Sacramento County Grand Jury • 2022-2023

Sacramento County Grand Jury Final Report 2022-2023

Published: June 30, 2023 72 pages Consolidated Report

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⚠️ Translation Notice: This content has been automatically translated. The original English text is the official version. Translation may contain errors.

⚠️ Este contenido ha sido traducido automáticamente. El texto original en inglés es la versión oficial. La traducción puede contener errores.

Findings 12 findings

The District Board has lost the trust of the community to make prudent financial decisions.

The current accounting system is inadequate to meet the legal requirements related to financial reporting to the public which has resulted in two legally required financial audits being overdue.

The late audits, combined with the unreliable existing accounting system, have created an environment that exposes the District to a high risk of fraud.

The District Board cannot expect to recover public trust sufficient to propose any tax/fee increases until it replaces its antiquated billing and accounting system to produce reliable billings and financial records.

The District has at times taken actions against staff that has interfered with the operation of the District.

High employee turnover indicates poor employee retention that has interfered with the operation of the District.

The lack of an effective succession strategy has impaired the ability of the District to maintain adequate competent staff which has resulted in the loss of critical accounting system knowledge among the District staff.

The lack of an updated Capital Reserve Policy has contributed to poor management and inadequate Capital Reserve.

The use of County Property Tax funds to subsidize its growing security costs without raising the security fees has jeopardized the financial stability of the District.

F10

The Capital Reserves are underfunded by over $10 million, jeopardizing the financial stability of the District.

F11

The District has inappropriately subsidized the cost of reclaimed water to RMCC.

F12

A perceived conflict of interest exists in the community due to a close relationship between the District, the RMA and the RMCC and their respective Board members.

Recommendations 13

R1

The District board should upgrade the District’s billing and accounting system with the new Enterprise Resource Planning (ERP) accounting system
R2

The District Board should insure that the audit for 2020-21 is completed no later than April 1, 2023, and the FY 2021-22 audit
R3

The District Board should task its ERP consultant to implement a program to fully train District accounting staff on this new accounting system and prepare new accounting manuals acceptable to the General Manager or designee
R4

The District Board should retain a controller to ensure proper accounting procedures are followed and the integrity of the accounting data is maintained
R5

The District needs to ensure invoices are tracked within the accounting system and that the accounts payable listing be generated on a monthly basis
R6

The District should create an ongoing training program for the Board and staff regarding the Brown Act, compliance, accounting procedures, and work place practices and behaviors including prevention of sexual harassment and hostile work environment. This should be fully implemented in 2024.
R7

The District Board should either adopt a practice of reviewing personnel actions by someone not in the chain of command to ensure that proper procedures are followed or engage an outside expert in personnel matters or legal counsel to review such actions, to make sure proper procedures are followed.
R8

The District Board should require administration to report quarterly on staff development and staff identified concerns beginning October 1, 2023.
R9

The District should reduce its security services funding to a level that is supported by fees paid by residents specific to fund security services.
R10

Effectively immediately, County tax funds should not be diverted to security services, deleted expenditures should be allocated to the Capital Reserves.
R11

The District Board should develop and implement a capitol reserve fund policy with supporting fees sufficient to fund the long-term infrastructure needs of the District.
R12

The District Board should revise its agreement with the RMCC and begin charging for the use of reclaimed water on the RMCC golf courses at rates typical in the Sacramento area
R13

The District Board and staff should avoid perceptions of conflicts of interest in their fiduciary responsibilities to protect the interests of the District and its rate payers.

Observations 2

OB1

District Board meeting audio recordings (FY 2022).
OB2

Members of the Grand Jury, like other citizens of the County, witnessed the ever- increasing population of homeless living on our streets, in parks, on sidewalks, and in other open areas.