Board of Supervisors County of Marin President*

The administration and oversight of the CAL-Card Program in the County of Marin is decentralized and jointly administered by two departments which results in an inconsistent and variable application of oversight and controls. This has led to a lack of clarity and accountability. Response: Partially disagree CAL-Cards are a method of payment used to purchase low-dollar-value expenditures that otherwise do not warrant issuing purchase orders or contracts. By County policy, these purchases are less than $5,000. Purchases over $5,000 are made using a requisition and Purchase Order. We cannot agree that current administration of CAL-Card use leads to oversight and controls that are "inconsistent and variable". The County has both a Procurement Manual (updated in 2023) and a CAL-Card Policy Manual (updated in 2021), which all CAL-Card holders are required to review and understand before they are issued a card. County Policy, authorized by the Board of Supervisors, gives the responsibility of Cal-Card oversight explicitly to the Director of Public Works as the County Purchasing Agent, while the County Executive is identified as the Deputy Purchasing Agent. However, given that the Department of Finance (DOF) monitors and audits all other payment methods, oversight of the program by that department could potentially present some level of efficiency. We will evaluate this potential organizational change relative to the current checks and balances or shared approach toward Cal-CARD administration.

The integrity of the CAL-Card Program would be more adequately safeguarded if the Department of Finance is given complete authority and responsibility to administer all aspects of the CAL-Card Program. Response: Partially disagree We cannot agree conclusively with this finding as an organizational change of this magnitude should be analyzed with a cost-benefit and organizational review that considers staffing, administration, and technological capacity, among other factors. Consistent with the response to F1, staff will evaluate the effectiveness of a single point of oversight in the Department of Finance, after which we will be better positioned to conclusively agree or disagree with this finding.

The Department of Finance does not currently have adequate resources to administer all aspects of the CAL-Card Program. Response: Partially disagree We cannot agree or disagree with this finding absent an organizational assessment which would ascertain whether adequate resources are needed or could be shifted. County of Marin Response to Grand Jury Report Findings and Recommendations "An Analysis of the Use and Oversight of County Purchase Cards" (May 23, 2024

Although the CAL-Card Policy Manual requires that no one person should perform more than one part of any purchasing transaction, there are violations of this policy. Response: Partially disagree We cannot agree or disagree with this finding, as we have not reviewed any documentation that led the Grand Jury to this conclusion. We have not identified any violations of CAL-Card policy at this time.

The County of Marin's initial and continuing training program for CAL-Card users and their supervisors is inadequate. Response: Partially Disagree We disagree that the initial training for CAL-Card users is inadequate. CAL-Card users receive a CAL-Card Policy Manual that clearly defines the requirements regarding use of the CAL-Card, and staff have access to both the CAL-Card Policy Manual and the Procurement Manual from multiple sources. Staff are directed to the State Department of General Services Procurement Division for further training, including informational videos. There is no continuing or annual training requirement at this time. However we will review the potential for such with the Departments of Human Resources, Public Works, and Finance.

There is no structured process by which the County of Marin is guaranteed preferential government pricing when CAL-Cards are used. Response: Disagree The CAL-Card is a method of payment. The Department of Finance issues an Employee Travel Guidance document and the Department of Public Works issues a Procurement Manual and a CAL Card Manual, all of which provide a structured process for CAL-Card use, including pricing. Employees are required to adhere to these documents for all purchases and payment methods. As stated in the Procurement Manual, "CAL-Cards are used to purchase low dollar value expenditures that otherwise do not warrant issuing purchase orders or contracts. The list of permitted purchases and prohibited purchases is further described under Policy Section 24. Cal- Card purchases must be properly coded using National Institute for Governmental Purchasing (NIGP) codes in the financial system." Because CAL-Cards are explicitly for low dollar purchases in specific categories where competitive pricing between vendors is negligible, the issue of preferential pricing is not applicable.

There is a lack of rigor in the County of Marin for retrieving and closing cards when there is a change in the job status of the cardholder. Response: Disagree While any policies and practices should be viewed through the lens of continuous improvement, we do not agree there is a lack of rigor in current procedures for employee status change. All County of Marin Response to Grand Jury Findings and Recommendations County of Marin Response to Grand Jury Report Findings and Recommendations "An Analysis of the Use and Oversight of County Purchase Cards" (May 23, 2024) County departments maintain a log of technology, security, or other County property assigned to staff during the course of employment. These items are then recovered from individuals when they separate from County employment. This includes phones, laptops, ID/Access cards, tools/equipment, and CAL-Cards. Additionally, a CAL-Card can easily be cancelled with US Bank if it is not recovered upon termination.

There currently is no formal procedure to document and retain records concerning the training of CAL-Card Approving Officials or card users. Response: Disagree While there is currently no annual training requirement for CAL-Card holders and Approving Officials, records of every County employee's onboarding and training are retained by the County. Specific to CAL-Cards, copies of each employees' CAL-Card Application or Change Request are kept by the Agency Program Administrator in the Procurement Division. This application includes certification that the employee has completed the required training for card issuance. This document is verified and signed both by the Program Administrator and the 1 Department Head of the employee.

The County of Marin does not require that employees annually attest to having reviewed the rules of CAL-Card use and that they understand that violations of the policy can lead to disciplinary action. Response: Disagree Employees are required to attest to having reviewed the rules of CAL-Card use, and that they understand that violations of the policy can lead to disciplinary action in the initial application and training for CAL-Card access. At this time annual re-attestation is not required, though the County will review options toward this end.

The County of Marin does not exercise consistent oversight to assure that purchases are being made consistent with the CAL-Card Policy Manual and with existing contracts for competitively bid goods and services. Response: Disagree Per the County's internal CAL-Card Policy, "All Cardholder, Approving Officials, and Invoice Processors are required to attend initial training and periodic training as determined by the Purchasing Agent in order to maintain their CAL-Card status", and "Each Department Head is responsible for maintaining a system of internal control for CAL-Card to: a) properly account for all CAL-Card Transactions; b) minimize potential for CAL-Card related errors or irregularities; and c) Obtain accurate CAL-Card balances for consolidating financial information and monitoring expenditures". We have no evidence that this oversight is not exercised consistently. County of Marin Response to Grand Jury Report Findings and Recommendations "An Analysis of the Use and Oversight of County Purchase Cards" (May 23, 2024 RESPONSE TO GRAND JURY RECOMMENDATIONS The Marin County Civil Grand Jury recommends the following: