San Joaquin County 2021-2022 Grand Jury Final Report

Note: Missing finding numbers detected: F16, F17, F18

Conclusions 42

• CL1
  Decreasing Fund Balance and Reserve for Economic Uncertainty Failure to accurately estimate the ending fund balance Failure to maintain the minimum reserve for economic uncertainty If unable to maintain the minimum reserve for economic uncertainty, a board-approved plan to restore the ٠ minimum reserve for economic uncertainty does not exist Projected unrestricted fund balance not stable or not increasing Unrestricted fund balance does not include assigned or committed reserves above the recommended reserve ٠ level when unfunded or contingent liabilities or one-time costs exist
• CL2
  Breakdown in Leadership and Communication Uninformed decisions made because the system(s) can't provide key financial and personnel data needed • Instability in the chief business official or superintendent positions (been with the district less than two years) • Lack of regular communication between the superintendent and all members of the administrative cabinet • Timely training on financial management, budget and governance not provided to site and department ٠ administrators who are responsible for budget management and decision-making Board policies and administrative regulations routinely ignored, not adopted, updated, implemented or ٠ communicated to staff Micromanagement by board members Systems fully or partially controlled by highly influential special interest groups
• CL3
  Failure to produce timely and accurate financial information ٠ Annual Independent Audit Report contains material apportionment or internal control findings • Inadequate, undocumented monitoring and oversight of authorized charter schools ٠ Out-of-date long-range facilities master plan ٠ Special education costs not monitored, with contribution rate above the statewide average contribution rate Appendix B: ESSER funds The Elementary and Secondary School Emergency Relief Fund (ESSER) was established as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act in March 2020. CARES provided direct funding to states and districts to address the impact COVID-19 has had, and continues to have, on elementary and secondary schools across the nation. The ESSER Fund is the leading source of funding for public elementary and secondary education under each law. As each succeeding law was enacted, the U.S. Department of Education (ED) modified the acronym ESSER to distinguish each fund from the other. Collectively known as ESSER funds. The Office of Elementary and Secondary Education (https://oese.ed.gov/offices/education- stabilization-fund/elementary-secondary-school-emergency-relief-fund/) clarifies each ESSER phase as: ESSER I On March 27, 2020, Congress set aside approximately $13.2 billion of the $30.75 billion allotted to the Education Stabilization Fund through the Coronavirus Aid Relief, and Economic Security (CARES) Act for the Elementary and Secondary School Emergency Relief Fund (ESSER) Fund. The Department awarded these grants to State educational agencies (SEAs) for the purpose of providing local educational agencies (LEAs), including charter schools that are LEAs, with emergency relief funds to address the impact that COVID-19 has had, and continues to have, on elementary and secondary schools across the Nation. ESSER Fund awards to SEAs are in the same proportion as each State received funds under Part A of Title I of the Elementary and Secondary Education Act of 1965, as amended, in fiscal year 2019. ESSER II The Coronavirus Response and Relief Supplemental Appropriations (CRRSA) Act, 2021, was signed into law on December 27, 2020, and provided an additional $54.3 billion for the Elementary and Secondary School Emergency Relief (ESSER II) Fund. ESSER II Fund awards to SEAs are in the same proportion as each State received funds under Part A of Title I of the Elementary and Secondary Education Act of 1965, as amended, in fiscal year 2020. American Rescue Plan (ARP) ESSER (III) On Thursday, March 11, 2021, the American Rescue Plan (ARP) Act was signed into law. It was an unprecedented $1.9 trillion package of assistance measures, including $122 billion for the ARP Elementary and Secondary School Emergency Relief (ARP ESSER) Fund. Funds are provided to SEAs and LEAs to help safely reopen and sustain the same operation of schools and address the impact of the coronavirus pandemic on the Nation's students. ARP ESSER Fund awards to SEAs are in the same proportion as each State received funds under Part A of Title I of the Elementary and Secondary Education Act of 1965, as amended, in fiscal year 2020. https://oese.ed.gov/offices/education-stabilization-fund/elementary-secondary-school-emergency-relief-fund/ CARES/ ESSER I CRRSA / ESSER II ARP / ESSER III Funding for K-12 $54.3 billion $123 billion $13.2 billion Obligation Deadline September 2022 September 2023 September 2024 Same as CARES plus: Uses Summer learning • Activities to address "learning loss" • Providing mental health Preparing schools for reopening • services Projects to improve air quality in school buildings • Educational technology • including hardware and software Activities to address the • unique needs of various subgroups, including students with disabilities, BIPOC students, English learners, as well as students experiencing homeless, low income, or in foster care Preparedness and ٠ continuity of services ESSER funds can be used in a variety of ways as long as the use addresses the impact of COVID-
• CL4
  Ineffective Internal Controls and Fraud Prevention Lack of controls that limit access to the financial system • Access and authorization controls to the financial system not reviewed and updated upon employment actions (e.g., resignations, terminations, promotions or demotions) and at least annually Duties in accounts payable, accounts receivable, purchasing, contracts, payroll, human resources, associated student body, and warehouse/receiving not segregated, supervised or monitored Beginning balances for the new fiscal year not posted and reconciled with the ending balances from the prior ٠ fiscal year Prior year accruals not reviewed and cleared by first interim Suspense accounts not reconciled regularly General ledger not reconciled or closed timely Inadequate processes and procedures in place to discourage and detect fraud
• CL5
  Lack of Multiyear Planning Unreasonable and/or unclear multiyear projections that are not aligned with industry standards Failure to explain trend analysis LCFF calculation not prepared with multiyear considerations • Financial decisions made without most current multiyear projection in mind ٠ Detailed information not included when "other adjustments" is used with multiyear projections (line B10) •
• CL6
  Inattention to Non-Voter-Approved Debt and Risk Management Sources of non-voter-approved debt repayment unstable, unpredictable and from the unrestricted general fund • Downgrade of credit rating Out-of-date actuarial study without a plan to pay for any unfunded liabilities when self-insured High levels of non-voter-approved debt (such as COPs, bridge financing, BANS, RANS and others), with total • annual debt service payments greater than 2% of the district's unrestricted general fund revenues
• CL7
  Lack of Position Control Financial and human resources systems not integrated Accounting for positions and costs is incomplete Staffing not analyzed or adjusted based on staffing ratios and enrollment Budget, payroll and position control not reconciled regularly • Budget source not identified for each new position before the position is authorized by the governing board • New positions and extra assignments posted before governing board approval ٠ Staffing ratios for certificated, classified and administrative positions not adopted or followed . Lack of regular meetings between human resources, payroll and budget to discuss issues and improve • processes. Related Issues of Concern
• CL8
  While all three funds can be used for things like hiring new staff, avoiding layoffs and implementing strategies that address the public health crisis. There are some additional nuances that were added to the terms for ESSER II and ESSER III. These include: accelerating learning recovery, • facilitating remote learning, • prepping for reopening, • testing for reopening, • improving air quality in schools, • maintaining health and safety and • building new protocols to meet CDC guidance. Appendix C: Consultant Forms E 3600 BOARD POLICY Adopted: 06/12/07 Page 1 of 2 Business and Noninstructional Operations Consultants CONSULTANT UTILIZATION FORM The following form is to be utilized by all non-instructional Consultants. The form is divided into two sections. Section #1 is to be utilized by the Consultant, and Section #2 by the District designees. Section #1 To provide consultant services to the Stockton Unified School District, all potential noninstructional Consultants must first provide the District's Office _____ with the following information. The information may be provided below or attached hereto.
• CL9
  Unreliable Budget Development Budget has been disapproved or conditionally approved by the county office within the last two years Unreasonable and/or unclear budget assumptions Reliance on prior-year rollover budget method Position control data not used Local Control Funding Formula (LCFF) revenue not calculated correctly Reliance on carryover funds One-time sources utilized for ongoing expenditures Expenditures described in the LCAP not aligned with the budget
• CL10
  Insufficient Budget Monitoring or Updates Failure to regularly update budget assumptions Negative or three consecutive qualified interim report certifications Downgrade of an interim certification by the county superintendent "Lack of going concern" designation from the county superintendent Actual revenues and expenditures inconsistent with the most current budget Budget revisions not posted in the financial system or communicated to the board regularly Lack of control or monitoring of total compensation as a percentage of total expenses Failure to regularly reconcile balance sheet accounts in the general ledger Incomplete responses to criteria and standards variances or deficiencies identified by the county office of education Requisitions or purchase orders processed when the budget is insufficient •
• CL11
  Inadequate Cash Management Failure to reconcile cash accounts monthly 18-month cash flow not forecast Lack of short-term plan to address cash flow needs Noncompliance with Education Code requirements when interfund borrowing is occurring Failure to set aside repayment funds when external borrowing is occurring Lack of communication to the board about the district's cash position (with a clear distinction that cash and fund balance are not the same thing)
• CL12
  Mismanaged Collective Bargaining Agreements Failure to consider long-term impact of collective bargaining agreements Lack of bargaining agreements with all units for several years with no resources identified to cover potential settlements Presettlement analysis not conducted thoroughly or timely Settlements above the funded cost of living adjustment (COLA) Lack of compliance with public disclosure requirements under Government Code Sections 3540.2, 3543.2 and 3547.5 and Education Code Section 42142 Board approval of collective bargaining agreement is inconsistent with superintendent's and CBO's certification
• CL13
  Increasing and/or Unplanned Contributions and Transfers Insufficient control and monitoring of contributions and transfers Lack of a board approved plan to eliminate, reduce, or control contributions/transfers Transfers from the unrestricted general fund not made when needed to cover projected negative fund balances in other funds Contributions/transfers to restricted programs and/or other funds not budgeted
• CL14
  Continuing Deficit Spending Deficit spending in the current or two subsequent fiscal years Not having or implementing a board-approved plan to reduce and/or eliminate deficit spending Not decreasing deficit spending over the past two fiscal years
• CL15
  Mismanaged Employee Benefits Actuarial valuation not completed in accordance with Governmental Accounting Standards Board (GASB) requirements to determine the unfunded liability for other post-employment benefits (OPEB) Lack of a board adopted plan to fund health and welfare retiree benefit liabilities Nonexistence or noncompliance of a policy or collectively bargained agreement to limit accrued vacation balances No verification and determination of eligibility for benefits for all active and retired employees and dependents in the last five years Compensated leave balances not tracked, reconciled and reported
• CL16
  Inattention to Enrollment and Attendance Reporting Enrollment decreasing and/or unstable Enrollment and average daily attendance (ADA) data not monitored and analyzed at least monthly through P2 Consistently inaccurate data reported through CALPADS and other state reporting Enrollment projections and assumptions not based on historical data, industry-standard methods, and other reasonable considerations CALPADS data not reviewed and verified by applicable sites and departments and corrected as needed before the report submission deadlines Unplanned or unmonitored effects of enrollment losses to charter schools Board policy to limit outgoing interdistrict transfers is nonexistent, or policy is not followed
• CL17
  a "seat at the table" with other agency department heads in regular meetings, and a rigorous employee education and training program in cybersecurity matters. Disclaimers Grand Jury reports are based on documentary evidence and the testimony of sworn or admonished witnesses, not on conjecture or opinion. However, the Grand Jury is precluded by law from disclosing such evidence except upon the specific approval of the Presiding Judge of the Superior Court, or another judge appointed by the Presiding Judge (Penal Code Sections 911, 924.1 (a) and 929). Similarly, the Grand Jury is precluded by law from disclosing the identity of witnesses except upon an order of the court for narrowly defined purposes (Penal Code Sections 924.2 and 929). Response Requirements California Penal Code Sections 933 and 933.05 require that specific responses to all findings and
• CL18
  engagement process to review survey results to ensure that new management and updated policies are providing a positive effect on the District's work environment; complete an investigation into allegations that merit increases or step increases were
• CL19
  withheld from employees pending their signing a non-disclosure agreement; and complete an investigation into the allegations that non-exempt employees did not receive mileage payments and were not paid for overtime hours while attending the Napa retreat.
• CL20
  the six city police departments within the County; the San Joaquin County Sheriffs' Office; and
• CL21
  the San Joaquin County Probation Department.
• CL22
  The Grand Jury surveyed six (Escalon, Lodi, Manteca, Ripon, Stockton, and Tracy) city police departments and the County Probation Department. Lathrop contracts police services with the County Sheriff's Department; therefore, it was not surveyed independently. The surveys addressed employment (recruitment, hiring and retention), use of COVID-19 funds and execution of COVID-19 protocols. In addition, the Grand Jury received presentations from the Stockton, Tracy, Manteca, Lodi and Ripon Police Departments, the Sheriff's Office and the San Joaquin County Probation Department. The Grand Jury toured the San Joaquin County Jail and the Juvenile Detention Facility. Several Grand Jurors went on ride-a-longs with the Stockton, Lodi, Tracy, Manteca, Ripon and Escalon Police Departments and the Sheriff's patrol division. This report includes information gleaned from the survey responses, the presentations, the facility visits and independent research of agency websites. All the departments are faced with recruiting, hiring and retention challenges. Fewer people want to become law enforcement officers, and pay scales are lower in San Joaquin County than those in surrounding counties. While all departments follow Center for Disease Control (CDC) health and safety guidelines for COVID-19, each has its own policies and procedures for vaccinations, masking and COVID-19 testing. Departments received varying amounts of COVID- 19 relief funding.
• CL23
  San Joaquin County Board of Supervisors
• CL24
  San Joaquin County Community Development
• CL25
  San Joaquin County Counsel
• CL26
  San Joaquin County District Attorney's Office
• CL27
  San Joaquin County Environmental Health
• CL28
  San Joaquin County Public Works
• CL29
  San Joaquin County Sheriff's Office
• CL30
  City of Stockton City Manager's Office
• CL31
  City of Stockton Public Works City of Stockton Police Department
• CL32
  Country Club/River Drive 209 CARES This group will be included in ordinance development and assist in identifying necessary resources, staffing, and workflow processes for effective enforcement of the ordinance. 2020-2021 Grand Jury Finding F4: Legal limitations continue to prevent each jurisdiction from sharing the specific costs of cleanup outside of their respective jurisdictions, making a coordinated response difficult. Agency Response: Partially disagree. The law does not allow one jurisdiction to use funding that is allocated for a specific purpose in a separate jurisdiction. Effective coordination comes from shared data and consistent ordinances, strategies, and enforcement. That type of coordination will assist in deterring illegal dumping and the ability to apply for and receive funding and grant awards relating to illegal dumping. 2020-2021 Grand Jury Finding F5: Free drop-off services continue to be underutilized because the public is unaware of most of the programs offered. Agency Response: Disagree. In 2020, due to COVID-19, only 3 "Free Dumpster Day" events were held. To date in 2021, 36 "Free Dumpster Day" events for San Joaquin County and the City of Stockton have been held, and an additional six recycling and E- Waste events were held. These events were advertised through social media platforms such as Facebook. Flyers were also printed in English and Spanish, and were distributed door-to-door and in community centers. The Community Development Department, Code Enforcement Division, held 12 events during the 2020 calendar year collecting 75 dumpsters containing 302,650 tons of trash, garbage, junk, and debris. The department provided more than 170 dump passes to assist residents with items that could not be collected at the event sites. The number of residents coming to the Free Dumpster Day events and using free dump passes indicates that the public is aware of those programs. The County is dedicated to continuing to create and publicize such programs. 2020-2021 Grand Jury Finding F6: There is no formal procedure to ensure complaints are resolved. Agency Response: Disagree. Complaints are received through the GORequest system for Public Works and the permit tracking system for the Community Development Department (CDD). Complaints received by CDD are taken to a meeting with Environmental Health and Sheriff staff on a weekly basis to determine the best course of action for resolving the complaints. They are then assigned to the appropriate County department for resolution. Complaints received by Public Works are assigned to the Road or Channel Maintenance divisions. If the dumping occurs on private property or in one of the cities, it is referred to the appropriate jurisdiction for resolution. 2020-2021 Grand Jury Finding F7: Fee waivers, coupons, and vouchers are available, but are still not being utilized. Agency Response: Partially agree. San Joaquin County Department of Public Works has agreements in place with franchised residential waste collectors that provide for additional services for customers to dispose of bulky items that will not fit into residential waste containers. This service is provided to residential customers to assist with the disposal of large items or extra garbage and to discourage illegal dumping. The additional services available to residential collection customers vary by contract and range from dump vouchers to bulky item pick-up services. See Page 6 for a breakdown of additional services per County Service Area. In addition to the waivers, coupons, and vouchers, Free Dumpster Day events have been offered, which are more convenient for the public as the services are brought directly to them. The Community Development Department, Code Enforcement Division, has held 12 events during the 2020 calendar year in which more than 170 dump passes were distributed to residents. 2020-2021 Grand Jury Recommendation R1: By December 31, 2021, develop and adopt, an enforceable ordinance to deter illegal dumping which included a mechanism for collecting fines, an appeals process, and a way to recoup the cost of administration from the illegal dumpers. Agency Response: Will be implemented. The County will work on developing an ordinance, but potentially not by December 31, 2021, to deter illegal dumping and hold illegal dumpers accountable that includes a mechanism for collecting fines, an appeals process, and a way to recoup some of the costs of administration from the illegal dumpers. 2021-2022 Grand Jury Discussion, Findings and Recommendations A draft ordinance is complete and will be part of an illegal dumping mitigation package proposed for approval to the Board of Supervisors by early summer of 2022. 2021-2022 Grand Jury Finding F1: Because the County has not created a strong, enforceable ordinance, illegal dumping continues without consequences. 2021-2022 Grand Jury Recommendation R1: By September 30, 2022, the Board of Supervisors adopts an enforceable ordinance to deter illegal dumping. This ordinance will include a mechanism for collecting fines, an appeals process, and a way to recoup the cost of administration from the illegal dumpers. 2020-2021 Grand Jury Recommendation R2.1: By December 31, 2021, obtain and install appropriate surveillance equipment, such as lighting and cameras, in the top five dumping hotspots. Agency Response: Will be implemented. Through the ordinance development and resource allocation process, the County will consider the type and amount of appropriate surveillance equipment necessary to assist with enforcement and to deter illegal dumping, but potentially not by December 31, 2021. Cameras have been installed in multiple locations, including the top five dumping spots. The 2021-2022 Grand Jury determined to take no further action. 2020-2021 Grand Jury Recommendation R2.2: By December 31, 2021, develop and adopt a plan for ongoing monitoring of the cameras. Agency Response: Requires further analysis. The County will develop and adopt a plan for appropriate and effective monitoring of the cameras in such a way that the information can be used in the citation or prosecution of the illegal dumper, but potentially not by December 31, 2021. 2021-2022 Grand Jury Discussion, Findings and Recommendations Cameras have been installed in multiple locations, including the top five dumping spots, but the cameras are not being used in a manner that allows for effective citing and prosecution of illegal dumpers. 2021-2022 Grand Jury Finding F2: San Joaquin County still lacks the capability to monitor dumping hotspots and to prosecute illegal dumpers. 2021-2022 Grand Jury Recommendation R2: By September 30, 2022, approves a plan to effectively monitor the surveillance cameras. 2020-2021 Grand Jury Recommendation R3: By December 31, 2021, develop and adopt the county-wide Task Force, which includes representation from San Joaquin County Public Works Department, Sheriff's Office, District Attorney's Office, Community Development, and all cities within the County. This Task Force meet regularly throughout the year. Agency Response: Has been implemented. The County has created a Task Force including the recommended Departments/Offices and the City of Stockton. The County will create similar Task Forces or, alternatively, include the other six incorporated cities in the existing Task Force through the ordinance development process. The 2021-2022 Grand Jury determined to take no further action. 2020-2021 Grand Jury Recommendation R4: By December 31, 2021, the newly formed Task Force develop a plan to share costs for illegal dumping pickup throughout the County and the City of Stockton. Agency Response: Requires further analysis. As a step toward implementing the
• CL33
  future public health emergencies, written clarification of policies for placement and utilization of personnel designated as
• CL34
  Increase overall SEMS/NIMS compliance throughout the County.
• CL35
  Improve operational coordination and communications between responders and stakeholders.
• CL36
  Improve the capability to provide adequate and necessary public information and warning before, during, and after an event.
• CL37
  Improve plans and capabilities to provide mass care and shelter to disaster survivors. An updated Plan will be developed by September 30, 2021. Multi-Year Training and Exercise Plan (MYTEP) and Emergency Operations Plan (EOP) were updated and completed in October 2021. The EOP was approved by the Disaster Council department heads and the Board of Supervisors in January
• CL38
  publicly agree to abide by the Governance Norms adopted by the Board;
• CL39
  publicly agree to adhere to the California School Board Association Professional Governance Standards;
• CL40
  publicly livestream all Board meetings, even after returning to in-person meetings;
• CL41
  because the District is not the appropriate, nor the legal, venue for these complaints. Method of Follow-Up Investigation The 2021-22 Grand Jury reviewed the 2020-2021 responses to the report, Case #0620, Stockton Unified School District: Dissension, Dismay, and Disarray, and documented the mandatory responses to the findings and recommendations These responses were then reviewed to determine: if the agency responses were complete and comprehensible; if the agency implemented the recommendations within the stated deadlines; and if confirmation, including written documentation and interviews, was necessary.
• CL42
  SJC Board of Will be Further action R1 R1 September 30, 2022 Supervisors implemented required Implemented Will be R2.1 implemented No further action Further action Will be R2.2 R2 September 30, 2022 implemented required R3 Implemented No further action 2021-2022 Grand Jury Conclusion 2020-2021 Respondent Response Rec#