Jury’s investigation, there was evidence of improper employee classifications (regular versus temporary) as well as the finding of derogatory material being entered into employee personnel files by a department head without advisement or the employee’s right to respond as required by law.
• CL32 Page 7
  The Jury was unable to locate any City office policy or procedures manuals.
• CL33 Page 7
  During the transition, the City Manager directed the expert financial consultant not to discuss prior history of the City’s financial affairs with the new Finance Manager. Conclusions:
• CL34 Page 8
  The City Manager terminated these investigations prior to the issuance of a final report. Page 8 of 9 pages
• CL35 Page 7
  Historically, there appears to have been little, if any, supervision of the Office Operations Supervisor by the City Manager.
• CL36 Page 7
  The City Manager does not appear to have instituted (or required the institution of) the most basic of operational policies and procedures, or financial safeguards.
• CL37 Page 7
  There is no indication that the City Manager made any effort prior to April 2006, to provide a written evaluation of the job performance of the Office Operations Supervisor.
• CL38 Page 7
  The City Manager is not availing the City of the benefit of collaboration between the financial consultant and the new Finance Manager in correcting the City’s financial problems.
• CL39 Page 7
  During his tenure, the City Manager has fallen short in the performance of duties assigned by the City Council. Page 7 of 9 pages
• CL40 Page 8
  The City’s outside auditors have not performed a comprehensive audit, but rather have examined only materials provided by the Office Operations Supervisor and other City staff.
• CL41 Page 8
  To date, only one Auditor Management Review Letter has been located for the past seven years. (An Auditor’s Management Review Letter identifies any significant issues discovered in the audit process.)
• CL42 Page 8
  Between May 17, 2006 and June 28, 2006, the City received seven consultant interim reports covering the review of materials under the care, custody and control of the City Clerk/Office Operations Supervisor.
• CL43 Page 8
  The interim reports referred to in No. 8 above contained in excess of 70 detailed and task specific recommendations.
• CL44 Page 9
  The City does not appear to have viable administrative and operational plans in place delineating clear lines of authority and accountability with checks and balances to assure proper functioning of the City.
• CL45 Page 9
  The effort of the City Council to accommodate the City Clerk in the performance of her duties has not succeeded.
• CL46 Page 9
  The City Council historically appears to have abdicated its oversight responsibilities in favor of a comfortable relationship with the City’s Senior Administrators – they have, sadly, been “asleep at the wheel”.
• CL47 Page 9
  The Jury agrees with one of the consultant’s investigative reports that offered the following assessment: “Failure to observe basic system procedures, training, record maintenance and upgrade protocols has severely damaged the ability of the City to function and meet the required service needs to Nevada City. This failure is so unusual and so extreme – in dollars, personnel, customer service, and efficiency, that it is difficult to quantify.” It is evident the City has been suffering from a lengthy chronic malady and has become the victim of institutionalized inertia. Whatever the cause of the City’s difficulties, it is inescapable that “the buck stops with the City Council”.
• CL48 Page 20
  In the five years since the Jury's 2001-2002 Report, the City has made no observable effort to correct, let alone improve, the manner in which its municipal records are kept, indexed or safeguarded. I disagree with this statement. With the assistance of part-time help, the Planning files were completely reorganized and placed in locked cabinets and some of the Administrative files were reorganized. When that part-time person left, however, I was never given money, authorization or personnel to accomplish more, despite requests for same.
• CL49 Page 20
  The manner in which the City's records are maintained and accessible preclude reasonable access thereto and utilization by members of the public, City officials or members of the City Council. I partially disagree with this statement. The general public, Council, and staff could easily obtain/review records from my office. The California Public Records Act Section 6253(a) requires that access be immediate. An agency has 10 days to decide if copies will be provided in "unusual or voluminous" requests. On any given day I would easily retrieve records and reports for Councilmembers, staff and the general public as can be verified by them. Additionally, a review of the "Requests for Records" file kept by me would show that most requests were filled immediately or within 2-3 days. I do not know how the records have been kept since April 25, 2006 but it is my understanding that citizens are routinely kept waiting for records the maximum 10 days or longer.
• CL50 Page 20
  Effective oversight of the City's affairs by the City Council is impaired by the current lack of any ordered record keeping and protection policy. Page 3 of14 City Clerk ofthe City ofNevada City Response - 2006-2007 Grand Jury Report July 30, 2007 I disagree. During the past five years, two Councilmembers regularly asked for records and information, the rest of the councilmembers rarely, if ever, requested anything from my office. Therefore, I do not believe that their ineffective oversight was caused by recordkeeping.
• CL51 Page 12
  The examination of the City's books by its expert consultants also disclosed only sporadic bank statement reconciliation, no general ledger reconciliation to cash, and substantial variances in financial accounts. I agree with the statement in regards to the Bank Statement. When the Accounting Technician left in October 2003, the part-time new hire did not know how to reconcile the bank statements. I requested the hiring of a competent Accounting Technician and was not allowed to hire one. We then entered into an agreement to have the accounting firm reconcile the bank statement. I disagree with the statement in regards to reconciliation of the General Ledger to Cash. This was done monthly as my files will show. I would reconcile the bank statement to the cash flow using a printout from the General Ledger. I would check each deposit and warrant-run against the cash flow sheet and mark the incorrect cash flow entries and give it back to the Office Clerk to correct any mistakes that had been made. I would also adjust for returned checks, bank charges, etc.
• CL52 Page 12
  The City's expert consultants also found, historically, the City's basic accounting activities were left to the year-end auditors, and the new Government Accounting Standards Board Policy, GASB 34, which became effective in 2004, had not yet been implemented by the City. I agree with this statement. I did not have a background in accounting and did not know GASB 34 standards or how to implement them. For the 2004/2005 Fiscal Year Audit, the City Manager was required to write a Management Discussion and Analysis to comply with GASB 34. Yet, to my knowledge, it was not done. I repeatedly offered my assistance in every way so that the audit could be completed. It was my understanding that the auditing firm kept asking the City Manager and he kept promising he'd do it but as of April 25, 2006 it had not been done. The former Page 6 of14 City Clerk ofthe City ofNevada City Response - 2006-2007 Grand Jury Report July 30, 2007 City Manager worked closely with the auditing firm, but that did not seem to be the case with the new City Manager.
• CL53 Page 24
  In the course of the review of the City's affairs by the City and its expert consultants, a number of undeposited checks payable to the City dating back several years were discovered. I agree with this statement. From time to time the City Manager, City Attorney, City Planner or City Engineer would instruct the Office Clerk or me to hold checks and not deposit them immediately. These checks were placed in the vault. It was usually done when, for some reason, a project was deemed incomplete or a question of dispute arose. Two specific checks were placed in files on my desk at the direction of the City Manager and I was waiting for his further dispensation.
• CL54 Page 13
  Effective February 19,2007, the City hired a Finance Manager to replace a full­ time financial consultant who has worked over the past months to address many of the deficiencies noted above. I have no direct knowledge ofthis finding to agree or disagree. Conclusions:
• CL55 Page 6
  The City has had to hire additional personnel to perform functions of the City Clerk and to cover the responsibilities of the former Office Operations Supervisor. I have no knowledge of this finding. The City informed me that I would only be allowed to perform the statutory duties of City Clerk, not the duties I had customarily been performing as City Clerk. I have performed ALL of the duties that the City will allow me to perform as City Clerk. I have expended approximately $5,000.00 in legal costs out of my own pocket to try to protect the office of City Clerk, which office pays $100.00 per month. I am not sure what the Grand Jury expects me to do in this situation. Government Code Section 40811 states "The City Clerk is the custodian of the City seal." The City Manager refused to allow me custody of the City seal. He indicated it would be locked in the Chief of Police's office with no access to it and if I needed it, it would be made available to me. It has come to my attention that in the past 15 months it has been used a number of times by City employees, not deputized by me to act on my behalf, and without my authorization. This is just one example of the City Manager interfering with the legal duties of the City Clerk. As to performing duties of the Office Operations Supervisor, this is a surprise to me since I was informed that position had been eliminated in a "reorganization" and replaced with a Finance Director who was hired in-lieu of an Office Operations Supervisor, not as "additional" personnel. Page 11 of 14 City Clerk of the City of Nevada City Response - 2006-2007 Grand Jury Report July 30, 2007
• CL56 Page 6
  The incumbent City Clerk, in her individual capacity, has sued Nevada City alleging wrongful termination of her employment as Office Operations Supervisor. I agree.
• CL57 Page 6
  Over seventy percent of California cities utilize an appointed City Clerk in order to provide more effective oversight of the work of that position. I have no knowledge of what other California cities do in regards to City Clerks. I do know that many of my peers are elected and have no knowledge where the seventy percent (70%) figure came from. Conclusions:
• CL58 Page 9
  The City, as of March 2007, could not provide the cost of the reports referred to in No.8 above; However, materials reviewed by the Jury suggest the cost will exceed $200,000. 7 Answer: Disagree
• CL59 Page 5
  The manner in which the City has managed its finances over the past many years has resulted in the loss of significant revenue to the City. I don't agree or disagree with this statement.
• CL60 Page 5
  The City has clearly been at unnecessary risk of financial loss by reason of the manner in which its financial records were maintained (or not maintained) and the apparent absence of any oversight or meaningful audit of its financial practices. I agree with this statement.
• CL61 Page 24
  The continued operation of the City's current financial practices and procedures would be a breach of the public's trust. I have no knowledge of the City's current financial practices and procedures. Page 7 of14 City Clerk ofthe City ofNevada City Response - 2006-2007 Grand Jury Report July 30, 2007
• CL62 Page 5
  With the guidance of the full time consultant, the City appears to be making substantial progress in implementing appropriate financial procedures and policies. I have no knowledge of the City's progress in implementing appropriate financial procedures and policies. I would like to indicate that I asked for such a person numerous times and was ignored by the current City Manager. It is sad that so much money has been spent to get to a point that would have been gotten to years ago if the City Manager had only been willing to address the issue. With my workload and increasing overtime I requested of the current City Manager numerous times a person to fill this need and was ignored. It should be noted that there are now at least four people sharing the work that I was trying to get accomplished but which I had been denied personnel to assist me with.
• CL63 Page 5
  The Jury commends the City for its hiring of a Finance Manager. I agree. It should be noted that the City had a Finance Manager hired in late 1987. When that person left (I believe it was in 1990 or 1991), the City Council chose to allow the position to remain vacant and placed many of the duties and responsibilities on me. The former City Manager and I were splitting the responsibilities along with a part-time Accounting Technician who was also hired to help with payroll, business licenses and accounts payable. The new City Manager did not assume the same responsibilities.
• CL64 Page 27
  At the time of the Jury's investigation, the Jury found that deeds conveying real property to the City had not been recorded. I don't agree or disagree. I have no knowledge of deeds being unrecorded. I did have a cover page and Resolution in a file ready to record a utility easement on a property located on Drummond St., however, I could not complete the recordation because the City Engineer had been unable to supply the necessary documentation.
• CL65 Page 27
  At the time of the Jury's investigation, City Ordinances and Council Resolutions were not being maintained in an organized manner, were not readily accessible by the public, and had not been codified, indexed or published since 1990. Additionally, City Council Minutes had not been filed since 1995. I strongly disagree. For over 18 years I took minutes at the City Council meetings. Up until April 25, 2006, ALL City Council minutes, Ordinances and Resolutions were kept in an organized manner. The minutes had not been punched and bound in Minute books since 1995 due to the price (approximately $200 per book with some years requiring more than one book) and the increasing difficulty of obtaining them. HOWEVER, on April 25, 2006, the last day I had any access to the records in City Hall, the signed, attested minutes, along with the original ordinances and resolutions were properly filed in pocket files with the date (2000, 2001, etc.) clearly marked and kept in chronological order along with all other minute books dating back to the 1800's in a locked cabinet. In addition, copies of the Ordinances and Resolutions were kept in separate files, one per year, with indexes in a filing cabinet (one drawer for Ordinances, one for Resolutions) so they were readily accessible for public review or copying. Additionally the original agenda coversheets for all City Council meetings and Planning Commission meetings were filed in chronological order, as were the Page 10 of 14 ~---- -------- --­ City Clerk ofthe City ofNevada City Response - 2006-2007 Grand Jury Report July 30, 2007 Planning Commission minutes. Also, all Minutes, Ordinances, Resolutions and Agendas prepared after the City started using computers were filed on the computer in file folders appropriately marked and named in a uniform naming order. A backup file was also kept on the County computer system. I agree that Ordinances had not been codified since 1990, the last time money was budgeted for that project. Despite my repeated requests to the current City Manager for money to be budgeted to accomplish that task, he never responded. I had been in contact with representatives from LexislNexis and another company that I can't recall the name of, regarding bringing our Municipal Code up-to-date. That correspondence was on the right-hand side of my desk on April 25, 2006. However I could not proceed without money to do so and City Manager authorization.
• CL66 Page 6
  The incumbent City Clerk is no longer performing the material duties of that public office. I strongly disagree with this statement. I am doing everything I am allowed by the City Manager and City Attorney to do. Their tampering with the office should be reviewed by the Grand Jury. Additionally I completed the tasks required to conduct the June 2006 election which included adding a last-minute write-in candidate and a ballot measure for road improvements.
• CL67 Page 6
  The City is without a functioning City Clerk to perform the statutory duties imposed by California Government Code §§40801-40814. I strongly disagree with this statement. The City of Nevada City is only without a functioning City Clerk, if it truly is, because the City Manager and City Attorney have chosen for it to be so with the inaction of the City Council to stop them. I have been available to perform any and all City Clerk duties that are asked of me.
• CL68 Page 29
  The incumbent City Clerk, while also the City's Office Operations Supervisor, failed in a material manner to perform both the statutory City Clerk duties and those of Office Operations Supervisor, to the detriment of the City. I strongly disagree with this statement. I was given so many duties to perform no one person could have performed them completely, yet I was not given any additional help as requested. When I told the City Manager I was overloaded and asked him for additional staffing, he ignored my requests. When I asked him to Page 12 of 14 City Clerk ofthe City ofNevada City Response - 2006-2007 Grand Jury Report July 30, 2007 prioritize the items he wanted done first, he gave me more to do. When I told him I was having to work 50-60 hours a week and was still falling behind he told me to ''just go horne at 5:00 p.m. and not worry about it."
• CL69 Page 3
  In its 2001-2002 Report, the Jury found the City did not then " ...have a written procedure for records management, resulting in a lack of guidelines for employees. Additionally, the manner of maintaining public records does not comply with State guidelines." Answer: Agree
• CL70 Page 3
  In its 2001-2002 Report, the Jury recommended, among other matters, (a) the City develop a much­ needed records management system; (b) the City implement the Local Government Records Management Guidelines issued by the California Secretary of State; and (c) the City initiate a records security and back-up system. 1 Answer: Agree
• CL71 Page 11
  The City, in its Response to the Jury's 2001-2002 Report wrote, "The City is currendy in the process of hiring a new City Manager. The City Clerk will discuss this item [Records Management] with the new City Manager after the position is filled." Answer: Agree
• CL72 Page 11
  In further response to the Jury's 2001-2002 Report, City representatives also wrote: 'CWhen the Grand Jury provides funding, we will implement new Records Management Guidelines." Answer: Agree. This response was generated by the office operations supervisor.
• CL73 Page 6
  The incumbent City Clerk, in her individual capacity, has sued Nevada City alleging wrongful termination of her employment as Office Operations Supervisor. Answer: Agree
• CL74 Page 6
  Over seventy percent of California cities utilize an appointed City Clerk in order to provide more effective oversight of the work of that position. Answer: I believe this premise to be true but have not investigated the Clerk issues.

No Responses Found 1

Government entities assigned to respond to this report. No response documents have been linked in our database.