Score: +2
(3/5/1)
Riverside County Grand Jury
• 2008-2009
Palo Verde Cemetery District
⚠️ 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 and Recommendations 11 findings
F1
Prior to September 2008, district trustees were negligent in their oversight of the financial affairs of the district. The trustees failed to demand financial accountability from the general manager, who signed blank checks and permitted improper expenditures of district funds. No formal orientation and training program for trustees exists. Testimony from former trustees revealed they were unaware of their basic fiduciary responsibilities. Minutes of their meetings were either incomplete or reflected inadequate decision-making for a governing body. 1
Related Recommendations (1)
R1
The district should immediately establish an orientation and training program for trustees to include proper handling of finances, fiduciary responsibilities, management hiring practices and employee benefits.
F2
The prior general manager of the district failed in his basic management responsibilities to the district, by: a. not providing appropriate orientation and training to the trustees b. making questionable expenditures for personal use from district funds c. improperly borrowing funds from the district endowment fund to finance operating expenses d. using poor record keeping practices, he ignored recommendations from the outside auditor.
Related Recommendations (1)
R2
The district should seek recoupment of funds improperly paid to and/or by the former general manager, including but not limited to: vacation time, compensatory time, sick leave, cell phone expenses, gasoline allotments and other inappropriate expenditures.
F3
The Riverside County Board of Supervisors, as the appointing authority for district trustees, failed to provide instruction to trustees in their areas of responsibilities and fiduciary obligations.
Related Recommendations (1)
R3
The Riverside County Board of Supervisors, as the appointing authority for district trustees, failed to provide instruction to trustees in their areas of responsibilities and fiduciary obligations.
F4
Over several years the district faced a shortage of revenue to meet increasing operating costs. In an effort to correct this deficit, the board of trustees and general manager borrowed more than $253,000 from the endowment fund principal. This was a violation of California Health and Safety Code Section 9065(e), which states: “The board of trustees shall not spend the principal of the endowment care fund.” The fund is nearly depleted. The fund establishes in perpetuity the care and maintenance of the cemetery.
Related Recommendations (1)
R4
Over several years the district faced a shortage of revenue to meet increasing operating costs. In an effort to correct this deficit, the board of trustees and general manager borrowed more than $253,000 from the endowment fund principal. This was a violation of California Health and Safety Code Section 9065(e), which states: “The board of trustees shall not spend the principal of the endowment care fund.” The fund is nearly depleted. The fund establishes in perpetuity the care and maintenance of the cemetery.
F5
The district does not have a policies and procedures manual. This absence of written policies and procedures allowed for the careless implementation of financial and other decisions, which resulted in arbitrary and inappropriate actions taken by the prior general manager. An outdated card system identifying burial plots and financial records contained many errors. Burials were sometimes reserved for plots already occupied.
Related Recommendations (1)
R5
The district does not have a policies and procedures manual. This absence of written policies and procedures allowed for the careless implementation of financial and other decisions, which resulted in arbitrary and inappropriate actions taken by the prior general manager. An outdated card system identifying burial plots and financial records contained many errors. Burials were sometimes reserved for plots already occupied.
F6
The prior general manager failed to increase revenue or reduce operating costs over a six-year period, thus leaving the district in a vulnerable financial position. In June 2008, the district placed Measure “I” on the election ballot. This proposition called for an increased property tax assessment of $100 per parcel from voters in the district in order to finance district operations. The measure was defeated by nearly 86 percent of those voting.
Related Recommendations (1)
R6
The prior general manager failed to increase revenue or reduce operating costs over a six-year period, thus leaving the district in a vulnerable financial position. In June 2008, the district placed Measure “I” on the election ballot. This proposition called for an increased property tax assessment of $100 per parcel from voters in the district in order to finance district operations. The measure was defeated by nearly 86 percent of those voting.
F7
Financial records are kept in a manual format, thus leading to difficulties in documentation and reconciliation between bank balances and the general ledger. 2
Related Recommendations (1)
R7
Financial records are kept in a manual format, thus leading to difficulties in documentation and reconciliation between bank balances and the general ledger. 2
F8
The district has a long-term bonded indebtedness, incurred in 1999, and financed through the Palo Verde Cemetery Financing Authority. According to a recently prepared advisory report from the Riverside County Auditor-Controller, “the district is facing a risk of not meeting its bond obligations. Financing will be required to facilitate the district’s recovery and prevent defaulting on forthcoming bond payments.”
Related Recommendations (1)
R8
The district has a long-term bonded indebtedness, incurred in 1999, and financed through the Palo Verde Cemetery Financing Authority. According to a recently prepared advisory report from the Riverside County Auditor-Controller, “the district is facing a risk of not meeting its bond obligations. Financing will be required to facilitate the district’s recovery and prevent defaulting on forthcoming bond payments.”
F9
California Government Code Section 23010 (a) allows the County of Riverside to provide a loan to the Palo Verde Cemetery District with certain provisions.
Related Recommendations (1)
R9
California Government Code Section 23010 (a) allows the County of Riverside to provide a loan to the Palo Verde Cemetery District with certain provisions.
F10
Since September 2008, the district has been governed and maintained by three newly appointed trustees and a corps of Blythe community volunteers. Their efforts over these months of financial uncertainty should be commended. According to testimony, three employees should be placed on staff when it is financially able to do so, as volunteerism may not be sustainable.
Related Recommendations (1)
R10
Since September 2008, the district has been governed and maintained by three newly appointed trustees and a corps of Blythe community volunteers. Their efforts over these months of financial uncertainty should be commended. According to testimony, three employees should be placed on staff when it is financially able to do so, as volunteerism may not be sustainable.
F11
Provisions of the Ralph M. Brown Act were ignored. This act guarantees the rights of members of the public to attend and participate in meetings of local governmental entities, including special districts.
Related Recommendations (1)
R11
Provisions of the Ralph M. Brown Act were ignored. This act guarantees the rights of members of the public to attend and participate in meetings of local governmental entities, including special districts. Recommendations Riverside County Board of Supervisors Palo Verde Cemetery District Board of Trustees Blythe City Manager Blythe Redevelopment Agency
Agency Responses 9
Government agencies' official responses to this report's findings and recommendations. Click on a response to see the structured breakdown.